[Federal Register Volume 89, Number 61 (Thursday, March 28, 2024)]
[Notices]
[Pages 21566-21569]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-06584]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-99851; File No. SR-NYSECHX-2024-13]


Self-Regulatory Organizations; NYSE Chicago, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Amend the 
Connectivity Fee Schedule

March 22, 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 March 15, 2024, the NYSE Chicago, Inc. (``NYSE Chicago'' or 
the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I 
and II 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 Connectivity Fee Schedule (``Fee 
Schedule'') regarding colocation services and fees to update the list 
of included data products. 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Connectivity Fee Schedule (``Fee 
Schedule'') regarding colocation services and fees to update the list 
of included data products (``Included Data Products'').
    Currently, the table of Included Data Products in Colocation Note 4 
sets forth the market data feeds that Users \4\ can

[[Page 21567]]

connect to at no additional cost when they purchase a service that 
includes access to the LCN or IP network.\5\
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    \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. 87408 (October 28, 2019), 84 FR 58778 at 
n.6 (November 1, 2019) (SR-NYSECHX-2019-12). 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 
Exchange's affiliates the New York Stock Exchange LLC (``NYSE''), 
NYSE American LLC (``NYSE American''), NYSE Arca, Inc. (``NYSE 
Arca''), and NYSE National Inc. (``NYSE National'' and together, the 
``Affiliate SROs''). Each Affiliate SRO has submitted substantially 
the same proposed rule change to propose the changes described 
herein. See SR-NYSE-2024-17, SR-NYSEAMER-2024-20, SR-NYSEARCA-2024-
28, and SR-NYSENAT-2024-11.
    \5\ See 84 FR 58778, supra note 4.
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    Each of the Exchange and the Affiliate SROs has filed to establish 
an ``Aggregated Lite'' market data feed (the ``Aggregated Lite 
Feeds'').\6\ Accordingly, the Exchange proposes to update the table of 
Included Data Products to include the Aggregated Lite Feeds. To 
implement the change, the Exchange proposes to update the table of 
Included Data Products of the NYSE, NYSE American and NYSE Arca as 
follows (proposed additions underlined):
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    \6\ See Securities Exchange Act Release No. 99691 (March 7, 
2024), 89 FR 18468 (March 13, 2024) (SR-NYSECHX-2024-08).
[GRAPHIC] [TIFF OMITTED] TN28MR24.023

    When NYSE Chicago and NYSE National were added to the Included Data 
Products, the individual market data feeds offered were not broken 
out.\7\ Accordingly, in addition to adding the Aggregated Lite Feeds, 
the Exchange proposes to break out the NYSE Chicago and NYSE National 
market data feeds in Included Data Products, as follows (proposed 
additions underlined):
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    \7\ See 84 FR 58778, supra note 4, and Securities Exchange Act 
Release No. 83351 (May 31, 2018), 83 FR 26314 (June 6, 2018) (SR-
NYSENAT-2018-07) (Notice of Filing and Immediate Effectiveness of 
Proposed Rule Change To Adopt Co-Location Services and Fees In 
Connection With the Re-Launch of Trading on the Exchange and To 
Amend Its Schedule of Fees and Rebates To Provide for Such Co-
Location Services).
[GRAPHIC] [TIFF OMITTED] TN28MR24.024


[[Page 21568]]


