37028 Federal Register / Vol. 83, No. 147 / Tuesday, July 31, 2018 / Notices 

52The posting of the transitional rules on the 

public rules website will make it clear what 

disciplinary proceedings are governed by the 

transitional rules (i.e., matters initiated prior to the 

implementation date). 

53 15 U.S.C. 78s(b)(3)(A)(iii). 

54 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 

55 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

processes to new matters that are 

initiated on or after that implementation 

date. Any matters initiated prior to the 

implementation date will be completed 

using the current processes. As a 

consequence, the Exchange will delete 

the applicable portions of Chapters 15– 

17 from the Exchange’s Rulebook, but it 

will maintain a transitional Rulebook on 

the Exchange’s public rules website 

(http://nasdaqmrx.cchwallstreet.com/), 

which will contain the Exchange Rules 

as they are at the time of filing this rule 

change.52 These transitional Rules will 

apply exclusively to the matters 

initiated prior to the implementation 

date. Upon conclusion of the last matter 

to which the transitional rules apply, 

the Exchange will remove the defunct 

transitional rules from its public rules 

website. Thus, the transition will be 

conducted in a fair, orderly, and 

transparent manner. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will result in 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended 

[sic]. The proposed rule change is not 

intended to address competitive issues, 

but it should reduce burdens on 

Members, [sic] and Associated Persons. 

Specifically and as described in detail 

above, the Exchange believes that this 

change will bring efficiency and 

consistency in application of the 

investigative, disciplinary, and 

adjudicatory processes, thereby 

reducing the burden on Members and 

Associated Persons who are also 

members of BX and the other Nasdaq, 

Inc. Exchanges. 

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 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 53 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.54

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– 

MRX–2018–23 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–MRX–2018–23. 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–MRX–2018–23 and should 

be submitted on or before August 21, 

2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.55

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–16273 Filed 7–30–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83709; File No. SR– 

NYSENAT–2018–15] 

Self-Regulatory Organizations; NYSE 

National, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Its Schedule of 

Fees and Rebates 

July 25, 2018. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that on July 13, 

2018, NYSE National, Inc. (‘‘Exchange’’ 

or ‘‘NYSE National’’) 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 self-regulatory 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 its 

Schedule of Fees and Rebates (the 

‘‘Price List’’) related to colocation to 

provide Users with access to the 


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4The Exchange initially filed rule changes 

relating to its co-location services with the 

Commission on May 18, 2018. See Securities 

Exchange Act Release No. 83351 (May 31, 2018), 83 

FR 26314 (June 6, 2018) (SR–NYSENAT–2018–07). 

The Exchange operates a data center in Mahwah, 

New Jersey (the ‘‘data center’’) from which it 

provides co-location services to Users. 

5For purposes of the Exchange’s co-location 

services, a ‘‘User’’ means any market participant 

that requests to receive co-location services directly 

from the Exchange. See id. at note 9. As specified 

in the Price List, a User that incurs co-location fees 

for a particular co-location service pursuant thereto 

would not be subject to co-location fees for the 

same co-location service charged by the Exchange’s 

affiliates NYSE American LLC (‘‘NYSE American’’), 

New York Stock Exchange LLC (‘‘NYSE’’), and 

NYSE Arca, Inc. (‘‘NYSE Arca’’ and, together with 

NYSE American and NYSE, the ‘‘Affiliate SROs’’). 

See id. at note 11. 

6See supra note 4. 

7The Exchange currently provides connectivity to 

the OTC Markets Group data feed as a Third Party 

Data Feed. 

8See supra note 4. 

9 Information flows over existing network 

connections in two formats: ‘‘unicast’’ format, 

which is a format that allows one-to-one 

communication, similar to a phone line, in which 

information is sent to and from the Exchange; and 

‘‘multicast’’ format, which is a format in which 

information is sent one-way from the Exchange to 

multiple recipients at once, like a radio broadcast. 

systems, and connectivity to the data 

feeds, of various additional third 

parties. In addition, the Exchange 

proposes to amend its Price List to 

update the names of certain third parties 

to reflect their current names. 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 Exchange proposes to amend the 

co-location 4 services offered by the 

Exchange to provide Users 5 with access 

to the systems, and connectivity to the 

data feeds, of various additional third 

parties. In addition, the Exchange 

proposes to amend its Price List to 

update the names of certain third parties 

to reflect their current names. The 

Exchange proposes to make the 

corresponding amendments to the 

Exchange’s Price List related to these colocation services to reflect these 

proposed changes. 

