Self-Regulatory Organizations; NYSE National, Inc.; Notice of Filing of Proposed Change To Amend the Connectivity Fee Schedule, 342-346 [2024-31501]
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342
Federal Register / Vol. 90, No. 2 / Friday, January 3, 2025 / Notices
This Notice will be published in the
Federal Register.
Erica A. Barker,
Secretary.
[FR Doc. 2024–31562 Filed 1–2–25; 8:45 am]
BILLING CODE 7710–FW–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–102044; File No. SR–
CboeBZX–2024–124]
Self-Regulatory Organizations; Cboe
BZX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Amend Rule
21.15(b) (Exchange Data Products) To
Adopt Cboe Timestamping Service,
which is a Market Data Service
Comprised of Two Distinct Market Data
Reports
December 27, 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 December
13, 2024, Cboe BZX Exchange, Inc
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Item I below,
which Item has been substantially
prepared by the Exchange. The
Exchange has designated this proposal
for immediate effectiveness pursuant to
Section 19(b)(3)(A) of the Act 3 and Rule
19b–4(f) thereunder.4 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
Rule 21.15(b) (Exchange Data Products)
to adopt Cboe Timestamping Service,
which is a market data service
comprised of two distinct market data
reports. The Cboe Timestamping Service
will provide timestamp information for
orders, quotes and cancels for market
participants. More specifically, the Cboe
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1 15
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f). At any time within 60 days
of the filing of the proposed rule change, the
Commission summarily may temporarily suspend
such rule change if it appears to the Commission
that such action is necessary or appropriate in the
public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
If the Commission takes such action, the
Commission will institute proceedings to determine
whether the proposed rule change should be
approved or disapproved.
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Timestamping Service reports will
provide various timestamps relating to
the message lifecycle throughout the
exchange system. The first report—the
Missed Liquidity Report—will cover
order and quote messages and the
second report—Cancels Report—will
cover cancel messages. The proposed
reports are optional products that will
be available to all Members and
Members may opt to choose both
reports, one report, or neither report.
Corresponding fees will be assessed
based on the number of reports
selected.5 The text of the proposed rule
change is provided in Exhibit 5.
The proposed rule change, including
the Exchange’s statement of the purpose
of, and statutory basis for, the proposed
rule change, is available on the
Exchange’s website at https://
markets.cboe.com/us/equities/
regulation/rule_filings/bzx/, at the
Exchange’s Office of the Secretary, and
on the Commission’s website at https://
www.sec.gov/rules-regulations/selfregulatory-organization-rulemaking/
national-securities-exchanges?file_
number=SR-CboeBZX-2024-124.
124. 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-regulations/
self-regulatory-organizationrulemaking/national-securitiesexchanges?file_number=SR-CboeBZX2024-124). 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–CboeBZX–2024–124 and should be
submitted on or before January 24, 2025.
II. 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.6
Comments may be submitted
electronically by using the
Commission’s internet comment form
(https://www.sec.gov/rules-regulations/
self-regulatory-organizationrulemaking/national-securitiesexchanges?file_number=SR-CboeBZX2024-124) or by sending an email to
rule-comments@sec.gov. Please include
file number SR–CboeBZX–2024–124 on
the subject line. Alternatively, paper
comments may be sent to Secretary,
Securities and Exchange Commission,
100 F Street NE, Washington, DC
20549–1090. All submissions should
refer to file number SR–CboeBZX–2024–
SECURITIES AND EXCHANGE
COMMISSION
5 The Exchange plans to submit a separate filing
with the Commission pursuant to Section 19(b)(1)
to propose fees for the Missed Liquidity Report and
Cancels Report.
6 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
SRO.
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For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–31506 Filed 1–2–25; 8:45 am]
BILLING CODE 8011–01–P
[Release No. 34–102039; File No. SR–
NYSENAT–2024–33]
Self-Regulatory Organizations; NYSE
National, Inc.; Notice of Filing of
Proposed Change To Amend the
Connectivity Fee Schedule
December 27, 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 December
17, 2024, NYSE National, Inc. (‘‘NYSE
National’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
Connectivity Fee Schedule (‘‘Fee
Schedule’’) to add connectivity to the
New York Stock Exchange LLC, NYSE
American LLC, and NYSE Arca, Inc.
7 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
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trading floors. The proposed change is
available on the Exchange’s website at
www.nyse.com, at the principal office of
the Exchange, and at the Commission’s
Public Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend the
Fee Schedule to add connectivity to the
New York Stock Exchange LLC, NYSE
American LLC, and NYSE Arca, Inc.
trading floors (‘‘Trading Floors’’).
A User 4 may wish to have a
connection between the Mahwah, New
Jersey data center (‘‘MDC’’) 5 and a
Trading Floor. A connection between
the MDC and a Trading Floor may be
between the User and itself or between
the User and a third party. The User
may use such connection for receiving
and transmitting trading-related data
(including pre- and post-trade data and
clearing information) or providing
services to individuals physically
located on the floor (including access to
back-office systems), as determined by
the User.
