1966 Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices 

12See 15 U.S.C. 78f(b)(8). 

13 15 U.S.C. 78s(b)(3)(A). 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

CRD system for registration and 

disclosure. Accordingly, the Exchange 

believes that the fees collected for such 

use should likewise increase in lockstep 

with the fees assessed to FINRA 

members, as proposed by the Exchange. 

The Exchange further believes that the 

proposed fee change provides for the 

equitable allocation of reasonable fees 

and other charges, and does not unfairly 

discriminate between customers, 

issuers, brokers, and dealers. The fee 

applies equally to all individuals and 

firms required to report information the 

CRD system, and the proposed change 

will result in the same regulatory fees 

being charged to all member 

organizations required to report 

information to CRD and for services 

performed by FINRA regardless of 

whether such member organizations are 

FINRA members. Accordingly, the 

Exchange believes that the fee collected 

for such use should increase in lockstep 

with the fee adopted by FINRA as of 

January 2024, as proposed by the 

Exchange. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

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

the Act,12 the Exchange believes that the 

proposed rule change would not impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Specifically, 

the Exchange believes that the proposed 

change will reflect a fee that will be 

assessed by FINRA as of January 2024 

and will thus result in the same 

regulatory fee being charged to all 

member organizations required to report 

information to the CRD system and for 

services performed by FINRA, 

regardless of whether or not such 

member organizations are FINRA 

members. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective upon filing pursuant to Section 

19(b)(3)(A) 13 of the Act and paragraph 

(f) thereunder. 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 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 (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

NYSE–2023–51 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–NYSE–2023–51. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–NYSE–2023–51 and should be 

submitted on or before February 1, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Christina Z. Milnor, 

Assistant Secretary. 

[FR Doc. 2024–00386 Filed 1–10–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99280; File No. SR– 

CboeEDGX–2024–002] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend Its 

Fee Schedule 

January 5, 2024. 

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 January 2, 

2024, Cboe EDGX Exchange, Inc. 

(‘‘Exchange’’ or ‘‘EDGX’’) 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 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Cboe EDGX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGX’’) proposes to 

amend its Fee Schedule. The text of the 

proposed rule change is provided in 

Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

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

options/regulation/rule_filings/edgx/), 

at the Exchange’s Office of the 

Secretary, and at the Commission’s 

Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices 1967 

3See Cboe Global Markets, U.S. Equities Market 

Volume Summary, Month-to-Date (December 20, 

2023), available at https://www.cboe.com/us/ 

equities/market_statistics/. 

4See EDGX Equities Fee Schedule, Standard 

Rates. 

5 Id. 

6Fee code 3 is appended to orders adding 

liquidity to EDGX in the pre and post market in 

Tapes A or C securities. 

7Fee code 4 is appended to orders adding 

liquidity to EDGX in the pre and post market in 

Tape B securities. 

8Fee code B is appended to orders adding 

liquidity to EDGX in Tape B securities. 

9Fee code V is appended to orders adding 

liquidity to EDGX in Tape A securities. 

10Fee code Y is appended to orders adding 

liquidity to EDGX in Tape C securities. 

11See, e.g., NYSE Arca Fee Equities Fees and 

Charges; Standard Rates, available at https://

www.nyse.com/publicdocs/nyse/markets/nyse-arca/ 

NYSE_Arca_Marketplace_Fees.pdf; see also Nasdaq 

Price List; Add and Remove Rates; Rebates and 

Fees, Shares Executed Below $1.00, available at 

https://www.nasdaqtrader.com/Trader.aspx?id=

PriceListTrading2. NYSE Arca provides a rebate to 

add liquidity equal to 0.0% of Dollar Value for 

securities priced below $1.00 and Nasdaq provides 

rebates of $0.00 to add liquidity in securities priced 

below $1.00. 

12Fee code BB is appended to orders that remove 

liquidity from EDGX in Tape B securities. 

13Fee code N is appended to orders that remove 

liquidity from EDGX in Tape C securities. 

14Fee code W is appended to orders that remove 

liquidity from EDGX in Tape A securities. 

15ADAV means average daily added volume 

calculated as the number of shares added per day, 

calculated on a monthly basis. 

16TCV 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. 

17ADV means average daily volume calculated as 

the number of shares added to, removed from, or 

routed by, the Exchange, or any combination or 

subset thereof, per day. ADV is calculated on a 

monthly basis. 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend its 

Fee Schedule applicable to its equities 

trading platform (‘‘EDGX Equities’’) as 

follows: (1) by modifying the standard 

rate associated with certain fee codes; 

(2) by discontinuing Remove Volume 

Tier 1; and (3) by modifying Remove 

Volume Tier 3. The Exchange proposes 

to implement these changes effective 

January 2, 2024. 