As set forth in the Price List, the 

Exchange charges fees for connectivity 

to the execution systems of third party 

markets and other content service 

providers (‘‘Third Party Systems’’), and 

data feeds from third party markets and 

other content service providers (‘‘Third 

Party Data Feeds’’).6 The lists of Third 

Party Systems and Third Party Data 

Feeds are set forth in the Price List. 

The Exchange proposes to provide 

access to BM&F Bovespa, Canadian 

Securities Exchange (‘‘CSE’’), ITG 

TriAct MatchNow, NASDAQ Canada, 

Neo Aequitas, Omega, and OTC Markets 

Group as additional Third Party 

Systems (‘‘Proposed Third Party 

Systems’’). In addition, it proposes to 

provide connectivity to the same third 

parties’ data feeds, with the exception of 

the OTC Markets Group 7 (‘‘Proposed 

Third Party Data Feeds’’). 

BM&F Bovespa is a Brazilian national 

securities exchange. CSE and Neo 

Aequitas are Canadian national 

securities exchanges. NASDAQ Canada, 

also Canadian national securities 

exchange, operates three trading books 

for trading in Canadian securities: CXC, 

CXD, and CX2. ITG TriAct MatchNow 

and Omega are Canadian alternative 

markets that match customer orders in 

Canadian securities. OTC Markets 

Group operates trading platforms for 

over-the-counter securities. 

The Exchange would provide access 

to the Proposed Third Party Systems 

(‘‘Access’’), and connectivity to the 

Proposed Third Party Data Feeds 

(‘‘Connectivity’’), as conveniences to 

Users. Use of Access or Connectivity 

would be completely voluntary. The 

Exchange is not aware of any 

impediment to third parties offering 

Access or Connectivity. 

The Exchange does not have visibility 

into whether third parties currently 

offer, or intend to offer, Users access to 

the Proposed Third Party Systems and 

connectivity to the Proposed Third 

Party Data Feeds, as such third parties 

are not required to make that 

information public. However, if one or 

more third parties presently offer, or in 

the future opt to offer, such Access and 

Connectivity to Users, a User may 

utilize the Secure Financial Transaction 

Infrastructure (‘‘SFTI’’) network, a third 

party telecommunication network, third 

party wireless network, a cross connect, 

or a combination thereof to access such 

services and products through a 

connection to an access center outside 

the data center (which could be a SFTI 

access center, a third-party access 

center, or both), another User, or a third 

party vendor. 

Access to the Proposed Third Party 

Systems 

The Exchange proposes to revise the 

Price List to provide that Users may 

obtain connectivity to the Proposed 

Third Party Systems for a fee. As with 

the current Third Party Systems, Users 

would connect to the Proposed Third 

Party Systems over the internet protocol 

(‘‘IP’’) network, a local area network 

available in the data center.8

As with the current Third Party 

Systems, in order to obtain access to a 

Proposed Third Party System, the User 

would enter into an agreement with the 

relevant Proposed Third Party, pursuant 

to which the third party content service 

provider would charge the User for 

access to the Proposed Third Party 

System. The Exchange would then 

establish a unicast connection between 

the User and the Proposed Third Party 

System over the IP network.9 The 

Exchange would charge the User for the 

connectivity to the Proposed Third 

Party System. A User would only 

receive, and only be charged for, access 

to the Proposed Third Party System for 

which it enters into agreements with the 

third party content service provider. 

The Exchange has no ownership 

interest in any of the Proposed Third 

Party Systems. Establishing a User’s 

access to a Proposed Third Party System 

would not give the Exchange any right 

to use the Proposed Third Party System. 

Connectivity to a Proposed Third Party 

System would not provide access or 

order entry to the Exchange’s execution 

system, and a User’s connection to the 

Proposed Third Party System would not 

be through the Exchange’s execution 

system. 

As with the existing connections to 

Third Party Systems, the Exchange 

proposes to charge a monthly recurring 

fee for connectivity to the Proposed 

Third Party Systems. Specifically, when 

a User requests access to a Proposed 

Third Party System, it would identify 

the applicable content service provider 

and what bandwidth connection it 

required. 

The Exchange proposes to modify its 

Price List to add the Proposed Third 

Party Systems to its existing list of Third 

Party Systems. The Exchange does not 


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10See supra note 4, at 26315, 26316. 

