Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Notices 7321 

2 (6,392 portfolios that hold equity securities × 7.2 

hours per year) + (2,857 portfolios holding no 

equity securities × 0.17 hours per year) + (1,476 

portfolios holding fund securities × 1 hour per year) 

= 47,984 hours. 

3The hourly wage figure for a compliance 

attorney is from the Securities Industry and 

Financial Markets Association’s Management & 

Professional Salaries in the Securities Industry 

2013, modified by Commission staff to account for 

an 1800-hour work-year and inflation and 

multiplied by 5.35 to account for bonuses, firm size, 

employee benefits and overhead. 

4 47,984 hours × $368 per hour = $17,658,112. 

5 (6,392 portfolios holding equity securities × 

$1,000 per year) + (2,857 portfolios holding no 

equity securities × $0 per year) + (1,476 fund of 

funds × $100) = $6,539,600. 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See Fee Schedule, Section I.D., Prepayment 

Program. 

securities is 7.2 hours per response, the 

current burden estimate for funds 

holding no equity securities is 0.17 

hours (10 minutes) per response, and 

the current burden estimate for fund of 

funds is 1 hour per response. Therefore, 

the number of aggregate burden hours, 

when calculated using the current 

number of portfolios, is approximately 

47,984 hours.2 We continue to believe 

that these estimates for Form N–PX’s 

current burden are appropriate. Based 

on the Commission’s estimate of 47,984 

burden hours and an estimated wage 

rate of approximately $368 per hour,3

the total cost to reporting persons of the 

hour burden for filing Form N–PX is 

approximately $17.66 million.4

The estimated cost burden of Form N– 

PX is $1,000 in external costs per 

portfolio holding equity securities that 

is paid to third-party service providers. 

External costs for portfolios holding no 

equity securities have previously been 

estimated to be zero because portfolios 

holding no equity securities generally 

have no proxy votes to report and 

therefore do not require third-party 

service providers to assist with proxy 

voting and preparing reports on Form 

N–PX. The estimated cost burden of 

Form N–PX for fund of funds is 

estimated to be $100 per portfolio 

because fund of funds generally either 

have no proxy votes to report; or if 

proxy votes are reported, they are 

generally limited in the number of 

securities and the number of voting 

matters relative to portfolios holding 

equity securities. Therefore, the 

aggregate cost burden, when calculated 

using the current number of portfolios, 

is approximately $6,539,600 in external 

costs.5 We continue to believe that these 

estimates for Form N–PX’s current cost 

burden are appropriate. 

Estimates of average burden hours 

and costs are made solely for the 

purposes of the Paperwork Reduction 

Act and are not derived from a 

comprehensive or even representative 

survey or study of the costs of 

Commission rules and forms. 

Compliance with the collection of 

information requirements of Form N–PX 

is mandatory. Responses to the 

collection of information will not be 

kept confidential. An agency may not 

conduct or sponsor, and a person is not 

required to respond to, a collection of 

information unless it displays a 

currently valid OMB control number. 

Written comments are invited on: (a) 

Whether the collection of information is 

necessary for the proper performance of 

the functions of the Commission, 

including whether the information has 

practical utility; (b) the accuracy of the 

Commission’s estimate of the burden of 

the collection of information; (c) ways to 

enhance the quality, utility, and clarity 

of the information collected; and (d) 

ways to minimize the burden of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted in 

writing within 60 days of this 

publication. 

Please direct your written comments 

to David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, C/O Cynthia 

Roscoe, 100 F Street NE, Washington, 

DC 20549; or send an email to: PRA_

Mailbox@sec.gov. 

