Federal Register / Vol. 85, No. 250 / Wednesday, December 30, 2020 / Notices 86617 

16 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(1). 

4 17 CFR 240.19b–4. 

5 15 U.S.C. 78s(b)(3)(A)(ii). 

6See Securities Exchange Act Release No. 89967 

(September 23, 2020), 85 FR 63616 (October 8, 

2020) (SR–IEX–2020–14). 

7See IEX Rule 1.160(s). 

8See Securities Exchange Act Release No. 89686 

(August 26, 2020), 85 FR 54438 (September 1, 2020) 

(SR–IEX–2019–15). 

9See IEX Rule 1.160(p). 

10See IEX Rules 11.190(b)(7) and 11.190(g). 

11See IEX Rule 11.190(b)(7). 

12 Generally, IEX currently charges $.0003 per 

share for any displayed orders that execute 

(whether they add or remove liquidity) and $.0009 

per share for any non-displayed orders that execute 

(whether they add or remove liquidity). If the shares 

execute for less than $1.00 per share, the Exchange 

charges 0.30% of the total dollar value of the 

transaction. See IEX Fee Schedule, https://

iextrading.com/trading/fees/. 

13See IEX Fee Schedule, https://iextrading.com/ 

trading/fees/. 

14For purposes of the discount, IEX aggregates all 

of a Member’s MPIDs to calculate each Member’s 

D-Peg, M-Peg, and D-Limit liquidity providing 

orders on a monthly basis. Upon a Member’s 

request and subject to IEX’s review and verification 

of the affiliate’s relationship to the requesting 

Member, IEX will aggregate the Member’s activity 

with activity of the Member’s affiliated Member(s). 

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, on business days 

between the hours of 10:00 a.m. and 

3:00 p.m., located at 100 F Street NE, 

Washington, DC 20549. Copies of such 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NASDAQ–2020–092 and 

should be submitted on or before 

January 20, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2020–28803 Filed 12–29–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90786; File No. SR–IEX– 

2020–19] 

Self-Regulatory Organizations: 

Investors Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Related to 

Transaction Fees Pursuant to IEX Rule 

15.110 

December 22, 2020. 

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 

11, 2020, the Investors Exchange LLC 

(‘‘IEX’’ or the ‘‘Exchange’’) 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 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 Substance of 

the Proposed Rule Change 

Pursuant to the provisions of Section 

19(b)(1) under the Act,3 and Rule 19b4 thereunder,4 IEX is filing with the 

Commission a proposed rule change to 

amend its Fee Schedule, pursuant to 

IEX Rule 15.110(a) and (c) (the ‘‘Fee 

Schedule’’) to modify certain 

promotional pricing incentives for the 

execution of Discretionary Limit (‘‘DLimit’’) orders. Changes to the Fee 

Schedule pursuant to this proposal are 

effective upon filing,5 and the Exchange 

plans to implement the changes on 

January 1, 2021. 

The text of the proposed rule change 

is available at the Exchange’s website at 

www.iextrading.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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization 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 Exchange proposes to amend its 

Fee Schedule, pursuant to IEX Rule 

15.110(a) and (c), to modify certain 

pricing incentives currently applicable 

to executions of Discretionary Limit 

(‘‘D-Limit’’), Discretionary Peg (‘‘DPeg’’), and Midpoint Peg (‘‘M-Peg’’) 

order executions that were implemented 

with the launch of the D-limit order 

type on October 1 2020.6 Specifically, 

the Exchange proposes to eliminate the 

fee discount of $0.0002 per executed 

share available to IEX Members 7 for 

liquidity-providing D-Peg and M-Peg 

orders. 

