30998 Federal Register / Vol. 83, No. 127 / Monday, July 2, 2018 / Notices 

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

2 17 CFR 240.19b–4. 

3The Exchange initially filed the proposed 

pricing changes on June 1, 2018 (SR–NASDAQ– 

2018–043). On July [sic] 12, 2018, the Exchange 

withdrew that filing and submitted this filing. This 

filing makes technical corrections, provides further 

discussion of the proposed change, and clarifies the 

statutory basis and burden on competition 

discussions. 

4See Securities Exchange Act Release No. 82825 

(March 7, 2018), 83 FR 10937 (March 13, 2018) (SR– 

NASDAQ–2017–074). 

5See Securities Exchange Act Release No. 82905 

(March 20, 2018), 83 FR 12988 (March 26, 2018) 

(SR–NASDAQ–2018–021). 

PREVIOUSLY ANNOUNCED TIME AND DATE OF

THE MEETING: Thursday, June 28, 2018 at 

2:00 p.m. 

CHANGES IN THE MEETING: The following 

item will not be considered during the 

Closed Meeting on Thursday, June 28, 

2018: 

• Report on an investigation. 

CONTACT PERSON FOR MORE INFORMATION: 

For further information and to ascertain 

what, if any, matters have been added, 

deleted or postponed, please contact the 

Office of the Secretary at (202) 551– 

5400. 

Dated: June 28, 2018. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2018–14281 Filed 6–28–18; 4:15 pm] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83522; File No. SR– 

NASDAQ–2018–047] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Adopt a 

New Transaction Fee for Execution of 

Midpoint Extended Life Orders 

June 26, 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 June 12, 

2018, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘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 

The Exchange proposes to amend the 

Exchange’s transaction fees at Rule 7018 

to adopt a new transaction fee for 

execution of Midpoint Extended Life 

Orders. 

While these amendments are effective 

upon filing, as discussed below, the 

Exchange will begin assessing the 

proposed fees on July 2, 2018.3

The text of the proposed rule change 

is available on the Exchange’s website at 

http://nasdaq.cchwallstreet.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 

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 purpose of the proposed rule 

change is to amend the Exchange’s 

transaction fees at Rule 7018(a)(1)–(3) to 

charge no fee for execution of Midpoint 

Extended Life Orders in the month of 

July 2018 if the member executes at 

least 250,000 shares in Midpoint 

Extended Life Orders in June 2018, and 

adopt a fee of $0.0006 per share 

executed for execution of all other 

Midpoint Extended Life Orders in 

securities with a price of $1 or more. 

Transactions in Midpoint Extended Life 

Orders in securities with a price less 

than $1 will remain at no cost. 

On March 7, 2018, the Commission 

approved the Exchange’s proposal to 

adopt a new Order Type, the Midpoint 

Extended Life Order.4 The Midpoint 

Extended Life Order is an Order Type 

with a Non-Display Order Attribute that 

is priced at the midpoint between the 

NBBO and that will not be eligible to 

execute until the Holding Period of one 

half of a second has passed after 

acceptance of the Order by the System. 

Once a Midpoint Extended Life Order 

becomes eligible to execute by existing 

unchanged for the Holding Period, the 

Order may only execute against other 

eligible Midpoint Extended Life Orders. 

The Exchange has not assessed a charge 

for Midpoint Extended Life Orders 

executions since the Exchange began to 

offer them on March 12, 2018.5

Under Rule 7018, the Exchange is 

proposing to assess fees for certain 

Midpoint Extended Life Orders 

beginning July 2, 2018, while 

continuing to provide a no fee tier for 

the month of July 2018 if a member 

meets qualification criteria based on its 

activity in Midpoint Extended Life 

Orders in June 2018. Specifically, the 

Exchange is proposing to assess no 

charge for execution of Midpoint 

Extended Life Orders in the month of 

July 2018 if the member executes at 

least at least [sic] 250,000 shares in 

Midpoint Extended Life Orders in the 

immediately preceding month. Thus, 

the new fee will be applied beginning 

July 2, 2018 based on the number of 

Midpoint Extended Life Orders 

executed by the member in the month 

of June 2018. The Exchange is also 

adopting a new fee of $0.0006 per share 

executed assessed for execution of 

Midpoint Extended Life Orders in 

securities priced at $1 or more 

applicable to members that do not 

qualify under the no cost tier described 

immediately above. After July 2018, the 

Exchange will assess a charge of $0.0006 

per share executed assessed [sic] for 

execution of any Midpoint Extended 

Life Order in a security priced $1 or 

greater. The proposed fees cover Orders 

in securities of any of the three tapes. 