Dated: January 21, 2021. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–01667 Filed 1–26–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90956; File No. SR– 

NYSEAMER–2021–03] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the NYSE 

American Options Fee Schedule 

January 21, 2021. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on January 

13, 2021, NYSE American LLC (‘‘NYSE 

American’’ 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 selfregulatory organization. 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 

The Exchange proposes to amend the 

NYSE American Options Fee Schedule 

(‘‘Fee Schedule’’) regarding the credit 

for certain American Customer 

Engagement (‘‘ACE’’) Program Simple 

transactions. The Exchange proposes to 

implement the fee change effective 

January 13, 2021. The proposed rule 

change is available on the Exchange’s 

website at www.nyse.com, at the 

principal office of the Exchange, and at 

the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of this filing is to modify 

the Fee Schedule regarding a certain 

credit available to ACE Program 

participants who also have an affiliated 

or appointed Market Maker that 

participates in the Prepayment 

Program.4 The Exchange proposes to 

implement the rule change on January 

13, 2021. 

Section I.E. of the Fee Schedule sets 

forth the per contract credits applicable 

to Simple and Complex executions for 

participants in the ACE Program. 

Currently, the Exchange offers a range of 

credits to ACE Program participants for 

each electronic Customer contract, 

including certain credits available to 

participants with affiliated or appointed 

Market Makers that prepay their Market 

Maker fees. The credits are tiered based 

on increasing levels of Customer 


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7322 Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Notices 

5See proposed Fee Schedule, Section I.E., 

American Customer Engagement (‘‘ACE’’) Program 

Table. 

6See, e.g., Cboe Exchange Inc. (‘‘Cboe’’), Fee 

Schedule, Volume Incentive Program, available at: 

https://cdn.cboe.com/resources/membership/Cboe_

FeeSchedule.pdf (providing per contract credits 

based on volume tiers in Simple and Complex 

executions). 

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

8 15 U.S.C. 78f(b)(4) and (5). 

9See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(S7–10–04) (‘‘Reg NMS Adopting Release’’). 

10The OCC publishes options and futures volume 

in a variety of formats, including daily and monthly 

volume by exchange, available here: https://

www.theocc.com/Market-Data/Market-DataReports/Volume-and-Open-Interest/MonthlyWeekly-Volume-Statistics. 

11Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, see id., the 

Exchange’s market share in multiply-listed equity 

and ETF options increased from 8.06% for the 

month of November 2019 to 9.09% for the month 

of November 2020. 

12See, e.g., supra note 6 (regarding Cboe’s VIP 

Program). 

Electronic Average Daily Volume 

(‘‘ADV’’) or, for Tiers 3 through 5, Total 

Electronic ADV, of which 20% of the 

qualifying volume for the Tier must be 

Customer volume. 

The Exchange proposes to modify the 

Fee Schedule to amend the per contract 

credit applicable to Tier 5 Simple 

executions by Order Flow Providers that 

have an affiliated or appointed Market 

Maker that prepays its Market Maker 

Fees (the ‘‘Credit’’). Specifically, the 

Exchange proposes to modify the 

amount of the Credit from ($0.24) per 

contract to ($0.23) per contract.5

Because the volume of Electronic 

executions has increased across the 

industry, the Exchange believes the 

proposed change would still encourage 

more participants to try to achieve the 

Credit by directing more order flow to 

the Exchange. 

The Exchange’s fees are constrained 

by intermarket competition, as ATP 

Holders may direct their order flow to 

any of the 16 options exchanges, 

including another exchange with similar 

incentive programs.6 Thus, ATP Holders 

have a choice of where they direct their 

order flow, including Electronic 

volume. 

To the extent that the proposed 

modification to the Credit continues to 

encourage Customer order flow and 

Market Makers to prepay their fees, all 

market participants stand to benefit 

from both increased Customer order 

flow to achieve the Credit and 

continued Market Maker participation 

to take advantage of having pre-paid 

their fees. The Exchange believes all 

market participants stand to benefit 

from increased order flow, which 

promotes market depth, facilitates 

tighter spreads and enhances price 

discovery. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,7 in general, and 

furthers the objectives of Sections 

6(b)(4) and (5) of the Act,8 in particular, 

because it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members, 

issuers and other persons using its 

facilities and does not unfairly 

discriminate between customers, 

issuers, brokers or dealers. 

