[Federal Register Volume 89, Number 95 (Wednesday, May 15, 2024)]
[Notices]
[Pages 42518-42521]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-10599]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-100098; File No. SR-NYSECHX-2024-16]


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

May 9, 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 April 29, 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.

[[Page 42519]]

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 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-2024-25, SR-NYSEAMER-2024-27, SR-NYSEARCA-2024-
35, and SR-NYSENAT-2024-14.
    \5\ See Securities Exchange Act Release No. 87408 (October 28, 
2019), 84 FR 58778 (November 1, 2019) (SR-NYSECHX-2019-12) (Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend the Fee Schedule of NYSE Chicago, Inc.).
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    The NYSE has filed to establish the ``NYSE Pillar Depth'' market 
data feed.\6\ Accordingly, the Exchange proposes to update the table of 
Included Data Products to include the NYSE Pillar Depth market data 
feed. In addition, in the current table the NYSE American Options and 
NYSE Arca Options market data feeds offered are not broken out.\7\ 
Accordingly, the Exchange proposes to do so now.
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    \6\ See Securities Exchange Act Release No. 100030 (April 25, 
2024) (SR-NYSE-2024-24) (Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change to Establish the NYSE Pillar 
Depth Data Feed).
    \7\ See 84 FR 58778, Note 5, supra.
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    To implement the proposed rule change, the Exchange proposes to 
update the table of Included Data Products as follows (proposed 
additions italicized):

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NYSE:
    NYSE Aggregated Lite.
    NYSE Alerts.
    NYSE BBO.
    NYSE Integrated Feed.
    NYSE OpenBook.
    NYSE Order Imbalances.
    NYSE Pillar Depth.
    NYSE Trades.
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NYSE American Options:
    NYSE American Options Top Feed.
    NYSE American Options Deep Feed.
    NYSE American Options Complex Order Book.
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NYSE Arca Options:
    NYSE Arca Options Top Feed.
    NYSE Arca Options Deep Feed.
    NYSE Arca Options Complex Order Book.
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    The Exchange expects that the present filing will become operative 
on the later of (a) the present filing becoming operative; and (b) the 
filing to establish a fee for the NYSE Pillar Depth market data feed 
becoming operative.\8\ The Exchange expects such operative date to be 
no later than the end of the second quarter of 2024.
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    \8\ If no such filing is made, then the present filing would 
become operative upon the NYSE Pillar Depth market data feed 
becoming operative.
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    The Exchange does not charge for connectivity to the Included Data 
Feeds. Accordingly, it would not charge for connectivity to the NYSE 
Pillar Depth market data feed.
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 NYSE Pillar Depth market data 
feed, 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 colocation 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,\9\ in general, and furthers the 
objectives of Section 6(b)(5) of the Act,\10\ 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,\11\ 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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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ 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 NYSE Pillar Depth market data feed 
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 the additional market data feed without paying 
additional charges.
    Adding the proposed additional Included Data Product would allow a 
User to connect to the NYSE Pillar Depth market data feed if 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 NYSE Pillar Depth market 
data feed. As alternatives to connecting to the NYSE Pillar Depth 
market data feed as an Included Data Product, a User may connect to the 
market data feed 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 NYSE Pillar Depth market data feed and setting forth 
the

[[Page 42520]]

NYSE American Options and NYSE Arca Options 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 NYSE Pillar Depth market data feed 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 the additional market data 
feed 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 
NYSE Pillar Depth market data feed would allow a User to connect to it 
if 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 NYSE Pillar Depth market data feed and setting forth 
the NYSE American Options and NYSE Arca Options 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.
    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 proposed change would 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.
    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 NYSE Pillar 
Depth market data feed 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 the additional market data 
feed without paying additional charges.
    Adding the proposed additional Included Data Products would allow a 
User to connect to the NYSE Pillar Depth market data feed if 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 NYSE Pillar Depth market data feed. As alternatives to 
connecting to the NYSE Pillar Depth market data feed as an Included 
Data Product, a User may connect to the market data feed 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 NYSE Pillar Depth market data feed and setting forth 
the NYSE American Options and NYSE Arca Options 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)(iii). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file 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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[[Page 42521]]

    A proposed rule change filed under Rule 19b-4(f)(6) \15\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b4(f)(6)(iii),\16\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has 
requested that the Commission waive the 30-day operative delay so that 
the proposal may become operative immediately upon filing. The Exchange 
states that waiver of the 30-day operative delay would be consistent 
with the protection of investors and the public interest because it 
would allow the Exchange to offer, and therefore ensure that Users 
could access, the NYSE Pillar Depth market data feed when it is 
available. For these reasons, the Commission finds that waiver of the 
operative delay is consistent with the protection of investors and the 
public interest. Accordingly, the Commission hereby waives the 30-day 
operative delay and designates the proposal operative upon filing.\17\
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    \15\ 17 CFR 240.19b-4(f)(6).
    \16\ 17 CFR 240.19b-4(f)(6)(iii).
    \17\ For purposes only of accelerating the operative date of 
this proposal, the Commission has considered the proposed rule's 
impact on efficiency, competition, and capital formation. 15 U.S.C. 
78c(f).
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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) \18\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \18\ 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-2024-16 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-2024-16. 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-2024-16 and should 
be submitted on or before June 5, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-10599 Filed 5-14-24; 8:45 am]
BILLING CODE 8011-01-P