Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX Pearl Equities Fee Schedule, 83061-83064 [2024-23659]

Download as PDF Federal Register / Vol. 89, No. 199 / Tuesday, October 15, 2024 / Notices be issued unless the Commission orders a hearing. Interested persons may request a hearing on any application by emailing the SEC’s Secretary at Secretarys-Office@sec.gov and serving the Applicants with a copy of the request by email, if an email address is listed for the relevant Applicant below, or personally or by mail, if a physical address is listed for the relevant Applicant below. Hearing requests should be received by the Commission by 5:30 p.m. on November 1, 2024 and should be accompanied by proof of service on the Applicants, in the form of an affidavit or, for lawyers, a certificate of service. Pursuant to rule 0– 5 under the Act, hearing requests should state the nature of the writer’s interest, any facts bearing upon the desirability of a hearing on the matter, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by emailing the Commission’s Secretary at Secretarys-Office@sec.gov. The Commission: Secretarys-Office@sec.gov. Applicants: ahakkak@whiteoaksf.com, Vadim.avdeychik@cliffordchance.com and Clifford.cone@cliffordchance.com. ADDRESSES: FOR FURTHER INFORMATION CONTACT: Barbara T. Heussler, Senior Counsel, or Thomas Ahmadifar, Branch Chief, at (202) 551–6825 (Division of Investment Management, Chief Counsel’s Office). For Applicants’ representations, legal analysis, and conditions, please refer to Applicants’ fourth amended and restated application, dated October 7, 2024, which may be obtained via the Commission’s website by searching for the file number at the top of this document, or for an Applicant using the Company name search field, on the SEC’s EDGAR system. The SEC’s EDGAR system may be searched at, https://www.sec.gov/edgar/searchedgar/ legacy/companysearch.html. You may also call the SEC’s Public Reference Room at (202) 551–8090. SUPPLEMENTARY INFORMATION: khammond on DSKJM1Z7X2PROD with NOTICES For the Commission, by the Division of Investment Management, under delegated authority. Sherry R. Haywood, Assistant Secretary. [FR Doc. 2024–23679 Filed 10–11–24; 8:45 am] BILLING CODE 8011–01–P VerDate Sep<11>2014 16:35 Oct 11, 2024 Jkt 265001 SECURITIES AND EXCHANGE COMMISSION Sunshine Act Meetings 2:00 p.m. on Thursday, October 17, 2024. TIME AND DATE: The meeting will be held via remote means and/or at the Commission’s headquarters, 100 F Street NE, Washington, DC 20549. PLACE: This meeting will be closed to the public. STATUS: MATTERS TO BE CONSIDERED: Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries will attend the closed meeting. Certain staff members who have an interest in the matters also may be present. In the event that the time, date, or location of this meeting changes, an announcement of the change, along with the new time, date, and/or place of the meeting will be posted on the Commission’s website at https:// www.sec.gov. The General Counsel of the Commission, or her designee, has certified that, in her opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (6), (7), (8), 9(B) and (10) and 17 CFR 200.402(a)(3), (a)(5), (a)(6), (a)(7), (a)(8), (a)(9)(ii) and (a)(10), permit consideration of the scheduled matters at the closed meeting. The subject matter of the closed meeting will consist of the following topics: Institution and settlement of injunctive actions; Institution and settlement of administrative proceedings; Resolution of litigation claims; and Other matters relating to examinations and enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting agenda items that may consist of adjudicatory, examination, litigation, or regulatory matters. CONTACT PERSON FOR MORE INFORMATION: For further information, please contact Vanessa A. Countryman from the Office of the Secretary at (202) 551–5400. Authority: 5 U.S.C. 552b. Dated: October 10, 2024. Vanessa A. Countryman, Secretary. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–101282; File No. SR– PEARL–2024–46] Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX Pearl Equities Fee Schedule October 8, 2024. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on September 30, 2024, MIAX PEARL, LLC (‘‘MIAX Pearl’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) a 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 The Exchange is filing a proposal to amend the fee schedule (the ‘‘Fee Schedule’’) applicable to MIAX Pearl Equities, an equities trading facility of the Exchange. The text of the proposed rule change is available on the Exchange’s website at https://www.miaxglobal.com/markets/ us-equities/pearl-equities/rule-filings, at MIAX Pearl’s principal office, 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. [FR Doc. 2024–23833 Filed 10–10–24; 4:15 pm] 1 15 BILLING CODE 8011–01–P 2 17 PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 83061 E:\FR\FM\15OCN1.SGM U.S.C. 78s(b)(1). CFR 240.19b–4. 