The Exchange believes that the market 

in Midpoint Extended Life Orders has 

matured to the point that it can support 

the proposed $0.0006 per share 

executed fee; however, the Exchange 

also believes that promoting liquidity in 

Midpoint Extended Life Orders 

continues to be warranted. Thus, the 

Exchange is proposing to not assess a 

fee for executions of Midpoint Extended 

Life Orders in the month of July 2018 if 

members have at least 250,000 shares 

executed in Midpoint Extended Life 

Orders in June 2018. Allowing 

transactions to occur at no cost if a 

member provides a certain level of 

Midpoint Extended Life Order liquidity 

will promote use of the Midpoint 

Extended Life Order, which will in turn 

help bring continued overall liquidity in 

Midpoint Extended Life Orders in 

securities priced $1 or more to the 

Exchange in June 2018, since members 

may increase their activity in Midpoint 

Extended Life Orders, and members that 

have not yet used Midpoint Extended 

Life Orders may begin trading in them 

to benefit from the zero fee tier. To the 

extent that members are provided 


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

7 15 U.S.C. 78f(b)(4) and (5). 

8Securities Exchange Act Release No. 51808 

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

(‘‘Regulation NMS Adopting Release’’). 

9NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 

2010). 

10See NetCoalition, at 534–535. 11 Id. at 537. 12 Id. at 539 (quoting Securities Exchange Act 

Release No. 59039 (December 2, 2008), 73 FR 

74770, 74782–83 (December 9, 2008) (SR– 

NYSEArca–2006–21)). 13See Rule 7018(a)(1)–(3). 

14 Id. 

15See Investors Exchange Fee Schedule, available 

at: https://iextrading.com/trading/fees/. 

16See Securities Exchange Act Release No. 81311 

(August 3, 2017), 82 FR 37248 (August 9, 2017) 

(SR–NASDAQ–2017–074). 

17RTFY is a routing option available for an order 

that qualifies as a Designated Retail Order under 

which orders check the System for available shares 

only if so instructed by the entering firm and are 

thereafter routed to destinations on the System 

routing table. If shares remain unexecuted after 

routing, they are posted to the book. Once on the 

book, should the order subsequently be locked or 

crossed by another market center, the System will 

not route the order to the locking or crossing market 

center. RTFY is designed to allow orders to 

participate in the opening, reopening and closing 

process of the primary listing market for a security. 

See Rule 4758(a)(1)(A)(v)b. 

18See Rule 7018. 

incentive to trade in Midpoint Extended 

Life Orders to meet the zero fee tier 

qualification requirement, the benefit to 

liquidity should continue to through 

July 2018 as members that qualified for 

the zero fee tier take advantage of the 

zero fee trading for the month. Fees for 

all Midpoint Extended Life Orders in 

June 2018 will remain at no cost. In 

addition, the Exchange is not proposing 

to adopt a new fee for execution of 

Midpoint Extended Life Orders in 

securities below $1 (Rule 7018(b)) 

whatsoever, which will continue to be 

allowed at no cost. 

Accordingly, the Exchange is 

proposing to amend Rule 7018(a)(1)–(3) 

to note: (1) That members executing a 

Midpoint Extended Life Order will be 

assessed a charge of $0.0000 per share 

executed in the month of July 2018 if 

the member executes at least 250,000 

shares in Midpoint Extended Life 

Orders in June 2018; and (2) that all 

other members will be assessed a fee of 

$0.0006 per share executed, for 

executions of Midpoint Extended Life 

Orders in securities priced $1 or more. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,6 in general, and furthers the 

objectives of Sections 6(b)(4) and 6(b)(5) 

of the Act,7 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees and other charges 

among members and issuers and other 

persons using any facility, and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

The Commission and the courts have 

repeatedly expressed their preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, while 

adopting a series of steps to improve the 

current market model, 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.’’ 8

Likewise, in NetCoalition v. Securities 

and Exchange Commission 9

(‘‘NetCoalition’’) the D.C. Circuit upheld 

the Commission’s use of a market-based 

approach in evaluating the fairness of 

market data fees against a challenge 

claiming that Congress mandated a costbased approach.10 As the court 

emphasized, the Commission ‘‘intended 

in Regulation NMS that ‘market forces, 

rather than regulatory requirements’ 

play a role in determining the market 

data . . . to be made available to 

investors and at what cost.’’ 11

Further, ‘‘[n]o one disputes that 

competition for order flow is ‘fierce.’ 