The Exchange first notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. More 

specifically, the Exchange is only one of 

16 registered equities exchanges, as well 

as a number of alternative trading 

systems and other off-exchange venues 

that do not have similar self-regulatory 

responsibilities under the Securities 

Exchange Act of 1934 (the ‘‘Act’’), to 

which market participants may direct 

their order flow. Based on publicly 

available information,3 no single 

registered equities exchange has more 

than 13% of the market share. Thus, in 

such a low-concentrated and highly 

competitive market, no single equities 

exchange possesses significant pricing 

power in the execution of order flow. 

The Exchange in particular operates a 

‘‘Maker-Taker’’ model whereby it pays 

rebates to members that add liquidity 

and assesses fees to those that remove 

liquidity. The Exchange’s Fee Schedule 

sets forth the standard rebates and rates 

applied per share for orders that provide 

and remove liquidity, respectively. 

Currently, for orders in securities priced 

at or above $1.00, the Exchange 

provides a standard rebate of $0.00160 

per share for orders that add liquidity 

and assesses a fee of $0.0030 per share 

for orders that remove liquidity.4 For 

orders in securities priced below $1.00, 

the Exchange provides a standard rebate 

of $0.00009 per share for orders that add 

liquidity and assesses a fee of 0.30% of 

the total dollar value for orders that 

remove liquidity.5 Additionally, in 

response to the competitive 

environment, the Exchange also offers 

tiered pricing which provides Members 

opportunities to qualify for higher 

rebates or reduced fees where certain 

volume criteria and thresholds are met. 

Tiered pricing provides an incremental 

incentive for Members to strive for 

higher tier levels, which provides 

increasingly higher benefits or discounts 

for satisfying increasingly more 

stringent criteria. 

Standard Rates 

Currently, the Exchange offers 

standard rates to add liquidity for orders 

appended with fee codes 3,6 4,7 B,8 V,9

and Y.10 The Exchange now proposes to 

revise the standard rebate associated 

with securities priced below $1.00 from 

$0.00009 per share to $0.00003 per 

share for orders appended with fee 

codes 3, 4, B, V, or Y. The purpose of 

reducing the standard rebate associated 

with securities priced below $1.00 is for 

business and competitive reasons, as the 

Exchange believes that reducing such 

rebate as proposed would decrease the 

Exchange’s expenditures with respect to 

transaction pricing in a manner that is 

still consistent with the Exchange’s 

overall pricing philosophy of 

encouraging added liquidity. The 

Exchange notes that despite the 

decrease in the standard rebate 

associated with securities priced below 

$1.00, the standard rebate remains 

competitive and continues to be more 

favorable for Members than the standard 

rate provided by competing 

exchanges.11

Remove Volume Tiers 

Under footnote 1 of the Fee Schedule, 

the Exchange currently offers various 

Add/Remove Volume Tiers. In 

particular, the Exchange offers three 

Remove Volume Tiers that each assess 

a reduced fee for Members’ qualifying 

orders yielding fee codes BB,12 N,13 and 

W14 where a Member reaches certain 

add volume-based criteria. The 

Exchange now proposes to discontinue 

Remove Volume Tier 1 as the Exchange 

no longer wishes to, nor is required to, 

maintain such tier. More specifically, 

the proposed change removes this tier as 

the Exchange would rather redirect 

future resources and funding into other 

programs and tiers intended to 

incentivize increased order flow. In 

conjunction with discontinuing Remove 

Volume Tier 1, the Exchange proposes 

to renumber Remove Volume Tiers 2 

and 3 as Remove Volume Tiers 1 and 2, 

respectively, following the deletion of 

current Remove Volume Tier 1. 

In addition to the proposed deletion 

of Remove Tier 1, the Exchange 

proposes to amend the criteria of 

proposed Remove Volume Tier 2 

(current Remove Volume Tier 3). 

