78 FR 190 pgs. 60358-60360 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Options Fee Schedule To Include an Additional Market Maker Monthly Posting Credit Tier
Type: NOTICEVolume: 78Number: 190Pages: 60358 - 60360
Pages: 60358, 60359, 60360Docket number: [Release No. 34-70504; File No. SR-NYSEArca-2013-93]
FR document: [FR Doc. 2013-23902 Filed 9-30-13; 8:45 am]
Agency: Securities and Exchange Commission
Official PDF Version: PDF Version
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-70504; File No. SR-NYSEArca-2013-93]
Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Options Fee Schedule To Include an Additional Market Maker Monthly Posting Credit Tier
September 25, 2013.
[top] Pursuant to Section 19(b)(1)1of the Securities Exchange Act of 1934 (the "Act")2and Rule 19b-4 thereunder,3notice is hereby given that, on September 17, 2013, NYSE Arca, Inc. (the "Exchange" or "NYSE Arca") filed with the Securities and Exchange Commission (the "Commission") the proposed rule change as described in Items I, II, and III below, which Items
Footnotes:
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 the Substance of the Proposed Rule Change
The Exchange proposes to amend the NYSE Arca Options Fee Schedule ("Fee Schedule") to include an additional Market Maker monthly posting credit tier. The Exchange proposes to implement the fee change effective October 1, 2013. The text of the proposed rule change is available on the Exchange's Web site 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 Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend the Fee Schedule to include an additional Market Maker monthly posting credit tier. The Exchange proposes to implement the fee change effective October 1, 2013.
The Exchange currently offers two Market Maker monthly posting credit tiers applicable to posted electronic Market Maker executions in Penny Pilot issues and SPY, as follows:
| Tier | Qualification basis | Credit applied to posted | Credit applied to posted | |
| (average electronic executions per day) | electronic market maker | electronic market maker | ||
| executions in penny pilot | executions in SPY | |||
| issues (except SPY) | ||||
| Base | ($0.32) | ($0.32) | ||
| Super Tier | 80,000 Contracts from Market Maker Posted Orders in All Issues, or | 200,000 Contracts Combined from all orders in Penny Pilot Issues, all account types, with at least 100,000 Contracts from Posted Orders in Penny Pilot Issues4 | ($0.37) | ($0.39) |
The Exchangeproposes to reduce the base credit from $0.32 to $0.28 for both Penny Pilot issues and SPY and create a new Select Tier that would offer a credit of $0.32 for both Penny Pilot issues and SPY if the Market Maker has average electronic executions per day of 30,000 contracts from Market Maker posted orders in all issues. Credits for the Super Tier would remain the same. The resulting tiers and pricing would be as follows:
Footnotes:
4 This calculation includes transaction volume from the Market Maker's affiliates.
| Tier | Qualification basis | Credit applied to posted | Credit applied to posted | |
| (average electronic executions per day) | electronic market maker | electronic market maker | ||
| executions in penny pilot | executions in SPY | |||
| issues (except SPY) | ||||
| Base | ($0.28) | ($0.28) | ||
| Select Tier | 30,000 Contracts from Market Maker Posted Orders in All Issues | ($0.32) | ($0.32) | |
| Super Tier | 80,000 Contracts from Market Maker Posted Orders in All Issues, or | 200,000 Contracts Combined from all orders in Penny Pilot Issues, all account types, with at least 100,000 Contracts from Posted Orders in Penny Pilot Issues5 | ($0.37) | ($0.39) |
The Exchangenotes that the proposed change is not otherwise intended to address any other issues, and the Exchange is not aware of any problems that OTP Holders and OTP Firms, including Market Makers, would have in complying with the proposed change.
Footnotes:
5 This calculation includes transaction volume from the Market Maker's affiliates.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,6in general, and furthers the objectives of Sections 6(b)(4) and (5) of the Act,7in particular, because it provides for the equitable allocation of reasonable dues, fees, and other charges among its members, issuers and other persons using its facilities and does not unfairly discriminate between customers, issuers, brokers or dealers.
Footnotes:
6 15 U.S.C. 78f(b).
7 15 U.S.C. 78f(b)(4) and (5).
[top] The Exchange believes that the proposed change is reasonable because
Footnotes:
8 NASDAQ Options Market ("NOM") credits range from -$0.25 to -$0.40. Topaz Exchange, LLC ("Topaz") credits range from -0.30 to -$0.39.
The Exchange believes that the proposed change is equitable and not unfairly discriminatory because it would apply to all Market Makers on an equal and non-discriminatory basis. The Exchange further believes that the proposed change is equitable and not unfairly discriminatory because it is reasonably related to the value to the Exchange's market quality associated with higher volumes in Market Maker posted orders, including both Penny Pilot issues and non-Penny Pilot issues. The proposed lower credit for Market Makers in the base tier is reasonable and equitable because it would reasonably ensure that the Exchange will derive sufficient revenue to continue to fund the higher credits available under the Select Tier and Super Tier for the benefit of all market participants.
Finally, the Exchange believes that it is subject to significant competitive forces, as described below in the Exchange's statement regarding the burden on competition.
For these reasons, the Exchange believes that the proposal is consistent with the Act.
B. Self-Regulatory Organization's Statement on Burden on Competition
In accordance with Section 6(b)(8) of the Act,9the Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. Instead, the Exchange believes that the proposed change would continue to encourage competition, including by attracting additional liquidity to the Exchange, which would continue to make the Exchange a more competitive venue for, among other things, order execution and price discovery. The Exchange does not believe that the proposed change will impair the ability of Market Makers or competing order execution venues to maintain their competitive standing in the financial markets.
Footnotes:
9 15 U.S.C. 78f(b)(8).
Finally, the Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive. In such an environment, the Exchange must continually review, and consider adjusting, its fees and credits to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed rule change reflects this competitive environment.
C. Self-Regulatory Organization's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action
The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A)10of the Act and subparagraph (f)(2) of Rule 19b-411thereunder, because it establishes a due, fee, or other charge imposed by the Exchange.
Footnotes:
10 15 U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b-4(f)(2).
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings under Section 19(b)(2)(B)12of the Act to determine whether the proposed rule change should be approved or disapproved.
Footnotes:
12 15 U.S.C. 78s(b)(2)(B).
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 ( http://www.sec.gov/rules/sro.shtml ); or
• Use the Commission's Internet comment form ( http://www.sec.gov/rules/sro.shtml ); or
• Send an email to rule-comments@sec.gov . Please include File Number SR-NYSEArca-2013-93 on the subject line.
Paper Comments
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
• Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEArca-2013-93. 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 Web site ( http://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 Web site 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 10:00 a.m. and 3:00 p.m. Copies of such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NYSEArca-2013-93, and should be submitted on or before October 22, 2013.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13
Kevin M. O'Neill,
Deputy Secretary.
Footnotes:
13 17 CFR 200.30-3(a)(12).
[FR Doc. 2013-23902 Filed 9-30-13; 8:45 am]
BILLING CODE 8011-01-P