[Federal Register Volume 83, Number 248 (Friday, December 28, 2018)]
[Notices]
[Pages 67408-67416]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-28198]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84901; File No. SR-FINRA-2018-042]


Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend FINRA Rules 7610A and 7620A To Modify 
Certain Fees and Credits Applicable to FINRA/Nasdaq TRF Retail 
Participants

December 20, 2018.

    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on December

[[Page 67409]]

17, 2018, Financial Industry Regulatory Authority, Inc. (``FINRA'') 
filed with the Securities and Exchange Commission (``SEC'' or 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by FINRA. FINRA has 
designated the proposed rule change as ``establishing or changing a 
due, fee or other charge'' under Section 19(b)(3)(A)(ii) of the Act \3\ 
and Rule 19b-4(f)(2) thereunder,\4\ which renders the proposal 
effective upon receipt of this filing by the Commission. 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\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    FINRA is proposing to amend FINRA Rules 7610A and 7620A to modify 
certain fees and credits applicable to Retail Participants that use the 
FINRA/Nasdaq Trade Reporting Facility Carteret (the ``FINRA/Nasdaq TRF 
Carteret'') and/or the FINRA/Nasdaq Trade Reporting Facility Chicago 
(the ``FINRA/Nasdaq TRF Chicago''). Under FINRA rules and as used 
herein, the term ``FINRA/Nasdaq TRF'' means the FINRA/Nasdaq TRF 
Carteret, the FINRA/Nasdaq TRF Chicago, or both, as applicable, 
depending on the facility or facilities to which the participant elects 
to report.
    The text of the proposed rule change is available on FINRA's 
website at http://www.finra.org, at the principal office of FINRA 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, FINRA 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. FINRA 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 FINRA/Nasdaq TRF is a facility of FINRA that is operated by 
Nasdaq, Inc. (``Nasdaq''). In connection with the establishment of the 
FINRA/Nasdaq TRF, FINRA and Nasdaq entered into a limited liability 
company agreement (the ``LLC Agreement''). Under the LLC Agreement, 
FINRA, the ``SRO Member,'' has sole regulatory responsibility for the 
FINRA/Nasdaq TRF. Nasdaq, the ``Business Member,'' is primarily 
responsible for the management of the FINRA/Nasdaq TRF's business 
affairs, including establishing pricing for use of the FINRA/Nasdaq 
TRF, to the extent those affairs are not inconsistent with the 
regulatory and oversight functions of FINRA. Additionally, the Business 
Member is obligated to pay the cost of regulation and is entitled to 
the profits and losses, if any, derived from the operation of the 
FINRA/Nasdaq TRF.
    Pursuant to the FINRA Rule 7600A Series, FINRA/Nasdaq TRF 
participants are charged fees, may qualify for fee caps (Rule 7620A), 
and also may qualify for revenue sharing payments for trade reporting 
to the FINRA/Nasdaq TRF (Rule 7610A). These rules are administered by 
Nasdaq, in its capacity as the Business Member and operator of the 
FINRA/Nasdaq TRF on behalf of FINRA,\5\ and Nasdaq collects all fees on 
behalf of the FINRA/Nasdaq TRF.
---------------------------------------------------------------------------

    \5\ FINRA's oversight of this function performed by the Business 
Member is conducted through a recurring assessment and review of TRF 
operations by an outside independent audit firm.
---------------------------------------------------------------------------

    Pursuant to Supplementary Material .01 to FINRA Rule 7620A, a 
``Retail Participant'' \6\ is a participant ``for which substantially 
all of its trade reporting activity on the FINRA/Nasdaq Trade Reporting 
Facility comprises Retail Orders.'' \7\ Under FINRA Rule 7620A, Retail 
Participants presently are subject to four categories of transaction-
based fees, each of which is applicable to transactions on the three 
Tapes: \8\ (1) Media/Executing Party; (2) Non-Media/Executing Party; 
(3) Media/Contra Party; and (4) Non-Media/Contra Party.\9\ Rule 7620A 
provides that for any of these categories of fees, a Retail Participant 
may qualify for a cap on the fees it would otherwise pay to report 
trades to a particular Tape during a given month, provided that during 
the month, the Retail Participant achieves a daily average number of 
Media/Executing Party trades of at least 2,500 in that same Tape.\10\ 
The uncapped fee rates and cap amounts that apply to Retail 
Participants are different from those that apply to non-Retail 
Participants under the Rule.\11\
---------------------------------------------------------------------------

    \6\ To qualify as a ``Retail Participant'' and for special 
pricing under the Retail Participant fee schedule, a participant 
must complete and submit to Nasdaq, as the Business Member, an 
application. The application form requires the participant to attest 
to its qualifications as a Retail Participant on the FINRA/Nasdaq 
TRF in which it is a participant and for which it seeks Retail 
Participant pricing. The participant must also attest to its 
reasonable expectation that it will maintain its qualifications for 
a one year period following the date of attestation. Once a 
participant has been designated as a Retail Participant, it must 
complete and submit a written attestation to Nasdaq on an annual 
basis to retain its status as such. A Retail Participant must inform 
Nasdaq promptly if at any time it ceases to qualify or it reasonably 
expects that it will cease to qualify as a Retail Participant.
    \7\ Pursuant to FINRA Rule 7260A.01, a ``Retail Order'' means 
``an order that originates from a natural person, provided that, 
prior to submission, no change is made to the terms of the order 
with respect to price or side of market and the order does not 
originate from a trading algorithm or any other computerized 
methodology.''
    \8\ Market data is transmitted to three tapes based on the 
listing venue of the security: New York Stock Exchange securities 
(``Tape A''), NYSE American and regional exchange securities (``Tape 
B''), and Nasdaq Stock Market securities (``Tape C'').
    \9\ Media eligible trade reports are those that are submitted to 
the FINRA/Nasdaq TRF for public dissemination by the Securities 
Information Processors (``SIPs''). By contrast, non-media trade 
reports are not submitted to the FINRA/Nasdaq TRF for public 
dissemination, but are submitted for regulatory and/or clearance and 
settlement purposes.
    Pursuant to the Rule's Supplementary Material, the ``Executing 
Party (EP)'' is defined as the member with the trade reporting 
obligation under FINRA rules, and the ``Contra (CP)'' is defined as 
the member on the contra side of a trade report.
    \10\ Additionally, the Rule provides for a monthly Participation 
Fee, from which Retail Participants are exempt. It also provides for 
two special fee cap programs--known as the ``ATS Market Maker Media/
Contra Party Cap'' and the ``ATS Market Maker Combined Media 
Activity Cap''--for participants that make markets in an alternative 
trading system (``ATS'').
    \11\ Retail Participants generally do not achieve Executing 
Party activity sufficient to qualify for cap programs due to the 
nature and scale of their retail businesses. Retail orders that 
originate from natural persons or from nonprofessional investors are 
not produced in the same volumes or notional amounts as are orders 
that originate from professional executing broker firms. To date, 
only one Retail Participant has achieved enough Executing Party 
activity to qualify for a cap.
---------------------------------------------------------------------------