15OCN1 83062 Federal Register / Vol. 89, No. 199 / Tuesday, October 15, 2024 / Notices 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 the Fee Schedule to decrease the fee for executions of orders that remove liquidity from the Exchange in securities priced below $1.00 per share from 0.25% to 0.20% of the total dollar value of the transaction.3 khammond on DSKJM1Z7X2PROD with NOTICES Proposal To Decrease the Fee for Removing Liquidity in Securities Priced Below $1.00 per Share Currently, the Exchange assesses a fee of 0.25% of the total dollar value of any transaction in securities priced below $1.00 per share that removes liquidity from the Exchange across all Tapes.4 The Exchange now proposes to decrease the fee from 0.25% to 0.20% of the total dollar value of any transaction in securities priced below $1.00 per share that removes liquidity from the Exchange across all Tapes. The purpose of the proposed change is for business and competitive reasons. Specifically, the Exchange proposes to amend Section (1)(a) Standard Rates Table of the Fee Schedule to change the value in the table for Removing Liquidity in Securities below $1.00 from 0.25% to 0.20%. Additionally, the Exchange proposes to amend the Section (1)(b) Liquidity Indicator Codes and Associated Fees, to reflect the proposed change to the Standard Rates Table. The Exchange provides a table in section (1)(b), Liquidity Indicator Codes and Associated Fees, that provides a list of fees and rebates so that Equity Members 5 may better understand the fee or rebate that is applied to each execution. The liquidity indicator code for each execution is returned on the real-time trade report sent to the Equity Member that submitted the order. The Exchange now proposes to amend the column titled ‘‘Fee/(Rebate) Securities Priced Below $1.00’’ in Section (1)(b) of the Fee Schedule to reflect the proposed decrease to the standard fee assessed for Removing Liquidity (Displayed Orders and NonDisplayed Orders) in securities priced 3 The Exchange notes that it recently reduced the fee for removing liquidity in securities priced at or above $1.00. See Securities Exchange Act Release No. 101100 (September 19, 2024), 89 FR 78359 (September 25, 2024) (SR–PEARL–2024–41). 4 See Fee Schedule, Section (1)(a). See also Fee Schedule, Section (1)(b), Liquidity Indicator Codes RA, RB, RC, RR, RT, Ra, Rb, Rc, Rp, Rr and Rt. 5 The term ‘‘Equity Member’’ is a Member authorized by the Exchange to transact business on MIAX Pearl Equities. See Exchange Rule 1901. VerDate Sep<11>2014 18:13 Oct 11, 2024 Jkt 265001 below $1.00 per share from 0.25% to 0.20% for the following liquidity indicator codes: ‘‘RA,’’ ‘‘RB,’’ ‘‘RC,’’ ‘‘RR,’’ ‘‘RT,’’ ‘‘Ra,’’ ‘‘Rb,’’ ‘‘Rc,’’ ‘‘Rp,’’ ‘‘Rr,’’ and ‘‘Rt.’’ The Exchange believes it is appropriate to decrease the fee from 0.25% to 0.20% of the total dollar value of any transaction in securities priced below $1.00 per share that removes liquidity from the Exchange across all Tapes to further encourage market participants to enter liquidity removing orders on the Exchange, thereby increasing the execution opportunities for the liquidity adding orders resting on the MIAX Pearl Equities Book.6 Implementation The Exchange proposes to implement the changes to the Fee Schedule pursuant to this proposal on October 1, 2024. 2. Statutory Basis The Exchange believes that its proposal to amend its Fee Schedule is consistent with Section 6(b) of the Act 7 in general, and furthers the objectives of Section 6(b)(4) of the Act 8 in particular, in that it is an equitable allocation of reasonable fees and other charges among its Equity Members and issuers and other persons using its facilities. The Exchange also believes that the proposed rule change is consistent with the objectives of Section 6(b)(5) 9 requirements that the rules of an exchange be designed to prevent fraudulent and manipulative acts and practices, and 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, particularly, is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. The Exchange operates in a highly fragmented and competitive market in which market participants can readily direct their order flow to competing venues if they deem fee levels at a particular venue to be excessive or incentives to be insufficient. More specifically, the Exchange is only one of 6 The term ‘‘MIAX Pearl Equities Book’’ shall mean the electronic book of orders in equity securities maintained by the System. See Exchange Rule 1901. 7 15 U.S.C. 78f(b). 8 15 U.S.C. 78f(b)(4). 9 15 U.S.C. 78f(b)(5). PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 many venues, including 16 registered equities exchanges as well as a number of alternative trading systems and other off-exchange venues, to which market participants may direct their order flow. Based on publicly available information, no single registered equities exchange currently has more than approximately 15–16% of the total market share of executed volume of equities trading.10 Thus, in such a low-concentrated and highly competitive market, no single equities exchange possesses significant pricing power in the execution of order flow, and the Exchange currently represents less than 2% of the overall market share.11 The Commission and the courts have repeatedly expressed their preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. In Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and also recognized that current regulation of the market system ‘‘has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.’’ 