[Federal Register Volume 80, Number 240 (Tuesday, December 15, 2015)]
[Notices]
[Pages 77683-77684]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-31444]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76603; File No. SR-EDGX-2015-58]


Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change Related to 
Fees for Use of EDGX Exchange, Inc.

 December 9, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on December 1, 2015, EDGX Exchange, Inc. (the ``Exchange'' or 
``EDGX'') 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 Exchange. The 
Exchange has designated the proposed rule change as one establishing or 
changing a member due, fee, or other charge imposed by the Exchange 
under Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) 
thereunder,\4\ which renders the proposed rule change effective upon 
filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend its fees and rebates 
applicable to Members \5\ of the Exchange pursuant to EDGX Rule 15.1(a) 
and (c) (``Fee Schedule'') to increase the fee for orders yielding fee 
code K, which routes to NASDAQ OMX PSX (``PSX'') using ROUC or ROUE 
routing strategy.
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    \5\ The term ``Member'' is defined as ``any registered broker or 
dealer, or any person associated with a registered broker or dealer, 
that has been admitted to membership in the Exchange. A Member will 
have the status of a ``member'' of the Exchange as that term is 
defined in Section 3(a)(3) of the Act.'' See Exchange Rule 1.5(n).
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    The text of the proposed rule change is available at the Exchange's 
Web site at www.batstrading.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 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 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 increase the fee for orders yielding fee 
code K, which routes to PSX using ROUC or ROUE routing strategy. In 
securities priced at or above $1.00, the Exchange currently assesses a 
fee of $0.0028 per share for Members' orders that yield fee code K. The 
Exchange proposes to amend its Fee Schedule to increase this fee to 
$0.0029 per share. The proposed change would enable the Exchange to 
pass through the rate that BATS Trading, Inc. (``BATS Trading''), the 
Exchange's affiliated routing broker-dealer, is charged for routing 
orders to PSX when it does not qualify for a volume tiered reduced fee. 
The proposed change is in response to PSX's December 2015 fee change 
where PSX increased the fee to remove liquidity via routable order 
types it charges its customers, from a fee of $0.0027 per share to a 
fee of $0.0028 per share for Tapes A and B securities and from a fee of 
$0.0028 per share to $0.0029 per share for Tape C securities.\6\ When 
BATS Trading routes to PSX, it will now be charged a standard rate of 
$0.0028 per share for Tapes A and B securities and $0.0029 per share 
for Tape C securities.\7\ BATS Trading will pass through this rate to 
the Exchange and the Exchange, in turn, will pass through of a rate of 
$0.0029 per share for Tape A, B, and C securities to its Members.\8\ 
The proposed increase to the fee under fee code K would enable the 
Exchange to equitably allocate its costs among all Members utilizing 
fee code K. The Exchange proposes to implement this amendment to its 
Fee Schedule immediately.
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    \6\ See Equity Trader Alert 2015-189, available at http://www.nasdaqtrader.com/TraderNews.aspx?id=ETA-2015-189.
    \7\ The Exchange notes that to the extent BATS Trading does or 
does not achieve any volume tiered reduced fee on PSX, its rate for 
fee code K will not change.
    \8\ The Exchange notes that, due to billing system limitations 
that do not allow for separate rates by tape, it will pass through 
the higher fee of $0.0029 per share for all Tapes A, B & C 
securities.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\9\ in general, and 
furthers the objectives of Section 6(b)(4),\10\ in particular, as it is 
designed to provide for the equitable allocation of reasonable dues, 
fees and other charges among its Members and other persons using its 
facilities. The Exchange believes that its proposal to increase the fee 
for Members' orders that yield fee code K represents an equitable 
allocation of reasonable dues, fees, and other charges among Members 
and other persons using its facilities because the Exchange does not 
levy additional fees or offer additional rebates for orders that it 
routes to PSX through BATS Trading. As of December 1, 2015, PSX 
increased the fee to remove liquidity from a fee of $0.0027 per share 
to a fee of $0.0028 per share for Tapes A and B securities and from a 
fee of $0.0028 per share to $0.0029 per share for Tape C 
securities.\11\ Therefore, the Exchange believes that its proposal to 
pass through a fee of $0.0029 per share for orders that yield fee code 
K is equitable and reasonable because it accounts for the pricing 
changes on PSX. In addition, the proposal allows the Exchange to now 
charge its Members a pass-through rate for orders that are routed to 
PSX.

[[Page 77684]]

Furthermore, the Exchange notes that routing through BATS Trading is 
voluntary. Lastly, the Exchange also believes that the proposed 
amendment is non-discriminatory because it applies uniformly to all 
Members.
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    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(4).
    \11\ See supra note 4.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    This proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act. The Exchange does not believe that this change represents a 
significant departure from previous pricing offered by the Exchange or 
pricing offered by the Exchange's competitors. Additionally, Members 
may opt to disfavor the Exchange's pricing if they believe that 
alternatives offer them better value. Accordingly, the Exchange does 
not believe that the proposed changes will impair the ability of 
Members or competing venues to maintain their competitive standing in 
the financial markets. The Exchange believes that its proposal to pass 
through a fee of $0.0029 per share for Members' orders that yield fee 
code K would increase intermarket competition because it offers 
customers an alternative means to route to PSX. The Exchange believes 
that its proposal would not burden intramarket competition because the 
proposed rate would apply uniformly to all Members.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any unsolicited written comments from Members or other interested 
parties.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \12\ and paragraph (f) of Rule 19b-4 
thereunder.\13\ 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.
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    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-EDGX-2015-58 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-EDGX-2015-58. 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 the 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-EDGX-2015-58, and should be 
submitted on or before January 5, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
Robert W. Errett,
Deputy Secretary.
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    \14\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2015-31444 Filed 12-14-15; 8:45 am]
 BILLING CODE 8011-01-P