Self-Regulatory Organizations; NYSE Chicago, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the Existing Note in the Connectivity Fee Schedule, 74314-74317 [2024-20640]
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Federal Register / Vol. 89, No. 177 / Thursday, September 12, 2024 / Notices
about the special characteristics of a
closed-end fund that makes periodic
repurchase offers.
The Commission staff estimates that
80 funds make use of rule 23c–3
annually, including 14 funds that are
relying upon rule 23c–3 for the first
time. The Commission staff estimates
that on average a fund spends 89 hours
annually in complying with the
requirements of the rule and Form N–
23c–3, with funds relying upon rule
23c–3 for the first time incurring an
additional one-time burden of 28 hours.
The Commission therefore estimates the
total annual hour burden of the rule’s
and form’s paperwork requirements to
be 7,512 hours. In addition to the
burden hours, the Commission staff
estimates that the average yearly cost to
each fund that relies on rule 23c–3 to
print and mail repurchase offers to
shareholders is about $38,003.10. The
Commission estimates total annual cost
is therefore about $3,040,248.
Estimates of average burden hours
and costs are made solely for purposes
of the Paperwork Reduction Act and are
not derived from a comprehensive or
even representative survey or study of
the costs of Commission rules and
forms. Compliance with the collection
of information requirements of the rule
and form is mandatory only for those
funds that rely on the rule to repurchase
shares of the fund. The information
provided to the Commission on Form
N–23c–3 will not be kept confidential.
An agency may not conduct or sponsor,
and a person is not required to respond
to a collection of information unless it
displays a currently valid OMB control
number.
The public may view background
documentation for this information
collection at the following website:
www.reginfo.gov. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function. Written comments and
recommendations for the proposed
information collection should be sent
within 30 days of publication of this
notice by October 15, 2024 to (i)
MBX.OMB.OIRA.SEC_desk_officer@
omb.eop.gov and (ii) Austin Gerig,
Director/Chief Data Officer, Securities
and Exchange Commission, c/o
Oluwaseun Ajayi, 100 F Street NE,
Washington, DC 20549, or by sending an
email to: PRA_Mailbox@sec.gov.
Dated: September 9, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–20700 Filed 9–11–24; 8:45 am]
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SECURITIES AND EXCHANGE
COMMISSION
regarding cabinet and combined
waitlists.
[Release No. 34–100966; File No. SR–
NYSECHX–2024–27]
Background
Shortly after the onset of the Covid–
19 pandemic, the Exchange began
experiencing unprecedented User 4
demand for cabinets and power at the
Mahwah, New Jersey data center
(‘‘MDC’’).5 In order to manage its
inventory, in late 2020, the Exchange
filed to create purchasing limits and a
waitlist for cabinet orders (‘‘Cabinet
Waitlist’’).6 In early 2021, the Exchange
filed to create additional purchasing
limits and a waitlist for orders for
additional power in the MDC.7
In 2021 and 2022, the Exchange
expanded the amount of space and
power available in the MDC by opening
a new colocation hall (i.e., Hall 4). ICE
is currently expanding the amount of
colocation space and power available at
the MDC through a new colocation hall
(i.e., Hall 5).
The Exchange subsequently amended
the Fee Schedule to provide an
alternative procedure by which the
Exchange can allocate power in the
Mahwah Data Center via depositguaranteed orders from Users made
within a 90-day ‘‘Ordering Window.’’ 8
Self-Regulatory Organizations; NYSE
Chicago, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Amending the Existing
Note in the Connectivity Fee Schedule
September 6, 2024.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on August
27, 2024, NYSE Chicago, Inc. (‘‘NYSE
Chicago’’ or the ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
existing note in the Connectivity Fee
Schedule (‘‘Fee Schedule’’) regarding
cabinet and combined waitlists. The
proposed rule change is available on the
Exchange’s website at www.nyse.com, at
the principal office of the Exchange, and
at the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend the
existing note in the Fee Schedule
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
PO 00000
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4 For purposes of the Exchange’s colocation
services, a ‘‘User’’ means any market participant
that requests to receive colocation services directly
from the Exchange. See Securities Exchange Act
Release No. 87408 (October 28, 2019), 84 FR 58778
at n.6 (November 1, 2019) (SR–NYSECHX–2019–
12). As specified in the Fee Schedule, a User that
incurs colocation fees for a particular colocation
service pursuant thereto would not be subject to
colocation fees for the same colocation service
charged by the New York Stock Exchange LLC
(‘‘NYSE’’), NYSE American LLC, NYSE Arca, Inc.,
and NYSE National, Inc. (together, the ‘‘Affiliate
SROs’’). Each Affiliate SRO has submitted
substantially the same proposed rule change to
propose the changes described herein. See SR–
NYSE–2024–49, SR–NYSEAMER–2024–52, SR–
NYSEARCA–2024–71, and SR–NYSENAT–2024–
24.