12 The Exchange believes that the evershifting market share among the exchanges from month to month demonstrates that market participants can shift order flow or discontinue to reduce use of certain categories of products, in response to new or different pricing structures being introduced into the market. Accordingly, competitive forces constrain the Exchange’s transaction fees and rebates, and market participants can readily trade on competing venues if they deem pricing levels at those other venues to be more favorable. The Exchange believes the proposal reflects a reasonable and competitive pricing structure designed to incentivize market participants to direct their order flow to the Exchange, which the Exchange believes would enhance liquidity and market quality to the benefit of all Equity Members and market participants. Proposal To Decrease the Fee for Removing Liquidity in Securities Priced Below $1.00 per Share The Exchange believes that the proposed change to decrease the standard fee for executions of all orders 10 Market share percentage calculated as of August 25, 2024. The Exchange receives and processes data made available through consolidated data feeds. 11 Id. 12 Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37499 (June 29, 2005). E:\FR\FM\15OCN1.SGM 15OCN1 Federal Register / Vol. 89, No. 199 / Tuesday, October 15, 2024 / Notices in securities priced below $1.00 per share that remove liquidity from the Exchange is reasonable, equitable, and consistent with the Act as the proposed fee remains lower than, or similar to, the standard fee to remove liquidity in securities priced below $1.00 per share charged by competing equities exchanges.13 The Exchange further believes that the proposal to decrease the standard fee for executions of all orders in securities priced below $1.00 per share that remove liquidity from the Exchange is equitably allocated and not unfairly discriminatory because it will apply equally to all Equity Members that remove liquidity from the Exchange. For the reasons discussed above, the Exchange submits that the proposal satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of the Act in that it provides for the equitable allocation of reasonable dues, fees and other charges among its Equity Members and other persons using its facilities and is not designed to unfairly discriminate between customers, issuers, brokers, or dealers. As described more fully below in the Exchange’s statement regarding the burden on competition, the Exchange believes that its transaction pricing is subject to significant competitive forces, and that the proposed fees and rebates described herein are appropriate to address such forces. khammond on DSKJM1Z7X2PROD with NOTICES B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed changes will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The Exchange believes the proposed changes will continue to encourage Equity Members to maintain or increase their order flow to the Exchange, thereby contributing to a deeper and more liquid market to the benefit of all market participants and enhancing the attractiveness of the Exchange as a trading venue. As a result, the Exchange believes the proposal will enhance its 13 See Cboe EDGX Equities Fee Schedule, Standard Rates, available at https://www.cboe.com/ us/equities/membership/fee_schedule/edgx/ (charging a standard fee of 0.30% of the dollar value to remove liquidity in securities priced below $1.00 per share); see also MEMX Fee Schedule, Transaction Fees (charging a standard fee of 0.28% of the total dollar value to remove liquidity in securities priced below $1.00 per share); and NYSE American Equities Price List, Section I.A.2., available at https://www.nyse.com/publicdocs/ nyse/markets/nyse-american/NYSE_America_ Equities_Price_List.pdf (charging a standard fee of 0.25% of the total dollar value of the transaction to remove liquidity in securities priced below $1.00 per share). VerDate Sep<11>2014 16:35 Oct 11, 2024 Jkt 265001 competitiveness as a market that attracts actionable orders, thereby making it a more desirable destination venue for its customers. For these reasons, the Exchange believes that the proposal furthers the Commission’s goal in adopting Regulation NMS of fostering competition among orders, which promotes ‘‘more efficient pricing of individual stocks for all types of orders, large and small.’’ 