[Federal Register Volume 84, Number 53 (Tuesday, March 19, 2019)]
[Notices]
[Pages 10159-10161]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-05090]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85306; File No. SR-NYSEARCA-2019-11]


Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the NYSE 
Arca Options Fees and Charges and the NYSE Arca Equities Fees and 
Charges Related to Co-Location Services

March 13, 2019.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on March 1, 2019, NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the NYSE Arca Options Fees and 
Charges (the ``Options Fee Schedule'') and the NYSE Arca Equities Fees 
and Charges (the ``Equities Fee Schedule'' and, together with the 
Options Fee Schedule,

[[Page 10160]]

the ``Fee Schedules'') related to co-location services to make a 
ministerial change to reflect the name change of its affiliate Chicago 
Stock Exchange, Inc. and to correct a typographical error. The proposed 
rule 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Fee Schedules related to co-
location \4\ services offered by the Exchange to make a ministerial 
change to reflect the name change of its affiliate Chicago Stock 
Exchange, Inc. (``CHX'') to NYSE Chicago, Inc. (``NYSE Chicago'') and 
to correct a typographical error.
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    \4\ The Exchange initially filed rule changes relating to its 
co-location services with the Securities and Exchange Commission 
(``Commission'') in 2010. See Securities Exchange Act Release No. 
63275 (November 8, 2010), 75 FR 70048 (November 16, 2010) (SR-
NYSEArca-2010-100). The Exchange operates a data center in Mahwah, 
New Jersey (the ``data center'') from which it provides co-location 
services to Users. For purposes of the Exchange's co-location 
services, a ``User'' means any market participant that requests to 
receive co-location services directly from the Exchange. See 
Securities Exchange Act Release No. 76010 (September 29, 2015), 80 
FR 60197 (October 5, 2015) (SR-NYSEArca-2015-82). As specified in 
the Fee Schedules, a User that incurs co-location fees for a 
particular co-location service pursuant thereto would not be subject 
to co-location fees for the same co-location service charged by the 
Exchange's affiliates New York Stock Exchange LLC (``NYSE''), NYSE 
American LLC (``NYSE American''), and NYSE National, Inc. (``NYSE 
National'' and, together, the ``Affiliate SROs''). See Securities 
Exchange Act Release No. 70173 (August 13, 2013), 78 FR 50459 
(August 19, 2013) (SR-NYSEArca-2013-80).
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    On February 15, 2019, CHX changed its name to NYSE Chicago.\5\ In a 
non-substantive administrative change, the Exchange proposes to update 
General Note 4 related to co-location services \6\ as follows:
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    \5\ See Securities Exchange Release No. 84494 (October 26, 
2018), 83 FR 54953 (November 1, 2018) (SR-CHX-2018-05).
    \6\ General Note 4 describes the access to trading and execution 
systems and the connectivity to included data products which a User 
receives when it purchases access to the Liquidity Center Network 
(``LCN'') or internet protocol (``IP'') network, local area networks 
available in the data center. See Securities Exchange Act Release 
No. 79729 (January 4, 2017), 82 FR 3061 (January 10, 2017) (SR-
NYSEArca-2016-172) (notice of filing and immediate effectiveness of 
proposed rule change amending the Exchange's Fee Schedules related 
to co-location services to increase LCN and IP network fees and add 
a description of access to trading and execution services and 
connectivity to included data products).
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     Delete references to ``Chicago Stock Exchange, Inc.'' and 
``CHX'' from the first paragraph of General Note 4, replacing them with 
references to ``NYSE Chicago, Inc.'' and ``NYSE Chicago''; and
     In the table under Included Data Products, delete 
``Chicago Stock Exchange (CHX)'' from the first line and add a line for 
``NYSE Chicago'' in alphabetical order after NYSE Bonds.
    In addition, in the third sentence of the first paragraph under 
``Connectivity to Third Party Data Feeds,'' the Exchange proposes to 
correct a typographical error by replacing ``Fees'' with ``Feeds.''
General
    As is the case with all Exchange co-location arrangements, (i) 
neither a User nor any of the User's customers would be permitted to 
submit orders directly to the Exchange unless such User or customer is 
a member organization, a Sponsored Participant or an agent thereof 
(e.g., a service bureau providing order entry services); (ii) use of 
the co-location services proposed herein would be completely voluntary 
and available to all Users on a non-discriminatory basis; \7\ and (iii) 
a User would only incur one charge for the particular co-location 
service described herein, regardless of whether the User connects only 
to the Exchange or to the Exchange and one or more of the Affiliate 
SROs.\8\
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    \7\ As is currently the case, Users that receive co-location 
services from the Exchange will not receive any means of access to 
the Exchange's trading and execution systems that is separate from, 
or superior to, that of other Users. In this regard, all orders sent 
to the Exchange enter the Exchange's trading and execution systems 
through the same order gateway, regardless of whether the sender is 
co-located in the data center or not. In addition, co-located Users 
do not receive any market data or data service product that is not 
available to all Users, although Users that receive co-location 
services normally would expect reduced latencies, as compared to 
Users that are not co-located, in sending orders to, and receiving 
market data from, the Exchange.
    \8\ See 78 FR 50459, supra note 4, at 50459. NYSE, NYSE 
American, and NYSE National have submitted substantially the same 
proposed rule change to propose the changes described herein. See 
SR-NYSE-2019-11, SR-NYSEAmer-2019-02, and SR-NYSENat-2019-05.
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    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 Users would have in 
complying with the proposed change.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\9\ in general, and with Section 6(b)(1) 
\10\ in particular, in that it enables the Exchange to be so organized 
as to have the capacity to be able to carry out the purposes of the 
Exchange Act and to comply, and to enforce compliance by its exchange 
members and persons associated with its exchange members, with the 
provisions of the Exchange Act, the rules and regulations thereunder, 
and the rules of the Exchange.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(1).
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    The proposed rule change is a non-substantive change and does not 
impact the governance or ownership of the Exchange. The Exchange 
believes that the proposed rule change would enable the Exchange to 
continue to be so organized as to have the capacity to carry out the 
purposes of the Exchange Act and comply and enforce compliance with the 
provisions of the Exchange Act by its members and persons associated 
with its members, because ensuring that the Fee Schedules accurately 
reflects the name change of its affiliate NYSE Chicago and correcting a 
typographical error would contribute to the orderly operation of the 
Exchange by adding clarity and transparency to such documents.
    The Exchange also believes that the proposed change furthers the 
objectives of Section 6(b)(5) of the Act \11\ 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 mechanisms 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.
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    \11\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that the proposed change would remove

