44096 Federal Register / Vol. 83, No. 168 / Wednesday, August 29, 2018 / Notices 

35 Id. 

36 Id. 

37 In approving this Proposed Rule Change, the 

Commission has considered the proposed rule’s 

impact on efficiency, competition, and capital 

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

38 15 U.S.C. 78s(b)(2). 

39 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)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5 ‘‘ADAV’’ means average daily added volume 

calculated as the number of shares added per day 

and ‘‘ADV’’ means average daily volume calculated 

as the number of shares added or removed, 

combined, per day. See BYX Fee Schedule, 

Definitions. ADAV and ADV are calculated on a 

monthly basis. The Exchange excludes from its 

calculation of ADAV and ADV shares added or 

removed on any day that the Exchange’s system 

experiences a disruption that lasts for more than 60 

minutes during regular trading hours (‘‘Exchange 

System Disruption’’), on any day with a scheduled 

early market close and on the last Friday in June 

(the ‘‘Russell Reconstitution Day’’). Routed shares 

are not included in ADAV or ADV calculation. With 

prior notice to the Exchange, a Member may 

aggregate ADAV or ADV with other Members that 

control, are controlled by, or are under common 

control with such Member (as evidenced on such 

Member’s Form BD). 

6W is associated with orders that remove 

liquidity from BYX in Tape A securities. 

7BB is associated with orders that remove 

liquidity from BYX in Tape B securities. 

8N is associated with orders that remove liquidity 

from BYX in Tape C securities. 

9 Destination Specific is a routing option under 

which an order checks the System for available 

shares and then is sent to an away trading center 

or centers specified by the User. See Rule 

11.13(b)(3)(E). 

10 IX is associated with orders routed to IEX using 

the Destination Specific, TRIM or TRIM2 routing 

strategies. 

duration of the wind-down process, 

OCC’s capitalization through the winddown process, the maintenance of 

Critical Services and Critical Support 

Functions, and the retention of 

personnel and contractual relationships. 

OCC also provided information 

regarding its assumption about the cost 

of the wind-down process. Further, the 

RWD Plan identifies potential 

transactions that could be effected to 

accomplish the objectives of wind-down 

with the ultimate goal of transferring 

ownership of OCC itself by the 

consummation or a consensual sale or 

similar transaction, in a manner that 

ensures the continuation of OCC’s 

Critical Services. The Commission 

considered the assumptions that the 

RWD Plan makes regarding wind-down 

as well as the potential transactions in 

which OCC might engage in the event of 

a wind-down. The Commission also 

considered the estimated cost of winddown noted in the RWD Plan in light of 

OCC’s rules regarding the maintenance 

of certain capital levels and qualifying 

liquid resources. The Commission 

believes that the RWD Plan, which 

indicates the cost at which OCC could 

effectuate an orderly wind-down, i.e., at 

a lower cost than the amount of its 

liquid resources is consistent with Rule 

17Ad–22(e)(15)(i).35

Therefore, the Commission believes 

that the proposed changes that would 

determine costs associated with an 

orderly wind-down and that would 

further ensure that OCC holds liquid net 

assets greater than these costs, are 

consistent with Rule 17Ad– 

22(e)(15)(i).36

IV. Conclusion 

On the basis of the foregoing, the 

Commission finds that the Amended 

Proposed Rule Change is consistent 

with the requirements of the Exchange 

Act, and in particular, with the 

requirements of Section 17A of the 

Exchange Act 37 and the rules and 

regulations thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Exchange Act,38

that the Proposed Rule Change (SR– 

OCC–2017–021), as modified by Partial 

Amendment No. 2, be, and it hereby is, 

approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.39

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–18673 Filed 8–28–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83925; File No. SR– 

CboeBYX–2018–017] 

Self-Regulatory Organizations; Cboe 

BYX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change Related to Fees 

for Use on Cboe BYX Exchange, Inc. 

August 23, 2018. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on August 9, 

2018, Cboe BYX Exchange, Inc. (the 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II and III 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated the proposed rule change as 

one establishing or changing a member 

due, fee, or other charge imposed by the 

Exchange under Section 19(b)(3)(A)(ii) 

of the Act 3 and Rule 19b–4(f)(2) 

thereunder,4 which renders the 

proposed rule change 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 

amend the Exchange’s fee schedule 

applicable to its equities trading 

platform to: (1) Increase the ADV 

requirements to qualify for Add/Remove 

Volume Tier 6 associated with fee codes 

W, BB, and N, and (2) increase the 

routing fee charged to orders routed to 

Investors Exchange LLC using the 

Destination Specific routing strategy 

under fee code IX, and eliminate an 

outdated reference to the TRIM and 

TRIM2 routing strategies in this fee 

code. 