    Under Rule 7610A, FINRA members that report over-the-counter 
(``OTC'') transactions in NMS stocks to a FINRA/Nasdaq TRF for public 
dissemination or ``media'' purposes may receive quarterly transaction 
credits that equal a percentage of FINRA/Nasdaq TRF revenues that are 
attributable to the members' transactions.\12\ The percentage of 
attributable revenue that a FINRA member may receive in the form of a 
transaction credit varies depending upon the extent of the member's 
market share on the FINRA/Nasdaq TRF.\13\ The

[[Page 67410]]

schedule of transaction credits is as follows. (Presently, it does not 
distinguish among categories of FINRA/Nasdaq TRF participants.)
---------------------------------------------------------------------------

    \12\ Under the Rule, a transaction is attributable to a FINRA 
member if a trade report submitted to the FINRA/Nasdaq TRF that the 
FINRA/Nasdaq TRF then submits to either of the SIPs identifies the 
FINRA member as the Executing Party on the transaction.
    \13\ For purposes of this Rule, the term ``market share'' means 
a percentage calculated by dividing the total number of shares 
represented by trades reported by a FINRA member to the FINRA/Nasdaq 
TRF for media purposes during a given calendar quarter by the total 
number of shares represented by all trades reported to the 
Consolidated Tape Association or the Nasdaq Securities Information 
Processor, as applicable, during that quarter. Market Share is 
calculated separately for each tape. See Rule 7620A. The Rule notes, 
moreover, that if a FINRA member reports trades to both FINRA/Nasdaq 
TRFs during a given calendar quarter, then ``market share'' shall be 
calculated by dividing the total number of shares represented by 
trades reported by the member to both of the FINRA/Nasdaq TRFs 
during that calendar quarter by the total number of shares 
represented by all trades reported to the Consolidated Tape 
Association or the Nasdaq SIP, as applicable, during that quarter.

------------------------------------------------------------------------
                                                        Percent of
            Percentage market share               attributable  revenue
                                                          shared
------------------------------------------------------------------------
Tape A:
    Greater than or equal to 2%................                       98
    Less than 2% but greater than or equal to                         95
     1%........................................
    Less than 1% but greater than or equal to                         75
     0.50%.....................................
    Less than 0.50% but greater than or equal                         20
     to 0.10%..................................
    Less than 0.10%............................                        0
Tape B:
    Greater than or equal to 2%................                       98
    Less than 2% but greater than or equal to                         90
     1%........................................
    Less than 1% but greater than or equal to                         70
     0.35%.....................................
    Less than 0.35% but greater than or equal                         10
     to 0.10%..................................
    Less than 0.10%............................                        0
Tape C:
    Greater than or equal to 2%................                       98
    Less than 2% but greater than or equal to                         95
     1%........................................
    Less than 1% but greater than or equal to                         75
     0.50%.....................................
    Less than 0.50% but greater than or equal                         20
     to 0.10%..................................
    Less than 0.10%............................                        0
------------------------------------------------------------------------

    The Rule 7600A Series expressly provides that the schedules of 
credits and fees apply to reporting activity that occurs on either or 
both of the FINRA/Nasdaq TRFs and a participant's eligibility for any 
volume-based credits or fee caps will be determined based upon its 
aggregate reporting volume between the two FINRA/Nasdaq TRFs. Nasdaq, 
as the Business Member, has determined to make several amendments to 
the current schedules of fees, caps, and credits. There is substantial 
competition in the market for OTC trade reporting between the FINRA/
Nasdaq TRF and the FINRA/NYSE TRF, as evidenced by a recent shift in 
market share between these facilities.\14\ The proposed rule change 
responds to these competitive forces by reducing the fees that most 
Retail Participants pay to the FINRA/Nasdaq TRF. It also establishes a 
new transaction credit program that will be more accessible to Retail 
Participants than is the existing credit program. The proposed rule 
change also clarifies the fee schedule and corrects a typographical 
error in the existing fee schedule. Each of these proposed changes is 
described in detail below.
---------------------------------------------------------------------------

    \14\ Nasdaq understands, based upon Retail Participant feedback, 
that recent market share changes are attributable to disparities in 
pricing between the FINRA/Nasdaq TRF and the FINRA/NYSE TRF. Due to 
pricing concerns, some Retail Participants have instructed their 
executing counterparties to shift their trade reporting activity 
from the FINRA/Nasdaq TRF to the FINRA/NYSE TRF. The proposed rule 
change seeks to lower Retail Participant pricing on the FINRA/Nasdaq 
TRF to render the FINRA/Nasdaq TRF a more attractive trade reporting 
venue for this market segment.
---------------------------------------------------------------------------