The Proposed Rule Change Is 

Reasonable 

The Exchange operates in a highly 

competitive market. The Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, the 

Commission highlighted the importance 

of market forces in determining prices 

and SRO revenues and, also, recognized 

that current regulation of the market 

system ‘‘has been remarkably successful 

in promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 9

There are currently 16 registered 

options exchanges competing for order 

flow. Based on publicly-available 

information, and excluding index-based 

options, no single exchange has more 

than 16% of the market share of 

executed volume of multiply-listed 

equity and ETF options trades.10

Therefore, currently no exchange 

possesses significant pricing power in 

the execution of multiply-listed equity & 

ETF options order flow. More 

specifically, in November 2020, the 

Exchange had less than 10% market 

share of executed volume of multiplylisted equity and ETF options trades.11

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can shift order flow, or discontinue or 

reduce use of certain categories of 

products, in response to fee changes. 

Accordingly, competitive forces 

constrain options exchange transaction 

fees. Stated otherwise, changes to 

exchange transaction fees and credits 

can have a direct effect on the ability of 

an exchange to compete for order flow. 

The proposed rule change is designed 

to continue to incent ATP Holders to 

direct liquidity to the Exchange in 

Electronic executions, similar to other 

exchange programs with competitive 

pricing programs, thereby promoting 

market depth, price discovery and 

improvement and enhancing order 

execution opportunities for market 

participants. In particular, the Exchange 

believes it is reasonable to adjust the 

Credit downward, as the Credit would 

remain consistent with those offered by 

a competing options exchange for 

electronic participants.12

The proposed change is reasonably 

designed to continue to encourage ATP 

Holders to participate in both the ACE 

Program and in the Market Maker 

Prepayment Program and to achieve 

ACE Tier 5 (the highest ACE Tier) to 

qualify for the Credit. The Exchange 

believes that otherwise maintaining the 

qualification bases to achieve the ACE 

Tier credits should also continue to 

encourage greater use of the Exchange 

by all ATP Holders, which may lead to 

greater opportunities to trade—and for 

price improvement—for all participants. 

Because the ACE Program is based on 

the amount of Customer business 

transacted on the Exchange, the 

Exchange believes the proposed change 

to decrease the Credit would still 

continue to incent providers of 

Customer order flow to direct that order 

flow to the Exchange. In addition, ATP 

Holders’ affiliated or appointed Market 

Makers will also continue to be incented 

to compete to make markets in a manner 

that enables the Exchange to improve its 

overall competitiveness and strengthen 

its market quality for all market 

participants. 

Further, the Exchange believes this 

proposed change would continue to 

attract more volume and liquidity to the 

Exchange generally, and more Customer 

volume specifically, and would 

therefore benefit all market participants 

(including those that do not participate 

in the ACE Program) through increased 

opportunities to trade at potentially 

improved prices and enhanced 

opportunities for price discovery. In 

addition, the proposed change would 

continue to encourage ATP Holders to 

have affiliated or appointed Market 

Makers prepay their Market Maker fees, 

which in turn encourages the Market 

Makers to conduct business and to make 

competitive markets on the Exchange, to 

the benefit of all markets participants. 

Finally, to the extent the proposed 

change encourages greater volume and 

liquidity, the Exchange believes the 

proposed change would continue to 

improve the Exchange’s overall 

competitiveness and strengthen its 

market quality for all market 

participants. In the backdrop of the 

competitive environment in which the 


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Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Notices 7323 

13See Reg NMS Adopting Release, supra note 9, 

at 37499. 

14See supra note 10. 

15Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, supra note 

11, the Exchange’s market share in multiply-listed 

equity and ETF options increased from 8.06% for 

the month of November 2019 to 9.09% for the 

month of November 2020. 

16See, e.g., supra note 6 (regarding Cboe’s VIP 

Program). 

