[Federal Register Volume 88, Number 188 (Friday, September 29, 2023)]
[Notices]
[Pages 67398-67400]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-21349]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-98514; File No. SR-OPRA-2023-01]


Joint Industry Plan; Order Instituting Proceedings To Determine 
Whether To Approve or Disapprove a Proposed Amendment To Modify the 
Options Price Reporting Authority's Fee Schedule Regarding Caps on the 
Amounts of Certain Port Fees

September 25, 2023.

I. Introduction

    On July 14, 2023, the Options Price Reporting Authority (``OPRA''), 
pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 608 of Regulation National Market System 
(``Regulation NMS'') thereunder,\2\ filed with the Securities and 
Exchange Commission (``Commission'') a proposed amendment to the Plan 
for Reporting of Consolidated Options Last Sale Reports and Quotation 
Information (``OPRA Plan'').\3\ The proposed OPRA Plan amendment 
(``Proposed Amendment'') would amend the OPRA Fee Schedule to reflect 
the applicable monthly fee caps on certain connectivity ports that are 
used to access OPRA data. The Proposed Amendment was published for 
comment in the Federal Register on August 2, 2023.\4\ The Commission 
has not received any comments on the Proposed Amendment.
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    \1\ 15 U.S.C 78k-1.
    \2\ 17 CFR 242.608.
    \3\ The OPRA Plan is a national market system plan approved by 
the Commission pursuant to Section 11A of the Act and Rule 608 
thereunder. See Securities Exchange Act Release No. 17638 (Mar. 18, 
1981), 22 SEC. Docket 484 (Mar. 31, 1981). The full text of the OPRA 
Plan and a list of its participants are available at https://www.opraplan.com/. The OPRA Plan provides for the collection and 
dissemination of last sale and quotation information on options that 
are traded on the participant exchanges.
    \4\ See Securities Exchange Act Release No. 98012 (July 27, 
2023), 88 FR 50939 (``Notice'').
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    This order institutes proceedings, under Rule 608(b)(2)(i) of 
Regulation NMS,\5\ to determine whether to approve or disapprove the 
Proposed Amendment or to approve the Proposed Amendment with any 
changes or subject to any conditions the Commission deems necessary or 
appropriate after considering public comment.
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    \5\ 17 CFR 242.608(b)(2)(i).
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II. Summary of the Proposed Amendment \6\
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    \6\ The full text of the Proposed Amendment appears as 
Attachment A to the Notice. See Notice, supra note 4, 88 FR at 
50941-42.
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    OPRA states that the Proposed Amendment is designed to amend the 
OPRA Fee Schedule to provide public notice that OPRA negotiated terms 
in the 2021 Processor Services Agreement (the ``2021 Processor 
Agreement'') between OPRA and the Securities Industry Automation 
Corporation (``SIAC'') that impose caps on certain port fees that can 
be charged per month when SIAC, either directly or through a third 
party, provides direct access to OPRA data to any person authorized by 
OPRA to receive direct access to OPRA data.\7\ OPRA further states 
that, under the 2021 Processor Agreement, SIAC is OPRA's ``processor,'' 
meaning that SIAC gathers the last sale and quote information from each 
of the OPRA members, consolidates that information, and disseminates 
the consolidated OPRA data.\8\ According to OPRA, as the processor, 
SIAC works directly with OPRA members and data vendors to provide 
connectivity to SIAC, and connectivity to SIAC is currently provided by 
an affiliate of SIAC, the ICE Global Network (``IGN''), which both sets 
and charges the port fees associated with that connectivity.\9\
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    \7\ See id. at 50939.
    \8\ See id.
    \9\ See id.
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    OPRA states that recipients of OPRA data can access that data using 
a 10 gigabit (``Gb''), 40 Gb, or 100 Gb network connection. OPRA 
further states that it has contractually capped the connectivity or 
``port'' fees that SIAC, or any third party utilized by SIAC, may 
charge to provide direct connectivity to OPRA data using a 10 Gb or 40 
Gb connection and that it has ``the right to approve a cap on port fees 
that could be charged for . . . higher capacity ports'' in the event 
that such higher capacity ports become available in the future.\10\
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    \10\ See id.
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    OPRA states that the negotiated port fee caps of $16,000 per month 
per 10 Gb port and $20,500 per month per 40 Gb port were established as 
part of the 2015 Processor Agreement between OPRA and SIAC.\11\ OPRA 
further states that these caps were retained in the 2021 Processor 
Agreement,\12\ and that OPRA's Management Committee