5 Through its Fixed Income and Data Services
(‘‘FIDS’’) (previously ICE Data Services) business,
Intercontinental Exchange, Inc. (‘‘ICE’’) operates the
MDC. The Exchange and the Affiliate SROs are
indirect subsidiaries of ICE.
6 See Securities Exchange Act Release No. 90732
(December 18, 2020), 85 FR 84443 (December 28,
2020) (SR–NYSE–2020–73, SR–NYSEAMER–2020–
66, SR–NYSEArca–2020–82, SR–NYSECHX–2020–
26, and SR–NYSENAT–2020–28) (establishing the
procedures in current Colocation Note 6(a) and
7(a)).
7 See Securities Exchange Act Release No. 91515
(April 8, 2021), 86 FR 19674 (April 14, 2021) (SR–
NYSE–2021–12, SR–NYSEAMER–2021–08, SR–
NYSEArca–2021–11, SR–NYSECHX–2021–02, and
SR–NYSENAT–2021–03) (establishing the
procedures in current Colocation Note 6(b) and
7(b)).
8 See Securities Exchange Act Release No. 98937
(November 14, 2023), 88 FR 80795 (November 20,
2023) (SR–NYSE–2023–29, SR–NYSEAMER–2023–
39, SR–NYSEArca–2023–53, SR–NYSECHX–2023–
16, and SR–NYSENAT–2023–18) (‘‘Ordering
Window Approval Order’’).
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The Ordering Window procedure was
designed with the goal of addressing
both (a) whether customer demand
would support additional expansion
projects to provide further power, and
(b) the fact that previous procedures in
the Fee Schedule were not well-tailored
to allocating large amounts of power
that become available all at once, such
as when a new colocation hall opens.9
Orders received during an Ordering
Window are not considered finalized
until the Exchange has received the
User’s signed order form and a deposit
equal to two months’ worth of the
monthly recurring costs of the amount
of new power ordered.
The Exchange had a power and
cabinet waitlist (‘‘Combined Waitlist’’)
in place before the Ordering Window.
The Exchange found that when the
Combined Waitlist was in effect,
approximately 2⁄3 of its offers of power
were rejected. Users further down the
Combined Waitlist received power only
after those higher up the Combined
Waitlist were offered the power and
rejected it. As a result, the Users that
actually wanted power received it only
after a delay that lasted weeks or even
months.
Proposed Changes
In response, the Exchange proposes to
amend Fee Schedule Colocation Note 7
(Cabinet and Combined Waitlists)
(‘‘Note 7’’) to require that Users wanting
to be placed on a waitlist must
guarantee their order with a deposit.10
Requiring Users to submit deposits with
their orders in order to be placed on the
waitlist would help avoid delays for
Users further down the list, by
encouraging Users to carefully assess
their true power and cabinet needs and
protecting against Users ordering more
power or cabinets than they actually
intend to purchase. Requiring Users to
submit deposits along with their orders
was approved by the Commission in the
Exchange’s Ordering Window filing,11
and so the deposit requirement here
would not be novel.
To implement the change, Note 7(a),
which sets forth the practices the
Exchange follows for a Cabinet Waitlist,
would be revised to provide that a User
would be placed on the Cabinet Waitlist
based on the date its finalized order is
received, and that a User’s order would
be finalized when the Exchange receives
(a) User’s signed order form and (b) a
deposit equal to two months’ worth of
9 Id.,
at 80794.
proposed change would not apply to Users
that are already on a waitlist at the time the
proposed change becomes operative.
11 See Ordering Window Approval Order, supra
note 8.
10 The
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the monthly recurring costs of the
power requested for the cabinets
ordered.12
Note 7(b), which sets forth the
practices the Exchange follows for a
Combined Waitlist, similarly would be
revised to provide that a User would be
placed on the Combined Waitlist based
on the date its finalized order for
cabinets and/or additional power is
received, and that a User’s order would
be finalized when the Exchange receives
(a) User’s signed order form and (b) a
deposit equal to two months’ worth of
the monthly recurring costs of (i) the
power requested for the cabinets
ordered and/or (ii) the additional power
ordered.13
Note 7(a) and (b) would be revised to
provide that:
• If a User changes the size of its
order while it is on the Cabinet or
Combined Waitlist, as the case may be,
and any additional deposit is received
by the Exchange, it will maintain its
place, provided that the User may not
increase the size of its order such that
it would exceed the Cabinet Limits or
Combined Limits, as applicable.