. . . As the SEC explained, ‘[i]n the U.S. 

national market system, buyers and 

sellers of securities, and the brokerdealers that act as their order-routing 

agents, have a wide range of choices of 

where to route orders for execution’; 

[and] ‘no exchange can afford to take its 

market share percentages for granted’ 

because ‘no exchange possesses a 

monopoly, regulatory or otherwise, in 

the execution of order flow from broker 

dealers’ . . . .’’ 12

The proposed $0.0006 per share 

executed fee is reasonable because the 

Exchange has considered the nature of 

the market in Midpoint Extended Life 

Orders, the need to assess a fee to help 

cover the costs of supporting trading on 

Nasdaq, and the Exchange’s desire to 

continue to promote use of Midpoint 

Extended Life Orders on the Exchange. 

Taking these factors into consideration, 

the Exchange has determined that 

$0.0006 per share executed is 

appropriate. The Exchange currently 

assess [sic] a fee of $0.0007 per share 

executed for certain TFTY Orders.13 The 

Exchange also assesses $0.0007 per 

share executed for QCST and QDRK 

orders, except for QCST orders that 

execute on Nasdaq BX for which there 

is no charge or credit.14 Thus, the lower 

fee is similar to existing fees for Orders 

executed on the Exchange and may 

promote use of Midpoint Extended Life 

Orders and consequently the quality of 

the market in Midpoint Extended Life 

Orders. The Exchange also notes that a 

competitor exchange assesses a fee of 

$0.0009 per share executed for both 

adding and removing all non-displayed 

liquidity in securities priced $1 or 

more.15

As discussed extensively in its 

proposal,16 the Exchange believes that 

the Midpoint Extended Life Order is 

consistent with the Act because it is 

emblematic of a core function of a 

national securities exchange, namely 

matching buyers and sellers of securities 

on a transparent and well-regulated 

market, and helping these buyers and 

sellers come together to receive the best 

execution possible. The Exchange 

achieves this by permitting Midpoint 

Extended Life Orders to execute solely 

against other Midpoint Extended Life 

Orders at the midpoint of the NBBO in 

return for providing market-improving 

behavior in the form of a longer-lived 

midpoint order. Thus, the Exchange 

believes that it is important for 

participants using Midpoint Extended 

Life Orders to have a deep and liquid 

market. Applying a lower fee than the 

$0.0030 per share executed that the 

Exchange assesses for removing resting 

midpoint liquidity should provide 

incentive to market participants to use 

Midpoint Extended Life Orders while 

also allowing the Exchange to recoup 

some of the costs it incurs in offering 

the Order. 

The Exchange also believes that 

allowing transactions of Midpoint 

Extended Life Orders at no cost in July 

2018 is reasonable because it currently 

offers them at no cost. In addition, the 

Exchange does not charge a fee for 

transactions in Orders with a RTFY 

routing Order Attribute.17 Such an 

Order must meet the definition of 

Designated Retail Order, which requires, 

among other things, that the Order not 

originate from a trading algorithm or 

any other computerized methodology.18

Thus, allowing transactions of the RTFY 

Order Attribute at no cost is designed to 

promote the Exchange as a venue for 

retail investor Orders. Likewise, the 

Exchange is proposing to allow 

transactions in Midpoint Extended Life 

Orders at no cost in July 2018 to 

promote use of such Orders and 

consequently the quality of the market 

in Midpoint Extended Life Orders. 

The Exchange believes that the 

proposed fees are an equitable 

allocation and are not unfairly 

discriminatory because the Exchange 


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19Based on whether the member is removing or 

adding liquidity. See Rule 7018(a). 

20See Rule 7014(f)(5)(A). 21 15 U.S.C. 78s(b)(3)(A)(ii). 

will apply the same fee to all similarly 

situated members. The Midpoint 

Extended Life Order may be used by any 

market participant that is willing to 

satisfy the requirements of the Order 

Type and meet the volume requirement 

therefore qualify for the proposed zero 

fee tiers. Moreover, members not 

interested in using Midpoint Extended 

Life Orders will continue to have the 

ability to enter midpoint Orders in the 

Nasdaq System, which have both fees 

and credits associated with their 

execution.19 The Exchange is assessing 

fees for transactions in Midpoint 

Extended Life Orders beginning July 2, 

2018 and providing a limited time 

during which transactions in Midpoint 

Extended Life Orders may [sic] done at 

no cost. The proposed $0.0006 per share 

executed fee is lower than most other 

fees assessed for executions, which is 

reflective of the beneficial nature of the 

type of Order. Any member may take 

advantage of the lower fee by using the 

Order Type. Similarly, members will 

receive no charge in the month of July 

2018 if it meets the 250,000 share 

execution requirement of the tier. The 

Exchange believes that 250,000 shares 

executed is a modest level that is 

attainable by any member that chooses 

to enter Midpoint Extended Life Orders. 