11See Securities Exchange Act Release No. 78119 

(June 27, 2016), 81 FR 41611 (SR–ISE2016–11; SR– 

ISE Gemini–2016–05; SR–ISE Mercury–2016–10) 

(Order Granting Accelerated Approval of Proposed 

Rule Changes, Each as Modified by Amendment No. 

1 Thereto, Relating to a Corporate Transaction in 

Which Nasdaq, Inc. Will Become the Indirect Parent 

of ISE, ISE Gemini, and ISE Mercury). See also 

Securities Exchange Act Release No. 80325 (March 

29, 2017), 82 FR 16445 (April 4, 2017) (Notice of 

Filing and Immediate Effectiveness of Proposed 

Rule Change To Rename the Exchange as Nasdaq 

ISE, LLC). 

12See, e.g., Securities Exchange Act Release No. 

81981 (October 30, 2017), 82 FR 51309 (November 

3, 2017) (SR–CBOE–2017–066); and 81962 (October 

26, 2017), 82 FR 50711 (November 1, 2017) (SR– 

BatsBZX–2017–70). 

13As is currently the case, Users that receive colocation services from the Exchange will not receive 

any means of access to the Exchange’s trading and 

execution systems that is separate from, or superior 

to, that of other Users. In this regard, all orders sent 

to the Exchange enter the Exchange’s trading and 

execution systems through the same order gateway, 

regardless of whether the sender is co-located in the 

data center or not. In addition, co-located Users do 

not receive any market data or data service product 

that is not available to all Users, although Users that 

receive co-location services normally would expect 

reduced latencies in sending orders to, and 

receiving market data from, the Exchange. 

14See SR–NYSENAT–2018–07, supra note 4 at 

26314. The Affiliate SROs have also submitted 

substantially the same proposed rule change to 

propose the changes described herein. See SR– 

NYSEArca–2018–52, SR–NYSEAmerican–2018–35, 

and SR–NYSE–2018–32. 

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

16 15 U.S.C. 78f(b)(5). 

propose to change the monthly 

recurring fee the Exchange charges 

Users for unicast connectivity to each 

Third Party System, including the 

Proposed Third Party Systems. 

Connectivity to the Proposed Third 

Party Data Feeds 

The Exchange proposes to revise the 

Price List to provide that Users may 

obtain connectivity to the Proposed 

Third Party Data Feeds for a fee. The 

Exchange would receive a Proposed 

Third Party Data Feed from the content 

service provider at the Exchange’s data 

center. The Exchange would then 

provide connectivity to that data to 

Users for a fee. Users would connect to 

the Proposed Third Party Data Feeds 

over the IP network.10 The Proposed 

Third Party Data Feeds would include 

trading information concerning the 

securities that are traded on the relevant 

Proposed Third Party Systems. 

In order to connect to a Proposed 

Third Party Data Feed, a User would 

enter into a contract with the content 

service provider, pursuant to which the 

content service provider would charge 

the User for the data feed. The Exchange 

would receive the Proposed Third Party 

Data Feed over its fiber optic network 

and, after the content service provider 

and User entered into the contract and 

the Exchange received authorization 

from the content service provider, the 

Exchange would re-transmit the data to 

the User over the User’s port. The 

Exchange would charge the User for the 

connectivity to the Proposed Third 

Party Data Feed. A User would only 

receive, and would only be charged for, 

connectivity to a Proposed Third Party 

Data Feed for which it entered into a 

contract. 

The Exchange has no affiliation with 

the sellers of the Proposed Third Party 

Data Feeds. It would have no right to 

use the Proposed Third Party Data Feeds 

other than as a redistributor of the data. 

The Proposed Third Party Data Feeds 

would not provide access or order entry 

to the Exchange’s execution system. The 

Proposed Third Party Data Feeds would 

not provide access or order entry to the 

execution systems of the third parties 

generating the feeds. The Exchange 

would receive the Proposed Third Party 

Data Feeds via arms-length agreements 

and it would have no inherent 

advantage over any other distributor of 

such data. 

As it does with the existing Third 

Party Data Feeds, the Exchange 

proposes to charge a monthly recurring 

fee for connectivity to the Proposed 

Third Party Data Feeds. Depending on 

its needs and bandwidth, a User may 

opt to receive all or some of the feeds 

or services included in the Proposed 

Third Parties’ Data Feeds. 