14 Intra-Market Competition The Exchange believes that the proposed changes will continue to incentivize market participants to direct order flow to the Exchange, thereby contributing to a deeper and more liquid market to the benefit of all market participants and enhancing the attractiveness of the Exchange as a trading venue, which the Exchange believes, in turn, will continue to encourage market participants to direct additional order flow to the Exchange. Greater liquidity benefits all Equity Members by providing more trading opportunities and encourages Equity Members to send orders to the Exchange, thereby contributing to robust levels of liquidity, which benefits all Equity Members. Similarly, the proposed decrease to the standard fee for executions of orders that remove volume from the Exchange will continue to apply equally to all Equity Members. As such, the Exchange believes the proposed changes would not impose any burden on intra-market competition that is not necessary or appropriate in furtherance of the purposes of the Act. Intermarket Competition The Exchange believes its proposal will benefit competition as the Exchange operates in a highly competitive market. Equity Members have numerous alternative venues they may participate on and direct their order flow to, including fifteen other equities exchanges and numerous alternative trading systems and other off-exchange venues. As noted above, no single registered equities exchange currently has more than 15–16% of the total market share of executed volume of equities trading.15 Thus, in such a lowconcentrated and highly competitive market, no single equities exchange possesses significant pricing power in the execution of order flow. Moreover, the Exchange believes that the evershifting market share among the exchanges from month to month 14 See Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 47396 (June 29, 2005). 15 See supra note 10. PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 83063 demonstrates that market participants can shift order flow in response to new or different pricing structures being introduced to the market. Accordingly, competitive forces constrain the Exchange’s transaction fees and rebates generally, including with respect to executions of orders that remove volume from the Exchange, and market participants can readily choose to send their orders to other exchanges and offexchange venues if they deem fee levels at those other venues to be more favorable. As described above, the proposed changes are competitive proposals through which the Exchange is seeking to encourage additional order flow to the Exchange. Such proposed changes to (i) [sic] decrease the Removing Liquidity fee is comparable to, and competitive with, rates charged by other exchanges.16 The proposed change to update the Liquidity Indicator Codes and Associated Fees table is in conjunction with the Exchange’s above mentioned proposed change to the standard fee for Removing Liquidity from the Exchange. Additionally, the Commission has repeatedly expressed its preference for competition over regulatory intervention in determining prices, products, and services in the securities markets. Specifically, in Regulation NMS, the Commission highlighted the importance of market forces in determining prices and SRO revenues and, also, recognized that current regulation of the market system ‘‘has been remarkably successful in promoting market competition in its broader forms that are most important to investors and listed companies.’’ 17 The fact that this market is competitive has also long been recognized by the courts. In NetCoalition v. Securities and Exchange Commission, the D.C. circuit stated: ‘‘[n]o one disputes that competition for order flow is ‘fierce.’ . . . As the SEC explained, ‘[i]n the U.S. national market system, buyers and sellers of securities, and the brokerdealers that act as their routing agents, have a wide range of choices of where to route orders for execution’; [and] ‘no exchange can afford to take its market share percentages for granted’ because ‘no exchange possesses a monopoly, regulatory or otherwise, in the execution of order flow from broker dealers’ . . . .’’ 18 Accordingly, the Exchange 16 See supra note 13. Securities Exchange Act Release No. 51808 (June 9, 2005), 70 FR 37496, 37499 (June 29, 2005). 18 NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010) (quoting Securities Exchange Act Release 17 See E:\FR\FM\15OCN1.SGM Continued 15OCN1 83064 Federal Register / Vol. 89, No. 199 / Tuesday, October 15, 2024 / Notices does not believe its proposed pricing changes impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. 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 Pursuant to Section 19(b)(3)(A)(ii) of the Act,19 and Rule 19b–4(f)(2) thereunder 20 the Exchange has designated this proposal as establishing or changing a due, fee, or other charge imposed on any person, whether or not the person is a member of the selfregulatory organization, which renders the proposed rule change effective upon filing. 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– PEARL–2024–46 on the subject line. khammond on DSKJM1Z7X2PROD with NOTICES 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–PEARL–2024–46. 