General Clarification and Reorganization
    First, the proposed rule change clarifies Rule 7620A by adding 
roman numerals to each of the headings in the fee schedule and also 
letters and numbers to its subheadings. These proposed changes will 
render the fee schedule easier to read and understand, particularly 
when there is a need to cross-reference the various fee programs 
contained therein.
    The proposed rule change also moves the example of the operation of 
the fee schedule, which presently appears immediately under the heading 
``Non-Comparison/Accept (Non-Match/Compare) Trade Report Fees and Caps 
on Trade Report Fees'' (to be numbered ``II''), to the subheading ``Cap 
Qualifying Activity (Requisite Daily Average Media/Executing Party 
Trade Reporting Activity for a Participant to Qualify for Fee Caps in 
Paragraphs 1-4 Above)'' (to be relocated to follow subparagraphs 1 
through 4 and numbered ``II.A''). Movement of this example is necessary 
because of other proposed changes to the Rule, to be discussed below, 
which will render the example applicable only under the fee program set 
forth in revised subparagraph II.A. As discussed below, the proposed 
rule change adds new examples that are tailored for the new Retail 
Participant fee programs that will be set forth in proposed 
subparagraphs II.B and II.C.
    Additionally, the proposed rule change adds a clarifying sentence 
beneath proposed paragraph II, which states that a participant's 
activity that qualifies for more than one special fee program under the 
Rule will automatically receive the benefit of the lowest applicable 
fee rate or cap. The purpose of this sentence is to clarify how the fee 
schedule operates where multiple discounts or caps apply to the same 
activity on the FINRA/Nasdaq TRF. An example of the application of this 
principle is included in the Rule text, under proposed subparagraph 
II.C, and below.
    Lastly, the proposed rule change amends the definition of a 
``Retail Order,'' in Supplementary Material .01 to Rule 7620A, to 
clarify that it includes orders ``on behalf of accounts that are held 
in a corporate legal form, such as an Individual Retirement Account, 
Corporation, or a Limited Liability Corporation that has been 
established for the benefit of an individual or group of related family 
members, provided that the order is submitted by an individual.'' 
Although the existing definition arguably implies that a Retail Order 
already includes such orders,

[[Page 67411]]

prospective Retail Participants have requested the proposed 
clarification to eliminate any uncertainty in this regard.
Special Pricing Programs for Retail Participants
    The proposed rule change will replace the existing pricing programs 
for Retail Participants with two new programs that are intended to 
substantially decrease the fees that many Retail Participants pay to 
the FINRA/Nasdaq TRF. The first new program is the Retail Participant 
Contra Party Fee Discount and Cap Program and the second one is the 
Retail Participant Combined Cap Program. These new pricing programs are 
described below.\15\
---------------------------------------------------------------------------

    \15\ The proposed rule change would specify that if a 
participant in the FINRA/Nasdaq TRF is approved as a Retail 
Participant on or before the twenty-second day of a month, such 
approval will be deemed effective, for purposes of Rule 7620A, as of 
the first day of that month, whereas an approval that occurs after 
the twenty-second day of the month will be deemed effective the 
first day of the next month. If a participant in the FINRA/Nasdaq 
TRF notifies Nasdaq, Inc. that it no longer qualifies as a Retail 
Participant during a given month, such notification shall be deemed 
effective, for purposes of Rule 7620A, as of the first day of the 
next month.
---------------------------------------------------------------------------

Retail Participant Contra Party Fee Discount and Cap Program
    The first proposed pricing program, which is set forth in a new 
subparagraph II.B, will focus on a Retail Participant's Contra Party 
activity on the FINRA/Nasdaq TRF. Most of the activity in which Retail 
Participants engage on the FINRA/Nasdaq TRF is Contra Party activity, 
and this new program is intended to reduce substantially the fees that 
Retail Participants, and their clients, pay for engaging in such 
activity.
    Presently, a Retail Participant that engages in Contra Party 
activity on the FINRA/Nasdaq TRF pays the following fees. The monthly 
charge for a Retail Participant that engages in Media/Contra Party 
(Non-Media/Contra Party) activity is $0.013 multiplied by the number of 
Media/Contra Party (Non-Media/Contra Party) trades that the participant 
reports to the FINRA/Nasdaq TRF during the month. Retail Participants 
qualify for a cap (on a per Tape basis) on Media/Contra Party (Non-
Media/Contra Party) fees during a given month if they report to the 
FINRA/Nasdaq TRFs, on average, at least 2,500 Media/Executing Party 
trades per day in Tapes A, B, or C. If capped, Media/Contra Party (Non-
Media/Contra Party) fees for a Retail Participant equal $0.013 
multiplied by 2,500 multiplied by the number of trading days during 
that month.
    The proposed rule change will largely replace this pricing scheme 
with a new one that will make it easier for Retail Participants to 
qualify for discounts or caps on their Contra Party activity. 
Specifically, a Retail Participant will be entitled to receive special 
tiered pricing on its Contra Party activity even when it has no 
corresponding Media/Executing Party Activity. Under the proposed 
program, a Retail Participant will qualify for discounted or capped 
fees to the extent that it achieves, during a given month, a qualifying 
volume of average daily Contra Party activity (Media, Non-Media, or 
both) in a particular Tape. Within each Tape, a qualifying Retail 
Participant will receive a volume-based discount on its monthly 
uncapped Contra Party activity charges relative to the standard 
rate.\16\ For both Media/Contra Party and Non-Media/Contra Party 
activity, the standard uncapped rate is the number of Media/Contra 
Party (Non-Media/Contra Party) reports during the month multiplied by 
$0.013, whereas the discounted rates under the new program will be the 
number of Media/Contra Party (Non-Media/Contra Party) reports 
multiplied by the following:
---------------------------------------------------------------------------

    \16\ The structure of the proposed tiers differs within each 
Tape. The tiers are structured to enable Retail Participants to 
qualify for special pricing on Contra Party activity beginning at 
lower volumes on Tape B, where the FINRA/Nasdaq TRF has less such 
activity, and at higher volumes on Tapes A and C, where the FINRA/
Nasdaq TRF has more such activity.