17 15 U.S.C. 78s(b)(3)(A). 

Exchange operates, the proposed rule 

change is a reasonable attempt by the 

Exchange to maintain its market share 

relative to its competitors. 

The Proposed Rule Change Is an 

Equitable Allocation of Fees and Credits 

The Exchange believes the proposed 

rule change is an equitable allocation of 

its fees and credits. The proposal is 

based on the amount and type of 

business transacted on the Exchange 

and ATP Holders can opt to avail 

themselves of the incentives available 

through the ACE and Market Maker 

Prepayment Programs or not. The 

proposal is also designed to encourage 

ATP Holders and their affiliated or 

appointed parties to aggregate their 

executions at the Exchange as a primary 

execution venue. Moreover, to the 

extent that the proposed change 

continues to attract more Market Maker 

prepay activity to the Exchange, this 

increased order flow would continue to 

make the Exchange a more competitive 

venue for order execution. Thus, the 

Exchange believes the proposed rule 

change would improve market quality 

for all market participants on the 

Exchange and, as a consequence, 

continue to attract more order flow to 

the Exchange, thereby improving 

market-wide quality and price 

discovery. 

The Proposed Rule Change Is Not 

Unfairly Discriminatory 

The Exchange believes that the 

proposal is not unfairly discriminatory 

because the proposed modification 

would be available to all similarlysituated market participants on an equal 

and non-discriminatory basis. 

The proposal is based on the amount 

and type of business transacted on the 

Exchange and ATP Holders are not 

obligated to try to qualify for the credits 

available to ACE or Market Maker 

Prepayment Program participants. 

Rather, the Exchange’s proposed 

modification to the Credit is designed to 

continue to encourage greater use of the 

Market Maker Prepayment Program, 

which may lead to greater opportunities 

to trade—and for price improvement— 

for all participants, as well as continue 

to encourage participants to utilize the 

Exchange as a primary trading venue (if 

they have not done so previously) or 

increase Electronic volume sent to the 

Exchange. To the extent that the 

proposed change continues to attract 

more executions to the Exchange, this 

increased order flow would continue to 

make the Exchange a more competitive 

venue for order execution. Thus, the 

Exchange believes the proposed rule 

change would continue to improve 

market quality for all market 

participants on the Exchange and, as a 

consequence, attract more order flow to 

the Exchange thereby improving marketwide quality and price discovery. The 

resulting volume and liquidity would 

continue to provide more trading 

opportunities and tighter spreads to all 

market participants and thus would 

promote just and equitable principles of 

trade, 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. 

Finally, the Exchange believes that it 

is subject to significant competitive 

forces, as described below in the 

Exchange’s statement regarding the 

burden on competition. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with Section 6(b)(8) of 

the Act, the Exchange does not believe 

that the proposed rule change would 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

Instead, as discussed above, the 

Exchange believes that the proposed 

changes would continue to encourage 

the submission of additional liquidity to 

a public exchange, thereby promoting 

market depth, price discovery and 

transparency and enhancing order 

execution opportunities for all market 

participants. As a result, the Exchange 

believes that the proposed changes 

further the Commission’s goal in 

adopting Regulation NMS of fostering 

integrated competition among orders, 

which promotes ‘‘more efficient pricing 

of individual stocks for all types of 

orders, large and small.’’ 13

Intramarket Competition. The 

proposed change is designed to 

continue to attract order flow to the 

Exchange by offering competitive rates 

and credits via the ACE Program, based 

on increased volumes on the Exchange, 

which would enhance the quality of 

quoting and may increase the volumes 

of contracts traded on the Exchange. To 

the extent that this purpose is achieved, 

all of the Exchange’s market participants 

should benefit from the continued 

market liquidity. Enhanced market 

quality and increased transaction 

volume that results from the increase in 

order flow directed to the Exchange will 

benefit all market participants and 

improve competition on the Exchange. 