The Exchange proposes to add an
option for such a connection to the Fee
Schedule. Specifically, the Exchange
proposes to amend the Fee Schedule to
add unicast connections through which
a User can establish a connection
between the MDC and a Trading Floor
over dedicated bandwidth (‘‘TF
Connections’’).6 Presently, a TF
Connection can be in the form of a
virtual control circuit between the MDC
and a single Trading Floor (‘‘TF VCC’’),
or a virtual routing and forwarding
service between the MDC and one or
more Trading Floors (‘‘TF VRF’’). A TF
Connection may be used for any
purpose: neither FIDS nor the Exchange
has any visibility into a TF Connection.
All TF Connections must be
authorized by both parties to the
connection before FIDS will establish a
connection. Establishing a User’s TF
Connection will not give FIDS or the
Exchange any right to use the relevant
exchange’s system. A TF Connection
will not provide direct access or order
entry to the Exchange’s execution
system, and a User’s TF Connection will
not be through the Exchange’s execution
system.
TF Connections are offered at a
monthly fee based on bandwidth
requirements, which fee is consistent
with the monthly fees charged for VCC
connections and the same as those
charged for connectivity to Third Party
Systems.7 When a User requests a TF
Connection, it identifies the size of
bandwidth connection it requires, and
the monthly charge for the TF
Connection varies based on the size of
the bandwidth. The calculation of the
monthly fee may differ based on
whether the form chosen by the User is
a TF VCC or TF VRF. This is because
the TF VCC connects the MDC to one
Trading Floor, while the TF VRF may
connect the MDC to more than one
Trading Floor. Accordingly, the
Exchange proposes to add a note to the
Fee Schedule to clarify the difference.
To make the change, the Exchange
proposes to amend the Fee Schedule as
follows (all text new):
Description
(Mb)
Type of service
Connectivity to Trading Floor * ........................................................................................................................
1
3
5
10
25
50
100
Amount of charge
(monthly charge)
$200
400
500
800
1,200
1,800
2,500
* The amount of the charge for Connectivity to Trading Floor may differ based on the connectivity chosen: (a) a virtual control circuit between
the Mahwah data center and a single Trading Floor (‘‘VCC’’), or (b) a virtual routing and forwarding service between the Mahwah data center and
one or more Trading Floors (‘‘VRF’’). Specifically, if the User chooses VCCs or combination of a VCC and VRF for connectivity to several Trading Floors, it will be charged separately for each connection. If the User chooses one VRF for connectivity to multiple trading floors, the User will
be charged for one connection.
General
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The proposed rule change would not
apply differently to distinct types or
sizes of market participants. Rather, it
would apply to all Users equally. As is
currently the case, the Fee Schedule
would be applied uniformly to all Users.
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. 83351 (May 31, 2018), 83 FR 26314 at
n.9 (June 6, 2018) (SR–NYSENAT–2018–07). 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 American
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FIDS does not expect that the proposed
rule change will result in new Users.
Use of the services proposed in this
filing are completely voluntary and
available to all Users on a nondiscriminatory basis.
The proposed change is 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.
LLC, NYSE Arca, Inc., and NYSE Chicago, Inc.
(together, the ‘‘Affiliate SROs’’). Each Affiliate SRO
has submitted substantially the same proposed rule
change to propose the change described herein. See
SR–NYSE–2024–81, SR–NYSEAMER–2024–80, SR–
NYSEARCA–2024–113, and SR–NYSECHX–2024–
37.
5 Through its Fixed Income and Data Services
(‘‘FIDS’’) business, Intercontinental Exchange, Inc.
(‘‘ICE’’) operates the MDC. The Exchange and the
Affiliate SROs are indirect subsidiaries of ICE.
6 Information flows over existing network
connections in two formats: ‘‘unicast’’ format,
which is a format that allows one-to-one
communication, similar to a phone line, in which
information is sent to and from the Exchange; and
‘‘multicast’’ format, which is a format in which
information is sent one-way from the Exchange to
multiple recipients at once, like a radio broadcast.
7 See Connectivity Fee Schedule—A. Co-Location
Fees.
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2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,8 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,9 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,10 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 rule change is reasonable.
In considering the reasonableness of
proposed services and fees, the
Commission’s market-based test
considers ‘‘whether the exchange was
subject to significant competitive forces
in setting the terms of its proposal
. . . , including the level of any
fees.’’ 11 If the Exchange meets that
burden, ‘‘the Commission will find that
its proposal is consistent with the Act
unless ‘there is a substantial
countervailing basis to find that the
terms’ of the proposal violate the Act or
the rules thereunder.’’ 12 Here, the
8 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
10 15 U.S.C. 78f(b)(4).
11 Securities Exchange Act Release No. 90209
(October 15, 2020), 85 FR 67044, 67049 (October 21,
2020) (Order Granting Accelerated Approval to
Establish a Wireless Fee Schedule Setting Forth
Available Wireless Bandwidth Connections and
Wireless Market Data Connections) (SR–NYSE–
2020–05, SR–NYSEAMER–2020–05, SR–
NYSEArca–2020–08, SR–NYSECHX–2020–02, SR–
NYSENAT–2020–03, SR–NYSE–2020–11, SR–
NYSEAMER–2020–10, SR–NYSEArca–2020–15,
SR–NYSECHX–2020–05, SR–NYSENAT–2020–08)
(‘‘Wireless Approval Order’’), citing Securities
Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74770, 74781 (December 9, 2008)
(‘‘2008 ArcaBook Approval Order’’). See
NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
12 Wireless Approval Order, supra note 11, at
67049, citing 2008 ArcaBook Approval Order, supra
note 11, at 74781.