• If a User wishes to reduce the size
of its order while it is on the Cabinet or
Combined Waitlist, its deposit would
not be reduced or returned, but rather
would be applied against the User’s first
and subsequent months’ invoices after
cabinets are, and/or the power is,
delivered until the deposit is depleted.
• If the User removes its order from
the Cabinet Waitlist or Combined
Waitlist, its deposit will be returned.
• A User that is removed from the
Cabinet or Combined Waitlist but
subsequently submits a new finalized
order for cabinets and/or additional
power will be added back to the bottom
of the waitlist.
• The deposit will be applied to the
User’s first and subsequent months’
invoices after the cabinets are and/or
12 Because monthly charges are calculated based
on power, not on cabinets, the Exchange proposes
to calculate the deposit based on the power
requested for the cabinets ordered. In such a case,
the deposit would be calculated as (a) the number
of kilowatts allocated to the cabinets the User is
ordering, multiplied by (b) the appropriate ‘‘Per kW
Monthly Fee’’ as indicated in the Connectivity Fee
Schedule. The Per kW Monthly Fee is a factor of
the total number of kilowatts allocated to all of a
User’s dedicated cabinets and varies based on the
total kilowatts allocated to a User.
13 The deposit would be calculated as (a) the
number of kilowatts allocated to the cabinets the
User is ordering, if any, plus the number of
kilowatts of additional power, multiplied by (b) the
appropriate ‘‘Per kW Monthly Fee’’ as indicated in
the Connectivity Fee Schedule. The Per kW
Monthly Fee is a factor of the total number of
kilowatts allocated to all of a User’s dedicated
cabinets and varies based on the total kilowatts
allocated to a User.
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additional power is delivered until the
deposit is completely depleted.
General
The proposed changes would not
apply differently to distinct types or
sizes of market participants. Rather,
they would apply to all Users equally.
As is currently the case, the Fee
Schedule would be applied uniformly to
all Users. FIDS does not expect that the
proposed rule change will result in new
Users.
The proposed changes are not
otherwise intended to address any other
issues relating to co-location services
and/or related fees, and the Exchange is
not aware of any problems that
customers would have in complying
with the proposed change.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,14 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,15 in particular, because it is
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 and because it is not
designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers. The
Exchange further believes that the
proposed rule change is consistent with
Section 6(b)(4) of the Act,16 because it
provides for the equitable allocation of
reasonable dues, fees, and other charges
among its members and issuers and
other persons using its facilities and
does not unfairly discriminate between
customers, issuers, brokers, or dealers.
The Proposed Change Is Reasonable
The Exchange believes that the
proposed change is reasonable because
requiring Users to submit deposits with
their orders in order to be placed on the
waitlist would help avoid delays for
Users further down the list, by
encouraging Users to carefully assess
their true power and cabinet needs and
protecting against Users ordering more
power or cabinets than they actually
intend to purchase. Without firm,
14 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
16 15 U.S.C. 78f(b)(4).
15 15
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guaranteed commitments from
waitlisted Users to purchase cabinets or
power if made available, the Exchange
runs the risk of overestimating
waitlisted Users’ true demand, creating
delays for Users further down the list.
The proposed deposit requirement
would address this by discouraging
waitlisted Users from submitting orders
for more cabinets or power than they
actually intend to purchase.
The proposed deposit requirement is
reasonable because, on the one hand, it
is not so onerous as to dissuade Users
from submitting orders, and, on the
other hand, it is not so trivial that it
would fail to deter Users from
submitting exaggerated orders. It is
substantially similar to the deposit
provision already required under the
Ordering Window, and as such, the
deposit requirement here would not be
novel.17
In addition, the Exchange believes
that the proposed change is reasonable
because the deposit is proportional to
the size of the order, and not a fixed
amount. As a result, smaller Users
would not be disproportionately
affected by the deposit requirement.
Under the proposed procedure, if a
User wishes to reduce an order while on
a waitlist, its deposit would not be
reduced or returned, but rather would
be applied against the User’s first and
subsequent months’ invoices after the
cabinets are, or the power is, delivered
until the deposit is completely depleted.
The Exchange believes that this would
remove impediments and perfect the
mechanism of a free and open market
and a national market system because a
waitlisted User would be reimbursed for
all of its deposit even if it reduces its
order. This would remove any incentive
a User otherwise might have to
understate its needs for cabinets and/or
power out of a concern that it would not
be reimbursed for the full amount of its
deposit.