The text of the proposed rule change 

is available at the Exchange’s website at 

www.markets.cboe.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 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 purpose of the proposed rule 

change is to amend the Exchange’s fee 

schedule applicable to its equities 

trading platform (‘‘BYX Equities’’) to: (1) 

Increase the ADV 5 requirements to 

qualify for Add/Remove Volume Tier 6 

associated with fee codes W,6 BB,7 and 

N,8 and (2) increase the routing fee 

charged to orders routed to Investors 

Exchange LLC (‘‘IEX’’) using the 

Destination Specific 9 routing strategy 

under fee code IX,10 and eliminate an 

outdated reference to the TRIM and 


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Federal Register / Vol. 83, No. 168 / Wednesday, August 29, 2018 / Notices 44097 

11TRIM and TRIM2 are both routing options 

under which an order checks the System for 

available shares and then is sent to destinations on 

the applicable System routing table. See Rule 

11.13(b)(3)(G). 

12See BYX Fee Schedule, footnote 1, Add/ 

Remove Volume Tiers. 

13 ‘‘TCV’’ means total consolidated volume 

calculated as the volume reported by all exchanges 

and trade reporting facilities to a consolidated 

transaction reporting plan for the month for which 

the fees apply. The Exchange excludes from its 

calculation of TCV volume on any day that the 

Exchange experiences an Exchange System 

Disruption, on any day with a scheduled early 

market close and the Russell Reconstitution Day. 

14 15 U.S.C. 78f. 

15 15 U.S.C. 78f(b)(4) and (5). 16See SR–IEX–2018–16 (pending publication). 

TRIM2 11 routing strategies in this fee 

code. 

Fee Codes W, BB, and N: Add/Remove 

Volume Tier 6 

The Exchange provides a standard 

rebate of $0.00050 for orders that 

remove liquidity from BYX in securities 

priced at or above $1.00. Members may 

also qualify for a higher rebate based on 

the Exchange’s Add/Remove Volume 

Tiers, which are designed to encourage 

Members to bring order flow to BYX by 

providing higher rebates for removing 

liquidity and discounted fees for adding 

liquidity to firms based on their activity 

on the Exchange.12 Currently, Members 

can qualify for a higher rebate of 

$0.0015 pursuant to Tier 6 of the Add/ 

Remove Volume Tiers if the Member 

has: (1) An ADV that is greater than or 

equal to 0.05% of TCV,13 and (2) an 

ADAV that is greater than or equal to 

500,000 shares. The Exchange proposes 

to increase the ADV requirement for 

Tier 6 so that an ADV that is greater 

than or equal to 0.08% of TCV would 

be required. The current ADAV 

requirement of greater than or equal to 

500,000 shares would remain 

unchanged. The proposed change 

applies to fee codes W, BB, and N, 

which relate to orders that remove 

liquidity from BYX in Tapes A, B, and 

C, respectively. 

Fee Code IX: IEX Routing Fees 

Currently, the fee schedule provides 

that orders in securities priced at or 

above $1.00 routed to IEX using 

specified routing strategies—i.e., 

Destination Specific, TRIM, or TRIM2— 

are charged a fee of $0.0010 per share 

under fee code IX. The Exchange 

proposes to increase the routing fee 

charged to orders routed to IEX to 

$0.0030 so that the Exchange can recoup 

increased costs associated with routing 

order flow to that market. Furthermore, 

in May 2018, the Exchange removed IEX 

from the System routing table for its 

TRIM and TRIM2 routing strategies, 

which are designed to route to low cost 

away markets, due to increased costs 

associated with routing to IEX. Since 

IEX is no longer considered as a 

potential routing destination for those 

strategies, the Exchange proposes to 

eliminate the reference to these routing 

strategies in fee code IX. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the objectives of Section 6 of the Act,14

in general, and furthers the objectives of 

Section 6(b)(4) and 6(b)(5),15 in 

particular, as it is designed to provide 

for the equitable allocation of reasonable 

dues, fees and other charges among its 

members and other persons using its 

facilities and is designed to promote just 

and equitable principles of trade, to 

foster cooperation and coordination 

with persons engaged in facilitating 

transactions in securities, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system and, in 

general, to protect investors and the 

public interest. 

Fee Codes W, BB, and N: Add/Remove 

Volume Tier 6 

The Exchange believes that the 

proposed changes to the Add/Remove 

Volume Tier 6 are reasonable because 

the proposed changes are designed to 

incentivize Members to bring more 

order flow to the Exchange. Under the 

Exchange’s fee schedule members are 

eligible for a rebate for liquidity 

removing orders that may be increased 

based on meeting certain additional 

requirements. With respect to Add/ 

Remove Volume Tier 6, Members that 

meet specified ADV and ADAV 

requirements are eligible for such an 

increased remove rebate. The Exchange 

is proposing to increase the ADV 

requirements for this rebate tier to 

encourage Members to send more order 

flow to the Exchange in order to qualify 

for the rebate. The Exchange believes 

that the rebates are still competitive 

with rebates provided on other equities 

exchanges, notwithstanding the higher 

volume requirements required to meet 

this tier. The Exchange also believes 

that the proposed change is equitable 

and not unfairly discriminatory because 

the proposed ADV requirements (and 

associated rebate) would apply equally 

to all Members. Furthermore, the 

Exchange believes that all market 

participants would benefit from 

additional trading opportunities if the 

Exchange is successful in incentivizing 

increased order flow. 