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Exchange is subject to significant
competitive forces in setting the terms
on which it offers its proposal, in
particular because substantially similar
substitutes are available, and the thirdparty vendors are not at a competitive
disadvantage created by the Exchange.
In 2013 the MDC opened two meetme-rooms to telecommunications
service providers (‘‘Telecoms’’),13 to
enable Telecoms to offer circuits into
the MDC. The TF Connections compete
with circuits currently offered by the 16
third-party Telecoms that have installed
their equipment in the MDC’s two meetme-rooms.
The Telecom circuits (including any
circuit-based network services a
Telecom may offer) are reasonable
substitutes for TF Connections. The
Commission has recognized that
products do not need to be identical to
be considered substitutable; it is
sufficient that they be substantially
similar.14 Because Telecoms can
connect to the Trading Floors, the TF
Connections and the circuits provided
by the Telecoms perform the same
function: connecting into and out of the
MDC and the Trading Floors. The
providers of the TF Connection and
Telecom circuits design them to perform
with particular combinations of latency,
bandwidth, price, termination point,
and other factors that they believe will
attract Users, and Users choose from
among these competing services on the
basis of their business needs.
The TF Connections are sufficiently
similar substitutes to the circuits offered
by the 16 Telecoms even though the TF
Connections all terminate on a Trading
Floor while circuits from the 16
Telecoms could terminate on a Trading
Floor or other locations. While neither
the Exchange nor FIDS knows the end
point of any particular Telecom circuit,
the Exchange understands that the
Telecoms can offer circuits terminating
in any location, including the Trading
Floors. Moreover, the Telecoms may
offer smaller circuits that are the same
as or similar size to the TF Connections.
Ultimately, Users can choose to
configure their pathway in the way that
best suits their business needs.
The TF Connections do not have a
distance or latency advantage over the
Telecoms’ circuits within the MDC.
FIDS has normalized (a) the distance
between the meet-me-rooms and the
colocation halls and (b) the distance
13 Telecoms are licensed by the Federal
Communications Commission and are not required
to be, or be affiliated with, a member of the
Exchange or an Affiliate SRO.
14 See 2008 ArcaBook Approval Order, supra note
11, at 74789 and note 295 (recognizing that
products need not be identical to be substitutable).
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between the rooms where the FIDS
circuits and the TF Connections exit the
MDC and the colocation halls. As a
result, a User choosing whether to use
the TF Connections or Telecom circuits
does not face any difference in the
distances or latency within the MDC.
The Exchange is not aware of any
differences under its control that give
the Exchange a latency advantage.
The Exchange also believes that the
TF Connections do not have any latency
or bandwidth advantage over the
Telecoms’ circuits outside of the MDC.
The Exchange believes that the
Telecoms operating in the meet-merooms offer circuits with a variety of
latency and bandwidth specifications,
some of which may exceed the
specifications of the TF Connections.15
The Exchange believes that Users
consider these latency and bandwidth
factors—as well as other factors, such as
price and termination point—in
determining which offerings will best
serve their business needs.
In sum, the Exchange is not aware of
anything that would make the
Telecoms’ circuits inadequate
substitutes for the TF Connections.
Nor does the Exchange have a
competitive advantage over any thirdparty competitors by virtue of the fact
that it owns and operates the MDC’s
meet-me-rooms. In most cases, circuits
coming out of the MDC are provided by
the Telecoms.16 Currently, 16 Telecoms
operate in the meet-me-rooms and
provide a variety of circuit choices. It is
in the Exchange’s best interest to set the
fees that Telecoms pay to operate in the
meet-me-rooms at a reasonable level 17
so that market participants, including
Telecoms, will maximize their use of
the MDC. By setting the meet-me-room
fees at a reasonable level, the Exchange
encourages Telecoms to participate in
the meet-me-rooms and to sell circuits
to Users for connecting into and out of
the MDC. These Telecoms then compete
with each other by pricing such circuits
at competitive rates. These competitive
rates for circuits help draw in more
Users and Hosted Customers to the
15 The specifications of FIDS’s competitors’
circuits are not publicly known. The Exchange
understands that FIDS has gleaned any information
it has about its competitors through anecdotal
communications, by observing customers’
purchasing choices in the competitive market, and
from its own experience as a purchaser of circuits
from telecommunications providers to build FIDS’s
own networks.
16 Note that in the case of wireless connectivity,
a User still requires a fiber circuit to transport data.
If a Telecom is used, the data is transmitted
wirelessly to the relevant pole, and then from the
pole to the meet-me-room using a fiber circuit.
17 See Securities Exchange Act Release No. 98002
(July 26, 2023), 88 FR 50232 (August 1, 2023) (SR–
NYSENat–2023–12) (‘‘MMR Notice’’).