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 No. 59039 (December 2, 2008), 73 FR 74770, 74782– 83 (December 9, 2008) (SR–NYSE–2006–21)). 19 15 U.S.C. 78s(b)(3)(A)(ii). 20 17 CFR 240.19b–4. VerDate Sep<11>2014 18:13 Oct 11, 2024 Jkt 265001 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–PEARL–2024–46 and should be submitted on or before November 5, 2024. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.21 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2024–23659 Filed 10–11–24; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Investment Company Act Release No. 35355; File No. 812–15500] TriplePoint Venture Growth BDC Corp., et al. October 9, 2024. Securities and Exchange Commission (‘‘Commission’’ or ‘‘SEC’’). ACTION: Notice. AGENCY: Notice of application for an order under sections 17(d) and 57(i) of the Investment Company Act of 1940 (the ‘‘Act’’) and rule 17d–1 under the Act to permit certain joint transactions otherwise prohibited by sections 17(d) and 57(a)(4) of the Act and rule 17d–1 under the Act. SUMMARY OF APPLICATION: Applicants request an order to amend a previous order granted by the Commission that permits certain business development companies and closed-end management investment companies to co-invest in portfolio companies with each other and with certain affiliated investment entities. 21 17 PO 00000 CFR 200.30–3(a)(12). Frm 00096 Fmt 4703 Sfmt 4703 TriplePoint Venture Growth BDC Corp.; TriplePoint Private Venture Credit Inc.; TPVG Variable Funding Company LLC; TPVG Investment LLC; TPVC Funding Company LLC; TPVC Investment LLC; TriplePoint Advisers LLC; TriplePoint Capital LLC; TriplePoint Financial LLC; TPF Funding 1 LLC; TPF Funding 2 LLC; TriplePoint Ventures 5 LLC; TPC Credit Partners 3 LLC; TriplePoint Venture Lending Fund, LLC; and TriplePoint Venture Lending SPV, LLC. FILING DATES: The application was filed on August 22, 2023, and amended on February 7, 2024, and June 26, 2024. HEARING OR NOTIFICATION OF HEARING: An order granting the requested relief will be issued unless the Commission orders a hearing. Interested persons may request a hearing on any application by emailing the SEC’s Secretary at Secretarys-Office@sec.gov and serving the Applicants with a copy of the request by email, if an email address is listed for the relevant Applicant below, or personally or by mail, if a physical address is listed for the relevant Applicant below. Hearing requests should be received by the Commission by 5:30 p.m. on November 4, 2024, and should be accompanied by proof of service on the Applicants, in the form of an affidavit or, for lawyers, a certificate of service. Pursuant to rule 0– 5 under the Act, hearing requests should state the nature of the writer’s interest, any facts bearing upon the desirability of a hearing on the matter, the reason for the request, and the issues contested. Persons who wish to be notified of a hearing may request notification by emailing the Commission’s Secretary at Secretarys-Office@sec.gov. ADDRESSES: The Commission: Secretarys-Office@sec.gov. Applicants: James P. Labe and Sajal K. Srivastava, TriplePoint Advisers LLC, at jlabe@ triplepointcapital.com and sks@ triplepointcapital.com, respectively, and Harry S. Pangas, Esq. and Clay Douglas, Esq., Dechert LLP, at harry.pangas@dechert.com and clay.douglas@dechert.com, respectively. FOR FURTHER INFORMATION CONTACT: Kieran G. Brown, Senior Counsel, or Terri Jordan, Branch Chief, at (202) 551– 6825 (Division of Investment Management, Chief Counsel’s Office). SUPPLEMENTARY INFORMATION: For Applicants’ representations, legal analysis, and conditions, please refer to Applicants’ second amended and restated application, dated June 26, 2024, which may be obtained via the Commission’s website by searching for the file number at the top of this document, or for an Applicant using the APPLICANTS: E:\FR\FM\15OCN1.SGM 15OCN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 89, Number 199 (Tuesday, October 15, 2024)]
[Notices]
[Pages 83061-83064]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-23659]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101282; File No. SR-PEARL-2024-46]


Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX 
Pearl Equities Fee Schedule

October 8, 2024.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on September 30, 2024, MIAX PEARL, LLC (``MIAX Pearl'' or ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') a 
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.
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    \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

    The Exchange is filing a proposal to amend the fee schedule (the 
``Fee Schedule'') applicable to MIAX Pearl Equities, an equities 
trading facility of the Exchange.
    The text of the proposed rule change is available on the Exchange's 
website at https://www.miaxglobal.com/markets/us-equities/pearl-equities/rule-filings, at MIAX Pearl's principal office, 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.

