12384 Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 

33 15 U.S.C. 78(b)(2). 34 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3A ‘‘Customer’’ is any entity that receives the BBO 

Data Feed directly from MDX’s system and then 

distributes it either internally or externally to 

Subscribers. A ‘‘Subscriber’’ is a person (other than 

an employee of a Customer) that receives the BBO 

Data Feed from a Customer for its own internal use. 

4The Exchange notes that MDX makes available 

to Customers the BBO data and last sale data that 

is included in the BBO Data Feed no earlier than 

the time at which the Exchange sends that data to 

the processors under the CQ, CTA and Nasdaq/UTP 

Plans. The Exchange also notes that it also makes 

the BBO data and last sale data that is included in 

the BBO Data Feed available directly to CBSX 

Trading Permit Holders, and permits them to 

redistribute the data to their customers. 

5 15 U.S.C. 78f(b). 

6 15 U.S.C. 78f(b)(4). 

7 15 U.S.C. 78f(b)(5). 

VII. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Exchange Act,33

that the proposed rule change (SR– 

FINRA–2010–061), as modified by 

Amendment No. 1, be, and hereby is, 

approved on an accelerated basis. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.34

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–5024 Filed 3–4–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63998; File No. SR–CBOE– 

2011–018] 

Self-Regulatory Organizations; 

Chicago Board Options Exchange, 

Incorporated; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Codify a Fee Schedule 

for the Sale by Market Data Express, 

LLC, of a BBO Data Feed for Securities 

Traded on CBSX 

March 1, 2011. 

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 February 

17, 2011, Chicago Board Options 

Exchange, Incorporated (‘‘CBOE’’ or the 

‘‘Exchange’’) 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 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

This proposal submitted by Chicago 

Board Options Exchange, Incorporated 

(‘‘CBOE’’ or ‘‘Exchange’’) is to codify a fee 

schedule for the sale by Market Data 

Express, LLC (‘‘MDX’’), an affiliate of 

CBOE, of a data product that includes 

CBOE Stock Exchange (‘‘CBSX’’) best bid 

and offer and trade data and certain 

related market data. The text of the 

proposed rule change is available on the 

Exchange’s Web site (http:// 

www.cboe.org/legal), at the Exchange’s 

Office of the Secretary 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, 

CBOE 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. CBOE has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to establish fees that MDX will 

charge for the sale of certain market data 

with respect to the trading of securities 

on CBSX. CBSX is CBOE’s stock trading 

facility. 

CBOE currently collects and processes 

market data with respect to quotes and 

orders and the prices of trades for all 

securities that are traded on CBSX. This 

market data includes the ‘‘best bid and 

offer,’’ or ‘‘BBO’’, consisting of all 

outstanding quotes and standing orders 

at the best available price level on each 

side of the market, with aggregate size 

(‘‘BBO data,’’ sometimes referred to as 

‘‘top of book data’’). Data with respect to 

executed trades is referred to as ‘‘last 

sale’’ data. CBOE reports CBSX BBO 

data under the Consolidated Quotation 

Plan (‘‘CQ Plan’’) and CBSX last sale data 

under the Consolidated Tape 

Association Plan (‘‘CTA Plan’’) with 

respect to NYSE-listed securities and 

securities listed on exchanges other than 

NYSE and Nasdaq for inclusion in those 

Plans’ consolidated data streams. CBOE 

reports CBSX BBO data and CBSX last 

sale data under the Nasdaq Unlisted 

Trading Privileges Plan (‘‘Nasdaq/UTP 

Plan’’) with respect to Nasdaq-listed 

securities for inclusion in that Plan’s 

consolidated data stream. 

MDX provides to ‘‘Customers’’ 3 a realtime, low latency data feed that includes 

the CBSX BBO data and last sale data. 

(This data feed is sometimes referred to 

in this filing as the ‘‘BBO Data Feed’’). 