Intermarket Competition. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily favor one of the 

16 competing option exchanges if they 

deem fee levels at a particular venue to 

be excessive. In such an environment, 

the Exchange must continually adjust its 

fees to remain competitive with other 

exchanges and to attract order flow to 

the Exchange. Based on publiclyavailable information, and excluding 

index-based options, no single exchange 

currently has more than 16% of the 

market share of executed volume of 

multiply-listed equity and ETF options 

trades.14 Therefore, no exchange 

currently possesses significant pricing 

power in the execution of multiplylisted equity and ETF options order 

flow. More specifically, in November 

2020, the Exchange had less than 10% 

market share of executed volume of 

multiply-listed equity and ETF options 

trades.15

The Exchange believes that the 

proposed rule change reflects this 

competitive environment because, even 

though the amount of the Credit is 

decreased, ATP Holders should still be 

incentivized to direct trading interest to 

the Exchange, to provide liquidity and 

to attract order flow. To the extent that 

this purpose is achieved, all the 

Exchange’s market participants should 

benefit from the improved market 

quality and increased opportunities for 

price improvement. 

The Exchange believes that the 

proposed change could promote 

competition between the Exchange and 

other execution venues, including 

another exchange that currently offers 

similar pricing incentives,16 by 

encouraging additional orders to be sent 

to the Exchange for execution. 

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 is effective 

upon filing pursuant to Section 

19(b)(3)(A) 17 of the Act and 


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7324 Federal Register / Vol. 86, No. 16 / Wednesday, January 27, 2021 / Notices 

18 17 CFR 240.19b–4(f)(2). 

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. 

3The Exchange initially filed the proposed fee 

changes January 4, 2021 (SR–CboeEDGA–2021– 

002). On January 13, 2021, the Exchange withdrew 

that filing and submitted this proposal. 

4See Cboe Global Markets, U.S. Equities Market 

Volume Summary, Month-to-Date (January 13, 

2021), available at https://markets.cboe.com/us/ 

equities/market_statistics/. 

subparagraph (f)(2) of Rule 19b–4 18

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

under Section 19(b)(2)(B) 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– 

NYSEAMER–2021–03 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–NYSEAMER–2021–03. 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 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–NYSEAMER–2021–03, and 

should be submitted on or before 

February 17, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–01727 Filed 1–26–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90964; File No. SR– 

CboeEDGA–2021–004] 

Self-Regulatory Organizations; Cboe 

EDGA Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of 

Proposed Rule Change To Establish a 

Monthly Fee Assessed on Members’ 

MPIDs 

January 21, 2021. 

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 January 

13, 2021, Cboe EDGA Exchange, Inc. 

(the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the 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 

Cboe EDGA Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGA Equities’’) 

proposes to amend its fee schedule to 

establish a fee in connection with a 

Member’s Market Participant 

Identifier(s) (‘‘MPID’’). The text of the 

proposed rule change is provided in 

Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

website (http://markets.cboe.com/us/ 

equities/regulation/rule_filings/edga/), 

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, the 

Exchange 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 

Exchange 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 to adopt a monthly fee 

assessed on Members’ MPIDs.3

The Exchange first notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. More 

specifically, the Exchange is only one of 

16 registered equities exchanges, as well 

as a number of alternative trading 

systems and other off-exchange venues 

that do not have similar self-regulatory 

responsibilities under the Exchange Act, 

to which market participants may direct 

their order flow. Based on publicly 

available information,4 no single 

registered equities exchange has more 

than 16% of consolidated equity market 

share and currently the Exchange 

represents approximately 1.0% of the 

U.S. equities market. Thus, in such a 

low-concentrated and highly 

competitive market, no single equities 

exchange possesses significant pricing 

power in the execution of order flow. 

The Exchange further notes that brokerVerDate Sep<11>2014 17:04 Jan 26, 2021 Jkt 253001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4703 E:\FR\FM\27JAN1.SGM 27JAN1

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