----------------------------------------------------------------------------------------------------------------
                                                                                             Discounted rate
                                                                Daily average number of   (relative to standard
                             Tier                                executions during the     rate) to be used to
                                                                month needed to qualify     calculate monthly
                                                                        for tier           charge, if uncapped
----------------------------------------------------------------------------------------------------------------
Tape A:
    1.........................................................           50,000-100,000                  $0.0120
    2.........................................................          100,001-200,000                   0.0072
    3.........................................................          200,001-300,000                   0.0052
    4.........................................................                 >300,000                   0.0050
Tape B:
    1.........................................................            15,000-30,000                   0.0120
    2.........................................................            30,001-60,000                   0.0072
    3.........................................................           60,001-100,000                   0.0052
    4.........................................................                 >100,000                   0.0050
Tape C:
    1.........................................................           50,000-100,000                   0.0120
    2.........................................................          100,001-200,000                   0.0072
    3.........................................................          200,001-300,000                   0.0052
    4.........................................................                 >300,000                   0.0050
----------------------------------------------------------------------------------------------------------------

    In addition, monthly fees for a Retail Participant's qualifying 
Contra Party activity for each Tape will be capped at a maximum monthly 
amount if the Retail Participant qualifies for Tier 4 pricing, as 
follows:

----------------------------------------------------------------------------------------------------------------
                                                                Daily average number of
                                                                 executions during the   Maximum monthly charge,
                             Tier                               month needed to qualify         if capped
                                                                        for tier
----------------------------------------------------------------------------------------------------------------
Tape A:
    1.........................................................           50,000-100,000                      n/a
    2.........................................................          100,001-200,000                      n/a

[[Page 67412]]

 
    3.........................................................          200,001-300,000                      n/a
    4.........................................................                 >300,000                  $32,000
Tape B:
    1.........................................................            15,000-30,000                      n/a
    2.........................................................            30,001-60,000                      n/a
    3.........................................................           60,001-100,000                      n/a
    4.........................................................                 >100,000                   11,000
Tape C:
    1.........................................................           50,000-100,000                      n/a
    2.........................................................          100,001-200,000                      n/a
    3.........................................................          200,001-300,000                      n/a
    4.........................................................                 >300,000                   32,000
----------------------------------------------------------------------------------------------------------------

These caps will replace the existing cap formulas that apply to Retail 
Participants for their Media/Contra Party and Non-Media Contra Party 
reporting activity (proposed subparagraphs II.3 and II.4).
Example 1
    An example of the application of the proposed program is as 
follows. If in a given month with 20 trading days, a Retail Participant 
achieves an average daily execution volume on the FINRA/Nasdaq TRF of 
150,000 Media/Contra Party trades in Tape A, 20,000 Media/Contra Party 
Trades in Tape B, and 400,000 Media/Contra Party Trades in Tape C, then 
the Retail Participant would be entitled to receive the special Media/
Contra Party pricing set forth in proposed subparagraph 3 with respect 
to its activity in Tape A (Tier 2), Tape B (Tier 1) and Tape C (Tier 
4). As to Tape A, the Retail Participant would pay the uncapped 
discounted monthly charges applicable to Tier 2 (($.0072) x (the number 
of Media/Contra Party trades in Tape A during the month (150,000)) x 
(20 trading days) = $21,600. As to Tape B, the Retail Participant would 
pay the uncapped discounted monthly charges applicable to Tier 1, which 
would be $4,800 (($.012) x (the number of Media/Contra Party trades in 
Tape B during the month (20,000)) x (20 trading days)). As to Tape C, 
the Retail Participant would pay the lesser of the uncapped discounted 
monthly charges applicable to Tier 4 (($.005) x (the number of Media/
Contra Party trades in Tape C during the month (400,000)) x (20 trading 
days) = $40,000) or the Tier 4 cap ($32,000), which would be $32,000. 
Assuming that these Media/Contra Party transactions comprised all of 
the Retail Participant's activity on the FINRA/Nasdaq TRF, then the 
Retail Participant's total fees would be $58,400.
    By comparison, under the existing program, the Retail Participant 
would not receive the benefit of any cap on its Contra Party activity 
unless it also achieves at least 2,500 average daily Executing Party 
reports in each Tape during the month. If the Retail Participant does 
not achieve a cap on its Contra Party activity--as has been the case 
generally,\17\ then under the existing program, the Retail Participant 
would pay the standard rate. At the standard rate, the same Contra 
Party activity would cost the Retail Participant $39,000 in Tape A 
($0.013 x 150,000 average daily executions x 20 trading days), $5,200 
in Tape B ($.013 x 20,000 average daily executions x 20 trading days), 
and $104,000 in Tape C ($.013 x 400,000 average daily executions x 20 
trading days), or a total of $148,200. Thus, under the existing fee 
schedule, the Retail Participant in this example would pay roughly 2.45 
times more for its Contra Party activity on the FINRA/Nasdaq TRF than 
it would under the proposed rule change.
---------------------------------------------------------------------------

    \17\ To date, only one Retail Participant has achieved the 
requisite Executing Party activity to also qualify it for a Contra 
Party cap.
---------------------------------------------------------------------------