The BBO and last sale data contained in 

the BBO Data Feed is identical to the 

data that CBOE sends to the processors 

under the CQ, CTA and Nasdaq/UTP 

Plans.4 In addition, the BBO Data Feed 

includes certain data that is not 

included in the data sent to the 

processors under the CQ, CTA and 

Nasdaq/UTP Plans, namely, totals of 

customer versus non-customer shares at 

the BBO and All-or-None contingency 

orders priced better than or equal to the 

BBO. The purpose of this proposed rule 

change is to establish the fees MDX will 

charge for the sale of the BBO Data 

Feed. 

MDX would charge Customers a 

‘‘direct connect fee’’ of $500 per 

connection per month. MDX would also 

charge Customers a ‘‘per user fee’’ of $25 

per month per ‘‘Authorized User’’ or 

‘‘Device’’ for receipt of the BBO Data 

Feed by Subscribers. An ‘‘Authorized 

User’’ is defined as an individual user 

(an individual human being) who is 

uniquely identified (by user ID and 

confidential password or other 

unambiguous method reasonably 

acceptable to MDX) and authorized by 

a Customer to access the BBO Data Feed 

supplied by the Customer. A ‘‘Device’’ is 

defined as any computer, workstation or 

other item of equipment, fixed or 

portable, that receives, accesses and/or 

displays data in visual, audible or other 

form. Either a CBSX Trading Permit 

Holder or a non-CBSX Trading Permit 

Holder may be a Customer. All 

Customers would be assessed the same 

fees. 

The proposed fees would be 

implemented on March 1, 2011. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the requirements of Section 6(b) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 5 in general, and, in particular, 

with Section 6(b)(4) of the Act 6 in that 

it provides for the equitable allocation 

of reasonable dues, fees and other 

charges among CBSX Trading Permit 

Holders and other persons using its 

facilities, and with Section 6(b)(5) 7 of 

the Act in that there will be no unfair 

discrimination between customers, 

issuers, brokers, or dealers in the 

distribution of the data. In addition, the 

Exchange believes that the proposed 


srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 12385 

8 15 U.S.C. 78f(b)(8). 

9See, Securities Exchange Act Release No. 59933 

(May 15, 2009), 74 FR 24889 (May 26, 2009) and 

http://www.nasdaqtrader.com. Nasdaq charges each 

non-professional subscriber to Nasdaq Basic a per 

subscriber monthly charge of $0.50 for Nasdaqlisted stocks, $0.25 for NYSE-listed stocks, and 

$0.25 for Amex-listed stocks. 

10See, Securities Exchange Act Release No. 62181 

(May 26, 2010), 75 FR 31488 (June 3, 2010) and 

http://www.nyxdata.com. 

11 15 U.S.C. 78s(b)(3)(A). 

12 17 CFR 240.19b–4(f)(2). [sic] 

rule change is consistent with the 

requirements of Section 6(b)(8) 8 of the 

Act in that it does not impose any 

burden on competition not necessary or 

appropriate in furtherance of the 

purposes of the Act. The fees charged 

would be the same for all market 

participants, and therefore do not 

unreasonably discriminate among 

market participants. 

The Exchange believes that the 

proposed market data fees are consistent 

with the requirements of the Act for 

several reasons. First, they compare 

favorably to fees that other markets 

charge for similar products. For 

example, the proposed direct connect 

fee of $500 per connection per month 

and per user fee of $25 per month 

compares favorably to the fees Nasdaq 

and NYSE charge for similar market 

data products. Nasdaq charges 

distributors of its ‘‘Nasdaq Basic’’ data 

feed a monthly fee of $1,500 per firm 

and charges each professional 

subscriber a per subscriber monthly 

charge of $10 for Nasdaq-listed stocks, 

$5 for NYSE-listed stocks, and $5 for 

Amex-listed stocks.9 Like the BBO Data 

Feed, the Nasdaq Basic data feed 

includes best bid and offer data and last 

sale data as well as other market data. 

NYSE charges a monthly fee of $1,500 

for the receipt of access to the ‘‘NYSE 

BBO’’ data feed plus $15 per month per 

professional subscriber and $5 per 

month per non-professional subscriber. 