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MDC, which directly benefits the
Exchange by increasing the customer
base to whom the Exchange can sell its
colocation services, which include
cabinets, power, ports, and connectivity
to many third-party data feeds, and
because having more Users and Hosted
Customers leads, in many cases, to
greater participation on the Exchange. In
this way, by setting the meet-me-room
fees at a level attractive to
telecommunications firms, the Exchange
spurs demand for all of the services it
sells at the MDC, while setting the meetme-room fees too high would negatively
affect the Exchange’s ability to sell its
services at the MDC.18 Accordingly,
there are real constraints on the meetme-room fees the Exchange charges,
such that the Exchange does not have an
advantage in terms of costs when
compared to third parties that enter the
MDC through the meet-me-rooms to
provide services to compete with the
Exchange’s services.
If anything, the Exchange would be
subject to a competitive disadvantage
vis-à-vis the Telecoms. They are not
subject to the Commission’s filing
requirements, and therefore can freely
change their services and pricing in
response to competitive forces. In
contrast, the Exchange’s service and
pricing would be standardized as set out
in this filing, and the Exchange would
be unable to respond to pricing pressure
from its competitors without seeking a
formal fee change in a filing before the
Commission.
If the Exchange were to set the price
of the TF Connections at a level that
Users found to be too high, Users would
likely respond by choosing one of the
many alternative options offered by the
16 Telecoms. Conversely, if the
Exchange were to offer the TF
Connections at prices aimed at
undercutting comparable Telecom
circuits, the Telecoms might reassess
whether it makes financial sense for
them to continue to participate in the
MDC’s meet-me-rooms. Their departure
might negatively impact User
participation in colocation and on the
Exchange. As a result, the Exchange is
not motivated to undercut the prices of
Telecom circuits.
In sum, because the Exchange is
subject to significant competitive forces
in setting the terms on which it offers
its proposal, in particular because the
Exchange believes that a substantially
similar substitute for TF Connectivity is
available, and the Exchange has not
18 See id. at 50235. Importantly, the Exchange is
prevented from making any alteration to its meetme-room services or fees without filing a proposal
for such changes with the Commission.
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placed third-party vendors at a
competitive disadvantage created by the
Exchange, the proposed fees for the TF
Connectivity are reasonable.19
For these reasons, the proposed
change is reasonable.
The Proposed Change Is Equitable
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 market
participants. Rather, it would apply to
all market participants equally.
In addition, the Exchange believes
that the proposal is equitable because
only Users that voluntarily select to
receive TF Connectivity would be
charged for it. The proposed TF
Connectivity is available to all Users on
an equal basis, and all Users that
voluntarily choose to purchase TF
Connectivity would be charged the same
amount for that circuit as all other
market participants purchasing that type
of TF Connectivity.
The Exchange believes that it is
equitable that it offers two types of TF
Connectivity: TF VCCs that may connect
to one Trading Floor, and TF VRFs that
may connect to one or more Trading
Floors. By offering these varied
technological options, FIDS provides
potential Users more choices from
which to choose the option that would
work best for their specific needs. The
Exchange proposes to add a note to the
Fee Schedule to clarify the difference,
thereby making it easier for potential
purchasers of the service to assess what
connectivity will best serve them.
The Proposed Change Is Not Unfairly
Discriminatory
The Exchange believes its proposal is
not unfairly discriminatory. The
proposed change does not apply
differently to distinct types or sizes of
market participants. Rather, it applies to
all market participants equally. The
purchase of any proposed service is
completely voluntary and the Fee
Schedule will be applied uniformly to
all market participants.
In addition, the Exchange believes
that the proposal is not unfairly
discriminatory because only Users that
voluntarily select to receive TF
Connectivity would be charged for it. TF
Connectivity is available to all market
participants on an equal basis, and all
19 See
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345
Users that voluntarily choose to
purchase TF Connectivity are charged
the same amount as all other market
participants purchasing that type of TF
Connectivity.
The Exchange believes that it is not
unfairly discriminatory that it offers two
types of TF Connectivity: TF VCCs that
may connect to one Trading Floor, and
TF VRFs that may connect to one or
more Trading Floors. By offering these
varied technological options, FIDS
provides potential Users more choices
from which to choose the option that
would work best for their specific
needs. The Exchange proposes to add a
note to the Fee Schedule to clarify the
difference, thereby making it easier for
potential purchasers of the service to
assess what connectivity will best serve
them.
For the reasons above, the proposed
change does 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.20
The proposed change would not
impose a burden on competition among
national securities exchanges or among
members of the Exchange.
The proposed change would enhance
competition in the market for circuits
transmitting data into and out of
colocation at the MDC to the Trading
Floors, by adding TF Connectivity, in
addition to the 16 Telecoms that also
sell circuits to Users. TF Connectivity
does not have any latency, bandwidth,
or other advantage over the Telecoms’
circuits. The proposal would not burden
competition in the sale of such circuits,
but rather, enhance it by providing
Users with an additional choice for their
circuit needs.
The Exchange believes that it would
not be a burden on competition that it
offers two types of TF Connectivity: TF
VCCs that may connect to one Trading
Floor, and TF VRFs that may connect to
one or more Trading Floors. By offering
these varied technological options, FIDS
provides potential Users more choices
from which to choose the option that
20 15
E:\FR\FM\03JAN1.SGM
U.S.C. 78f(b)(8).