Fee Code IX: IEX Routing Fees 

As other exchanges amend the fees 

charged for accessing liquidity, the 

Exchange believes that it is appropriate 

to amend its own routing fees so that it 

can recoup costs associated with routing 

orders to such away markets. The 

Exchange believes that the proposed 

fees for orders routed to IEX are 

reasonable because they reflect the costs 

associated with executing orders on IEX 

and additional operational expenses 

incurred by the Exchange. The 

Exchange is proposing to increase its 

routing fees due to an announced 

change in IEX’s fee schedule that would 

result in a significant increase in the 

transaction fees being charged by IEX to 

some orders, including orders routed by 

the Exchange.16 The Exchange believes 

that it is reasonable to pass these 

increased costs to Members that use the 

Exchange to route orders to that market. 

Members that do not wish to pay the 

proposed fee can send their routable 

orders directly to IEX instead of using 

routing functionality provided by the 

Exchange. The Exchange also believes 

that this change is equitable and not 

unfairly discriminatory because the 

proposed fees would apply equally to 

all Members that use the Exchange to 

route orders to IEX using the 

Destination Specific routing strategy. 

Routing through the Exchange is 

voluntary, and the Exchange operates in 

a competitive environment where 

market participants can readily direct 

order flow to competing venues or 

providers of routing services if they 

deem fee levels to be excessive. 

The Exchange also believes that the 

proposed change to eliminate references 

to TRIM and TRIM2 is consistent with 

the public interest and the protection of 

investors as this is a non-substantive 

change being made because the 

Exchange no longer routes to IEX using 

these routing strategies. The Exchange 

had previously routed orders to IEX 

using the TRIM and TRIM2 order 

routing strategies, which are designed to 

route to low cost venues, but recently 

stopped doing so due increased routing 

costs associated with trading on IEX. As 

such, the Exchange believes that 

updating the fee schedule to reflect that 

these two routing strategies are not 

available for routing to IEX will increase 

transparency around the operation of 

the Exchange to the benefit of Members 

and investors. Because this change 

merely updates a fee code to remove 

references to routing strategies that are 

not in use on the Exchange, it will have 


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44098 Federal Register / Vol. 83, No. 168 / Wednesday, August 29, 2018 / Notices 

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

18 17 CFR 240.19b–4(f). 19 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)(iii). 

4 17 CFR 240.19b–4(f)(6). 

no impact on the transaction fees 

actually assessed to Members. 

(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. 

The proposed changes to the Add/ 

Remove Tiers are designed to 

incentivize Members to bring more 

order flow to BYX as the Exchange 

competes for order flow with other 

equities markets. Furthermore, the 

proposed changes to the IEX routing 

fees are meant to recoup costs 

associated with executing orders on that 

market, and to increase transparency by 

properly reflecting the routing strategies 

available for IEX, and are therefore not 

designed to have any significant impact 

on competition. The Exchange operates 

in a highly competitive market in which 

market participants can readily direct 

their order flow to competing venues. In 

such an environment, the Exchange 

must continually review, and consider 

adjusting, its fees and rebates to remain 

competitive with other exchanges. For 

the reasons described above, the 

Exchange believes that the proposed fee 

changes reflect this competitive 

environment. 

(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) 

of the Act 17 and paragraph (f) of Rule 

19b–4 thereunder.18 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 necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposal 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– 

CboeBYX–2018–017 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–CboeBYX–2018–017. 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 such 

filing will also 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–CboeBYX–2018–017 and 

should be submitted on or before 

September 19, 2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–18676 Filed 8–28–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83923; File No. SR–CBOE– 

2018–059] 

Self-Regulatory Organizations; Cboe 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Delay the 

Implementation Date of Changes to 

Cboe Options Rule 24A.4, 

Interpretation and Policy .02, 

Concerning FLEX Options 

August 23, 2018. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on August 

14, 2018, Cboe Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘Cboe Options’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been prepared by the Exchange. The 

Exchange filed the proposal as a ‘‘noncontroversial’’ proposed rule change 

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

the Act 3 and Rule 19b–4(f)(6) 

thereunder.4 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 delay the 

implementation date of rule change SR– 

CBOE–2018–008 to permit all FLEX 

series to be fungible with the 

corresponding non-FLEX series once an 

identical non-FLEX series becomes 

listed. 

(additions are in italics; deletions are 

[bracketed]) 

* * * * * 

Rules of Cboe Exchange, Inc. 

* * * * * 

Rule 24A.4. Terms of FLEX Options 

* * * * * 

. . . Interpretations and Policies: 

.01 No change. 

.02 

The below version of Interpretation 

and Policy .02 will remain in effect until 

[an effective date specified by the 

Exchange in a Regulatory Circular. The 

effective date shall be no later than July 

31, 2018, and the Regulatory Circular 

announcing the effective date shall be 


sradovich on DSK3GMQ082PROD with NOTICES