Self-Regulatory Organizations; Cboe BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Replace the Regulatory Transaction Fee With a Sales Value Fee, 67138-67141 [2024-18469]

Download as PDF 67138 Federal Register / Vol. 89, No. 160 / Monday, August 19, 2024 / Notices are assessed on Members, these rebate and fee tiers are not based on the type of Member entering the orders that match, but rather on the Member’s own trading activity. Further, the proposed fee changes continue to be intended to encourage market participants to bring increased order flow to the Exchange, which benefits all market participants. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) 30 of the Act. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B) 31 of the Act to determine whether the proposed rule change should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include file number SR– IEX–2024–13 on the subject line. ddrumheller on DSK120RN23PROD with NOTICES1 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–IEX–2024–13. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s internet website (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for website viewing and printing in the Commission’s Public Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10 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–IEX–2024–13 and should be submitted on or before September 9, 2024. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.32 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2024–18472 Filed 8–16–24; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–100715; File No. SR– CboeBYX–2024–027] Self-Regulatory Organizations; Cboe BYX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Replace the Regulatory Transaction Fee With a Sales Value Fee August 13, 2024. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on July 30, 2024, Cboe BYX Exchange, Inc. (the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the 32 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 30 15 U.S.C. 78s(b)(3)(A)(ii). 31 15 U.S.C. 78s(b)(2)(B). VerDate Sep<11>2014 18:07 Aug 16, 2024 ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change Cboe BYX Exchange, Inc. (the ‘‘Exchange’’ or ‘‘BYX’’) proposes to amend its Fees Schedule. The text of the proposed rule change is provided in Exhibit 5. The text of the proposed rule change is also available on the Exchange’s website (https://markets.cboe.com/us/ equities/regulation/rule_filings/BYX/), at the Exchange’s Office of the Secretary, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to amend its Fees Schedule to add language concerning the application and collection of the Sales Value Fee, as described below. By way of background, Section 31 of the Securities Exchange Act of 1934 (the ‘‘Act’’) 3 requires each self-regulatory organization (‘‘SRO’’) to pay the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) twice annually a fee based on the aggregate dollar amount of certain sales of securities (i.e., ‘‘covered sales’’). A covered sale is a ‘‘sale of a security, other than an exempt sale or a sale of a security future, occurring on a national securities exchange or by or through any member of a national securities association otherwise than on 1 15 Jkt 262001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 3 17 E:\FR\FM\19AUN1.SGM CFR 240.31. 19AUN1 Federal Register / Vol. 89, No. 160 / Monday, August 19, 2024 / Notices a national securities exchange.’’ 4 Assessing a sales fee to defray the cost of these fees is common practice among the national securities exchanges and associations, including the Exchange’s affiliate options exchanges.5 In fact, the Exchange currently assesses a fee on its Members 6 for covered sales on the Exchange to recoup these amounts, which is described in Exchange Rule 15.1(b) (Regulatory Transaction Fee) but is not currently described on the Exchange’s Fee Schedule. The Exchange now proposes to amend its Fee Schedule to include information regarding this fee, including an explanation and description of the fee and how it is collected. In conjunction with the proposed addition to the Fee Schedule, the exchange also proposes to delete the applicable rule text found in Exchange Rule 15.1(b) and proposes to rename Rule 15.1(b) as ‘‘Reserved.’’ Specifically, the Exchange proposes to add a section to the Fee Schedule labeled ‘‘Sales Value Fee’’. The proposed new section defines the Sales Value Fee (‘‘Fee’’) as the fee assessed by the Exchange to each Member for sales in securities when a sale in an equity security occurs with respect to which the Exchange is obligated to pay a fee to the SEC under Section 31 of the Exchange Act or when a sell order in an equity security is routed for execution at a market other than the Exchange, resulting in a covered sale on that market and an obligation of the routing broker providing routing services for the Exchange, as described in Exchange Rules 2.11 and 2.12, to pay the related sales fee of that market. The proposed section provides that to the extent the Exchange may collect more from Members under the section than is due from the Exchange to the Commission under Section 31 of the Act, for example due to rounding differences, the excess monies collected may be used by the Exchange to fund its general operating expenses. The Exchange may reimburse its routing broker for all Section 31related fees incurred by the routing broker in connection with the routing services it provides. 