[[Page 67399]]

subsequently approved the $30,000 per month port fee cap with respect 
to the 100 Gb port in September 2021 in accordance with the terms of 
the 2021 Processor Agreement.\13\
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    \11\ See id.
    \12\ See id. at 50939-40 (stating OPRA ``used the negotiation 
process as an opportunity to ensure that SIAC's ability to increase 
the amount of port fees would be capped during the term of the 2015 
Processor Agreement for all OPRA data recipients, including OPRA 
members, who were authorized to receive direct access to OPRA 
data.'').
    \13\ See id.
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    OPRA states that it does not provide access ports, does not itself 
charge any port fees, does not collect any fees on behalf of OPRA 
members in connection with access to SIAC, and does not receive any 
portion of port fees charged by other entities.\14\ OPRA further states 
that it does not believe the caps that it negotiated with SIAC 
concerning ``the amount of port fees that can be charged either (1) 
establishes or changes a fee or charge collected on behalf of the 
members of the OPRA Plan in connection with access to, or use of, any 
OPRA facilities or (2) represents a fee or charge imposed by OPRA as 
contemplated by Rule 608(a)(5)(ii) of Regulation NMS.'' \15\ OPRA 
states that it submitted the Proposed Amendment to ``provide notice of 
the contractual fee caps it negotiated with SIAC'' and because 
Commission staff requested that it do so.\16\
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    \14\ See id. at 50939.
    \15\ Id.
    \16\ Id.
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III. Proceedings To Determine Whether To Approve Or Disapprove the 
Proposed Amendment

    The Commission is instituting proceedings pursuant to Rule 
608(b)(2)(i) of Regulation NMS,\17\ and Rule 700 of the Commission's 
Rules of Practice,\18\ to determine whether to approve or disapprove 
the Proposed Amendment or to approve the Proposed Amendment with any 
changes or subject to any conditions the Commission deems necessary or 
appropriate after considering public comment. Institution of 
proceedings does not indicate that the Commission has reached any 
conclusions with respect to any of the issues involved. Rather, the 
Commission seeks and encourages interested persons to provide 
additional comment on the Proposed Amendment to inform the Commission's 
analysis.
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    \17\ 17 CFR 242.608(b)(2)(i).
    \18\ 17 CFR 201.700.
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    Rule 608(b)(2) of Regulation NMS provides that the Commission 
``shall approve a . . . proposed amendment to an effective national 
market system plan, with such changes or subject to such conditions as 
the Commission may deem necessary or appropriate, if it finds that such 
. . . amendment is necessary or appropriate in the public interest, for 
the protection of investors and the maintenance of fair and orderly 
markets, to remove impediments to, and perfect the mechanisms of, a 
national market system, or otherwise in furtherance of the purposes of 
the Act.'' \19\ Rule 608(b)(2) further provides that the Commission 
shall disapprove a proposed amendment if it does not make such a 
finding.\20\ Pursuant to Rule 608(b)(2)(i) of Regulation NMS,\21\ the 
Commission is providing notice of the grounds for possible disapproval 
under consideration:
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    \19\ 17 CFR 242.608(b)(2).
    \20\ See id.
    \21\ 17 CFR 242.608(b)(2)(i). See also Commission Rule of 
Practice 700(b)(2), 17 CFR 201.700(b)(2).
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    <bullet> Whether the Proposed Amendment is consistent with Rule 608 
of Regulation NMS. Specifically, whether the Proposed Amendment is 
necessary or appropriate in the public interest, for the protection of 
investors and the maintenance of fair and orderly markets, to remove 
impediments to, and perfect the mechanisms of, a national market 
system, or otherwise in furtherance of the purposes of the Act.\22\
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    \22\ See 17 CFR 242.608(b)(2).
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    <bullet> Whether, consistent with Rule 603(a) and 614(d)(3) of 
Regulation NMS, the Proposed Amendment provides for the distribution of 
information with respect to quotations for and transactions in NMS 
stocks on terms that are fair and reasonable and not unreasonably 
discriminatory.\23\
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    \23\ See 17 CFR 242.603(a), 614(d)(3).
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    <bullet> Whether the Proposed Amendment is consistent with Rule 
608(a)(4)(C) of Regulation NMS requiring every amendment to a national 
market system plan be accompanied by, among other things, an analysis 
of the impact on competition of implementation of the amendment.\24\
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    \24\ See 17 CFR 242.608(a)(4)(C).
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    <bullet> Whether the Proposed Amendment is consistent with Rule 
608(a)(5) of Regulation NMS requiring every amendment to a national 
market system plan include a description of the manner in which any 
facility contemplated by the plan or amendment will be operated and 
further requiring that any such description include, to the extent 
applicable, the method by which any fees or charges collected on behalf 
of all of the sponsors and/or participants in connection with access 
to, or use of, any facility contemplated by the plan or amendment will 
be determined and imposed (including any provision for distribution of 
any net proceeds from such fees or charges to the sponsors and/or 
participants) and the amount of such fees or charge.\25\
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    \25\ See 17 CFR 242.608(a)(5).
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    <bullet> Whether modifications to the Proposed Amendment, or 
conditions to its approval, would be required to make the Proposed 
Amendment necessary or appropriate in the public interest, for the 
protection of investors and the maintenance of fair and orderly 
markets, to remove impediments to, and perfect the mechanisms of, a 
national market system, or otherwise in furtherance of the purposes of 
the Act.\26\
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    \26\ See CFR 242.608(b)(2).
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    <bullet> Whether the Proposed Amendment is consistent with 
Congress's finding, in Section 11A(1)(C)(iii) of the Act, that it is in 
the public interest and appropriate for the protection of investors and 
the maintenance of fair and orderly markets to ensure ``the 
availability to brokers, dealers, and investors or information with 
respect to quotations for and transactions in securities.\27\
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    \27\ 15 U.S.C. 78k-1(a)(1)(C)(iii).
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    <bullet> Whether, consistent with the purposes of Section 
11A(c)(1)(B) of the Act,\28\ the Proposed Amendment's provisions are 
drafted to support the prompt, accurate, reliable, and fair collection, 
processing, distribution, and publication of information with respect 
to quotations for and transactions in NMS securities, and the fairness 
and usefulness of the form and content of such information.
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    \28\ 15 U.S.C. 78k-1(c)(1)(B).
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    Under the Commission's Rules of Practice, the ``burden to 
demonstrate that a NMS plan filing is consistent with the Exchange Act 
and the rules and regulations issued thereunder . . . is on the plan 
participants that filed the NMS plan filing.'' \29\ The description of 
the NMS plan filing, its purpose and operation, its effect, and a legal 
analysis of its consistency with applicable requirements must all be 
sufficiently detailed and specific to support an affirmative Commission 
finding, and ``[a] mere assertion that the NMS plan filing is 
consistent with those requirements is not sufficient.'' \30\ Any 
failure of the plan participants that filed the NMS plan filing to 
provide such detail and specificity may result in the Commission not 
having a sufficient basis to make an affirmative finding that the NMS 
plan filing is consistent with the Act and the applicable rules and 
regulations thereunder.\31\
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    \29\ 17 CFR 201.700(b)(3)(ii).
    \30\ Id.
    \31\ See id.
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IV. Commission's Solicitation of Comments