Currently, the criteria for proposed 

Remove Volume Tier 2 is as follows: 

• Proposed Remove Volume Tier 2 

(current Remove Volume Tier 3) 

provides a reduced fee of $0.00275 per 

share for securities priced at or above 

$1.00 to qualifying orders (i.e., orders 

yielding fee codes BB, N, or W) and a 

reduced fee of 0.28% of total dollar 

value for securities priced below $1.00 

where: (1) Member has an ADAV 15

≥0.30% of the TCV; 16 and (2) Member 

has a total remove ADV 17 ≥0.40% of the 

TCV; or Member has a total remove 

ADV ≥40,000,000; and (3) Member adds 

Retail Pre Market Order ADV (i.e., 

yielding fee code ZO) ≥3,000,000. 

Now, the Exchange proposes to 

amend the second prong of criteria in 

proposed Remove Volume Tier 2 by 

removing the total remove ADV share 

requirement. The proposed criteria is as 

follows: 

• Proposed Remove Volume Tier 2 

provides a reduced fee of $0.00275 per 


ddrumheller on DSK120RN23PROD with NOTICES1
1968 Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices 

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

19 15 U.S.C. 78f(b)(5). 

20 Id. 

21 15 U.S.C. 78f(b)(4). 

22See, e.g., MIAX Pearl Equities Exchange Fee 

Schedule, Remove Volume Tier, available at https:// 

www.miaxglobal.com/sites/default/files/fee_

schedule-files/MIAX_Pearl_Equities_Fee_Schedule_

12012023.pdf; and MEMX Equities Fee Schedule, 

Liquidity Removal Tier, available at https://

info.memxtrading.com/equities-trading-resources/ 

us-equities-fee-schedule/. 

23See, e.g., BZX Equities Fee Schedule, Footnote 

1, Add/Remove Volume Tiers. 

24See, e.g., EDGX Equities Fee Schedule, 

Footnote 1, Add/Remove Volume Tiers. 25Supra note 11. 

share for securities priced at or above 

$1.00 to qualifying orders (i.e., orders 

yielding fee codes BB, N, or W) and a 

reduced fee of 0.28% of total dollar 

value for securities priced below $1.00 

where: (1) Member has an ADAV 

≥0.30% of the TCV; and (2) Member has 

a total remove ADV ≥040% of the TCV; 

and (3) Member adds Retail Pre Market 

Order ADV (i.e., yielding fee code ZO) 

≥3,000,000. 

The proposed amendment to 

proposed Remove Volume Tier 2 is 

intended to slightly increase the 

difficulty of achieving an existing 

opportunity to earn an enhanced rebate 

by providing a single alternative for 

Members to increase their order flow to 

the Exchange. Submitting increased 

order flow to the Exchange will further 

contribute to a deeper, more liquid 

market and provide even more 

execution opportunities for active 

market participants. Incentivizing an 

increase in liquidity adding volume, 

through enhanced rebate opportunities, 

encourages liquidity adding Members 

on the Exchange to contribute to a 

deeper, more liquid market, and 

liquidity executing Members on the 

Exchange to increase transactions and 

take execution opportunities provided 

by such increased liquidity, together 

providing for overall enhanced price 

discovery and price improvement 

opportunities on the Exchange. As such, 

increased overall order flow benefits all 

Members by contributing towards a 

robust and well-balanced market 

ecosystem. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the Act 

and the rules and regulations 

thereunder applicable to the Exchange 

and, in particular, the requirements of 

Section 6(b) of the Act.18 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 19 requirements that the rules of 

an exchange be 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 mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. 

Additionally, the Exchange believes the 

proposed rule change is consistent with 

the Section 6(b)(5) 20 requirement that 

the rules of an exchange not be designed 

to permit unfair discrimination between 

customers, issuers, brokers, or dealers as 

well as Section 6(b)(4) 21 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. 

As described above, the Exchange 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. The 

Exchange believes that its proposal to: 

(1) modify the standard rebates 

associated with securities priced below 

$1.00 and (2) modify proposed Retail 

Volume Tier 2 reflects a competitive 

pricing structure designed to incentivize 

market participants to direct their order 

flow to the Exchange, which the 

Exchange believes would enhance 

market quality to the benefit of all 

Members. 

Specifically, the Exchange’s proposed 

criteria for proposed Remove Volume 

Tier 2 is not a significant departure from 

existing criteria, continues to be 

reasonably correlated to the enhanced 

rebate offered by the Exchange and 

other competing exchanges,22 and will 

continue to incentivize Members to 

submit order flow to the Exchange. 