4 17 CFR 240.31(a)(6). e.g. Cboe C2 Options Fee Schedule, Sales Value Fee; NASDAQ Equities Price List, Sales Fees to Fund Section 31 Obligations; and NYSE Arca Rule 2.18 (Activity Assessment Fees). 6 See Rule 1.5(n). The term ‘‘Member’’ shall mean any registered broker or dealer that has been admitted to membership in the Exchange. A Member will have the status of a ‘‘member’’ of the Exchange as that term is defined in Section 3(a)(3) of the Act. Membership may be granted to a sole proprietor, partnership, corporation, limited liability company or other organization which is a registered broker or dealer pursuant to Section 15 of the Act, and which has been approved by the Exchange. The proposed section explains that the transactions to which the Fee applies are sales of equities. The Fee is collected indirectly from Members through their clearing firms by the Depositary [sic] Trust & Clearing Corporation (‘‘DTCC’’) on behalf of the Exchange with respect to sales in equity securities.7 For Members who do not have a DTCC account, the Exchange invoices these Members directly. The proposed section also sets forth the formula for calculating the Fee. Specifically, the Fee with respect to sales in equity securities is equal to (i) the Section 31 fee rate 8 multiplied by (ii) the Member’s aggregate dollar amount of covered sales resulting from equities [sic] that have a charge date in that month.9 The Fee is calculated and invoiced by the Exchange on a monthly basis, but is not paid to the Commission until the end of the applicable billing period.10 The billing period for Section 31-related fees is separated into two periods: (i) January 1 through August 31; and (ii) September 1 through December 31.11 The Exchange notes that if the SEC’s Section 31 fee rate changes in the middle of a month, the Exchange will perform a separate calculation with respect to covered sales under the new fee rate for the remaining portion of the month. In addition to the Exchange’s proposal to add the Fee to its Fee Schedule, the Exchange simultaneously proposes to delete the rule text found in Exchange Rule 15.1(b). Exchange Rule 15.1(b) currently provides a description of the Fee within the Exchange rulebook, which would be duplicative as the Fee will be set forth and more fully described in the Fee Schedule. The Exchange notes that the Fee, as described in Exchange Rule 15.1(b), is described only at a high-level and does not contain specific details about how the Exchange currently calculates and collects the Fee. Specifically, Exchange Rule 15.1(b) merely states that the Exchange assesses a Regulatory Transaction Fee to its Members in order to help fund the Exchange’s obligations to the Commission under Section 31. While Exchange Rule 15.1(b) does state how the Fee is calculated (which is ddrumheller on DSK120RN23PROD with NOTICES1 5 See, VerDate Sep<11>2014 18:07 Aug 16, 2024 Jkt 262001 7 See https://cdn.cboe.com/resources/ membership/Direct_Debit_Opt-In_Form.pdf. 8 The Section 31 fee rate is the fee rate applicable to covered sales under section 31(b) of the Act. See 15 U.S.C. 78ee(b). The current rate applicable to equities securities transactions is $27.80 per million dollars. See also https://cdn.cboe.com/resources/ fee_schedule/2024/Regulatory-Transaction-FeeAdjustment-per-SEC-Section-31-Rate-ChangeEffective-May-22-2024.pdf. 9 17 CFR 240.31(c). 10 17 CFR 240.31(c)(1). 11 17 CFR 240.31(a)(2). PO 00000 Frm 00083 Fmt 4703 Sfmt 4703 67139 identical to the proposed calculation described on the Fee Schedule), there is no description of the types of transactions that trigger the Fee or how the fee is collected by the Exchange. The Exchange proposes to more fully describe its current practice of calculating and collecting the Fee by providing additional details on the Fee Schedule. In conjunction with removing the rule text in Exchange Rule 15.1(b), the Exchange proposes to rename Exchange Rule 15.1(b) as ‘‘Reserved.’’ 2. Statutory Basis The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the ‘‘Act’’) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.12 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 13 requirements that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 14 requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. The Exchange also believes the proposed rule change is consistent with Section 6(b)(4) of the Act,15 which requires that Exchange rules provide for the equitable allocation of reasonable dues, fees, and other charges among its Members and other persons using its facilities. The Exchange believes that the proposed rule change is consistent with these requirements because the proposed amended Fee Schedule text provides Members with detail regarding the circumstances under which the Exchange assesses a Sales Value Fee, and the current process by which the Fee is collected. The Exchange’s current codification of the Fee in Exchange Rule 15.1(b) does not accurately depict the Exchange’s current practice of 12 15 13 15 U.S.C. 78f(b). U.S.C. 78f(b)(5). 14 Id. 15 15 E:\FR\FM\19AUN1.SGM U.S.C. 78f(b)(4). 