The D-Limit order type was approved 

by the Commission on August 26, 

2020,8 and is designed to protect 

liquidity providers from potential 

adverse selection by latency arbitrage 

trading strategies in a fair and 

nondiscriminatory manner. A D-Limit 

order may be a displayed or nondisplayed limit order that upon entry 

and when posting to the Order Book 9 is 

priced to be equal to and ranked at the 

order’s limit price, but will be adjusted 

to a less-aggressive price during periods 

of quote instability, as defined in IEX 

Rule 11.190(g).10 Otherwise, a D-Limit 

order operates in the same manner as 

either a displayed or non-displayed 

limit order, as applicable,11 and 

accordingly, the Exchange determined 

that liquidity-taking D-Limit orders 

would be subject to the same transaction 

fees as other displayed or non-displayed 

orders.12

Currently, a D-Limit order that 

provides liquidity and is executed at a 

price at or above $1.00 results in a free 

execution.13 In addition, D-Peg and MPeg orders that provide liquidity and 

execute at a price at or above $1.00 per 

share are currently subject to a discount 

of $0.0002 per share from the fee that 

would otherwise be charged for the 

number of shares of such orders 

executed up to the number of shares of 

D-Limit orders that provided liquidity 

and executed at a price at or above $1.00 

per share during such time period by 

the same Member, measured on a 

monthly basis.14

The fee discounts were designed to 

provide a narrowly tailored incentive 

for Members to utilize D-limit orders, a 

new and innovative order type, taking 

86618 Federal Register / Vol. 85, No. 250 / Wednesday, December 30, 2020 / Notices 

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

16 15 U.S.C. 78f(b)(4). 

17 15 U.S.C. 78f(b)(5). 18 15 U.S.C. 78s(b)(3)(A)(ii). 

into account that Members seeking to 

utilize the new D-Limit order type may 

have needed to modify and test new 

trading strategies and order entry 

systems in order to do so. Accordingly, 

the pricing incentives implemented by 

the Exchange were designed to provide 

a meaningful economic incentive for 

such efforts and to encourage use of this 

new order type. 

However, IEX has concluded that, 

while free executions for liquidity 

providing D-Limit orders priced at or 

above $1.00 continues to be an 

appropriate incentive, elimination of the 

related fee discount of $0.0002 per share 

for the execution of liquidity providing 

D-Peg and M-Peg orders is appropriate 

in order to simplify the fee structure. 

Specifically, based on informal 

discussions with Members, the 

Exchange understands that the fee 

discounts for non-D-Limit related order 

flow has created complexities in 

tracking applicable fees and 

corresponding billing for some Members 

and therefore do not provide a 

meaningful incentive for the use of DLimit orders. As a result, the Exchange 

proposes to eliminate the fee discount of 

$0.0002 per share for the execution of 

liquidity providing D-Peg and M-Peg 

orders. 

The Fee Schedule will continue to 

provide that execution of a D-Limit 

order that adds liquidity will result in 

a free execution, with the exception of 

executions below $1.00, which will 

continue to be assessed a fee of 0.30% 

of TDV (unless otherwise eligible for a 

free execution in accordance with the 

IEX Fee Schedule). 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,15 in general, and 

furthers the objectives of Section 

6(b)(4) 16 of the Act, in particular, in that 

it is designed to provide for the 

equitable allocation of reasonable fees 

among IEX Members and persons using 

its facilities. Additionally, IEX believes 

that the proposed changes to the Fee 

Schedule are consistent with the 

investor protection objectives of Section 

6(b)(5) 17 of the Act, in particular, in that 

they are 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 

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 are not designed to 

permit unfair discrimination between 

customers, brokers, or dealers. 

The Exchange believes that the 

proposed changes are consistent with 

the Act because they will be applicable 

to all Members on a fair, equal and 

nondiscriminatory basis. The 

transaction fee discount was part of a 

narrowly tailored approach, designed to 

maximize participation for the launch of 

D-Limit, while free executions for 

liquidity providing D-Limit orders 

priced at or above $1.00 per share is 

designed to provide the primary pricing 

incentive. As with any new order type, 

the implementation of D-Limit required 

a period during which Members needed 

to become familiar with its operation 

and potentially adjust order entry 

systems and trading strategies to 

effectively use D-Limit orders. However, 

based on informal Member feedback 

regarding the complexity such discounts 

have created, IEX believes that the 

transaction fee discounts are no longer 

necessary to incentivize Members to use 

D-Limit orders. 

The Exchange further believes that the 

proposed amendment is consistent with 

the Act’s requirement that the Exchange 

provide for an equitable allocation of 

fees. The Exchange’s proposal involves 

the elimination of transaction fee 

incentives that were available to all 

Members based on executions of 

liquidity adding D-Peg and M-Peg 

orders. Similarly, eliminating the 

transaction fee incentive will apply in 

an equal and nondiscriminatory manner 

to all Members. All Members will 

continue to be subject to the same fees 

for the use of D-Limit orders. Moreover, 

eliminating the fee discount will operate 

to simplify the Exchange’s fee structure 

and reduce any corresponding order 

tracking and billing complexities on the 

part of Members. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange does not believe that the 

proposed fees will impose any burden 

on intermarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange operates in a highly 

competitive market in which market 

participants can easily direct their 

orders to competing venues, including 

off-exchange venues, if its fees are 

viewed as non-competitive. Moreover, 

IEX believes that the proposed fees, as 

amended, continue to be designed to 

enhance competition by increasing the 

Exchange’s pool of both displayed and 

non-displayed liquidity, and to the 

extent that displayed liquidity 

increases, would contribute to the 

public price discovery process. Further, 

subject to the SEC rule filing process, 

other exchanges could adopt a similar 

order type and fee incentive. 