[[Page 83062]]

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 the Fee Schedule to decrease the fee 
for executions of orders that remove liquidity from the Exchange in 
securities priced below $1.00 per share from 0.25% to 0.20% of the 
total dollar value of the transaction.\3\
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    \3\ The Exchange notes that it recently reduced the fee for 
removing liquidity in securities priced at or above $1.00. See 
Securities Exchange Act Release No. 101100 (September 19, 2024), 89 
FR 78359 (September 25, 2024) (SR-PEARL-2024-41).
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Proposal To Decrease the Fee for Removing Liquidity in Securities 
Priced Below $1.00 per Share
    Currently, the Exchange assesses a fee of 0.25% of the total dollar 
value of any transaction in securities priced below $1.00 per share 
that removes liquidity from the Exchange across all Tapes.\4\ The 
Exchange now proposes to decrease the fee from 0.25% to 0.20% of the 
total dollar value of any transaction in securities priced below $1.00 
per share that removes liquidity from the Exchange across all Tapes. 
The purpose of the proposed change is for business and competitive 
reasons.
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    \4\ See Fee Schedule, Section (1)(a). See also Fee Schedule, 
Section (1)(b), Liquidity Indicator Codes RA, RB, RC, RR, RT, Ra, 
Rb, Rc, Rp, Rr and Rt.
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    Specifically, the Exchange proposes to amend Section (1)(a) 
Standard Rates Table of the Fee Schedule to change the value in the 
table for Removing Liquidity in Securities below $1.00 from 0.25% to 
0.20%. Additionally, the Exchange proposes to amend the Section (1)(b) 
Liquidity Indicator Codes and Associated Fees, to reflect the proposed 
change to the Standard Rates Table.
    The Exchange provides a table in section (1)(b), Liquidity 
Indicator Codes and Associated Fees, that provides a list of fees and 
rebates so that Equity Members \5\ may better understand the fee or 
rebate that is applied to each execution. The liquidity indicator code 
for each execution is returned on the real-time trade report sent to 
the Equity Member that submitted the order.
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    \5\ The term ``Equity Member'' is a Member authorized by the 
Exchange to transact business on MIAX Pearl Equities. See Exchange 
Rule 1901.
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    The Exchange now proposes to amend the column titled ``Fee/(Rebate) 
Securities Priced Below $1.00'' in Section (1)(b) of the Fee Schedule 
to reflect the proposed decrease to the standard fee assessed for 
Removing Liquidity (Displayed Orders and Non-Displayed Orders) in 
securities priced below $1.00 per share from 0.25% to 0.20% for the 
following liquidity indicator codes: ``RA,'' ``RB,'' ``RC,'' ``RR,'' 
``RT,'' ``Ra,'' ``Rb,'' ``Rc,'' ``Rp,'' ``Rr,'' and ``Rt.''
    The Exchange believes it is appropriate to decrease the fee from 
0.25% to 0.20% of the total dollar value of any transaction in 
securities priced below $1.00 per share that removes liquidity from the 
Exchange across all Tapes to further encourage market participants to 
enter liquidity removing orders on the Exchange, thereby increasing the 
execution opportunities for the liquidity adding orders resting on the 
MIAX Pearl Equities Book.\6\
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    \6\ The term ``MIAX Pearl Equities Book'' shall mean the 
electronic book of orders in equity securities maintained by the 
System. See Exchange Rule 1901.
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Implementation
    The Exchange proposes to implement the changes to the Fee Schedule 
pursuant to this proposal on October 1, 2024.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule 
is consistent with Section 6(b) of the Act \7\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act \8\ in particular, in that 
it is an equitable allocation of reasonable fees and other charges 
among its Equity Members and issuers and other persons using its 
facilities. The Exchange also believes that the proposed rule change is 
consistent with the objectives of Section 6(b)(5) \9\ requirements that 
the rules of an exchange be designed to prevent fraudulent and 
manipulative acts and practices, and 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, particularly, is not 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
    \9\ 15 U.S.C. 78f(b)(5).