19AUN1 ddrumheller on DSK120RN23PROD with NOTICES1 67140 Federal Register / Vol. 89, No. 160 / Monday, August 19, 2024 / Notices calculating and collecting the Fee. The Exchange believes that amending the description of the Fee and placing this description on its Fee Schedule rather than in the Exchange rulebook will provide additional guidance to its Members about which transactions are subject to the Fee, how the Fee is calculated, and how the Fee is collected. As such, the proposed changes will increase transparency, help avoid Member confusion and foster better understanding of the application of the Fee, which the Exchange believes promotes just and equitable principles of trade, removes impediments to and perfects the mechanism of a free and open market and a national market system, and protects investors and the public interest. Further, the Exchange believes the proposed change is reasonable as the Exchange is proposing to assess the same Fee to its Members that the Exchange must pay to the Commission twice annually. The Exchange believes the proposed change represents an equitable allocation of fees and is not unfairly discriminatory because it applies uniformly to all Members in that all Members submitting covered orders to the Exchange are assessed the Fee, which is equal to the fee that the Exchange is required to pay to the Commission. Furthermore, by moving the description of the Fee from Exchange Rule 15.1(b) to the Fee Schedule, all Members will have additional information about the types of orders subject to the Fee and how the Exchange collects the Fee from its Members, which do not currently appear in Exchange Rule 15.1(b). While Exchange Rule 15.1(b) describes at a high-level the Exchange’s ability to assess a fee in order to help fund the Exchange’s obligations under Section 31, it does not accurately depict the Exchange’s current practice in regard to calculating and collecting the Fee from its Members. The proposed movement of the description of the Fee from Exchange Rule 15.1(b) to the Fee Schedule will not change how the Exchange calculates or collects the Fee from its Members, but rather will provide a more complete and accurate description of the Fee to all Members. All Members will be able to access a detailed description of the Fee on the Fee Schedule and as such, the description of the Fee found in Exchange Rule 15.1(b) that does not accurately describe the Exchange’s current practice in calculating or collecting the Fee is no longer necessary. VerDate Sep<11>2014 18:07 Aug 16, 2024 Jkt 262001 B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe the proposed changes will impose any burden on intramarket competition. Particularly, the proposed change applies uniformly to all Members, in that the Sales Value Fee is applied uniformly to all Members’ applicable covered orders. Similarly, the proposal to delete Rule 15.1(b) from the Exchange rulebook will not impose any burden on competition because the change applies to all Members uniformly, in that all Members will instead be able to access the description of the Sales Value Fee and how the Fee is calculated on the Fee Schedule. The Exchange does not believe that the proposed rule changes will impose any burden on intermarket competition that is not necessary or appropriate in furtherance of the purposes of the Act. As noted above, assessing a sales fee to defray the cost of fees assessed under Section 31 of the Act is common practice among the national securities exchanges and associations.16 C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others The Exchange neither solicited nor received comments on the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 17 and paragraph (f) of Rule 19b–4 18 thereunder. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission will institute proceedings to determine whether the proposed rule change should be approved or disapproved. 16 Supra note 5. U.S.C. 78s(b)(3)(A). 18 17 CFR 240.19b–4(f). 17 15 PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include file number SR– CboeBYX–2024–027 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should refer to file number SR–CboeBYX–2024–027. This file number should be included on the subject line if email is used. To help the Commission process and review your comments more efficiently, please use only one method. The Commission will post all comments on the Commission’s internet website (https://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C. 552, will be available for website viewing and printing in the Commission’s Public Reference Room, 100 F Street NE, Washington, DC 20549, on official business days between the hours of 10 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–CboeBYX–2024–027 and should be submitted on or before September 9, 2024. E:\FR\FM\19AUN1.SGM 19AUN1 Federal Register / Vol. 89, No. 160 / Monday, August 19, 2024 / Notices For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Sherry R. Haywood, Assistant Secretary. instruments by writing to the above email address. [FR Doc. 2024–18469 Filed 8–16–24; 8:45 am] Background The Social Security Administration (SSA) provides income assistance to more than 13 million working-age adults and children with disabilities through the Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) programs. To evaluate these respondents as they navigate SSA’s application process, we are implementing the New Applicant Survey (NAS). The objective of the New Applicant Survey (NAS) is to provide SSA’s Office of Research, Demonstration, and Employment Support (ORDES) with information about recent applicants’ experience at different stages or touchpoints in the disability application process. SSA will use findings from the survey to inform testable policy interventions to improve the application experience for applicant. BILLING CODE 8011–01–P SOCIAL SECURITY