03JAN1
346
Federal Register / Vol. 90, No. 2 / Friday, January 3, 2025 / Notices
would work best for their specific
needs. The Exchange proposes to add a
note to the Fee Schedule to clarify the
difference, thereby making it easier for
potential purchasers of the service to
assess what connectivity will best serve
them
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
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days (i) as the Commission may
designate if it finds such longer period
to be appropriate and publishes its
reasons for so finding or (ii) as to which
the self-regulatory organization
consents, the Commission will:
(A) by order approve or disapprove
the proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be 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:
lotter on DSK11XQN23PROD 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–
NYSENAT–2024–33 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–NYSENAT–2024–33. 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
VerDate Sep<11>2014
18:01 Jan 02, 2025
Jkt 265001
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–NYSENAT–2024–33 and should be
submitted on or before January 24, 2025.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Vanessa A. Countryman,
Secretary.
[FR Doc. 2024–31501 Filed 1–2–25; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–102046; File No. SR–C2–
2024–022]
Self-Regulatory Organizations; Cboe
C2 Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Adopt Cboe
Timestamping Service Which is a
Market Data Service Comprised of Two
Distinct Market Data Reports
December 27, 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 December
13, 2024, Cboe C2 Exchange, Inc.
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Item I below,
which Item has been substantially
prepared by the Exchange. The
Exchange has designated this proposal
for immediate effectiveness pursuant to
Section 19(b)(3)(A) of the Act 3 and Rule
21 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
1 15
PO 00000
Frm 00046
Fmt 4703
Sfmt 4703
19b–4(f) thereunder.4 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 adopt the
Cboe Timestamping Service, which is a
market data service comprised of two
distinct market data reports. The Cboe
Timestamping Service will provide
timestamp information for orders, 5
quotes and cancels for market
participants. More specifically, the Cboe
Timestamping Service reports will
provide various timestamps relating to
the message lifecycle throughout the
exchange system. The first report—the
Missed Liquidity Report—will cover
order and quote messages and the
second report—Cancels Report—will
cover cancel messages. The proposed
reports are optional products that will
be available to all Members and
Members may opt to choose both
reports, one report, or neither report.
Corresponding fees will be assessed
based on the number of reports
selected.6
The proposed rule change, including
the Exchange’s statement of the purpose
of, and statutory basis for, the proposed
rule change, is available on the
Exchange’s website at https://
markets.cboe.com/us/options/
regulation/rule_filings/ctwo/, at the
Exchange’s Office of the Secretary, and
on the Commission’s website at https://
www.sec.gov/rules-regulations/selfregulatory-organization-rulemaking/
national-securities-exchanges?file_
number=SR-C2-2024-022.
II. 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.7
4 17 CFR 240.19b–4(f). At any time within 60 days
of the filing of the proposed rule change, the
Commission summarily may temporarily suspend
such rule change if it appears to the Commission
that such action is necessary or appropriate in the
public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
If the Commission takes such action, the
Commission will institute proceedings to determine
whether the proposed rule change should be
approved or disapproved.
5 Orders shall include both complex and simple
orders.
6 The Exchange plans to submit a separate filing
with the Commission pursuant to Section 19(b)(1)
to propose fees for the Missed Liquidity Report and
Cancels Report.
7 Copies of the submission, all subsequent
amendments, all written statements with respect to
the proposed rule change that are filed with the
E:\FR\FM\03JAN1.SGM
03JAN1
]]>Agencies
[Federal Register Volume 90, Number 2 (Friday, January 3, 2025)]
[Notices]
[Pages 342-346]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-31501]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-102039; File No. SR-NYSENAT-2024-33]
Self-Regulatory Organizations; NYSE National, Inc.; Notice of
Filing of Proposed Change To Amend the Connectivity Fee Schedule
December 27, 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 December 17, 2024, NYSE National, Inc. (``NYSE National'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend the Connectivity Fee Schedule (``Fee
Schedule'') to add connectivity to the New York Stock Exchange LLC,
NYSE American LLC, and NYSE Arca, Inc.
[[Page 343]]
trading floors. The proposed change is available on the Exchange's
website at www.nyse.com, at the principal office of the Exchange, and
at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Fee Schedule to add connectivity
to the New York Stock Exchange LLC, NYSE American LLC, and NYSE Arca,
Inc. trading floors (``Trading Floors'').
A User \4\ may wish to have a connection between the Mahwah, New
Jersey data center (``MDC'') \5\ and a Trading Floor. A connection
between the MDC and a Trading Floor may be between the User and itself
or between the User and a third party. The User may use such connection
for receiving and transmitting trading-related data (including pre- and
post-trade data and clearing information) or providing services to
individuals physically located on the floor (including access to back-
office systems), as determined by the User.
---------------------------------------------------------------------------
\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. 83351 (May 31, 2018), 83 FR 26314 at n.9
(June 6, 2018) (SR-NYSENAT-2018-07). 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 American LLC, NYSE Arca, Inc., and
NYSE Chicago, Inc. (together, the ``Affiliate SROs''). Each
Affiliate SRO has submitted substantially the same proposed rule
change to propose the change described herein. See SR-NYSE-2024-81,
SR-NYSEAMER-2024-80, SR-NYSEARCA-2024-113, and SR-NYSECHX-2024-37.
\5\ Through its Fixed Income and Data Services (``FIDS'')
business, Intercontinental Exchange, Inc. (``ICE'') operates the
MDC. The Exchange and the Affiliate SROs are indirect subsidiaries
of ICE.