The Exchange proposes to add the 

following fees for connectivity to the 

Proposed Third Party Data Feeds to its 

existing list in the Price List: (i) A 

$3,000 per month fee for BM&F 

Bovespa; (ii) a $1,500 per month fee for 

NASDAQ Canada; (iii) a $1,200 fee for 

Neo Aequitas; and (iv) a $1,000 per 

month fee for each of the CSE, ITG 

TriAct MatchNow and Omega. 

Name Changes 

The Exchange proposes to update 

references to the International Securities 

Exchange, LLC (‘‘ISE’’) to reflect its 

acquisition by NASDAQ, Inc. 

(‘‘NASDAQ’’).11 The Exchange also 

proposes to update references to Bats 

and Chicago Board Options Exchange 

(‘‘Cboe’’) to reflect their business 

combination and name changes.12 In the 

sections entitled, ‘‘Connectivity to Third 

Party Systems’’ and ‘‘Connectivity to 

Third Party Data Feeds’’, the Exchange 

proposes to replace references to 

‘‘International Securities Exchange 

(ISE)’’ with ‘‘NASDAQ ISE’’. The 

Exchange also proposes to delete a 

reference to ‘‘BATS’’ and replace it with 

‘‘Cboe BYX Exchange (CboeBYX), Cboe 

BZX Exchange (CboeBZX), Cboe EDGA 

Exchange (CboeEDGA), and Cboe EDGX 

Exchange (CboeEDGX)’’ and to replace 

references to ‘‘Chicago Board Options 

Exchange (CBOE)’’ with ‘‘Cboe 

Exchange (Cboe) and Cboe C2 Exchange 

(C2)’’. In each case, the names would be 

updated to their current names, clearly 

delineating the third parties to which 

the Exchange provides connectivity and 

access. 

In a non-substantive change, the 

Exchange proposes to reorganize the 

table of Third Party Systems to ensure 

it remains alphabetical in light of the 

proposed name changes. The Exchange 

does not propose to amend any fee 

related to connectivity to ISE or Cboe 

systems or access to ISE or Cboe data. 

General 

As is the case with all Exchange colocation arrangements, (i) neither a User 

nor any of the User’s customers would 

be permitted to submit orders directly to 

the Exchange unless such User or 

customer is a member organization, a 

Sponsored Participant or an agent 

thereof (e.g., a service bureau providing 

order entry services); (ii) use of the colocation services proposed herein would 

be completely voluntary and available 

to all Users on a non-discriminatory 

basis; 13 and (iii) a User would only 

incur one charge for the particular colocation service described herein, 

regardless of whether the User connects 

only to the Exchange or to the Exchange 

and one or more of the Affiliate SROs.14

The proposed change is not otherwise 

intended to address any other issues 

relating to co-location services and/or 

related fees, and the Exchange is not 

aware of any problems that Users would 

have in complying with the proposed 

change. 

2. Statutory Basis 

The Exchange believes that the 

proposed fee change is consistent with 

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

furthers the objectives of Sections 

6(b)(5) of the Act,16 in particular, 

because it is 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 regulating, clearing, settling, 

processing information with respect to, 

and facilitating transactions in 

securities, to remove impediments to, 

and perfect the mechanisms of, a free 

and open market and a national market 

system and, in general, to protect 

investors and the public interest and 

because it is not designed to permit 


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17 15 U.S.C. 78f(b)(4). 

unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange believes that the 

proposed changes would remove 

impediments to, and perfect the 

mechanisms of, a free and open market 

and a national market system and, in 

general, protect investors and the public 

interest because, by offering additional 

services, the Exchange would give each 

User additional options for addressing 

its access and connectivity needs, 

responding to User demand for access 

and connectivity options. Providing 

additional services would help each 

User tailor its data center operations to 

the requirements of its business 

operations by allowing it to select the 

form and latency of access and 

connectivity that best suits its needs. 

The Exchange would provide Access 

and Connectivity as conveniences to 

Users. Use of Access or Connectivity 

would be completely voluntary. The 

Exchange is not aware of any 

impediment to third parties offering 

Access or Connectivity. The Exchange 

does not have visibility into whether 

third parties currently offer, or intend to 

offer, Users access to the Proposed 

Third Party Systems and connectivity to 

the Proposed Third Party Data Feeds. 