ADMINISTRATION [Docket No: SSA–2024–0029] ddrumheller on DSK120RN23PROD with NOTICES1 Agency Information Collection Activities: Proposed Request The Social Security Administration (SSA) publishes a list of information collection packages requiring clearance by the Office of Management and Budget (OMB) in compliance with Public Law 104–13, the Paperwork Reduction Act of 1995, effective October 1, 1995. This notice includes two new collections for OMB approval, as well as revisions of OMB-approved information collections. SSA is soliciting comments on the accuracy of the agency’s burden estimate; the need for the information; its practical utility; ways to enhance its quality, utility, and clarity; and ways to minimize burden on respondents, including the use of automated collection techniques or other forms of information technology. Mail, email, or fax your comments and recommendations on the information collection(s) to the OMB Desk Officer and SSA Reports Clearance Officer at the following addresses or fax numbers. (OMB) Office of Management and Budget, Attn: Desk Officer for SSA (SSA) Social Security Administration, OLCA, Attn: Reports Clearance Director, Mail Stop 3253 Altmeyer, 6401 Security Blvd., Baltimore, MD 21235 Fax: 833–410–1631 Email address: OR.Reports.Clearance@ssa.gov Or you may submit your comments online through https://www.reginfo.gov/ public/do/PRAmain by clicking on Currently under Review—Open for Public Comments and choosing to click on one of SSA’s published items. Please reference Docket ID Number [SSA– 2024–0029] in your submitted response. The information collection below is pending at SSA. SSA will submit it to OMB within 60 days from the date of this notice. To be sure we consider your comments, we must receive them no later than October 18, 2024. Individuals can obtain copies of the collection 19 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 18:07 Aug 16, 2024 Jkt 262001 1. New Applicant Survey (NAS)—0960– NEW NAS Description The primary goal of NAS is to help SSA improve our current application process through the use of feedback from the public who use it. The research questions and survey will allow SSA to evaluate current practices and improve upon them. Ultimately, we expect the purpose of this survey will help SSA to implement a better overall application experience for respondents, as they use SSA’s systems. To provide information to SSA regarding applicants’ experiences at the different touchpoints in the disability application process, SSA’s evaluation will include the following analysis components: • Comparison of Characteristics: Comparing characteristics of nonrespondents (or the total sample) to those of respondents using information available for both non-respondents and respondents. • Modeling: Modeling response propensity using multivariate analyses, including observation and analysis of several outcome variables. • Evaluation of Differences: Evaluating differences found in comparisons between unadjusted (i.e., base-) weighted estimates of selected sampling frame characteristics based on the survey respondents and the corresponding population (frame) parameter. • Comparison of Estimates: Comparing weighted survey estimates (e.g., selected error rates by type) using unadjusted (base) weights versus nonresponse-adjusted weights. PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 67141 We expect the NAS will help SSA answer the following research questions: • What are the pre- and postapplication employment experiences of awarded and denied SSDI and SSI applicants? • What employment-, vocational-, medical-, or income-related services and supports did applicants use leading up to and since application? • What sources of information about SSDI or SSI did the applicant use or have access to? • What were the applicants’ experiences with representation during the application or post-application periods? SSA will conduct this survey with 10,000 respondents nationally. SSA will provide a list of recent adult applicants who have applied for Social Security disability benefits to the contractor to use for sample selection. To ensure that sampled applicants have recent experiences with the application process, we will restrict the target population to those who have applied, appealed, or received a determination in the six months prior to sampling. The sample will include individuals to whom SSA awarded benefits (beneficiaries), those to whom SSA denied benefits, as well as applicants who remain at different stages of the application process. For this survey, we will use the following methods for recruitment: • SSA Announcement • Email to Appointed Representative from Appointed Representative Associations • Email to Appointed Representative (Directly) • First USPS Mailing to All Applicants, which will include a small cash incentive of $2, a letter, and an information sheet • Second USPS Mailing to All Applicants • Third USPS Mailing to Nonrespondents • Fourth USPS Mailing to Nonrespondents • Fifth contact introducing the telephone modality. As part of recruitment, we will also conduct experiments regarding more cash incentives, invitations to complete the survey using multiple modalities (internet, paper, telephone), as well as an early-bird incentive. The Survey Instrument The survey asks questions that focus on the applicant’s experience with different aspects of the application process. We will use it to collect data E:\FR\FM\19AUN1.SGM 19AUN1