---------------------------------------------------------------------------
The Exchange proposes to add an option for such a connection to the
Fee Schedule. Specifically, the Exchange proposes to amend the Fee
Schedule to add unicast connections through which a User can establish
a connection between the MDC and a Trading Floor over dedicated
bandwidth (``TF Connections'').\6\ Presently, a TF Connection can be in
the form of a virtual control circuit between the MDC and a single
Trading Floor (``TF VCC''), or a virtual routing and forwarding service
between the MDC and one or more Trading Floors (``TF VRF''). A TF
Connection may be used for any purpose: neither FIDS nor the Exchange
has any visibility into a TF Connection.
---------------------------------------------------------------------------
\6\ Information flows over existing network connections in two
formats: ``unicast'' format, which is a format that allows one-to-
one communication, similar to a phone line, in which information is
sent to and from the Exchange; and ``multicast'' format, which is a
format in which information is sent one-way from the Exchange to
multiple recipients at once, like a radio broadcast.
---------------------------------------------------------------------------
All TF Connections must be authorized by both parties to the
connection before FIDS will establish a connection. Establishing a
User's TF Connection will not give FIDS or the Exchange any right to
use the relevant exchange's system. A TF Connection will not provide
direct access or order entry to the Exchange's execution system, and a
User's TF Connection will not be through the Exchange's execution
system.
TF Connections are offered at a monthly fee based on bandwidth
requirements, which fee is consistent with the monthly fees charged for
VCC connections and the same as those charged for connectivity to Third
Party Systems.\7\ When a User requests a TF Connection, it identifies
the size of bandwidth connection it requires, and the monthly charge
for the TF Connection varies based on the size of the bandwidth. The
calculation of the monthly fee may differ based on whether the form
chosen by the User is a TF VCC or TF VRF. This is because the TF VCC
connects the MDC to one Trading Floor, while the TF VRF may connect the
MDC to more than one Trading Floor. Accordingly, the Exchange proposes
to add a note to the Fee Schedule to clarify the difference.
---------------------------------------------------------------------------
\7\ See Connectivity Fee Schedule--A. Co-Location Fees.
---------------------------------------------------------------------------
To make the change, the Exchange proposes to amend the Fee Schedule
as follows (all text new):
------------------------------------------------------------------------
Description Amount of charge
Type of service (Mb) (monthly charge)
------------------------------------------------------------------------
Connectivity to Trading Floor *..... 1 $200
3 400
5 500
10 800
25 1,200
50 1,800
100 2,500
------------------------------------------------------------------------
* The amount of the charge for Connectivity to Trading Floor may differ
based on the connectivity chosen: (a) a virtual control circuit
between the Mahwah data center and a single Trading Floor (``VCC''),
or (b) a virtual routing and forwarding service between the Mahwah
data center and one or more Trading Floors (``VRF''). Specifically, if
the User chooses VCCs or combination of a VCC and VRF for connectivity
to several Trading Floors, it will be charged separately for each
connection. If the User chooses one VRF for connectivity to multiple
trading floors, the User will be charged for one connection.
General
The proposed rule change would not apply differently to distinct
types or sizes of market participants. Rather, it 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.
Use of the services proposed in this filing are completely
voluntary and available to all Users on a non-discriminatory basis.
The proposed change is 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.
[[Page 344]]
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\8\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\9\ 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,\10\ 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.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
\10\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Proposed Change Is Reasonable
The Exchange believes that the proposed rule change is reasonable.
In considering the reasonableness of proposed services and fees,
the Commission's market-based test considers ``whether the exchange was
subject to significant competitive forces in setting the terms of its
proposal . . . , including the level of any fees.'' \11\ If the
Exchange meets that burden, ``the Commission will find that its
proposal is consistent with the Act unless `there is a substantial
countervailing basis to find that the terms' of the proposal violate
the Act or the rules thereunder.'' \12\ Here, the Exchange is subject
to significant competitive forces in setting the terms on which it
offers its proposal, in particular because substantially similar
substitutes are available, and the third-party vendors are not at a
competitive disadvantage created by the Exchange.
---------------------------------------------------------------------------
\11\ Securities Exchange Act Release No. 90209 (October 15,
2020), 85 FR 67044, 67049 (October 21, 2020) (Order Granting
Accelerated Approval to Establish a Wireless Fee Schedule Setting
Forth Available Wireless Bandwidth Connections and Wireless Market
Data Connections) (SR-NYSE-2020-05, SR-NYSEAMER-2020-05, SR-
NYSEArca-2020-08, SR-NYSECHX-2020-02, SR-NYSENAT-2020-03, SR-NYSE-
2020-11, SR-NYSEAMER-2020-10, SR-NYSEArca-2020-15, SR-NYSECHX-2020-
05, SR-NYSENAT-2020-08) (``Wireless Approval Order''), citing
Securities Exchange Act Release No. 59039 (December 2, 2008), 73 FR
74770, 74781 (December 9, 2008) (``2008 ArcaBook Approval Order'').
See NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
\12\ Wireless Approval Order, supra note 11, at 67049, citing
2008 ArcaBook Approval Order, supra note 11, at 74781.
---------------------------------------------------------------------------
In 2013 the MDC opened two meet-me-rooms to telecommunications
service providers (``Telecoms''),\13\ to enable Telecoms to offer
circuits into the MDC. The TF Connections compete with circuits
currently offered by the 16 third-party Telecoms that have installed
their equipment in the MDC's two meet-me-rooms.
---------------------------------------------------------------------------
\13\ Telecoms are licensed by the Federal Communications
Commission and are not required to be, or be affiliated with, a
member of the Exchange or an Affiliate SRO.
---------------------------------------------------------------------------
The Telecom circuits (including any circuit-based network services
a Telecom may offer) are reasonable substitutes for TF Connections. The
Commission has recognized that products do not need to be identical to
be considered substitutable; it is sufficient that they be
substantially similar.\14\ Because Telecoms can connect to the Trading
Floors, the TF Connections and the circuits provided by the Telecoms
perform the same function: connecting into and out of the MDC and the
Trading Floors. The providers of the TF Connection and Telecom circuits
design them to perform with particular combinations of latency,
bandwidth, price, termination point, and other factors that they
believe will attract Users, and Users choose from among these competing
services on the basis of their business needs.
---------------------------------------------------------------------------
\14\ See 2008 ArcaBook Approval Order, supra note 11, at 74789
and note 295 (recognizing that products need not be identical to be
substitutable).
---------------------------------------------------------------------------
The TF Connections are sufficiently similar substitutes to the
circuits offered by the 16 Telecoms even though the TF Connections all
terminate on a Trading Floor while circuits from the 16 Telecoms could
terminate on a Trading Floor or other locations. While neither the
Exchange nor FIDS knows the end point of any particular Telecom
circuit, the Exchange understands that the Telecoms can offer circuits
terminating in any location, including the Trading Floors. Moreover,
the Telecoms may offer smaller circuits that are the same as or similar
size to the TF Connections. Ultimately, Users can choose to configure
their pathway in the way that best suits their business needs.
The TF Connections do not have a distance or latency advantage over
the Telecoms' circuits within the MDC. FIDS has normalized (a) the
distance between the meet-me-rooms and the colocation halls and (b) the
distance between the rooms where the FIDS circuits and the TF
Connections exit the MDC and the colocation halls. As a result, a User
choosing whether to use the TF Connections or Telecom circuits does not
face any difference in the distances or latency within the MDC. The
Exchange is not aware of any differences under its control that give
the Exchange a latency advantage.
The Exchange also believes that the TF Connections do not have any
latency or bandwidth advantage over the Telecoms' circuits outside of
the MDC. The Exchange believes that the Telecoms operating in the meet-
me-rooms offer circuits with a variety of latency and bandwidth
specifications, some of which may exceed the specifications of the TF
Connections.\15\ The Exchange believes that Users consider these
latency and bandwidth factors--as well as other factors, such as price
and termination point--in determining which offerings will best serve
their business needs.
---------------------------------------------------------------------------
\15\ The specifications of FIDS's competitors' circuits are not
publicly known. The Exchange understands that FIDS has gleaned any
information it has about its competitors through anecdotal
communications, by observing customers' purchasing choices in the
competitive market, and from its own experience as a purchaser of
circuits from telecommunications providers to build FIDS's own
networks.
---------------------------------------------------------------------------
In sum, the Exchange is not aware of anything that would make the
Telecoms' circuits inadequate substitutes for the TF Connections.
Nor does the Exchange have a competitive advantage over any third-
party competitors by virtue of the fact that it owns and operates the
MDC's meet-me-rooms. In most cases, circuits coming out of the MDC are
provided by the Telecoms.\16\ Currently, 16 Telecoms operate in the
meet-me-rooms and provide a variety of circuit choices. It is in the
Exchange's best interest to set the fees that Telecoms pay to operate
in the meet-me-rooms at a reasonable level \17\ so that market
participants, including Telecoms, will maximize their use of the MDC.
By setting the meet-me-room fees at a reasonable level, the Exchange
encourages Telecoms to participate in the meet-me-rooms and to sell
circuits to Users for connecting into and out of the MDC. These
Telecoms then compete with each other by pricing such circuits at
competitive rates. These competitive rates for circuits help draw in
more Users and Hosted Customers to the
[[Page 345]]
MDC, which directly benefits the Exchange by increasing the customer
base to whom the Exchange can sell its colocation services, which
include cabinets, power, ports, and connectivity to many third-party
data feeds, and because having more Users and Hosted Customers leads,
in many cases, to greater participation on the Exchange. In this way,
by setting the meet-me-room fees at a level attractive to
telecommunications firms, the Exchange spurs demand for all of the
services it sells at the MDC, while setting the meet-me-room fees too
high would negatively affect the Exchange's ability to sell its
services at the MDC.\18\ Accordingly, there are real constraints on the
meet-me-room fees the Exchange charges, such that the Exchange does not
have an advantage in terms of costs when compared to third parties that
enter the MDC through the meet-me-rooms to provide services to compete
with the Exchange's services.
---------------------------------------------------------------------------
\16\ Note that in the case of wireless connectivity, a User
still requires a fiber circuit to transport data. If a Telecom is
used, the data is transmitted wirelessly to the relevant pole, and
then from the pole to the meet-me-room using a fiber circuit.