    The Commission requests that interested persons provide written 
submissions of their views, data, and

[[Page 67400]]

arguments with respect to the issues identified above, as well as any 
other comments or concerns they may have regarding the proposal. In 
particular, the Commission invites the written views of interested 
persons concerning whether the proposal is consistent with Section 11A 
or any other provision of the Act, or the rules and regulations 
thereunder, and the Commission asks that commenters address the 
sufficiency and merit of OPRA's statements in support of the Proposed 
Amendment.\32\
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    \32\ See Notice, supra note 4, 88 FR at 30989.
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    Although there do not appear to be any issues relevant to approval 
or disapproval that would be facilitated by an oral presentation of 
views, data, and arguments, the Commission will consider, pursuant to 
Rule 608(b)(2)(i) of Regulation NMS,\33\ any request for an opportunity 
to make an oral presentation.\34\
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    \33\ 17 CFR 242.608(b)(2)(i).
    \34\ Rule 700(c)(2) of the Commission's Rules of Practice 
provides that ``[t]he Commission, in its sole discretion, may 
determine whether any issues relevant to approval or disapproval 
would be facilitated by the opportunity for an oral presentation of 
views.'' 17 CFR 201.700(c)(2).
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    Comments may be submitted by any of the following methods:

Electronic Comments

    <bullet> Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#97e5e2fbf2baf4f8fafaf2f9e3e4d7e4f2f4b9f0f8e1"><span class="__cf_email__" data-cfemail="750700191058161a1818101b0106350610165b121a03">[email protected]</span></a>. Please include 
file number SR-OPRA-2023-01 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-OPRA-2023-01. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for website viewing and 
printing in the Commission's Public Reference Room, 100 F Street, NE, 
Washington, DC 20549 on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the Participants' principal offices. Do not 
include personal identifiable information in submissions; you should 
submit only information that you wish to make available publicly. We 
may redact in part or withhold entirely from publication submitted 
material that is obscene or subject to copyright
    protection. All submissions should refer to file number SR-OPRA-
2023-01 and should be submitted on or before October 20, 2023. Rebuttal 
comments should be submitted by November 3, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\35\
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    \35\ 17 CFR 200.30-3(a)(85).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-21349 Filed 9-28-23; 8:45 am]
BILLING CODE 8011-01-P


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