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The Proposed Change Is Equitable and
Not Unfairly Discriminatory
The Exchange believes that the
proposed change provides for the
equitable allocation of reasonable dues,
17 See Ordering Window Approval Order, supra
note 8. The NYSE requires market participants to
submit deposits in other contexts as well. For
example, since 2012, the NYSE has required
prospective issuers to pay a $25,000 initial
application fee as part of the process for listing a
new security on the exchange. This fee functions as
a deposit that is credited toward the issuer’s listing
fees after it is listed on the exchange. The deposit
functions as ‘‘a disincentive for impractical
applications by issuers.’’ The deposit is forfeited if
the issuer does not ultimately list on the exchange.
See Securities Exchange Act Release No. 68470
(December 19, 20212), 77 FR 76116 at 76117
(December 26, 2012) (SR–NYSE–2012–68).
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fees, and other charges among its
members and issuers and other persons
using its facilities and does not unfairly
discriminate between customers,
issuers, brokers, or dealers because it is
not designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers. The
proposed changes would apply equally
to all types and sizes of market
participants. All Users would receive
equal notice of the deposit requirement
through the proposed changes to Note 7,
and the deposit requirement would be
the same for all Users. Smaller Users
with more modest power needs would
not be disadvantaged by the proposed
changes, as the deposit is proportional
to the size of the order and not a fixed
amount.
The proposed deposit requirement is
equitable because, on the one hand, it is
not so onerous as to dissuade Users
from submitting orders, and, on the
other hand, it is not so trivial that it
would fail to deter Users from
submitting exaggerated orders. It is
substantially similar to the deposit
provision already required under the
Ordering Window, and as such, the
deposit requirement here would not be
novel.18
Under the proposed procedure, if a
User wishes to reduce an order while on
a waitlist, its deposit would not be
reduced or returned, but rather would
be applied against the User’s first and
subsequent months’ invoices after the
cabinets are, or the power is, delivered
until the deposit is completely depleted.
The Exchange believes that this is
equitable because a waitlisted User
would be reimbursed for all of its
deposit even if it reduces its order. This
would remove any incentive a User
otherwise might have to understate its
needs for cabinets and/or power out of
a concern that it would not be
reimbursed for the full amount of its
deposit.
For the reasons above, the proposed
changes do not unfairly discriminate
between or among market participants
that are otherwise capable of satisfying
any applicable co-location fees,
requirements, terms, and conditions
established from time to time by the
Exchange.
For these reasons, the Exchange
believes that the proposal is consistent
with the Act.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange believes that the
proposal will not impose any burden on
18 See Ordering Window Approval Order, supra
note 8.
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competition that is not necessary or
appropriate in furtherance of the
purposes of Section 6(b)(8) of the Act.19
The Exchange believes that the
proposed rule change does not impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed rule change is designed to
help avoid delays for waitlisted Users,
by encouraging Users to carefully assess
their true power and cabinet needs and
protecting against Users ordering more
power or cabinets than they actually
intend to purchase. Without firm,
guaranteed commitments from
waitlisted Users to purchase cabinets or
power if made available, the Exchange
runs the risk of overestimating
waitlisted Users’ true demand, creating
delays for Users further down the list.
The proposed deposit requirement
would address this by discouraging
waitlisted Users from submitting orders
for more cabinets or power than they
actually intend to purchase, thereby
facilitating a more equitable distribution
of cabinets and power. Moreover, the
Ordering Window already requires a
deposit, and as such, the deposit
requirement here would not be novel.20
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 21 and Rule
19b–4(f)(6) thereunder.22 Because the
proposed rule change does not: (i)
significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
prior to 30 days from the date on which
it was filed, or such shorter time as the
Commission may designate, if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)(iii)
thereunder.23
19 15
U.S.C. 78f(b)(8).
Ordering Window Approval Order, supra
20 See
note 8.
21 15 U.S.C. 78s(b)(3)(A)(iii).
22 17 CFR 240.19b–4(f)(6).
23 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule
19b–4(f)(6) requires a self-regulatory organization to
give the Commission written notice of its intent to
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At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B) 24 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:
ddrumheller on DSK120RN23PROD with NOTICES1
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–
NYSECHX–2024–27 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–NYSECHX–2024–27. 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
file the proposed rule change at least five business
days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
24 15 U.S.C. 78s(b)(2)(B).
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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–NYSECHX–2024–27 and should be
submitted on or before October 3, 2024.