Retail Participant Combined Cap Program
    The second proposed pricing program, which is set forth in a new 
subparagraph II.C, is a Retail Participant Combined Cap Program, which 
will apply to Retail Participants that engage in Media/Executing Party 
activity in addition to Contra Party activity on the FINRA/Nasdaq TRF.
    Presently, a Retail Participant may qualify for a cap on its Media 
(Non-Media)/Executing Party activity separate and apart from the cap on 
its Contra Party activity. For Media/Executing Party (Non-Media/
Executing Party) fees, the monthly charge for a Retail Participant is 
$0.018 multiplied by the number of Media/Executing Party (Non-Media/
Executing Party) trades that the Retail Participant reports to the 
FINRA/Nasdaq TRF during that month. Such fees are capped once the 
Retail Participant reports to the FINRA/Nasdaq TRF, on average, at 
least 2,500 Media/Executing Party trades per day in Tapes A, B, or C 
during that month. If capped for trades in a particular Tape, Media/
Executing Party (Non-Media/Executing Party) fees for a Retail 
Participant equal $0.018 multiplied by 2,500 multiplied by the number 
of trading days during that month.
    The proposed rule change would eliminate this cap program because 
it is ill-suited for Retail Participants. The existing Retail 
Participant Executing Party pricing programs were adapted from programs 
that were based on Executing Party activity among non-Retail 
Participants, i.e., participants whose activity on the FINRA/Nasdaq TRF 
consists of Executing Party activity, primarily, and Contra Party 
activity, secondarily. However, Retail Participants' typical activity 
on the FINRA/Nasdaq TRF is the opposite of non-Retail Participants--it 
is almost exclusively limited to Contra Party activity. As such, the 
existing programs--which require a Retail Participant to engage in a 
threshold level of Media/Executing Party activity to qualify for a cap 
on either its Executing Party or its Contra Party activity--are 
ineffective. Indeed, only one Retail Participant to date has achieved 
enough Media/Executing Party activity to qualify for a cap.
    The proposed rule change would replace the existing Executing Party 
programs with a new Combined Activity Cap that is tailored specifically 
to the behavior of Retail Participants. That is, for Retail 
Participants that engage primarily in Contra Party activity on the 
FINRA/Nasdaq TRF, the proposed program would not disqualify them from 
any special pricing--as does the existing program--if they fail to 
engage in Executing Party activity. For Retail Participants that do 
engage in Executing

[[Page 67413]]

Party activity, the proposed program would cap their combined Executing 
Party and Contra Party activity for the month.
    Specifically, the proposed rule change would establish a new three-
tiered combined fee cap. Tier 1 would cap at $50,000 a Retail 
Participant's fees for its total Executing Party and Contra Party 
activity during a month. To qualify for the Tier 1 cap, a Retail 
Participant would need to achieve between 1,000 and 2,000 average daily 
Media/Executing Party trades across all three Tapes during the 
immediately preceding three month period.\18\ (This qualifying level of 
Media/Executing Party activity is notably less than the existing 
threshold requirement of 2,500 average daily Media/Executing Party 
trades.) Tier 2 would cap a Retail Participant's total monthly fees at 
$25,000. To qualify for the Tier 2 cap, a Retail Participant would need 
to achieve between 2,001 and 4,000 average daily Media/Executing Party 
trades across all three Tapes during the immediately preceding three 
month period. Finally, Tier 3 of the new program would cap a Retail 
participant's total monthly fees at $15,000. To qualify for the Tier 3 
cap, a Retail Participant would need to achieve more than 4,000 average 
daily Media/Executing Party trades across all three Tapes during the 
immediately preceding three month period.
---------------------------------------------------------------------------

    \18\ Unlike the existing program, which measures a Retail 
Participant's average daily executions during the prior month, the 
proposed program will measure activity over the course of the 
immediately preceding prior three months. Thus, to qualify for the 
proposed program, Retail Participants will be required to sustain 
their daily average activity level for a longer period of time than 
they do presently. This longer qualification period is intended to 
ensure that the program applies to Retail Participants that are 
maintaining or increasing Executing party activity, rather than 
those that have only episodic activity. This time period also aligns 
with the schedules for dividend reinvestment programs, which often 
are the basis for Executing Party activity.
---------------------------------------------------------------------------

Example 2
    The following is an example of the application of the Retail 
Participant Combined Activity Cap. Assume that a Retail Participant has 
the same level of Contra Party activity during a month as described in 
Example 1 above. Assume also that, in addition to this Contra Party 
activity, the Retail Participant also achieves, during the immediately 
preceding three month period, an average of 1,500 Media/Executing Party 
trade reports per day in Tape A, 500 Media/Executing Party trade 
reports per day in Tape B, and 100 Media/Executing Party trade reports 
per day in Tape C. In this scenario, the Retail Participant's aggregate 
2,100 average daily Media/Executing Party trades across all three Tapes 
would qualify it for the Tier 2 Retail Participant Combined Activity 
Cap of $25,000. The capped fee would cover all of the Retail 
Participant's Executing Party and Contra Party activity for the month. 
Thus, the Retail Participant would pay the $25,000 combined cap in lieu 
of paying $58,400 for its Contra Party activity under the proposed 
Retail Participant Contra Party Fee Discount and Cap Program (as 
described in Example 1). This is because the Retail Participant would 
receive the benefit of the lowest applicable fee for its activity on 
the FINRA/Nasdaq TRF.
Retail Participant Securities Transaction Credit
    The proposed rule change would amend Rule 7610A to establish a new 
category of transaction credits tailored to Retail Participants. Much 
like the existing fee program discussed above, the existing transaction 
credit program set forth in Rule 7610A was not designed with Retail 
Participants in mind because participants are entitled to credits only 
to the extent that they engage in substantial amounts of Media/
Executing Party activity. For example, those participants with less 
than 0.10% market share on the FINRA/Nasdaq TRF presently receive no 
credits for any revenue that is attributable to their Media/Executing 
Party activity in any Tape.
    The proposed rule change would make the transaction credit program 
available to Retail Participants that achieve even low levels of Media/
Executing Party activity during a given quarter. Under the proposed 
rule change, Retail Participants that achieve less than 0.10 percent 
market share on the FINRA/Nasdaq TRFs on any of the three Tapes would 
be entitled to receive credits equal to 75 percent of the revenue that 
is attributable to their Media/Executing Party activity in Tape A and 
Tape C and credits equal to 70 percent of attributable revenue in Tape 
B. Retail Participants that achieve a market share of between 0.10 
percent and less than 0.50 percent in Tape A or Tape C would receive 
credits equal to 75 percent of attributable revenue in that Tape 
(versus 20 percent of attributable revenue for other participants). 
Retail Participants that achieve a market share of between 0.10 percent 
and less than 0.35 percent in Tape B would receive credits equal to 70 
percent of attributable revenue in that Tape (versus 10 percent of 
attributable revenue for other participants). For higher market shares, 
Retail Participants in all Tapes would receive the same percentage 
shares of attributable revenue as would other participants.\19\
---------------------------------------------------------------------------