    The Exchange expects that the present filing will become operative 
immediately upon the filings to establish a fee for the Aggregated Lite 
Feed becoming operative. The Exchange expects such operative date or 
dates to be no later than the second quarter of 2024. It will announce 
the date or dates through a customer notice.
    The Exchange does not charge for connectivity to the Included Data 
Feeds. Accordingly, it would not charge for connectivity to the 
Aggregated Lite Feeds.
General
    The proposed changes would not apply differently to distinct types 
or sizes of market participants. Rather, they would apply to all Users 
equally. As is currently the case, the purchase of any colocation 
service, including connectivity to the Aggregated Lite Feeds, would be 
completely voluntary and the Fee Schedule would be applied uniformly to 
all Users. FIDS does not expect that the proposed rule change will 
result in new Users.
    The proposed changes are 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.
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.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
    \10\ 15 U.S.C. 78f(b)(4).
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The Proposed Change Is Reasonable
    The Exchange believes that the proposed rule change is reasonable 
and would perfect the mechanisms of a free and open market and a 
national market system and, in general, protect investors and the 
public interest, because adding the Aggregated Lite Feeds would 
increase the number of Included Data Products available to Users for no 
additional charge. All Users that voluntarily select to access the LCN 
or IP network would not be subject to a charge above and beyond the fee 
paid for the relevant LCN or IP network access. Accordingly, the 
Exchange believes that the proposed change is reasonable because the 
change would mean that a User would have the option of adding 
connectivity to additional market data feeds without paying additional 
charges.
    Adding the proposed additional Included Data Products would allow a 
User to connect to any of the Aggregated Lite Feeds that it wished, but 
would not require it to do so. As now, a User would be able to 
determine which Included Data Products, if any, to which it connects, 
based on what would best serve its needs, tailoring the service to the 
requirements of its business operations.
    The Exchange believes that the proposed rule change is reasonable 
because, as with the other Included Data Products, it believes it is 
not the exclusive method to connect to the Aggregated Lite Feeds. As 
alternatives to connecting to the Aggregated Lite Feeds as Included 
Data Products, a User may connect to the market data feeds through 
another User or through a connection to an Exchange access center 
outside the data center, third party access center, or third party 
vendor.
    By adding the Aggregated Lite Feeds and setting forth the NYSE 
Chicago and NYSE National feeds already offered, the proposed change 
would ensure that the list of Included Data Products was up to date and 
consistent in the level of detail. Accordingly, the Exchange believes 
that the proposed rule change is reasonable and would perfect the 
mechanisms of a free and open market and a national market system and, 
in general, protect investors and the public interest, as it would 
ensure that the description of Included Data Products was complete, 
ensuring that it is accessible and transparent, and providing market 
participants with clarity as to what connectivity is included in the 
purchase of access to the LCN and IP networks.
The Proposed Change Is Equitable and Not Unfairly Discriminatory
    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 adding the Aggregated Lite Feeds would increase the 
number of Included Data Products available to Users for no additional 
charge. All Users that voluntarily select to access the LCN or IP 
network would not be subject to a charge above and beyond the fee paid 
for the relevant LCN or IP network access. Accordingly, the Exchange 
believes that the proposed change is equitable and not unfairly 
discriminatory because the change would mean that a User would have the 
option of adding connectivity to additional market data feeds without 
paying additional charges.
    Further, the Exchange believes that the proposed change is 
equitable and not unfairly discriminatory since, as is true now, the 
proposed change would not apply differently to distinct types or sizes 
of Users but would apply to all Users equally. Moreover, adding the 
proposed additional Included Data Products would allow a User to 
connect to any of the Aggregated Lite Feeds that it wished, but would 
not require it to do so. As now, a User would be able to determine 
which Included Data Products, if any, to which it connects, based on 
what would best serve its needs, tailoring the service to the 
requirements of its business operations.
    By adding the Aggregated Lite Feeds and setting forth the NYSE 
Chicago and NYSE National feeds already offered, the proposed change 
would ensure that the list of Included Data Products was up to date and 
consistent in the level of detail. Accordingly, the Exchange believes 
that the proposed rule change is equitable and not unfairly 
discriminatory, as it would ensure that the description of Included 
Data Products was complete, ensuring that it is accessible and 
transparent, and providing market participants with clarity as to what 
connectivity is included in the purchase of access to the LCN and IP 
networks.
    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.

[[Page 21569]]

    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.\11\
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    \11\ 15 U.S.C. 78f(b)(8).
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    The Exchange believes that the proposed rule change does not impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because adding the Aggregated 
Lite Feeds would increase the number of Included Data Products 
available to Users for no additional charge. All Users that voluntarily 
select to access the LCN or IP network would not be subject to a charge 
above and beyond the fee paid for the relevant LCN or IP network 
access. Accordingly, the change would mean that a User would have the 
option of adding connectivity to additional market data feeds without 
paying additional charges.
    Adding the proposed additional Included Data Products would allow a 
User to connect to any of the Aggregated Lite Feeds that it wished, but 
would not require it to do so. In this way, the proposed changes would 
enhance competition by, as now, enabling a User to determine to which 
Included Data Products, if any, it connects, based on what would best 
serve its needs, tailoring the service to the requirements of its 
business operations.
    The Exchange believes that the proposed rule change does not impose 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because, as with the other 
Included Data Products, it believes it is not the exclusive method to 
connect to the Aggregated Lite Feeds. As alternatives to connecting to 
the Aggregated Lite Feeds as Included Data Products, a User may connect 
to the market data feeds through another User or through a connection 
to an Exchange access center outside the data center, third party 
access center, or third party vendor.
    By adding the Aggregated Lite Feeds and setting forth the NYSE 
Chicago and NYSE National feeds already offered, the proposed change 
would ensure that the list of Included Data Products was up to date and 
consistent in the level of detail. Accordingly, the Exchange believes 
that the proposed additions to the description of Included Data 
Products would make the description more accessible and transparent. In 
this manner, the proposed change would provide market participants with 
clarity as to what connectivity is included in the purchase of access 
to the LCN and IP networks, thereby enhancing competition by ensuring 
that all Users have access to the same information regarding the 
Included Data Products.

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 Exchange has filed the proposed rule change pursuant to section 
19(b)(3)(A)(iii) of the Act \12\ and Rule 19b-4(f)(6) thereunder.\13\ 
Because the proposed rule change does not: (i) significantly affect the 
protection of investors or the public interest; (ii) impose any 
significant burden on competition; and (iii) become operative prior to 
30 days from the date on which it was filed, or such shorter time as 
the Commission may designate, if consistent with the protection of 
investors and the public interest, the proposed rule change has become 
effective pursuant to section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.\14\
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    \12\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \13\ 17 CFR 240.19b-4(f)(6).
    \14\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires the Exchange to give the Commission written notice of its 
intent to file the proposed rule change, along with a brief 
description and text of the proposed rule change, at least five 
business days prior to the date of filing of the proposed rule 
change, or such shorter time as designated by the Commission. The 
Exchange has satisfied this requirement.
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    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) \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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-NYSECHX-2024-13 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-NYSECHX-2024-13. 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-NYSECHX-2024-13 and should 
be submitted on or before April 18, 2024.

    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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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-06584 Filed 3-27-24; 8:45 am]
BILLING CODE 8011-01-P