For the Commission, by the Division
of Trading and Markets, pursuant to
delegated authority.25
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–20640 Filed 9–11–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–629, OMB Control No.
3235–0719]
Submission for OMB Review;
Comment Request; Extension: Rule
13n–1—13n–12; Form SDR
Upon Written Request, Copies Available
From: Securities and Exchange
Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736
Notice is hereby given that pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget
(‘‘OMB’’) a request for approval of
extension of the previously approved
collection of information provided for in
Rules 13n–1 through 13n–12 (17 CFR
240.13n–1 through 240.13n–12) and
Form SDR (‘‘Rules’’), under the
Securities Exchange Act of 1934 (15
U.S.C. 78m(n)(3) et seq.).
Under the Rules, security-based swap
data repositories (‘‘SDRs’’) are required
to register with the Commission by
filing a completed Form SDR (the filing
of a completed Form SDR also
constitutes an application for
registration as a securities information
processor (‘‘SIP’’)). SDRs are also
required to abide by certain minimum
standards set out in the Rules, including
a requirement to update Form SDR,
abide by certain duties and core
principles, maintain data in accordance
with the rules, keep systems in
25 17
PO 00000
accordance with the Rules, keep
records, provide reports to the
Commission, maintain the privacy of
security-based swaps (‘‘SBSs’’) data,
make certain disclosures, and designate
a Chief Compliance Officer. In addition,
there are a number of collections of
information contained in the Rules. The
information collected pursuant to the
Rules is necessary to carry out the
mandates of the Dodd-Frank Act and
help ensure an orderly and transparent
market for SBSs.
Assuming a maximum of three SDRs,
the Commission estimates that the total
that the total burden for the Rules and
Form SDR for all respondents is 127,505
hours annually and approximately
382,511 burden hours for all
respondents over three years. In
addition, the Commission estimates that
the total cost of the Rules and Form SDR
for all respondents is approximately
$29,905,416 annually and
approximately $89,716,248 for all
respondents over three years.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
under the PRA unless it displays a
currently valid OMB control number.
The public may view background
documentation for this information
collection at the following website:
www.reginfo.gov. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function. Written comments and
recommendations for the proposed
information collection should be sent by
October 15, 2024 to (i) www.reginfo.gov/
public/do/PRAMain and (ii) Austin
Gerig, Director/Chief Information
Officer, Securities and Exchange
Commission, c/o Oluwaseun Ajayi, 100
F Street NE, Washington, DC 20549, or
by sending an email to: PRA_Mailbox@
sec.gov.
Dated: September 9, 2024.
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–20695 Filed 9–11–24; 8:45 am]
BILLING CODE 8011–01–P
CFR 200.30–3(a)(12).
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]]>Agencies
[Federal Register Volume 89, Number 177 (Thursday, September 12, 2024)]
[Notices]
[Pages 74314-74317]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-20640]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100966; File No. SR-NYSECHX-2024-27]
Self-Regulatory Organizations; NYSE Chicago, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Amending the
Existing Note in the Connectivity Fee Schedule
September 6, 2024.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that on August 27, 2024, NYSE Chicago, Inc. (``NYSE Chicago'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the existing note in the
Connectivity Fee Schedule (``Fee Schedule'') regarding cabinet and
combined waitlists. The proposed rule change is available on the
Exchange's website at www.nyse.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the existing note in the Fee
Schedule regarding cabinet and combined waitlists.
Background
Shortly after the onset of the Covid-19 pandemic, the Exchange
began experiencing unprecedented User \4\ demand for cabinets and power
at the Mahwah, New Jersey data center (``MDC'').\5\ In order to manage
its inventory, in late 2020, the Exchange filed to create purchasing
limits and a waitlist for cabinet orders (``Cabinet Waitlist'').\6\ In
early 2021, the Exchange filed to create additional purchasing limits
and a waitlist for orders for additional power in the MDC.\7\
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\4\ For purposes of the Exchange's colocation services, a
``User'' means any market participant that requests to receive
colocation services directly from the Exchange. See Securities
Exchange Act Release No. 87408 (October 28, 2019), 84 FR 58778 at
n.6 (November 1, 2019) (SR-NYSECHX-2019-12). As specified in the Fee
Schedule, a User that incurs colocation fees for a particular
colocation service pursuant thereto would not be subject to
colocation fees for the same colocation service charged by the New
York Stock Exchange LLC (``NYSE''), NYSE American LLC, NYSE Arca,
Inc., and NYSE National, Inc. (together, the ``Affiliate SROs'').