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    The Exchange operates in a highly fragmented and competitive market 
in which market participants can readily direct their order flow to 
competing venues if they deem fee levels at a particular venue to be 
excessive or incentives to be insufficient. More specifically, the 
Exchange is only one of many venues, including 16 registered equities 
exchanges as well as a number of alternative trading systems and other 
off-exchange venues, to which market participants may direct their 
order flow. Based on publicly available information, no single 
registered equities exchange currently has more than approximately 15-
16% of the total market share of executed volume of equities 
trading.\10\ Thus, in such a low-concentrated and highly competitive 
market, no single equities exchange possesses significant pricing power 
in the execution of order flow, and the Exchange currently represents 
less than 2% of the overall market share.\11\ The Commission and the 
courts have repeatedly expressed their preference for competition over 
regulatory intervention in determining prices, products, and services 
in the securities markets. In Regulation NMS, the Commission 
highlighted the importance of market forces in determining prices and 
SRO revenues and also recognized that current regulation of the market 
system ``has been remarkably successful in promoting market competition 
in its broader forms that are most important to investors and listed 
companies.'' \12\
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    \10\ Market share percentage calculated as of August 25, 2024. 
The Exchange receives and processes data made available through 
consolidated data feeds.
    \11\ Id.
    \12\ Securities Exchange Act Release No. 51808 (June 9, 2005), 
70 FR 37499 (June 29, 2005).
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    The Exchange believes that the ever-shifting market share among the 
exchanges from month to month demonstrates that market participants can 
shift order flow or discontinue to reduce use of certain categories of 
products, in response to new or different pricing structures being 
introduced into the market. Accordingly, competitive forces constrain 
the Exchange's transaction fees and rebates, and market participants 
can readily trade on competing venues if they deem pricing levels at 
those other venues to be more favorable. The Exchange believes the 
proposal reflects a reasonable and competitive pricing structure 
designed to incentivize market participants to direct their order flow 
to the Exchange, which the Exchange believes would enhance liquidity 
and market quality to the benefit of all Equity Members and market 
participants.
Proposal To Decrease the Fee for Removing Liquidity in Securities 
Priced Below $1.00 per Share
    The Exchange believes that the proposed change to decrease the 
standard fee for executions of all orders

[[Page 83063]]

in securities priced below $1.00 per share that remove liquidity from 
the Exchange is reasonable, equitable, and consistent with the Act as 
the proposed fee remains lower than, or similar to, the standard fee to 
remove liquidity in securities priced below $1.00 per share charged by 
competing equities exchanges.\13\ The Exchange further believes that 
the proposal to decrease the standard fee for executions of all orders 
in securities priced below $1.00 per share that remove liquidity from 
the Exchange is equitably allocated and not unfairly discriminatory 
because it will apply equally to all Equity Members that remove 
liquidity from the Exchange.
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    \13\ See Cboe EDGX Equities Fee Schedule, Standard Rates, 
available at https://www.cboe.com/us/equities/membership/fee_schedule/edgx/ (charging a standard fee of 0.30% of the dollar 
value to remove liquidity in securities priced below $1.00 per 
share); see also MEMX Fee Schedule, Transaction Fees (charging a 
standard fee of 0.28% of the total dollar value to remove liquidity 
in securities priced below $1.00 per share); and NYSE American 
Equities Price List, Section I.A.2., available at https://www.nyse.com/publicdocs/nyse/markets/nyse-american/NYSE_America_Equities_Price_List.pdf (charging a standard fee of 
0.25% of the total dollar value of the transaction to remove 
liquidity in securities priced below $1.00 per share).
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    For the reasons discussed above, the Exchange submits that the 
proposal satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of 
the Act in that it provides for the equitable allocation of reasonable 
dues, fees and other charges among its Equity Members and other persons 
using its facilities and is not designed to unfairly discriminate 
between customers, issuers, brokers, or dealers. As described more 
fully below in the Exchange's statement regarding the burden on 
competition, the Exchange believes that its transaction pricing is 
subject to significant competitive forces, and that the proposed fees 
and rebates described herein are appropriate to address such forces.

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

    The Exchange does not believe that the proposed changes will impose 
any burden on competition not necessary or appropriate in furtherance 
of the purposes of the Act. The Exchange believes the proposed changes 
will continue to encourage Equity Members to maintain or increase their 
order flow to the Exchange, thereby contributing to a deeper and more 
liquid market to the benefit of all market participants and enhancing 
the attractiveness of the Exchange as a trading venue. As a result, the 
Exchange believes the proposal will enhance its competitiveness as a 
market that attracts actionable orders, thereby making it a more 
desirable destination venue for its customers. For these reasons, the 
Exchange believes that the proposal furthers the Commission's goal in 
adopting Regulation NMS of fostering competition among orders, which 
promotes ``more efficient pricing of individual stocks for all types of 
orders, large and small.'' \14\
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    \14\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 47396 (June 29, 2005).