    \19\ The proposed rule change would specify that if a 
participant in the FINRA/Nasdaq TRF is approved as a Retail 
Participant after the first day of a calendar quarter, such approval 
will be deemed effective, for purposes of Rule 7610A, as of the 
first day of the next calendar quarter. Likewise, if a participant 
in the FINRA/Nasdaq TRF notifies Nasdaq, Inc. that it no longer 
qualifies as a Retail Participant after the first day of a calendar 
quarter, such notification shall be deemed effective, for purposes 
of Rule 7610A, as of the first day of the next calendar quarter.
---------------------------------------------------------------------------

    The proposal to tailor the transaction credit program to Retail 
Participants would provide another mechanism--in addition to lower fees 
and fee caps--to lower the overall costs to Retail Participants of 
participating in the FINRA/Nasdaq TRF, particularly for Retail 
Participants with a greater scope and volume of activity.
Clarification to ATS Market Maker Media/Contra Party Cap
    Lastly, the proposed rule change would amend the ATS Market Maker 
Media/Contra Party Cap, which currently is set forth in subparagraph 5 
and would be renumbered as subparagraph D, to correct a typographical 
error and also clarify the provision. This cap program provides for 
participants making markets in alternative trading systems registered 
pursuant to Regulation ATS to qualify for a fee cap on all their trades 
in a month if they meet three criteria. Presently in the Rule, the 
second criterion is that the ``Participant must be contra to a minimum 
of 1,000,000 trades in Tape A, 500,000 trades in Tape C or 250,000 
trades in Tape B.'' Prior to the reorganization of the fee schedule, 
effective September 1, 2018, this provision stated that to qualify for 
the program, ``Participant must be contra to a minimum of 1,000,000 
trades in Tape A, 500,000 trades in Tape C and 250,000 trades in Tape 
B.'' (Emphasis added.) \20\ Upon reorganizing the fee schedule, the 
``and'' in this provision was inadvertently changed to ``or.'' The 
proposed rule change corrects that unintended error.
---------------------------------------------------------------------------

    \20\ See Securities Exchange Act Release No. 83866 (Aug. 16, 
2018), 83 FR 42545 (Aug. 22, 2018) (Notice of Filing and Immediate 
Effectiveness of File No. SR-FINRA-2018-029).
---------------------------------------------------------------------------

    Additionally, the proposed rule change further amends this 
criterion due to concern that it could be misinterpreted (as corrected 
above) to mean that qualification for the cap requires a participant to 
meet minimum Contra Party trade reporting volumes in all three Tapes. 
In fact, the criterion is intended to mean that to qualify for the cap 
with respect to trade reports in a

[[Page 67414]]

particular Tape, a participant must meet the minimum trade volume 
threshold for that Tape. The proposed revised and corrected text is as 
---------------------------------------------------------------------------
follows:

    Participant must be contra to a minimum number of trades during 
the month in a particular Tape to qualify for a cap on trades in 
that Tape. The minimum number of monthly trades for each Tape are as 
follows: 1,000,000 trades in Tape A, 500,000 trades in Tape C and 
250,000 trades in Tape B.

    FINRA has filed the proposed rule change for immediate 
effectiveness. The operative date will be January 1, 2019.
2. Statutory Basis
    FINRA believes that the proposed rule changes [sic] are consistent 
with the provisions of Section 15A(b)(5) of the Act,\21\ which 
requires, among other things, that FINRA rules provide for the 
equitable allocation of reasonable dues, fees and other charges among 
members and issuers and other persons using any facility or system that 
FINRA operates or controls.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78o-3(b)(5).
---------------------------------------------------------------------------