The Exchange believes that the zero 

fee tier for July 2018, which is based on 

the number of shares in Midpoint 

Extended Life Order executed in June 

2018, is an equitable allocation and is 

not unfairly discriminatory because the 

Exchange has provided adequate notice 

of the changes to all members so that 

they may adjust their trading behavior, 

and any member may transact in 

Midpoint Extended Life Orders. Thus, 

all members may execute 250,000 shares 

or more in Midpoint Extended Life 

Orders in June 2018 to qualify for the 

zero cost tier in July 2018. The 

Exchange also applies qualification 

criteria for rebates under Rule 7014 that 

are based on the prior month’s activity. 

Specifically, the DLP program under 

Rule 7014(f) provides three rebates that 

have qualification criteria based on the 

level of ADV it had in the prior 

month.20

Last, the Exchange is not assessing a 

charge for executions in Midpoint 

Extended Life Orders in securities 

priced below $1 because there are very 

few executions in such Orders relative 

to transactions in Midpoint Extended 

Life Orders in securities priced at $1 or 

greater. Allowing such transactions at 

no cost will help promote a deeper 

market in Midpoint Extended Life 

Orders in securities priced below $1. 

Thus, the Exchange believes that the no 

cost tier in Midpoint Extended Life 

Orders in securities priced below $1 

remains an equitable allocation and is 

not unfairly discriminatory. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the Act. In terms of 

inter-market competition, the Exchange 

notes that it operates in a highly 

competitive market in which market 

participants can readily favor competing 

venues if they deem fee levels at a 

particular venue to be excessive, or 

rebate opportunities available at other 

venues to be more favorable. In such an 

environment, the Exchange must 

continually adjust its fees to remain 

competitive with other exchanges and 

with alternative trading systems that 

have been exempted from compliance 

with the statutory standards applicable 

to exchanges. Because competitors are 

free to modify their own fees in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which fee 

changes in this market may impose any 

burden on competition is extremely 

limited. 

In this instance, the proposal to assess 

no fee for certain executions of 

Midpoint Extended Life Orders and a 

modest fee of $0.0006 per share 

executed will not place any burden on 

competition, but rather will help ensure 

continued growth in the use of 

Midpoint Extended Life Orders by 

making such Orders attractive to 

members that seek to execute at the 

midpoint with like-minded members, 

while also allowing the Exchange to 

recoup some of the costs associated with 

offering the Order Type. The proposal 

also reduces burdens on members 

associated with the Exchange applying 

fees to an Order Type for which fees 

have not been assessed. The new fee 

tiers will help members transition to fee 

liable transactions by providing an 

opportunity to avoid paying a fee for a 

transaction in Midpoint Extended Life 

Orders in July 2018 if they choose to 

provide 250,000 or more shares 

executed in Midpoint Extended Life 

Orders for the month of June 2018. To 

the extent the proposal is not successful 

in promoting liquidity in Midpoint 

Extended Life Orders, it would have no 

meaningful impact on competition as 

few transactions in Midpoint Extended 

Life Orders would occur. In sum, if the 

proposal to assess the new fee tiers for 

executions of Midpoint Extended Life 

Orders is unattractive to market 

participants, it is likely that the 

Exchange will not gain any market share 

and may lose market share. 

Accordingly, the Exchange does not 

believe that the proposed changes will 

impair the ability of members or 

competing order execution venues to 

maintain their competitive standing in 

the financial markets. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or 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) of the Act.21

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) 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. 

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– 

NASDAQ–2018–047 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE, Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–NASDAQ–2018–047. This 

file number should be included on the 

subject line if email is used. To help the 


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22 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)(3)(A). 

4 17 CFR 240.19b–4(f)(6). 

5See EDGX Rules 11.6(n)(7), 11.8(b)(7) and 

11.8(d)(5); see also Securities Exchange Act Release 

No. 80841 (June 1, 2017), 82 FR 26559 (June 7, 

2017), (Notice of Filing and Immediate 

Effectiveness To Add a New Optional Order 

Instruction Known as Non-Displayed Swap). 