The NYSE BBO data feed provides best 

bid and offer information for NYSEtraded securities.10

The Exchange also believes that the 

proposed fees for the BBO Data Feed are 

consistent with the requirements of the 

Act because competition provides an 

effective constraint on the market data 

fees that the Exchange, through MDX, 

has the ability and the incentive to 

charge. CBSX has a compelling need to 

attract order flow from market 

participants in order to maintain its 

share of trading volume. This 

compelling need to attract order flow 

imposes significant pressure on CBOE to 

act reasonably in setting its fees for 

market data, particularly given that the 

market participants that will pay such 

fees often will be the same market 

participants from whom CBSX must 

attract order flow. These market 

participants include broker-dealers that 

control the handling of a large volume 

of customer and proprietary order flow. 

Given the portability of order flow from 

one exchange to another, any exchange 

that sought to charge unreasonably high 

data fees would risk alienating many of 

the same customers on whose orders it 

depends for competitive survival. CBSX 

competes for order flow with the other 

national securities exchanges that 

currently trade equities, with electronic 

communication networks (‘‘ECNs’’) and 

with other trading platforms. 

CBOE is constrained in pricing the 

BBO Data Feed by the availability to 

market participants of alternatives to 

purchasing the BBO Data Feed. CBOE 

must consider the extent to which 

market participants would choose one 

or more alternatives instead of 

purchasing the exchange’s data. For 

example, the BBO data and last sale data 

available in the BBO Data Feed is 

included in the CQ, CTA and Nasdaq/ 

UTP data feeds. The CQ, CTA and 

Nasdaq/UTP data feeds are widely 

distributed and relatively inexpensive, 

thus constraining CBOE’s ability to 

price the BBO Data Feed. In this respect, 

the CQ, CTA and Nasdaq/UTP data 

feeds, which include CBSX’s transaction 

information, are significant alternatives 

to the BBO Data Feed product. 

Further, the various self-regulatory 

organizations, ECNs and the several 

Trade Reporting Facilities of FINRA that 

produce proprietary data are sources of 

competition for MDX. As noted above, 

Nasdaq and NYSE offer market data 

products that compete with the BBO 

Data Feed. In addition, the Exchange 

believes other exchanges may currently 

offer top-of-book market data products 

for a fee or for free. 

For the reasons cited above, the 

Exchange believes that the BBO Data 

Feed offering, including the proposed 

fees, is equitable, fair, reasonable and 

not unreasonably discriminatory. In 

addition, the Exchange believes that no 

substantial countervailing basis exists to 

support a finding that the proposed 

terms and fees for the BBO Data Feed 

fails to meet the requirements of the 

Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE does not believe that the 

proposed rule change will impose any 

burden on competition that is not 

necessary or appropriate in furtherance 

of purposes of the Act. The Exchange 

believes that the BBO Data Feed offered 

by MDX will help attract new users and 

new order flow to CBSX, thereby 

improving CBSX’s ability to compete in 

the market for order flow and 

executions. 

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 has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 11 and subparagraph (f)(2) of 

Rule 19b–4 12 thereunder. 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. 

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 e-mail to rulecomments@sec.gov. Please include File 

Number SR–CBOE–2011–018 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–CBOE–2011–018. This file 

number should be included on the 

subject line if e-mail 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 


srobinson on DSKHWCL6B1PROD with NOTICES
12386 Federal Register / Vol. 76, No. 44 / Monday, March 7, 2011 / Notices 

13 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3A ‘‘Customer’’ is any entity that receives the BBO 

Data Feed directly from MDX’s system and then 

distributes it either internally or externally to 

Subscribers. A ‘‘Subscriber’’ is a person (other than 

an employee of a Customer) that receives the BBO 

Data Feed from a Customer for its own internal use. 

4The Exchange notes that MDX makes available 

to Customers the BBO data and last sale data that 

is included in the BBO Data Feed no earlier than 

the time at which the Exchange sends that data to 

OPRA. The Exchange also notes that it also makes 

the BBO data and last sale data that is included in 

the BBO Data Feed available directly to its Trading 

Permit Holders, and permits them to redistribute 

the data to their customers. 

5 15 U.S.C. 78f(b). 

6 15 U.S.C. 78f(b)(4). 

7 15 U.S.C. 78f(b)(5). 

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 on official business 

days between the hours of 10 a.m. and 

3 p.m. Copies of such filing also will be 

available for inspection and copying at 

the principal offices 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–CBOE–2011–018, and 

should be submitted on or before March 

28, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Cathy H. Ahn, 

Deputy Secretary. 