    First, FINRA believes that the proposed elimination of the existing 
Retail Participant pricing programs under Rule 7620A and adoption of 
new programs that are better aligned with and tailored to the 
behavioral profile of Retail Participants is an equitable allocation of 
reasonable fees. The existing pricing programs for Retail Participants 
were established by carving Retail Participants out from the general 
pricing programs applicable to all participants. The existing pricing 
programs were not designed with Retail Participants in mind, but 
instead are geared toward participants that engage in Executing Party 
activity primarily, and Contra Party activity secondarily. The 
behavioral profile of Retail Participants is the opposite of non-Retail 
Participants, such as ATS market makers and wholesalers. Retail 
Participants engage primarily, if not exclusively, in Contra Party 
activity on the FINRA/Nasdaq TRF. However, the only aspect of the 
Retail Participant programs that distinguishes them from their non-
Retail Participant counterparts is the fact that their pricing is 
frozen at pre-September 2018 levels. Because the Retail Participant 
programs were designed for non-Retail Participants, the existing Retail 
Participant programs have proven to be ineffective in accomplishing 
their objectives of lowering fees for Retail Participants and their 
retail customers. That is, the existing programs require Retail 
Participants to achieve at least 2,500 average daily Media/Executing 
Party trades to qualify for caps on either their Executing Party or 
their Contra Party activity fees, but Retail Participants generally do 
not generate enough Executing Party activity to trigger the caps. To 
date, only one Retail Participant has qualified for a cap. Moreover, 
the ineffectiveness of the existing Retail Participant programs in 
lowering fees has led certain Retail Participants to direct their 
executing counterparties to stop reporting their trades to the FINRA/
Nasdaq TRF and to report them instead to the FINRA/NYSE TRF, which does 
not charge Contra Parties that are not also reporting parties.
    The two proposed Retail Participant fee programs address the 
ineffectiveness of the existing programs by aligning fees, discounts, 
and caps with the activities in which Retail Participants engage on the 
FINRA/Nasdaq TRF. First and foremost in this regard, the proposed rule 
change introduces a tiered system of caps--as well as discounts, when 
caps are not economical to the Retail Participant--that become more 
favorable as the level of the Retail Participant's Contra Party 
activity increases. The proposed rule change also eliminates the 
requirement that a Retail Participant must engage in a threshold level 
of Media/Executing Party activity to qualify for discounts or caps on 
their Contra Party activity.
    Moreover, the proposed rule change introduces a Retail Participant 
Combined Activity Cap that would provide Retail Participants with a cap 
on their combined monthly activity on the FINRA/Nasdaq TRF to the 
extent that they have Media/Executing Party activity. This Combined 
Activity Cap in many cases would be more favorable than the Contra 
Activity cap for Retail Participants that also have Executing Party 
activity.
    For similar reasons, FINRA believes that the proposed rule change 
to establish a new securities transaction credit program under Rule 
7610A that is tailored to Retail Participants is an equitable 
allocation of reasonable fees. The existing securities transaction 
program is generally inaccessible to Retail Participants, insofar as 
they generally engage in low levels of Media/Executing Party activity. 
The proposed rule change would enable Retail Participants with even low 
levels of Media/Executing Party activity to receive credits for 
engaging in such activity. It also would increase the percentage of 
revenue sharing that occurs at these low levels of activity relative to 
the percentage that other types of participants receive with the same 
market shares. As such, the proposed rule change would provide another 
mechanism to lower the overall costs to Retail Participants of 
participating in the FINRA/Nasdaq TRF.
    The proposed new programs to benefit Retail Participants 
specifically are not unfairly discriminatory. Effective September 1, 
2018, a distinct category of Retail Participant pricing for the FINRA/
Nasdaq TRF was established in recognition of the fact that customers of 
Retail Participants generally include individual investors who trade 
less frequently than do other categories of customers. Accordingly, 
Retail Participants often report fewer trades to the FINRA/Nasdaq TRF 
than other participants. As such, the fees that Retail Participants 
(and their customers) pay should be better tailored to their activity 
on the FINRA/Nasdaq TRF.\22\ However, the existing programs have not 
achieved their objective of reducing costs for Retail Participants.
---------------------------------------------------------------------------

    \22\ See Securities Exchange Act Release No. 83866 (Aug. 16, 
2018), 83 FR 42545 (Aug. 22, 2018) (Notice of Filing and Immediate 
Effectiveness of File No. SR-FINRA-2018-029).
---------------------------------------------------------------------------

    Because the existing programs have not succeeded in reducing costs 
to Retail Participants relative to the FINRA/NYSE TRF (which also 
competes for Contra Party business and does not charge Contra Parties 
that are not also reporting parties), several Retail Participants have 
requested that their executing counterparties report their trades to 
the FINRA/NYSE TRF rather than the FINRA/Nasdaq TRF. The proposed rule 
change is designed to further reduce the costs to Retail Participants 
on the FINRA/Nasdaq TRF in an effort to stem, if not reverse, this loss 
of retail business to the FINRA/NYSE TRF.
    The proposed changes also are not unfairly discriminatory in that 
they will be available to all FINRA members that use the FINRA/Nasdaq 
TRF and meet the threshold requirements to qualify for the terms of the 
programs. The programs themselves are designed to be accessible to 
most, if not all, existing Retail Participants, including those with 
both low and high levels of activity on the FINRA/Nasdaq TRF.
    Additionally, the proposed rule change would reorganize and clarify 
Rule 7620A so that it is easier to comprehend and presented in a more 
logical order. The reorganization will also ensure that examples of the 
application of the Rule are placed in the paragraphs where they will be 
applicable going forward.
    The proposed rule change also would amend the definition of a 
``Retail Order'' in Supplementary Material .01 to Rule 7620A to clarify 
that this term includes

[[Page 67415]]

orders that originate from accounts that exist in corporate form for 
the benefit of individuals, provided that individuals submit the 
orders. Although it is reasonable to interpret the existing definition 
of a Retail Order to include an order that originates from an 
individual retirement account or another corporate account that exists 
for the benefit of an individual, the proposed rule change will 
eliminate any uncertainty in this regard. Moreover, the proposed rule 
change will aid prospective Retail Participants in understanding their 
obligations as such. The proposed clarifying language derives from the 
definition of a ``Designated Retail Order'' in Nasdaq Rule 7018 [sic], 
which is reasonable because the concepts are similar. This proposed 
change is equitable and not unfairly discriminatory because it merely 
makes a non-substantive technical clarification to the meaning of 
``Retail Order.''
    Finally, the proposed rule change would correct an unintended 
typographical error that occurred when Rule 7620A was reorganized 
effective September 1, 2018. FINRA, Nasdaq, and all FINRA/Nasdaq TRF 
participants have an interest in FINRA maintaining rules for its trade 
reporting facilities that are accurate and free of errors. Likewise, 
FINRA believes that clarifying the ATS Market Maker Media/Contra Party 
Cap will avoid confusion as to the number of Contra Party trades in a 
particular Tape that are required to qualify for the cap for that Tape.