Additionally, the Exchange notes that 

relative volume-based incentives and 

discounts have been widely adopted by 

exchanges,23 including the Exchange,24

and are reasonable, equitable and nondiscriminatory because they are open to 

all Members on an equal basis and 

provide additional benefits or discounts 

that are reasonably related to (i) the 

value to an exchange’s market quality 

and (ii) associated higher levels of 

market activity, such as higher levels of 

liquidity provision and/or growth 

patterns. Competing equity exchanges 

offer similar tiered pricing structures, 

including schedules of rebates and fees 

that apply based upon members 

achieving certain volume and/or growth 

thresholds, as well as assess similar fees 

or rebates for similar types of orders, to 

that of the Exchange. 

In particular, the Exchange believes 

its proposal to modify proposed Retail 

Volume Tier 2 is reasonable because the 

revised tier will be available to all 

Members and provide all Members with 

an opportunity to receive an enhanced 

rebate. The Exchange further believes 

the proposed modification to proposed 

Remove Volume Tier 2 will provide a 

reasonable means to encourage liquidity 

adding displayed orders in Members’ 

order flow to the Exchange and to 

incentivize Members to continue to 

provide liquidity adding volume to the 

Exchange by offering them an 

opportunity to receive an enhanced 

rebate on qualifying orders. While the 

proposed criteria in proposed Remove 

Volume Tier 2 is slightly more difficult 

than the current criteria found in that 

tier, the proposed criteria is not a 

significant departure from existing 

criteria, is reasonably correlated to the 

enhanced rebate offered by the 

Exchange, and will continue to 

incentivize Members to submit order 

flow to the Exchange. An overall 

increase in activity would deepen the 

Exchange’s liquidity pool, offers 

additional cost savings, support the 

quality of price discovery, promote 

market transparency and improve 

market quality, for all investors. 

Further, the Exchange believes that its 

proposal to modify the standard rebate 

associated with securities priced below 

$1.00 is reasonable, equitable, and 

consistent with the Act because such 

change is designed to decrease the 

Exchange’s expenditures with respect to 

transaction pricing in order to offset 

some of the costs associated with the 

Exchange’s current pricing structure, 

which provides various rebates for 

liquidity-adding orders, and the 

Exchange’s operations generally, in a 

manner that is consistent with the 

Exchange’s overall pricing philosophy 

of encouraging added liquidity. The 

proposed decreased standard rebate of 

$0.00003 per share is reasonable and 

appropriate because it remains 

competitive with the standard rebate 

offered by other exchanges.25 The 

Exchange further believes that the 

proposed decrease to the standard 

rebate associated with securities priced 

below $1.00 is not unfairly 

discriminatory because it applies to all 

Members equally, in that all Members 

will received the lower standard rebate 

upon submitting orders appended with 

fee codes B, V, Y, 3, or 4. 

The Exchange believes that its 

proposal to eliminate current Remove 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices 1969 

26Supra note 3. 

27See Securities Exchange Act Release No. 51808 

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

28NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. 

Cir. 2010) (quoting Securities Exchange Act Release 

No. 59039 (December 2, 2008), 73 FR 74770, 74782– 

83 (December 9, 2008) (SR–NYSEArca–2006–21)). 

Volume Tier 1 is reasonable because the 

Exchange is not required to maintain 

this tier nor is it required to provide 

Members an opportunity to receive 

enhanced rebates. The Exchange 

believes its proposal to eliminate this 

tier is also equitable and not unfairly 

discriminatory because it applies to all 

Members (i.e., the tier will not be 

available for any Member). The 

Exchange also notes that the proposed 

rule change to remove this tier merely 

results in Members not receiving an 

enhanced rebate, which, as noted above, 

the Exchange is not required to offer or 

maintain. Furthermore, the proposed 

rule change to eliminate current Remove 

Volume Tier 1 enables the Exchange to 

redirect resources and funding into 

other programs and tiers intended to 

incentivize increased order flow. 

The Exchange believes that the 

proposed changes to its standard rebate 

associated with securities priced below 

$1.00 and Remove Volume Tiers are 

reasonable as they do not represent a 

significant departure from the criteria or 

rebates currently offered in the Fee 

Schedule. The Exchange also believes 

that the proposal represents an equitable 

allocation of fees and rebates and is not 

unfairly discriminatory because all 

Members will be eligible for the 

proposed standard rebate and revised 

tier and have the opportunity to meet 

the revised tier’s criteria and receive the 

corresponding enhanced rebate if such 

criteria is met. Without having a view of 

activity on other markets and offexchange venues, the Exchange has no 

way of knowing whether this proposed 

rule change would definitely result in 

any Members qualifying the new 

proposed tiers. While the Exchange has 

no way of predicting with certainty how 

the proposed changes will impact 

Member activity, based on the prior 

months volume, the Exchange 

anticipates that at least one Member will 

be able to satisfy proposed Remove 

Volume Tier 2. The Exchange also notes 

that proposed changes will not 

adversely impact any Member’s ability 

to qualify for enhanced rebates offered 

under other tiers. Should a Member not 

meet the proposed new criteria, the 

Member will merely not receive that 

corresponding enhanced rebate. 