However, if one or more third parties 

presently offer, or in the future opt to 

offer, such access and connectivity to 

Users, a User may utilize the SFTI 

network, a third party 

telecommunication network, third party 

wireless network, a cross connect, or a 

combination thereof to access such 

services and products through a 

connection to an access center outside 

the data center (which could be a SFTI 

access center, a third-party access 

center, or both), another User, or a third 

party vendor. 

The Exchange believes that the 

proposed changes would remove 

impediments to, and perfect the 

mechanisms of, a free and open market 

and a national market system and, in 

general, protect investors and the public 

interest because, by offering Access and 

Connectivity to Users when available, 

the Exchange would give Users 

additional options for connectivity and 

access to new services as soon as they 

are available, responding to User 

demand for access and connectivity 

options. 

The Exchange also believes that the 

proposed fee change is consistent with 

Section 6(b)(4) of the Act,17 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 Exchange believes that the 

proposed fee changes are consistent 

with Section 6(b)(4) of the Act for 

multiple reasons. The Exchange 

operates in a highly competitive market 

in which exchanges offer co-location 

services as a means to facilitate the 

trading and other market activities of 

those market participants who believe 

that co-location enhances the efficiency 

of their operations. Accordingly, fees 

charged for co-location services are 

constrained by the active competition 

for the order flow of, and other business 

from, such market participants. If a 

particular exchange charges excessive 

fees for co-location services, affected 

market participants will opt to terminate 

their co-location arrangements with that 

exchange, and adopt a possible range of 

alternative strategies, including placing 

their servers in a physically proximate 

location outside the exchange’s data 

center (which could be a competing 

exchange), or pursuing strategies less 

dependent upon the lower exchange-toparticipant latency associated with colocation. Accordingly, the exchange 

charging excessive fees would stand to 

lose not only co-location revenues but 

also the liquidity of the formerly colocated trading firms, which could have 

additional follow-on effects on the 

market share and revenue of the affected 

exchange. 

The Exchange believes that the 

additional services and fees proposed 

herein would be equitably allocated and 

not unfairly discriminatory because, in 

addition to the services being 

completely voluntary, they would be 

available to all Users on an equal basis 

(i.e., the same products and services 

would be available to all Users). All 

Users that voluntarily selected to 

receive Access or Connectivity would be 

charged the same amount for the same 

services. Users that opted to use Access 

or Connectivity would not receive 

access or connectivity that is not 

available to all Users, as all market 

participants that contracted with the 

relevant market or content provider 

would receive access or connectivity. 

The Exchange believes that the 

proposed charges would be reasonable, 

equitably allocated and not unfairly 

discriminatory because the Exchange 

would offer the Access and Connectivity 

as conveniences to Users, but in order 

to do so must provide, maintain and 

operate the data center facility hardware 

and technology infrastructure. The 

Exchange must handle the installation, 

administration, monitoring, support and 

maintenance of such services, including 

by responding to any production issues. 

Since the inception of co-location, the 

Exchange has made numerous 

improvements to the network hardware 

and technology infrastructure and has 

established additional administrative 

controls. The Exchange has expanded 

the network infrastructure to keep pace 

with the increased number of services 

available to Users, including resilient 

and redundant feeds. In addition, in 

order to provide Access and 

Connectivity, the Exchange would 

maintain multiple connections to each 

Proposed Third Party Data Feed and 

Proposed Third Party System, allowing 

the Exchange to provide resilient and 

redundant connections; adapt to any 

changes made by the relevant third 

party; and cover any applicable fees 

charged by the relevant third party, such 

as port fees. In addition, Users would 

not be required to use any of their 

bandwidth for Access and Connectivity 

unless they wish to do so. 

The Exchange believes the proposed 

fees for Access and Connectivity would 

be reasonable because they would allow 

the Exchange to defray or cover the 

costs associated with offering Users 

Access and Connectivity while 

providing Users the convenience of 

receiving such Access and Connectivity 

within co-location, helping them tailor 

their data center operations to the 

requirements of their business 

operations. 

For the reasons above, the proposed 

changes would not unfairly discriminate 

between or among market participants 

that are otherwise capable of satisfying 

any applicable co-location fees, 

requirements, terms and conditions 

established from time to time by the 

Exchange. 