Each Affiliate SRO has submitted substantially the same proposed
rule change to propose the changes described herein. See SR-NYSE-
2024-49, SR-NYSEAMER-2024-52, SR-NYSEARCA-2024-71, and SR-NYSENAT-
2024-24.
\5\ Through its Fixed Income and Data Services (``FIDS'')
(previously ICE Data Services) business, Intercontinental Exchange,
Inc. (``ICE'') operates the MDC. The Exchange and the Affiliate SROs
are indirect subsidiaries of ICE.
\6\ See Securities Exchange Act Release No. 90732 (December 18,
2020), 85 FR 84443 (December 28, 2020) (SR-NYSE-2020-73, SR-
NYSEAMER-2020-66, SR-NYSEArca-2020-82, SR-NYSECHX-2020-26, and SR-
NYSENAT-2020-28) (establishing the procedures in current Colocation
Note 6(a) and 7(a)).
\7\ See Securities Exchange Act Release No. 91515 (April 8,
2021), 86 FR 19674 (April 14, 2021) (SR-NYSE-2021-12, SR-NYSEAMER-
2021-08, SR-NYSEArca-2021-11, SR-NYSECHX-2021-02, and SR-NYSENAT-
2021-03) (establishing the procedures in current Colocation Note
6(b) and 7(b)).
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In 2021 and 2022, the Exchange expanded the amount of space and
power available in the MDC by opening a new colocation hall (i.e., Hall
4). ICE is currently expanding the amount of colocation space and power
available at the MDC through a new colocation hall (i.e., Hall 5).
The Exchange subsequently amended the Fee Schedule to provide an
alternative procedure by which the Exchange can allocate power in the
Mahwah Data Center via deposit-guaranteed orders from Users made within
a 90-day ``Ordering Window.'' \8\
[[Page 74315]]
The Ordering Window procedure was designed with the goal of addressing
both (a) whether customer demand would support additional expansion
projects to provide further power, and (b) the fact that previous
procedures in the Fee Schedule were not well-tailored to allocating
large amounts of power that become available all at once, such as when
a new colocation hall opens.\9\ Orders received during an Ordering
Window are not considered finalized until the Exchange has received the
User's signed order form and a deposit equal to two months' worth of
the monthly recurring costs of the amount of new power ordered.
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\8\ See Securities Exchange Act Release No. 98937 (November 14,
2023), 88 FR 80795 (November 20, 2023) (SR-NYSE-2023-29, SR-
NYSEAMER-2023-39, SR-NYSEArca-2023-53, SR-NYSECHX-2023-16, and SR-
NYSENAT-2023-18) (``Ordering Window Approval Order'').
\9\ Id., at 80794.
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The Exchange had a power and cabinet waitlist (``Combined
Waitlist'') in place before the Ordering Window. The Exchange found
that when the Combined Waitlist was in effect, approximately \2/3\ of
its offers of power were rejected. Users further down the Combined
Waitlist received power only after those higher up the Combined
Waitlist were offered the power and rejected it. As a result, the Users
that actually wanted power received it only after a delay that lasted
weeks or even months.
Proposed Changes
In response, the Exchange proposes to amend Fee Schedule Colocation
Note 7 (Cabinet and Combined Waitlists) (``Note 7'') to require that
Users wanting to be placed on a waitlist must guarantee their order
with a deposit.\10\ Requiring Users to submit deposits with their
orders in order to be placed on the waitlist would help avoid delays
for Users further down the list, by encouraging Users to carefully
assess their true power and cabinet needs and protecting against Users
ordering more power or cabinets than they actually intend to purchase.
Requiring Users to submit deposits along with their orders was approved
by the Commission in the Exchange's Ordering Window filing,\11\ and so
the deposit requirement here would not be novel.
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\10\ The proposed change would not apply to Users that are
already on a waitlist at the time the proposed change becomes
operative.
\11\ See Ordering Window Approval Order, supra note 8.
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To implement the change, Note 7(a), which sets forth the practices
the Exchange follows for a Cabinet Waitlist, would be revised to
provide that a User would be placed on the Cabinet Waitlist based on
the date its finalized order is received, and that a User's order would
be finalized when the Exchange receives (a) User's signed order form
and (b) a deposit equal to two months' worth of the monthly recurring
costs of the power requested for the cabinets ordered.\12\
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\12\ Because monthly charges are calculated based on power, not
on cabinets, the Exchange proposes to calculate the deposit based on
the power requested for the cabinets ordered. In such a case, the
deposit would be calculated as (a) the number of kilowatts allocated
to the cabinets the User is ordering, multiplied by (b) the
appropriate ``Per kW Monthly Fee'' as indicated in the Connectivity
Fee Schedule. The Per kW Monthly Fee is a factor of the total number
of kilowatts allocated to all of a User's dedicated cabinets and
varies based on the total kilowatts allocated to a User.