[[Page 10161]]

impediments to, and perfect the mechanisms of, a free and open market 
and a national market system and, in general, protect investors and the 
public interest by ensuring that market participants can more easily 
navigate, understand and comply with the Fee Schedules. The Exchange 
believes that, by ensuring that such documents accurately reflect the 
name change of its affiliate NYSE Chicago, the proposed change would 
reduce potential investor or market participant confusion by providing 
market participants with clarity as to what connectivity is included in 
the purchase of access to the LCN and IP network.
    Similarly, correcting the typographical error in the third sentence 
of the first paragraph under ``Connectivity to Third Party Data Feeds'' 
would remove impediments to, and perfect the mechanisms of, a free and 
open market and a national market system and, in general, protect 
investors and the public interest because the change would clarify 
Exchange rules and alleviate any possible market participant confusion.
    For the reasons above, the proposed changes do 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

    In accordance with Section 6(b)(8) of the Act,\12\ the Exchange 
believes that the proposed rule change will not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act because it is ministerial in nature and is not 
designed to have any competitive impact, but rather to update 
references and correct a typographical error, thereby clarifying the 
Fee Schedules and alleviating any possible market participant 
confusion.
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    \12\ 15 U.S.C. 78f(b)(8).
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    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 proposed rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \13\ and Rule 19b-4(f)(3) \14\ thereunder in 
that the proposed rule change is concerned solely with the 
administration of the Exchange.
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(3).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may 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) \15\ of the Act to determine whether the proposed rule 
change should be approved or disapproved.
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    \15\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSEARCA-2019-11 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-2019-11. 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 (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 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 10:00 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. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NYSEARCA-2019-11, and should be 
submitted on or before April 9, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-05090 Filed 3-18-19; 8:45 am]
BILLING CODE 8011-01-P