[Federal Register Volume 80, Number 242 (Thursday, December 17, 2015)]
[Notices]
[Pages 78809-78810]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-31688]



[[Page 78809]]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76629; File No. SR-NYSEARCA-2015-120]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Equities Schedule of Fees and Charges for Exchange Services

December 11, 2015.
    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 1, 2015, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE 
Arca'') 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 NYSE Arca Equities Schedule of 
Fees and Charges for Exchange Services (``Fee Schedule''). The Exchange 
proposes to implement the change on December 1, 2015. 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 Routable Retail Order Tier 
(``Routable Retail'') applicable to Tape A and C Securities on the Fee 
Schedule. Currently, the Routable Retail pricing tier provides ETP 
Holders, including Market Makers, that (1) provide liquidity of 0.20% 
or more of the US consolidated average daily volume (``CADV'') during a 
billing month across all Tapes, (2) maintain a ratio during a billing 
month across all Tapes of executed provide liquidity that is eligible 
to route away from the Exchange (``Routable Orders'') \4\ to total 
executed provide liquidity of 55% or more, and (3) execute an ADV of 
Retail Orders \5\ that provide liquidity during the month that is 0.10% 
or more of the US CADV, with a credit of $0.0032 per share for Routable 
and non-Routable Orders in Tape A and Tape C Securities that provide 
liquidity to the Book and a fee of $0.0030 per share [sic] and $.0029 
per share for Routable and non-Routable Orders in Tape C Securities, 
respectively [sic], that take liquidity from the Book.\6\
---------------------------------------------------------------------------

    \4\ ETP Holders are able to include an instruction with their 
orders to determine whether the order will be eligible to route to 
an away exchange (e.g., to execute against trading interest with a 
better price than on the Exchange) or, for example, be cancelled if 
routing would otherwise occur.
    \5\ Retail Orders are defined in the Fee Schedule as orders 
designated as retail orders and that meet the requirements of Rule 
7.44(a)(3), but that are not executed in the Retail Liquidity 
Program. The Retail Liquidity Program is a pilot program designed to 
attract additional retail order flow to the Exchange for NYSE Arca-
listed securities and securities traded pursuant to unlisted trading 
privileges while also providing the potential for price improvement 
to such order flow. See Rule 7.44. See Securities Exchange Act 
Release No. 71176 (December 23, 2013), 78 FR 79524 (December 30, 
2013) (SR-NYSEArca-2013-107).
    \6\ See Basic Rate. Basic Rates are applicable when tier rates 
do not apply.
---------------------------------------------------------------------------

    The Exchange proposes to lower the per share credit for Routable 
and non-Routable Orders in Tape A and Tape C Securities that provide 
liquidity to the Book to $0.0030 per share. The Exchange proposes to 
implement the change on December 1, 2015.
    The proposed changes are not otherwise intended to address any 
other issues, and the Exchange is not aware of any problems that ETP 
Holders would have in complying with the proposed changes.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\7\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\8\ in 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.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The Exchange's proposal to lower the rebate for Routable and non-
Routable Orders in Tape A and Tape C Securities that provide liquidity 
to the Book is reasonable because the Exchange believes that despite 
the decrease, ETP Holders, including Market Makers, will continue to be 
incentivized to bring Retail Orders to earn the $0.0030 per share 
rebate. The Exchange further believes that the proposed fee change is 
equitable and not unfairly discriminatory because the lowered rebate 
would apply to all similarly situated ETP Holders, including Market 
Makers, equally. Additionally, the Exchange believes that the per share 
credits for Routable and non-Routable Orders that provide liquidity are 
fair, equitable and not unfairly discriminatory because they are 
consistent with rebate differentiation that exists today at other 
exchanges.
    The Exchange believes that the proposed rebate is competitive with 
rebates provided by other exchanges and is therefore reasonable and 
equitably allocated to those participants that direct orders to the 
Exchange rather than to a competing exchange. 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,\9\ the Exchange 
believes that the proposed rule change would not 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 
fee change will continue to encourage competition and attract liquidity 
to the Exchange, which will make the Exchange a more competitive venue 
for, among other things, order execution and price discovery. The 
Exchange does not believe that the proposed changes represent a 
significant departure from

[[Page 78810]]

pricing offered by the Exchange's competitors. Additionally, ETP 
Holders, including Market Makers, 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 ETP Holders, including Market Makers, or 
competing venues to maintain their competitive standing in the 
financial markets.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues. 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 promotes a 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) \10\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \11\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
---------------------------------------------------------------------------

    \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) \12\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \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
     Send an email to [email protected]. Please include 
File Number SR-NYSEARCA-2015-120 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-NYSEARCA-2015-120. 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-NYSEARCA-2015-120 and should 
be submitted on or before January 7, 2016.
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-31688 Filed 12-16-15; 8:45 am]
 BILLING CODE 8011-01-P