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Note 7(b), which sets forth the practices the Exchange follows for
a Combined Waitlist, similarly would be revised to provide that a User
would be placed on the Combined Waitlist based on the date its
finalized order for cabinets and/or additional power is received, and
that a User's order would be finalized when the Exchange receives (a)
User's signed order form and (b) a deposit equal to two months' worth
of the monthly recurring costs of (i) the power requested for the
cabinets ordered and/or (ii) the additional power ordered.\13\
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\13\ The deposit would be calculated as (a) the number of
kilowatts allocated to the cabinets the User is ordering, if any,
plus the number of kilowatts of additional power, multiplied by (b)
the appropriate ``Per kW Monthly Fee'' as indicated in the
Connectivity Fee Schedule. The Per kW Monthly Fee is a factor of the
total number of kilowatts allocated to all of a User's dedicated
cabinets and varies based on the total kilowatts allocated to a
User.
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Note 7(a) and (b) would be revised to provide that:
If a User changes the size of its order while it is on the
Cabinet or Combined Waitlist, as the case may be, and any additional
deposit is received by the Exchange, it will maintain its place,
provided that the User may not increase the size of its order such that
it would exceed the Cabinet Limits or Combined Limits, as applicable.
If a User wishes to reduce the size of its order while it
is on the Cabinet or Combined Waitlist, its deposit would not be
reduced or returned, but rather would be applied against the User's
first and subsequent months' invoices after cabinets are, and/or the
power is, delivered until the deposit is depleted.
If the User removes its order from the Cabinet Waitlist or
Combined Waitlist, its deposit will be returned.
A User that is removed from the Cabinet or Combined
Waitlist but subsequently submits a new finalized order for cabinets
and/or additional power will be added back to the bottom of the
waitlist.
The deposit will be applied to the User's first and
subsequent months' invoices after the cabinets are and/or additional
power is delivered until the deposit is completely depleted.
General
The proposed changes would not apply differently to distinct types
or sizes of market participants. Rather, they would apply to all Users
equally. As is currently the case, the Fee Schedule would be applied
uniformly to all Users. FIDS does not expect that the proposed rule
change will result in new Users.
The proposed changes are not otherwise intended to address any
other issues relating to co-location services and/or related fees, and
the Exchange is not aware of any problems that customers would have in
complying with the proposed change.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\14\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\15\ in particular, because it
is 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
and because it is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers. The Exchange further believes
that the proposed rule change is consistent with Section 6(b)(4) of the
Act,\16\ because it provides for the equitable allocation of reasonable
dues, fees, and other charges among its members and issuers and other
persons using its facilities and does not unfairly discriminate between
customers, issuers, brokers, or dealers.
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\14\ 15 U.S.C. 78f(b).
\15\ 15 U.S.C. 78f(b)(5).
\16\ 15 U.S.C. 78f(b)(4).
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The Proposed Change Is Reasonable
The Exchange believes that the proposed change is reasonable
because requiring Users to submit deposits with their orders in order
to be placed on the waitlist would help avoid delays for Users further
down the list, by encouraging Users to carefully assess their true
power and cabinet needs and protecting against Users ordering more
power or cabinets than they actually intend to purchase. Without firm,
[[Page 74316]]
guaranteed commitments from waitlisted Users to purchase cabinets or
power if made available, the Exchange runs the risk of overestimating
waitlisted Users' true demand, creating delays for Users further down
the list. The proposed deposit requirement would address this by
discouraging waitlisted Users from submitting orders for more cabinets
or power than they actually intend to purchase.
The proposed deposit requirement is reasonable because, on the one
hand, it is not so onerous as to dissuade Users from submitting orders,
and, on the other hand, it is not so trivial that it would fail to
deter Users from submitting exaggerated orders. It is substantially
similar to the deposit provision already required under the Ordering
Window, and as such, the deposit requirement here would not be
novel.\17\
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\17\ See Ordering Window Approval Order, supra note 8. The NYSE
requires market participants to submit deposits in other contexts as
well. For example, since 2012, the NYSE has required prospective
issuers to pay a $25,000 initial application fee as part of the
process for listing a new security on the exchange. This fee
functions as a deposit that is credited toward the issuer's listing
fees after it is listed on the exchange. The deposit functions as
``a disincentive for impractical applications by issuers.'' The
deposit is forfeited if the issuer does not ultimately list on the
exchange. See Securities Exchange Act Release No. 68470 (December
19, 20212), 77 FR 76116 at 76117 (December 26, 2012) (SR-NYSE-2012-
68).