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 that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Rather, as 

discussed above, the Exchange believes 

that the proposed changes would 

encourage the submission of additional 

order flow to a public exchange, thereby 

promoting market depth, execution 

incentives and enhanced execution 

opportunities, as well as price discovery 

and transparency for all Members. As a 

result, the Exchange believes that the 

proposed changes further the 

Commission’s goal in adopting 

Regulation NMS of fostering 

competition among orders, which 

promotes ‘‘more efficient pricing of 

individual stocks for all types of orders, 

large and small.’’ 

The Exchange believes the proposed 

rule changes do not impose any burden 

on intramarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Particularly, 

the proposed changes to the Exchange’s 

standard rebate associated with 

securities priced below $1.00 and the 

proposed changes to proposed Remove 

Volume Tier 2 will apply to all 

Members equally in that all Members 

are eligible for the standard rebate and 

the proposed revised tier, have a 

reasonable opportunity to meet the 

proposed tier’s criteria and will receive 

the enhanced rebate on their qualifying 

orders if such criteria is met. The 

Exchange does not believe the proposed 

changes burden competition, but rather, 

enhances competition as it is intended 

to increase the competitiveness of EDGX 

by amending an existing pricing 

incentive and adopting pricing 

incentives in order to attract order flow 

and incentivize participants to increase 

their participation on the Exchange, 

providing for additional execution 

opportunities for market participants 

and improved price transparency. 

Greater overall order flow, trading 

opportunities, and pricing transparency 

benefits all market participants on the 

Exchange by enhancing market quality 

and continuing to encourage Members 

to send orders, thereby contributing 

towards a robust and well-balanced 

market ecosystem. 

The Exchange believes the proposed 

elimination of Remove Volume Tier 1 

does not impose any burden on 

intramarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Particularly, 

the proposed change to eliminate the 

Remove Volume Tier 1 will not impose 

any burden on intramarket competition 

because the changes apply to all 

Members uniformly, as in, the tier will 

no longer be available to any Member. 

Next, the Exchange believes the 

proposed rule changes does not impose 

any burden on intermarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act. 

As previously discussed, the Exchange 

operates in a highly competitive market. 

Members have numerous alternative 

venues that they may participate on and 

direct their order flow, including other 

equities exchanges, off-exchange 

venues, and alternative trading systems. 

Additionally, the Exchange represents a 

small percentage of the overall market. 

Based on publicly available information, 

no single equities exchange has more 

than 13% of the market share.26

Therefore, no exchange possesses 

significant pricing power in the 

execution of order flow. Indeed, 

participants can readily choose to send 

their orders to other exchange and offexchange venues if they deem fee levels 

at those other venues to be more 

favorable. Moreover, the Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. Specifically, in Regulation 

NMS, the Commission highlighted the 

importance of market forces in 

determining prices and SRO revenues 

and, also, recognized that current 

regulation of the market system ‘‘has 

been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 27 The 

fact that this market is competitive has 

also long been recognized by the courts. 

In NetCoalition v. Securities and 

Exchange Commission, the D.C. Circuit 

stated as follows: ‘‘[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’. . . .’’.28 Accordingly, the 

Exchange does not believe its proposed 

fee change imposes any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 


ddrumheller on DSK120RN23PROD with NOTICES1
1970 Federal Register / Vol. 89, No. 8 / Thursday, January 11, 2024 / Notices 

29 15 U.S.C. 78s(b)(3)(A). 

30 17 CFR 240.19b–4(f). 31 17 CFR 200.30–3(a)(12). 

1Public Law 114–74 Sec. 701, 129 Stat. 599–601 

(Nov. 2, 2015), codified at 28 U.S.C. 2461 note. 

2Public Law 101–410, 104 Stat. 890–892 (1990), 

codified at 28 U.S.C. 2461 note. 