The Exchange also believes that the 

proposal to update the names of ISE, 

Bats and Cboe removes impediments to, 

and perfects the mechanisms of, a free 

and open market and a national market 

system. The Exchange does not propose 

to amend any fee related to connectivity 

to ISE or Cboe systems or access to ISE 

or Cboe data. The Exchange simply 

proposes to update its Price List to 

accurately reflect NASDAQ’s 

acquisition of ISE and the business 

combination and name change of Bats 

and Cboe. Therefore, the Exchange 

believes the proposed rule change 

would avoid any potential investor 

confusion regarding the third parties to 

which the Exchange provides access 

and connectivity. 

The Exchange believes that the nonsubstantive change to ensure the names 

in the table of Third Party Systems are 

in alphabetical order would remove 

impediments to, and perfect the 


daltland on DSKBBV9HB2PROD with NOTICES
37032 Federal Register / Vol. 83, No. 147 / Tuesday, July 31, 2018 / Notices 

18 15 U.S.C. 78f(b)(8). 

19 15 U.S.C. 78s(b)(3)(A)(iii). 

20 17 CFR 240.19b–4(f)(6). 

21 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 

22 17 CFR 240.19b–4(f)(6). 

23 17 CFR 240.19b–4(f)(6)(iii). 

mechanisms of, a free and open market 

and a national market system and, in 

general, protect investors and the public 

interest because the amendment would 

clarify Exchange rules and make it 

easier for market participants to find 

Third Party Systems in the table. The 

Exchange believes that this proposed 

non-substantive change is reasonable 

because the change would have no 

impact on pricing or services offered. 

Rather, the change would alleviate 

possible market participant confusion 

by making it easier to find NASDAQ, 

ISE and Cboe in the table. 

For these reasons, the Exchange 

believes that the proposal is consistent 

with the Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

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

the Act,18 the Exchange believes that the 

proposed rule change will not impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act because all of 

the proposed services are completely 

voluntary. 

The Exchange believes that providing 

Users with additional options for 

connectivity and access to new services 

would not impose any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act because such 

proposed Access and Connectivity 

would satisfy User demand for access 

and connectivity options. The Exchange 

would provide Access and Connectivity 

as conveniences equally to all Users. 

The Exchange does not have visibility 

into whether third parties currently 

offer, or intend to offer, Users access to 

the Proposed Third Party Systems and 

connectivity to the Proposed Third 

Party Data Feeds, as third parties are not 

required to make that information 

public. However, if one or more third 

parties presently offer, or in the future 

opt to offer, such access and 

connectivity to Users, a User may utilize 

the SFTI network, a third party 

telecommunication network, third party 

wireless network, a cross connect, or a 

combination thereof to access such 

services and products through a 

connection to an access center outside 

the data center (which could be a SFTI 

access center, a third-party access 

center, or both), another User, or a third 

party vendor. Users that opt to use the 

proposed Access or Connectivity would 

not receive access or connectivity that is 

not available to all Users, as all market 

participants that contract with the 

content provider may receive access or 

connectivity. In this way, the proposed 

changes would enhance competition by 

helping Users tailor their Access and 

Connectivity to the needs of their 

business operations by allowing them to 

select the form and latency of access 

and connectivity that best suits their 

needs. 

The Exchange operates in a highly 

competitive market in which exchanges 

offer co-location services as a means to 

facilitate the trading and other market 

activities of those market participants 

who believe that co-location enhances 

the efficiency of their operations. 

Accordingly, fees charged for colocation services are constrained by the 

active competition for the order flow of, 

and other business from, such market 

participants. If a particular exchange 

charges excessive fees for co-location 

services, affected market participants 

will opt to terminate their co-location 

arrangements with that exchange, and 

adopt a possible range of alternative 

strategies, including placing their 

servers in a physically proximate 

location outside the exchange’s data 

center (which could be a competing 

exchange), or pursuing strategies less 

dependent upon the lower exchange-toparticipant latency associated with colocation. Accordingly, the exchange 

charging excessive fees would stand to 

lose not only co-location revenues but 

also the liquidity of the formerly colocated trading firms, which could have 

additional follow-on effects on the 

market share and revenue of the affected 

exchange. For the reasons described 

above, the Exchange believes that the 

proposed rule change reflects this 

competitive environment. 

The Exchange believes that the 

proposal to update the name of ISE to 

reflect its acquisition by NASDAQ and 

Bats and Cboe to reflect their business 

combination and name change will not 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

The proposal is ministerial in nature 

and is not designed to have any 

competitive impact. It simply seeks to 

update the Price List to accurately 

reference these markets in light of their 

recent name changes. 