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In addition, the Exchange believes that the proposed change is
reasonable because the deposit is proportional to the size of the
order, and not a fixed amount. As a result, smaller Users would not be
disproportionately affected by the deposit requirement.
Under the proposed procedure, if a User wishes to reduce an order
while on a waitlist, its deposit would not be reduced or returned, but
rather would be applied against the User's first and subsequent months'
invoices after the cabinets are, or the power is, delivered until the
deposit is completely depleted. The Exchange believes that this would
remove impediments and perfect the mechanism of a free and open market
and a national market system because a waitlisted User would be
reimbursed for all of its deposit even if it reduces its order. This
would remove any incentive a User otherwise might have to understate
its needs for cabinets and/or power out of a concern that it would not
be reimbursed for the full amount of its deposit.
The Proposed Change Is Equitable and Not Unfairly Discriminatory
The Exchange believes that the proposed change provides for the
equitable allocation of reasonable dues, fees, and other charges among
its members and issuers and other persons using its facilities and does
not unfairly discriminate between customers, issuers, brokers, or
dealers because it is not designed to permit unfair discrimination
between customers, issuers, brokers, or dealers. The proposed changes
would apply equally to all types and sizes of market participants. All
Users would receive equal notice of the deposit requirement through the
proposed changes to Note 7, and the deposit requirement would be the
same for all Users. Smaller Users with more modest power needs would
not be disadvantaged by the proposed changes, as the deposit is
proportional to the size of the order and not a fixed amount.
The proposed deposit requirement is equitable because, on the one
hand, it is not so onerous as to dissuade Users from submitting orders,
and, on the other hand, it is not so trivial that it would fail to
deter Users from submitting exaggerated orders. It is substantially
similar to the deposit provision already required under the Ordering
Window, and as such, the deposit requirement here would not be
novel.\18\
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\18\ See Ordering Window Approval Order, supra note 8.
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Under the proposed procedure, if a User wishes to reduce an order
while on a waitlist, its deposit would not be reduced or returned, but
rather would be applied against the User's first and subsequent months'
invoices after the cabinets are, or the power is, delivered until the
deposit is completely depleted. The Exchange believes that this is
equitable because a waitlisted User would be reimbursed for all of its
deposit even if it reduces its order. This would remove any incentive a
User otherwise might have to understate its needs for cabinets and/or
power out of a concern that it would not be reimbursed for the full
amount of its deposit.
For the reasons above, the proposed changes do not unfairly
discriminate between or among market participants that are otherwise
capable of satisfying any applicable co-location fees, requirements,
terms, and conditions established from time to time by the Exchange.
For these reasons, the Exchange believes that the proposal is
consistent with the Act.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange believes that the proposal will not impose any burden
on competition that is not necessary or appropriate in furtherance of
the purposes of Section 6(b)(8) of the Act.\19\
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\19\ 15 U.S.C. 78f(b)(8).
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The Exchange believes that the proposed rule change does not impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The proposed rule change is
designed to help avoid delays for waitlisted Users, by encouraging
Users to carefully assess their true power and cabinet needs and
protecting against Users ordering more power or cabinets than they
actually intend to purchase. Without firm, guaranteed commitments from
waitlisted Users to purchase cabinets or power if made available, the
Exchange runs the risk of overestimating waitlisted Users' true demand,
creating delays for Users further down the list. The proposed deposit
requirement would address this by discouraging waitlisted Users from
submitting orders for more cabinets or power than they actually intend
to purchase, thereby facilitating a more equitable distribution of
cabinets and power. Moreover, the Ordering Window already requires a
deposit, and as such, the deposit requirement here would not be
novel.\20\
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\20\ See Ordering Window Approval Order, supra note 8.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \21\ and Rule 19b-4(f)(6) thereunder.\22\
Because the proposed rule change does not: (i) significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.\23\
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\21\ 15 U.S.C. 78s(b)(3)(A)(iii).
\22\ 17 CFR 240.19b-4(f)(6).
\23\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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[[Page 74317]]
At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \24\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\24\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
file number SR-NYSECHX-2024-27 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-NYSECHX-2024-27. 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-NYSECHX-2024-27 and should
be submitted on or before October 3, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\25\
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\25\ 17 CFR 200.30-3(a)(12).
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-20640 Filed 9-11-24; 8:45 am]
BILLING CODE 8011-01-P