Agencies

[Federal Register Volume 89, Number 160 (Monday, August 19, 2024)]
[Notices]
[Pages 67138-67141]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-18469]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-100715; File No. SR-CboeBYX-2024-027]


Self-Regulatory Organizations; Cboe BYX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Replace 
the Regulatory Transaction Fee With a Sales Value Fee

August 13, 2024.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on July 30, 2024, Cboe BYX Exchange, Inc. (the ``Exchange'') filed 
with the Securities and Exchange Commission (the ``Commission'') the 
proposed rule change as described in Items I, II, and III below, which 
Items have been prepared by the Exchange. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
---------------------------------------------------------------------------

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

    Cboe BYX Exchange, Inc. (the ``Exchange'' or ``BYX'') proposes to 
amend its Fees Schedule. The text of the proposed rule change is 
provided in Exhibit 5.
    The text of the proposed rule change is also available on the 
Exchange's website (https://markets.cboe.com/us/equities/regulation/rule_filings/BYX/), at the Exchange's Office of the Secretary, and at 
the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. The Exchange has prepared summaries, set forth in 
sections A, B, and C below, of the most significant aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Fees Schedule to add language 
concerning the application and collection of the Sales Value Fee, as 
described below.
    By way of background, Section 31 of the Securities Exchange Act of 
1934 (the ``Act'') \3\ requires each self-regulatory organization 
(``SRO'') to pay the Securities and Exchange Commission (``SEC'' or 
``Commission'') twice annually a fee based on the aggregate dollar 
amount of certain sales of securities (i.e., ``covered sales''). A 
covered sale is a ``sale of a security, other than an exempt sale or a 
sale of a security future, occurring on a national securities exchange 
or by or through any member of a national securities association 
otherwise than on

[[Page 67139]]

a national securities exchange.'' \4\ Assessing a sales fee to defray 
the cost of these fees is common practice among the national securities 
exchanges and associations, including the Exchange's affiliate options 
exchanges.\5\ In fact, the Exchange currently assesses a fee on its 
Members \6\ for covered sales on the Exchange to recoup these amounts, 
which is described in Exchange Rule 15.1(b) (Regulatory Transaction 
Fee) but is not currently described on the Exchange's Fee Schedule. The 
Exchange now proposes to amend its Fee Schedule to include information 
regarding this fee, including an explanation and description of the fee 
and how it is collected. In conjunction with the proposed addition to 
the Fee Schedule, the exchange also proposes to delete the applicable 
rule text found in Exchange Rule 15.1(b) and proposes to rename Rule 
15.1(b) as ``Reserved.''
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    \3\ 17 CFR 240.31.
    \4\ 17 CFR 240.31(a)(6).
    \5\ See, e.g. Cboe C2 Options Fee Schedule, Sales Value Fee; 
NASDAQ Equities Price List, Sales Fees to Fund Section 31 
Obligations; and NYSE Arca Rule 2.18 (Activity Assessment Fees).
    \6\ See Rule 1.5(n). The term ``Member'' shall mean any 
registered broker or dealer that has been admitted to membership in 
the Exchange. A Member will have the status of a ``member'' of the 
Exchange as that term is defined in Section 3(a)(3) of the Act. 
Membership may be granted to a sole proprietor, partnership, 
corporation, limited liability company or other organization which 
is a registered broker or dealer pursuant to Section 15 of the Act, 
and which has been approved by the Exchange.
---------------------------------------------------------------------------