The Exchange believes that the 

proposed non-substantive change to 

ensure the names in the table of Third 

Party Systems are in alphabetical order 

would not impose any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act because the change 

would have no impact on pricing or the 

services offered. Rather, the change 

would alleviate possible market 

participant confusion by making it 

easier to find Third Party Systems in the 

table. 

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 Exchange has filed the proposed 

rule change pursuant to Section 

19(b)(3)(A)(iii) of the Act 19 and Rule 

19b–4(f)(6) thereunder.20 Because the 

proposed rule change does not: (i) 

Significantly affect the protection of 

investors or the public interest; (ii) 

impose any significant burden on 

competition; and (iii) become operative 

prior to 30 days from the date on which 

it was filed, or such shorter time as the 

Commission may designate, if 

consistent with the protection of 

investors and the public interest, the 

proposed rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act and Rule 19b–4(f)(6)(iii) 

thereunder.21

A proposed rule change filed under 

Rule 19b–4(f)(6) 22 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),23 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The Exchange requests that the 

Commission waive the 30-day operative 

delay so that the proposal may become 

operative immediately upon filing. The 

Exchange represents that the proposed 

rule changes present no new or novel 

issues. According to the Exchange, 

waiver of the operative delay would 

allow Users to access the Proposed 

Third Party Systems and the Proposed 

Third Party Data Feeds without delay, 

which would assist Users in tailoring 

their data center operations to the 

requirements of their business 

operations. The Exchange also 

represents that the proposed changes to 

the Price List would provide Users with 

more complete information regarding 


daltland on DSKBBV9HB2PROD with NOTICES
Federal Register / Vol. 83, No. 147 / Tuesday, July 31, 2018 / Notices 37033 

24For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

25 15 U.S.C. 78s(b)(2)(B). 

26 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4The Exchange initially filed rule changes 

relating to its co-location services with the 

Commission in 2010. See Securities Exchange Act 

Release No. 62960 (September 21, 2010), 75 FR 

59310 (September 27, 2010) (SR–NYSE–2010–56). 

The Exchange operates a data center in Mahwah, 

New Jersey (the ‘‘data center’’) from which it 

provides co-location services to Users. 

5For purposes of the Exchange’s co-location 

services, a ‘‘User’’ means any market participant 

that requests to receive co-location services directly 

from the Exchange. See Securities Exchange Act 

Release No. 76008 (September 29, 2015), 80 FR 

60190 (October 5, 2015) (SR–NYSE–2015–40). As 

specified in the Price List, a User that incurs colocation fees for a particular co-location service 

pursuant thereto would not be subject to co-location 

fees for the same co-location service charged by the 

Exchange’s affiliates NYSE American LLC (‘‘NYSE 

American’’), NYSE National, Inc. (‘‘National’’), and 

NYSE Arca, Inc. (‘‘NYSE Arca’’ and, together with 

NYSE American and NYSE National, the ‘‘Affiliate 

SROs’’). See Securities Exchange Act Release No. 

70206 (August 15, 2013), 78 FR 51765 (August 21, 

2013) (SR–NYSE–2013–59). 

their Access and Connectivity options. 

The Exchange further asserts that waiver 

of the operative delay would help avoid 

potential investor confusion by allowing 

the Exchange to immediately update the 

names of the exchanges noted above to 

reflect recent business combinations 

and name changes. The Commission 

believes that waiving the 30-day 

operative delay is consistent with the 

protection of investors and the public 

interest. Accordingly, the Commission 

waives the 30-day operative delay and 

designates the proposed rule change 

operative upon filing.24

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) 25 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– 

NYSENAT–2018–15 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–NYSENAT–2018–15. 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–NYSENAT–2018–15 and 

should be submitted on or before 

August 21, 2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.26

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–16277 Filed 7–30–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83706; File No. SR–NYSE– 

2018–32] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend Its 

Price List Related to Colocation 

July 25, 2018. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that on July 13, 

2018, New York Stock Exchange LLC 

(‘‘NYSE’’ or ‘‘Exchange’’) 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 self-regulatory 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 its 

Price List related to colocation to 

provide Users with access to the 

systems, and connectivity to the data 

feeds, of various additional third 

parties. In addition, the Exchange 

proposes to amend its Price List to 

update the names of certain third parties 

to reflect their current names. 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 Exchange proposes to amend the 

co-location 4 services offered by the 

Exchange to provide Users 5 with access 

to the systems, and connectivity to the 


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