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Intra-Market Competition
    The Exchange believes that the proposed changes will continue to 
incentivize market participants to direct order flow to the Exchange, 
thereby contributing to a deeper and more liquid market to the benefit 
of all market participants and enhancing the attractiveness of the 
Exchange as a trading venue, which the Exchange believes, in turn, will 
continue to encourage market participants to direct additional order 
flow to the Exchange. Greater liquidity benefits all Equity Members by 
providing more trading opportunities and encourages Equity Members to 
send orders to the Exchange, thereby contributing to robust levels of 
liquidity, which benefits all Equity Members.
    Similarly, the proposed decrease to the standard fee for executions 
of orders that remove volume from the Exchange will continue to apply 
equally to all Equity Members. As such, the Exchange believes the 
proposed changes would not impose any burden on intra-market 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act.
Intermarket Competition
    The Exchange believes its proposal will benefit competition as the 
Exchange operates in a highly competitive market. Equity Members have 
numerous alternative venues they may participate on and direct their 
order flow to, including fifteen other equities exchanges and numerous 
alternative trading systems and other off-exchange venues. As noted 
above, no single registered equities exchange currently has more than 
15-16% of the total market share of executed volume of equities 
trading.\15\ Thus, in such a low-concentrated and highly competitive 
market, no single equities exchange possesses significant pricing power 
in the execution of order flow. Moreover, the Exchange believes that 
the ever-shifting market share among the exchanges from month to month 
demonstrates that market participants can shift order flow in response 
to new or different pricing structures being introduced to the market. 
Accordingly, competitive forces constrain the Exchange's transaction 
fees and rebates generally, including with respect to executions of 
orders that remove volume from the Exchange, and market participants 
can readily choose to send their orders to other exchanges and off-
exchange venues if they deem fee levels at those other venues to be 
more favorable.
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    \15\ See supra note 10.
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    As described above, the proposed changes are competitive proposals 
through which the Exchange is seeking to encourage additional order 
flow to the Exchange. Such proposed changes to (i) [sic] decrease the 
Removing Liquidity fee is comparable to, and competitive with, rates 
charged by other exchanges.\16\ The proposed change to update the 
Liquidity Indicator Codes and Associated Fees table is in conjunction 
with the Exchange's above mentioned proposed change to the standard fee 
for Removing Liquidity from the Exchange.
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    \16\ See supra note 13.
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    Additionally, the Commission has repeatedly expressed its 
preference for competition over regulatory intervention in determining 
prices, products, and services in the securities markets. Specifically, 
in Regulation NMS, the Commission highlighted the importance of market 
forces in determining prices and SRO revenues and, also, recognized 
that current regulation of the market system ``has been remarkably 
successful in promoting market competition in its broader forms that 
are most important to investors and listed companies.'' \17\ The fact 
that this market is competitive has also long been recognized by the 
courts. In NetCoalition v. Securities and Exchange Commission, the D.C. 
circuit stated: ``[n]o one disputes that competition for order flow is 
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market 
system, buyers and sellers of securities, and the broker-dealers that 
act as their routing agents, have a wide range of choices of where to 
route orders for execution'; [and] `no exchange can afford to take its 
market share percentages for granted' because `no exchange possesses a 
monopoly, regulatory or otherwise, in the execution of order flow from 
broker dealers' . . . .'' \18\ Accordingly, the Exchange

[[Page 83064]]

does not believe its proposed pricing changes impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act.
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    \17\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496, 37499 (June 29, 2005).
    \18\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010) 
(quoting Securities Exchange Act Release No. 59039 (December 2, 
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSE-2006-21)).
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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

    Pursuant to Section 19(b)(3)(A)(ii) of the Act,\19\ and Rule 19b-
4(f)(2) thereunder \20\ the Exchange has designated this proposal as 
establishing or changing a due, fee, or other charge imposed on any 
person, whether or not the person is a member of the self-regulatory 
organization, which renders the proposed rule change effective upon 
filing.
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    \19\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \20\ 17 CFR 240.19b-4.
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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-PEARL-2024-46 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-PEARL-2024-46. 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-PEARL-2024-46 and should be 
submitted on or before November 5, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
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    \21\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-23659 Filed 10-11-24; 8:45 am]
BILLING CODE 8011-01-P

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