\17\ See Securities Exchange Act Release No. 98002 (July 26,
2023), 88 FR 50232 (August 1, 2023) (SR-NYSENat-2023-12) (``MMR
Notice'').
\18\ See id. at 50235. Importantly, the Exchange is prevented
from making any alteration to its meet-me-room services or fees
without filing a proposal for such changes with the Commission.
---------------------------------------------------------------------------
If anything, the Exchange would be subject to a competitive
disadvantage vis-[agrave]-vis the Telecoms. They are not subject to the
Commission's filing requirements, and therefore can freely change their
services and pricing in response to competitive forces. In contrast,
the Exchange's service and pricing would be standardized as set out in
this filing, and the Exchange would be unable to respond to pricing
pressure from its competitors without seeking a formal fee change in a
filing before the Commission.
If the Exchange were to set the price of the TF Connections at a
level that Users found to be too high, Users would likely respond by
choosing one of the many alternative options offered by the 16
Telecoms. Conversely, if the Exchange were to offer the TF Connections
at prices aimed at undercutting comparable Telecom circuits, the
Telecoms might reassess whether it makes financial sense for them to
continue to participate in the MDC's meet-me-rooms. Their departure
might negatively impact User participation in colocation and on the
Exchange. As a result, the Exchange is not motivated to undercut the
prices of Telecom circuits.
In sum, because the Exchange is subject to significant competitive
forces in setting the terms on which it offers its proposal, in
particular because the Exchange believes that a substantially similar
substitute for TF Connectivity is available, and the Exchange has not
placed third-party vendors at a competitive disadvantage created by the
Exchange, the proposed fees for the TF Connectivity are reasonable.\19\
---------------------------------------------------------------------------
\19\ See Wireless Approval Order, supra note 11.
---------------------------------------------------------------------------
For these reasons, the proposed change is reasonable.
The Proposed Change Is Equitable
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 market participants. Rather, it would apply to all market
participants equally.
In addition, the Exchange believes that the proposal is equitable
because only Users that voluntarily select to receive TF Connectivity
would be charged for it. The proposed TF Connectivity is available to
all Users on an equal basis, and all Users that voluntarily choose to
purchase TF Connectivity would be charged the same amount for that
circuit as all other market participants purchasing that type of TF
Connectivity.
The Exchange believes that it is equitable that it offers two types
of TF Connectivity: TF VCCs that may connect to one Trading Floor, and
TF VRFs that may connect to one or more Trading Floors. By offering
these varied technological options, FIDS provides potential Users more
choices from which to choose the option that would work best for their
specific needs. The Exchange proposes to add a note to the Fee Schedule
to clarify the difference, thereby making it easier for potential
purchasers of the service to assess what connectivity will best serve
them.
The Proposed Change Is Not Unfairly Discriminatory
The Exchange believes its proposal is not unfairly discriminatory.
The proposed change does not apply differently to distinct types or
sizes of market participants. Rather, it applies to all market
participants equally. The purchase of any proposed service is
completely voluntary and the Fee Schedule will be applied uniformly to
all market participants.
In addition, the Exchange believes that the proposal is not
unfairly discriminatory because only Users that voluntarily select to
receive TF Connectivity would be charged for it. TF Connectivity is
available to all market participants on an equal basis, and all Users
that voluntarily choose to purchase TF Connectivity are charged the
same amount as all other market participants purchasing that type of TF
Connectivity.
The Exchange believes that it is not unfairly discriminatory that
it offers two types of TF Connectivity: TF VCCs that may connect to one
Trading Floor, and TF VRFs that may connect to one or more Trading
Floors. By offering these varied technological options, FIDS provides
potential Users more choices from which to choose the option that would
work best for their specific needs. The Exchange proposes to add a note
to the Fee Schedule to clarify the difference, thereby making it easier
for potential purchasers of the service to assess what connectivity
will best serve them.
For the reasons above, the proposed change does 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.\20\
---------------------------------------------------------------------------
\20\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------
The proposed change would not impose a burden on competition among
national securities exchanges or among members of the Exchange.
The proposed change would enhance competition in the market for
circuits transmitting data into and out of colocation at the MDC to the
Trading Floors, by adding TF Connectivity, in addition to the 16
Telecoms that also sell circuits to Users. TF Connectivity does not
have any latency, bandwidth, or other advantage over the Telecoms'
circuits. The proposal would not burden competition in the sale of such
circuits, but rather, enhance it by providing Users with an additional
choice for their circuit needs.
The Exchange believes that it would not be a burden on competition
that it offers two types of TF Connectivity: TF VCCs that may connect
to one Trading Floor, and TF VRFs that may connect to one or more
Trading Floors. By offering these varied technological options, FIDS
provides potential Users more choices from which to choose the option
that
[[Page 346]]
would work best for their specific needs. The Exchange proposes to add
a note to the Fee Schedule to clarify the difference, thereby making it
easier for potential purchasers of the service to assess what
connectivity will best serve them
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
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) by order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
file number SR-NYSENAT-2024-33 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-NYSENAT-2024-33. 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-NYSENAT-2024-33 and should
be submitted on or before January 24, 2025.
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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Vanessa A. Countryman,
Secretary.
[FR Doc. 2024-31501 Filed 1-2-25; 8:45 am]
BILLING CODE 8011-01-P