3Public Law. 104–134, title III, section 

31001(s)(1), 110 Stat. 1321–373 (1996), codified at 

28 U.S.C. 2461 note. 

4See Release Nos. 33–7361, 34–37912, IA–1596, 

IC–22310, dated Nov. 1, 1996 (effective Dec. 9, 

1996), previously found at 17 CFR 201.1001 and 

Table I to Subpart E of Part 201; Release Nos. 33– 

7946, 34–43897, IA–1921, IC–24846, dated Jan. 31, 

2001 (effective Feb. 2, 2001), previously found at 17 

CFR 201.1002 and Table II to Subpart E of Part 201; 

Release Nos. 33–8530, 34–51136, IA–2348, IC– 

26748, dated Feb. 9, 2005 (effective Feb. 14, 2005), 

previously found at 17 CFR 201.1003 and Table III 

to Subpart E of Part 201; Release Nos. 33–9009, 34– 

59449, IA–2845, IC–28635, dated Feb. 25, 2009 

(effective Mar. 3, 2009), previously found at 17 CFR 

201.1004 and Table IV to Subpart E of Part 201; and 

Release Nos. 33–9387, 34–68994, IA–3557, IC– 

30408, dated Feb. 27, 2013 (effective Mar. 5, 2013), 

previously found at 17 CFR 201.1005 and Table V 

to Subpart E of Part 201. The penalty amounts 

contained in these releases have now been 

consolidated into Table I to 17 CFR 201.1001. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange neither solicited nor 

received comments on the proposed 

rule change. 

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 29 and paragraph (f) of Rule 

19b–4 30 thereunder. 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. If the 

Commission takes such action, the 

Commission will institute proceedings 

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 (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

CboeEDGX–2024–002 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–CboeEDGX–2024–002. This 

file number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–CboeEDGX–2024–002 and should be 

submitted on or before February 1, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

Christina Z. Milnor, 

Assistant Secretary. 

[FR Doc. 2024–00385 Filed 1–10–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release Nos. 33–11263; 34–99276; IA– 

6521; IC–35085] 

Adjustments to Civil Monetary Penalty 

Amounts 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Notice of annual inflation 

adjustment of civil monetary penalties. 

SUMMARY: The Securities and Exchange 

Commission (‘‘Commission’’) is 

publishing this notice (‘‘Notice’’) 

pursuant to the Federal Civil Penalties 

Inflation Adjustment Act Improvements 

Act of 2015 (‘‘2015 Act’’). This Act 

requires all agencies to annually adjust 

for inflation the civil monetary penalties 

that can be imposed under the statutes 

administered by the agency and publish 

the adjusted amounts in the Federal 

Register. This Notice sets forth the 

annual inflation adjustment of the 

maximum amount of civil monetary 

penalties (‘‘CMPs’’) administered by the 

Commission under the Securities Act of 

1933, the Securities Exchange Act of 

1934 (‘‘Exchange Act’’), the Investment 

Company Act of 1940, the Investment 

Advisers Act of 1940, and certain 

penalties under the Sarbanes-Oxley Act 

of 2002. These amounts are effective 

beginning on January 15, 2024, and will 

apply to all penalties imposed after that 

date for violations of the 

aforementioned statutes that occurred 

after November 2, 2015. 

FOR FURTHER INFORMATION CONTACT: 

Stephen M. Ng, Senior Special Counsel, 

Office of the General Counsel, at (202) 

551–7957, or Hannah W. Riedel, Senior 

Counsel, Office of the General Counsel, 

at (202) 551–7918. 

SUPPLEMENTARY INFORMATION: 

I. Background 

This Notice is being published 

pursuant to the 2015 Act,1 which 

amended the Federal Civil Penalties 

Inflation Adjustment Act of 1990 

(‘‘Inflation Adjustment Act’’).2 The 

Inflation Adjustment Act previously had 

been amended by the Debt Collection 

Improvement Act of 1996 (‘‘DCIA’’) 3 to 

require that each Federal agency adopt 

regulations at least once every four years 

that adjust for inflation the CMPs that 

can be imposed under the statutes 

administered by the agency. Pursuant to 

this requirement, the Commission 

previously adopted regulations in 1996, 

2001, 2005, 2009, and 2013 to adjust the 

maximum amount of the CMPs that 

could be imposed under the statutes the 

Commission administers.4

The 2015 Act replaces the inflation 

adjustment formula prescribed in the 

DCIA with a new formula for calculating 

the inflation-adjusted amount of CMPs. 

The 2015 Act requires that agencies use 

this new formula to re-calculate the 

inflation-adjusted amounts of the 

penalties they administer on an annual 

basis and publish these new amounts in 


ddrumheller on DSK120RN23PROD with NOTICES1