[FR Doc. 2011–5063 Filed 3–4–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–63996; File No. SR–C2– 

2011–007] 

Self-Regulatory Organizations; C2 

Options Exchange, Incorporated; 

Notice of Filing and Immediate 

Effectiveness of Proposed Rule 

Change to Codify a Fee Schedule for 

the Sale by Market Data Express, LLC, 

of a BBO Data Feed for C2 Listed 

Options 

March 1, 2011. 

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 February 

17, 2011, C2 Options Exchange, 

Incorporated (‘‘C2’’ 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 Exchange. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

This proposal submitted by C2 

Options Exchange, Incorporated (‘‘C2’’ or 

‘‘Exchange’’) is to codify a fee schedule 

for the sale by Market Data Express, LLC 

(‘‘MDX’’), an affiliate of C2, of a data 

product that includes C2 best bid and 

offer and trade data and certain related 

market data. The text of the proposed 

rule change is available on the 

Exchange’s website. (http:// 

www.cboe.org/legal), at the Exchange’s 

Office of the Secretary and at the 

Commission. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, C2 

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. C2 has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to establish fees that MDX will 

charge for the sale of certain market data 

with respect to the trading of options on 

C2’s market. 

C2 currently collects and processes 

market data with respect to options 

quotes and orders and the prices of 

trades that are executed on the 

Exchange. This market data includes the 

‘‘best bid and offer,’’ or ‘‘BBO’’, 

consisting of all outstanding quotes and 

standing orders at the best available 

price level on each side of the market, 

with aggregate size (‘‘BBO data,’’ 

sometimes referred to as ‘‘top of book 

data’’). Data with respect to executed 

trades is referred to as ‘‘last sale’’ data. 

C2 formats its BBO data and last sale 

data according to Options Price 

Reporting Authority (‘‘OPRA’’) 

specifications and sends the data to 

OPRA for redistribution to the public. 

MDX provides to ‘‘Customers’’ 3 a realtime, low latency data feed that includes 

the C2 BBO data and last sale data. (This 

data feed is sometimes referred to in this 

filing as the ‘‘BBO Data Feed’’). The BBO 

and last sale data contained in the BBO 

Data Feed is identical to the data that C2 

sends to OPRA.4 In addition, the BBO 

Data Feed includes certain data that is 

not included in the data sent to OPRA, 

namely, totals of customer versus noncustomer contracts at the BBO, All-orNone contingency orders priced better 

than or equal to the BBO, and BBO data 

and last sale data for complex strategies 

(e.g., spreads, straddles, buy-writes, 

etc.). The purpose of this proposed rule 

change is to establish the fees MDX will 

charge for the sale of the BBO Data 

Feed. 

MDX would charge Customers a 

‘‘direct connect fee’’ of $1,000 per 

connection per month. MDX would also 

charge Customers a ‘‘per user fee’’ of $25 

per month per ‘‘Authorized User’’ or 

‘‘Device’’ for receipt of the BBO Data 

Feed by Subscribers. An ‘‘Authorized 

User’’ is defined as an individual user 

(an individual human being) who is 

uniquely identified (by user ID and 

confidential password or other 

unambiguous method reasonably 

acceptable to MDX) and authorized by 

a Customer to access the BBO Data Feed 

supplied by the Customer. A ‘‘Device’’ is 

defined as any computer, workstation or 

other item of equipment, fixed or 

portable, that receives, accesses and/or 

displays data in visual, audible or other 

form. Either a C2 Trading Permit Holder 

or a non-C2 Trading Permit Holder may 

be a Customer. All Customers would be 

assessed the same fees. 

The proposed fees would be 

implemented on March 1, 2011. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the requirements of Section 6(b) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 5 in general, and, in particular, 

with Section 6(b)(4) of the Act 6 in that 

it provides for the equitable allocation 

of reasonable dues, fees and other 

charges among C2 Trading Permit 

Holders and other persons using its 

facilities, and with Section 6(b)(5) 7 of 


srobinson on DSKHWCL6B1PROD with NOTICES