    Specifically, the Exchange proposes to add a section to the Fee 
Schedule labeled ``Sales Value Fee''. The proposed new section defines 
the Sales Value Fee (``Fee'') as the fee assessed by the Exchange to 
each Member for sales in securities when a sale in an equity security 
occurs with respect to which the Exchange is obligated to pay a fee to 
the SEC under Section 31 of the Exchange Act or when a sell order in an 
equity security is routed for execution at a market other than the 
Exchange, resulting in a covered sale on that market and an obligation 
of the routing broker providing routing services for the Exchange, as 
described in Exchange Rules 2.11 and 2.12, to pay the related sales fee 
of that market. The proposed section provides that to the extent the 
Exchange may collect more from Members under the section than is due 
from the Exchange to the Commission under Section 31 of the Act, for 
example due to rounding differences, the excess monies collected may be 
used by the Exchange to fund its general operating expenses. The 
Exchange may reimburse its routing broker for all Section 31-related 
fees incurred by the routing broker in connection with the routing 
services it provides.
    The proposed section explains that the transactions to which the 
Fee applies are sales of equities. The Fee is collected indirectly from 
Members through their clearing firms by the Depositary [sic] Trust & 
Clearing Corporation (``DTCC'') on behalf of the Exchange with respect 
to sales in equity securities.\7\ For Members who do not have a DTCC 
account, the Exchange invoices these Members directly.
---------------------------------------------------------------------------

    \7\ See https://cdn.cboe.com/resources/membership/Direct_Debit_Opt-In_Form.pdf.
---------------------------------------------------------------------------

    The proposed section also sets forth the formula for calculating 
the Fee. Specifically, the Fee with respect to sales in equity 
securities is equal to (i) the Section 31 fee rate \8\ multiplied by 
(ii) the Member's aggregate dollar amount of covered sales resulting 
from equities [sic] that have a charge date in that month.\9\ The Fee 
is calculated and invoiced by the Exchange on a monthly basis, but is 
not paid to the Commission until the end of the applicable billing 
period.\10\ The billing period for Section 31-related fees is separated 
into two periods: (i) January 1 through August 31; and (ii) September 1 
through December 31.\11\ The Exchange notes that if the SEC's Section 
31 fee rate changes in the middle of a month, the Exchange will perform 
a separate calculation with respect to covered sales under the new fee 
rate for the remaining portion of the month.
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    \8\ The Section 31 fee rate is the fee rate applicable to 
covered sales under section 31(b) of the Act. See 15 U.S.C. 78ee(b). 
The current rate applicable to equities securities transactions is 
$27.80 per million dollars. See also https://cdn.cboe.com/resources/fee_schedule/2024/Regulatory-Transaction-Fee-Adjustment-per-SEC-Section-31-Rate-Change-Effective-May-22-2024.pdf.
    \9\ 17 CFR 240.31(c).
    \10\ 17 CFR 240.31(c)(1).
    \11\ 17 CFR 240.31(a)(2).
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    In addition to the Exchange's proposal to add the Fee to its Fee 
Schedule, the Exchange simultaneously proposes to delete the rule text 
found in Exchange Rule 15.1(b). Exchange Rule 15.1(b) currently 
provides a description of the Fee within the Exchange rulebook, which 
would be duplicative as the Fee will be set forth and more fully 
described in the Fee Schedule. The Exchange notes that the Fee, as 
described in Exchange Rule 15.1(b), is described only at a high-level 
and does not contain specific details about how the Exchange currently 
calculates and collects the Fee. Specifically, Exchange Rule 15.1(b) 
merely states that the Exchange assesses a Regulatory Transaction Fee 
to its Members in order to help fund the Exchange's obligations to the 
Commission under Section 31. While Exchange Rule 15.1(b) does state how 
the Fee is calculated (which is identical to the proposed calculation 
described on the Fee Schedule), there is no description of the types of 
transactions that trigger the Fee or how the fee is collected by the 
Exchange. The Exchange proposes to more fully describe its current 
practice of calculating and collecting the Fee by providing additional 
details on the Fee Schedule. In conjunction with removing the rule text 
in Exchange Rule 15.1(b), the Exchange proposes to rename Exchange Rule 
15.1(b) as ``Reserved.''
2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Securities Exchange Act of 1934 (the ``Act'') and the rules and 
regulations thereunder applicable to the Exchange and, in particular, 
the requirements of Section 6(b) of the Act.\12\ Specifically, the 
Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \13\ requirements that the rules of an exchange be 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system, and, 
in general, to protect investors and the public interest. Additionally, 
the Exchange believes the proposed rule change is consistent with the 
Section 6(b)(5) \14\ requirement that the rules of an exchange not be 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers. The Exchange also believes the proposed rule 
change is consistent with Section 6(b)(4) of the Act,\15\ which 
requires that Exchange rules provide for the equitable allocation of 
reasonable dues, fees, and other charges among its Members and other 
persons using its facilities.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
    \14\ Id.
    \15\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that the proposed rule change is consistent 
with these requirements because the proposed amended Fee Schedule text 
provides Members with detail regarding the circumstances under which 
the Exchange assesses a Sales Value Fee, and the current process by 
which the Fee is collected. The Exchange's current codification of the 
Fee in Exchange Rule 15.1(b) does not accurately depict the Exchange's 
current practice of