The Exchange also does not believe 

that the proposed rule change will 

impose any burden on intramarket 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. While Members 

that add liquidity using certain D-Limit 

orders will be subject to different fees 

based on this usage, those differences 

are not based on the type of Member 

entering orders but on whether the 

Member chose to submit certain 

liquidity providing D-Limit orders. As 

noted above, not only can any Member 

submit certain liquidity adding D-Limit 

orders, but every Member would benefit 

from the availability of more liquidity 

on the Exchange that the proposed fees 

are designed to incentivize. The 

Exchange is proposing to eliminate 

discounted transaction fees for certain 

D-Peg and M-peg orders that were part 

of a narrowly tailored incentive for 

Members to begin using the D-Limit 

order type. As discussed in the Purpose 

and Statutory Basis sections, the 

Exchange has concluded that the fee 

transaction discounts are no longer 

necessary to incentivize Members to use 

D-Limit orders and can operate to 

introduce certain complexities in order 

tracking and billing. Accordingly, the 

Exchange does not believe that 

eliminating the transaction fee 

discounts will have any impact on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

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)(ii) 18 of the Act. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

Federal Register / Vol. 85, No. 250 / Wednesday, December 30, 2020 / Notices 86619 

19 15 U.S.C. 78s(b)(2)(B). 

20 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Congress in 1990 amended Exchange Act 

Section 15A to require FINRA to establish and 

maintain a toll-free telephone listing to receive 

inquiries regarding disciplinary actions involving 

its member firms and their associated persons, and 

promptly respond to such inquiries in writing. See 

Securities Enforcement Remedies and Penny Stock 

Reform Act of 1990, Public Law 101–429, 104 Stat. 

931 (1990). See also Notice to Members 00–16 

(March 2000). 

4 In 2006, Congress again amended Exchange Act 

Section 15A to, among other things, expand the 

methods by which BrokerCheck information is 

made available. See Military Personnel Financial 

Services Protection Act, Public Law 109–290, 120 

Stat. 1317 (2006). 

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) 19 of the Act to 

determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

IEX–2020–19 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–IEX–2020–19. 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 

offices of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–IEX–2020–19, and should 

be submitted on or before January 20, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2020–28811 Filed 12–29–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90778; File No. SR–FINRA– 

2020–045] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing of a 

Proposed Rule Change To Amend 

FINRA Rule 8312 (FINRA BrokerCheck 

Disclosure) 

December 22, 2020. 

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 

16, 2020, the 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. 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 Substance of 

the Proposed Rule Change 

FINRA is proposing to amend to 

amend FINRA Rule 8312 (FINRA 

BrokerCheck Disclosure). The proposed 

rule change would (1) make information 

about formerly registered individuals 

subject to a final regulatory action 

available through BrokerCheck® on a 

permanent basis only for those 

individuals who have been registered on 

or after August 16, 1999; and (2) exclude 

information from BrokerCheck about 

deceased individuals. The proposed 

rule change also would make nonsubstantive, technical changes to FINRA 

Rule 8312. 

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 

BrokerCheck Program 

FINRA established the BrokerCheck 

program (then known as the Public 

Disclosure Program) in 1988 to provide 

investors and the general public with 

information on the professional 

background, business practices, and 

conduct of member firms and their 

associated persons. Since establishing 

BrokerCheck, FINRA has regularly 

assessed the scope and utility of the 

information it provides to the public 

and, as a result, has made numerous 

changes to improve the program. These 

changes have made BrokerCheck easier 

to access by expanding the available 

methods of requesting information 

through the program. For instance, 

initially the public could request 

information only via U.S. mail or 

facsimile. FINRA subsequently added 

the ability to submit requests via a tollfree telephone number in 1991 and then 

through email in 1997.3 Now 

BrokerCheck reports are available 

instantly online at https://

brokercheck.finra.org/.4 FINRA also has 

increased the amount of information 

available through the program. At first,