B. Self-Regulatory Organization's Statement on Burden on Competition

    FINRA does not believe that the proposed rule change will result in 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.
Regulatory Need
    Nasdaq, as the Business Member and operator of the FINRA/Nasdaq 
TRF, collects all fees on behalf of the FINRA/Nasdaq TRF. As discussed 
above, Nasdaq has observed an increase in competition in the market for 
OTC trade reporting, and in response to competitive forces, determined 
to reduce fees for most Retail Participants that report trades to the 
FINRA/Nasdaq TRFs and establish a new transaction credit program that 
will be more accessible to such participants.
Economic Baseline
    As discussed above, pursuant to FINRA Rule 7620A, Retail 
Participants in the FINRA/Nasdaq TRF are currently subject to four 
categories of fees, each of which is applicable to transactions on the 
three Tapes: (1) Media/Executing Party; (2) Non-Media/Executing Party; 
(3) Media/Contra Party; (4) and Non-Media/Contra Party. The rule also 
provides fee caps for Retail Participants for a particular Tape during 
a given month, provided that during the month, the Retail Participant 
achieves a daily average number of Media/Executing Party trades of at 
least 2,500 in the same Tape.
    There are currently fifteen participants who are either approved or 
being considered for the Retail Participant program, that cumulatively 
represent approximately 25% of total reporting activity in the FINRA/
Nasdaq TRF over the past 12 months. However, due to the nature and 
scale of retail businesses, to date, only one Retail Participant had 
sufficient reporting activity to qualify for a cap.
    Also, pursuant to Rule 7610A, FINRA members that report OTC 
transactions in NMS stocks to a FINRA/Nasdaq TRF for public 
dissemination or ``media'' purposes may receive quarterly transaction 
credits that equal a percentage of FINRA/Nasdaq TRF revenues that are 
attributable to the members' transactions. However, the current rule 
does not distinguish among categories of FINRA/Nasdaq TRF participants. 
Due to Retail Participants' relatively smaller reporting activity 
compared to that of non-Retail Participants, Retail Participants have 
not received transactions credits in the past.
Economic Impacts
    The proposed rule change replaces the existing retail Participant 
Pricing Program with two new programs, ``Retail Participant Contra 
Party Fee Discount and Cap Program'' and ``Retail Participant Combined 
Cap Program,'' which are designed to reduce the fees that most Retail 
Participants pay to the FINRA/Nasdaq TRF.
    As mentioned above, there are fifteen current and prospective 
Retail Participants that could potentially benefit from the reduced 
fees under the proposed Retail Participant programs. While Example 1 
above illustrates the potential reduction in fees for a given volume in 
all Tapes, the potential reduction in fees in each Tape ranges from a 
few hundred dollars to approximately $50,000. The reduction in fees 
could be larger if the Participant qualifies for both the reduced fees 
and the combined cap. Currently, only one Retail Participant would have 
the sufficient activity to qualify for the Retail Participant Combined 
Cap Program based on its historical activity. Going forward, however, 
as a result of the proposal, additional Retail Participants may 
increase their Executing Party activity on the FINRA/Nasdaq TRF and 
potentially become eligible for transaction credits or the Retail 
Participant Combined Cap Program.
    FINRA analyzed data provided by Nasdaq that contain monthly fees 
incurred by fifteen current and prospective Retail Participants that 
reported OTC trades to FINRA/Nasdaq TRF over a one year period from 
July 2017 through June 2018. The data included the estimated reduction 
in fees that would have occurred under the proposed fee and cap 
schedule assuming that the reporting behavior would be the same under 
the current and the proposed schedule. The analysis demonstrated that 
there would be no reduction in fees for ten of the fifteen current and 
prospective Retail Participants, since their level of reporting 
activity would not qualify them for the discounts (although such Retail 
Participants would, at a minimum, be exempt from the $350 per month 
Participant Fee). The remaining five participants would observe average 
monthly reduction in fees that range from $390 to $111,856.
    The proposed rule change also opens up the transaction credit 
program to Retail Participants that achieve even low levels of 
Executing Party activity during a given quarter. In the four quarters 
between July 2017 and June 2018, four Retail Participants would have 
sufficient market share to qualify for transaction credits. The 
quarterly credits would range from $55 to $11,007 across all Tapes, 
with a median credit of $4,749.
    The potential net impact of the proposed rule change depends on 
whether participants alter their reporting activity across TRFs to be 
eligible for the fee caps. To the extent that the proposed reduction in 
fees provide [sic] net benefits, they may choose to shift their 
reporting from FINRA/NYSE TRF to FINRA/Nasdaq TRF. The net impact would 
also depend on whether the proposed fee caps create an optimal 
reporting strategy to be eligible for a specific cap to maximize the 
overall savings for all trade types reported to the FINRA/Nasdaq TRFs.
    Finally, FINRA notes that the proposed fee and fee cap changes 
occur within the context of a competitive environment in which the 
various trade reporting facilities vie for market share. The FINRA/NYSE 
TRF is free to adjust its fees and fee cap programs in response to the 
changes proposed herein to render them more attractive relative

[[Page 67416]]

to the FINRA/Nasdaq TRF. If any existing or prospective participant in 
FINRA/Nasdaq TRF determines that the new fees or fee cap thresholds are 
less attractive or are unfavorable relative to fees and fee cap 
programs applicable to the FINRA/NYSE TRF, such participants may choose 
to report to the FINRA/NYSE TRF in lieu of the FINRA/Nasdaq TRF, in 
which case the FINRA/Nasdaq TRFs would lose market share. However, the 
impact of differences in fees and fee cap programs across the TRFs on a 
participant's decision to prefer one TRF over the other may be limited 
by the set of functionalities each TRF provides.
Alternatives Considered
    No other alternatives were considered for the proposed rule change.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

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 \23\ and paragraph (f)(2) of Rule 19b-4 
thereunder.\24\ 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. If 
the Commission takes such action, the Commission shall institute 
proceedings to determine whether the proposed rule should be approved 
or disapproved.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78s(b)(3)(A).
    \24\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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

    <bullet> Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#b7c5c2dbd29ad4d8dadad2d9c3c4f7c4d2d499d0d8c1"><span class="__cf_email__" data-cfemail="8cfef9e0e9a1efe3e1e1e9e2f8ffccffe9efa2ebe3fa">[email protected]</span></a>. Please include 
File Number SR-FINRA-2018-042 on the subject line.

Paper Comments

    <bullet> 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-FINRA-2018-042. 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 the filing also will be available for inspection 
and copying at the principal office of FINRA. 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-FINRA-2018-042, and should be submitted 
on or before January 18, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\25\
---------------------------------------------------------------------------

    \25\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2018-28198 Filed 12-27-18; 8:45 am]
 BILLING CODE 8011-01-P


</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>