[[Page 67140]]

calculating and collecting the Fee. The Exchange believes that amending 
the description of the Fee and placing this description on its Fee 
Schedule rather than in the Exchange rulebook will provide additional 
guidance to its Members about which transactions are subject to the 
Fee, how the Fee is calculated, and how the Fee is collected. As such, 
the proposed changes will increase transparency, help avoid Member 
confusion and foster better understanding of the application of the 
Fee, which the Exchange believes promotes just and equitable principles 
of trade, removes impediments to and perfects the mechanism of a free 
and open market and a national market system, and protects investors 
and the public interest. Further, the Exchange believes the proposed 
change is reasonable as the Exchange is proposing to assess the same 
Fee to its Members that the Exchange must pay to the Commission twice 
annually.
    The Exchange believes the proposed change represents an equitable 
allocation of fees and is not unfairly discriminatory because it 
applies uniformly to all Members in that all Members submitting covered 
orders to the Exchange are assessed the Fee, which is equal to the fee 
that the Exchange is required to pay to the Commission. Furthermore, by 
moving the description of the Fee from Exchange Rule 15.1(b) to the Fee 
Schedule, all Members will have additional information about the types 
of orders subject to the Fee and how the Exchange collects the Fee from 
its Members, which do not currently appear in Exchange Rule 15.1(b). 
While Exchange Rule 15.1(b) describes at a high-level the Exchange's 
ability to assess a fee in order to help fund the Exchange's 
obligations under Section 31, it does not accurately depict the 
Exchange's current practice in regard to calculating and collecting the 
Fee from its Members. The proposed movement of the description of the 
Fee from Exchange Rule 15.1(b) to the Fee Schedule will not change how 
the Exchange calculates or collects the Fee from its Members, but 
rather will provide a more complete and accurate description of the Fee 
to all Members. All Members will be able to access a detailed 
description of the Fee on the Fee Schedule and as such, the description 
of the Fee found in Exchange Rule 15.1(b) that does not accurately 
describe the Exchange's current practice in calculating or collecting 
the Fee is no longer necessary.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. The Exchange does not 
believe the proposed changes will impose any burden on intramarket 
competition. Particularly, the proposed change applies uniformly to all 
Members, in that the Sales Value Fee is applied uniformly to all 
Members' applicable covered orders. Similarly, the proposal to delete 
Rule 15.1(b) from the Exchange rulebook will not impose any burden on 
competition because the change applies to all Members uniformly, in 
that all Members will instead be able to access the description of the 
Sales Value Fee and how the Fee is calculated on the Fee Schedule.
    The Exchange does not believe that the proposed rule changes will 
impose any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. As noted above, 
assessing a sales fee to defray the cost of fees assessed under Section 
31 of the Act is common practice among the national securities 
exchanges and associations.\16\
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    \16\ Supra note 5.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the 
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \17\ and paragraph (f) of Rule 19b-4 \18\ 
thereunder. At any time within 60 days of the filing of the proposed 
rule change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-CboeBYX-2024-027 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-CboeBYX-2024-027. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (https://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549, on official business days between the hours of 10 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-CboeBYX-2024-027 and should be submitted 
on or before September 9, 2024.


[[Page 67141]]


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-18469 Filed 8-16-24; 8:45 am]
BILLING CODE 8011-01-P
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