6See Nasdaq Rule 4703(m) (defining the Trade 

Now order modifier); see also Securities Exchange 

Act Release No. 79282 (November 10, 2016), 81 FR 

81219 (November 17, 2016) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule change to 

Amend Rule 4702 and Rule 4703 to Add a ‘‘Trade 

Now’’ Instruction to Certain Order Types). 

7See Arca Rule 7.31–E(d)(2)(B) (describing the 

Non-Display Remove Modifier); see also Securities 

Exchange Act Release No. 76267 (October 26, 2015), 

80 FR 66951 (October 30, 2015) (Order Approving 

Proposed Rule change Adopting New Equity 

Trading Rules Relating to Orders and Modifiers and 

Retail Liquidity Program To Reflect the 

Implementation of Pillar, the Exchange’s New 

Trading Technology Platform). 

8See supra note 5. 

9See supra notes 6 and 7. 

10See Exchange Rule 11.6(e)(2). 

11See Exchange Rule 1.5(d). 

12See Exchange Rule 1.5(ee). 

13Under Exchange Rule 11.6(n)(4), an order with 

a Post Only instruction will remove contra-side 

liquidity from the EDGA Book if the order is an 

order to buy or sell a security priced below $1.00 

or if the value of such execution when removing 

liquidity equals or exceeds the value of such 

execution if the order instead posted to the EDGA 

Book and subsequently provided liquidity, 

including the applicable fees charged or rebates 

provided. To determine at the time of a potential 

execution whether the value of such execution 

when removing liquidity equals or exceeds the 

value of such execution if the order instead posted 

to the EDGA Book and subsequently provided 

liquidity, the Exchange will use the highest possible 

Continued 

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 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–2018–047, and 

should be submitted on or before July 

23, 2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–14109 Filed 6–29–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83521; File No. SR– 

CboeEDGA–2018–011] 

Self-Regulatory Organizations; Cboe 

EDGA Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change to Rule 11.6, 

Definitions and Rule 11.8, Order Types 

June 26, 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 June 13, 

2018, Cboe EDGA Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGA’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6) thereunder,4

which renders it effective upon filing 

with the Commission. 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 filed a proposal to (i) 

amend paragraph (n) of Exchange Rule 

11.6, Routing/Posting Instructions to 

add a new optional order instruction to 

be known as Non-Displayed Swap; and 

(ii) make a related change to description 

of Limit Orders and MidPoint Peg 

Orders under Exchange Rule 11.8. The 

proposed amendments are identical to 

the rules of Cboe EDGX Exchange, Inc. 

(‘‘EDGX’’) 5 and substantially similar to 

the rules of the Nasdaq Stock Market 

LLC (‘‘Nasdaq’’) 6 and NYSE Arca, Inc. 

(‘‘Arca’’).7

The text of the proposed rule change 

is available at the Exchange’s website at 

www.markets.cboe.com, at the 

Exchange’s principal office and at the 

Public Reference Room of the 

Commission. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 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 parts 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: (i) Amend 

paragraph (n) of Exchange Rule 11.6, 

Routing/Posting Instructions to add a 

new optional order instruction to be 

known as Non-Displayed Swap; and (ii) 

make a related change to description of 

Limit Orders and MidPoint Peg Orders 

under Exchange Rule 11.8. These 

proposed amendments are identical to 

the rules of EDGX 8 and substantially 

similar to the rules of Nasdaq and Arca.9

The proposed Non-Displayed Swap 

(‘‘NDS’’) instruction would provide 

orders with a Non-Displayed 10

instruction resting on the EDGA Book 11

with a greater ability to receive an 

execution when that resting order is 

locked by an incoming order (e.g., the 

price of the resting non-displayed order 

is equal to the price of the incoming 

order that is to be placed on the EDGA 

Book). The NDS instruction would be an 

optional order instruction that would 

allow Users 12 to have their resting nondisplayed orders execute against an 

incoming order with a Post Only 

instruction rather than have it be locked 

by the incoming order. NDS would be 

defined as an instruction that may be 

attached to an order with a NonDisplayed instruction that when such 

order is resting on the EDGA Book and 

would be locked by an incoming order 

with a Post Only instruction that does 

not remove liquidity pursuant to 

paragraph (4) of Exchange Rule 

11.6(n),13 the order with a NDS 


daltland on DSKBBV9HB2PROD with NOTICES