7750 Federal Register / Vol. 89, No. 24 / Monday, February 5, 2024 / Notices 

31 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 originally filed to amend the Fee 

Schedule on January 2, 2024 (NYSEAmer–2023–69) 

[sic] and withdrew such filing on January 12, 2024 

(SR–NYSEAmer–2024–05) [sic], which latter filing 

the Exchange withdrew on January 25, 2024. 

5See Fee Schedule, Section III.E.1., Floor Broker 

Fixed Cost Prepayment Incentive Program (the ‘‘FB 

Prepay Program’’). ‘‘Eligible Fixed Costs’’ include 

monthly ATP Fees, the Floor Access Fee, and 

certain monthly Floor communication, 

connectivity, equipment and booth or podia fees, as 

set forth in the table in Section III.E.1. The 

Exchange notes that the FB Prepay Program is 

currently structured similarly to the Floor Broker 

prepayment program offered by its affiliated 

exchange, NYSE Arca, Inc. (‘‘NYSE Arca’’). See 

NYSE Arca Options Fee Schedule, FLOOR BROKER 

FIXED COST PREPAYMENT INCENTIVE 

PROGRAM (the ‘‘FB Prepay Program’’). 

6See Fee Schedule, Section III.E.2., Floor Broker 

Manual Billable Incentive Program. 

7See Fee Schedule, Section III.E. The Exchange 

proposes to remove the preamble to Section III.E., 

which relates to the Exchange’s already-completed 

migration to the Pillar trading platform, because the 

text is no longer applicable and its removal would 

add clarity to the Fee Schedule. See proposed Fee 

Schedule, Section III.E. 

8See Fee Schedule, Section III.E (providing, in 

relevant part, that the notification ‘‘email to enroll 

in the Program must originate from an officer of the 

Floor Broker organization and, except as provided 

for below, represents a binding commitment 

through the end of the following calendar year.’’). 

The Exchange proposes to modify Section III.E. of 

the Fee Schedule to remove the now obsolete 

phrase ‘‘except as provided for below,’’ as there is 

no exception to the notification requirement, which 

modification will add clarity, transparency, and 

internal consistency to the Fee Schedule. See 

proposed Fee Schedule, Section III.E. 

9To effect the proposed change to eliminate the 

Floor Broker Manual Billable Incentive Program 

and related rebates, the Exchange proposes to delete 

in its entirety Section III.E.2. of the Fee Schedule. 

In addition, for consistency, the Exchange proposes 

to delete from the Table of Contents reference to 

this Section III.E.2., which is currently (and 

erroneously) listed as ‘‘Reserved’’. See proposed Fee 

Schedule, Table of Contents. 

10See proposed Fee Schedule, Section III.E.1 

(excluding QCC transactions from volume 

calculation ‘‘unless otherwise specified’’), which 

would add clarity, transparency, and internal 

consistency to the Fee Schedule. For certain volume 

thresholds (i.e., those based solely on ‘‘manual 

billable sides’’), the Exchange proposes to continue 

to exclude QCC volume from the calculation of 

eligible volume for rebates paid through the Manual 

Billable Rebate Program because Floor Brokers 

would continue to be eligible for separate credits 

and rebates for QCC transactions through the QCC 

Billable Bonus Rebate. 

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–MRX–2024–02 and should be 

submitted on or before February 26, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–02162 Filed 2–2–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99449; File No. SR– 

NYSEAMER–2024–06] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Modify the NYSE 

American Options Fee Schedule 

January 30, 2024. 

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 January 

25, 2024, NYSE American LLC (‘‘NYSE 

American’’ or the ‘‘Exchange’’) 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 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 modify the 

NYSE American Options Fee Schedule 

(‘‘Fee Schedule’’). The Exchange 

proposes to implement the fee change 

effective January 25, 2024.4 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 purpose of this filing [sic] to 

amend the Fee Schedule in a number of 

ways as described herein. The Exchange 

proposes to implement the rule change 

on January 25, 2024. 

First, the Exchange proposes to 

modify the Fee Schedule to remove 

reference to costs that are no longer 

charged and are therefore inapplicable. 

Specifically, the Exchange proposes to 

modify the Fee Schedule to remove 

‘‘Login’’ costs from Sections III.E.1 and 

IV and to remove ‘‘Floor Broker 

Handheld’’ costs from Section IV. 

Next, the Exchange proposes to 

modify the Floor Broker Fixed Cost 

Prepayment Incentive Program (the ‘‘FB 

Prepay Program’’ or ‘‘Program’’), a 

prepayment incentive program that 

allows Floor Brokers to prepay certain 

of their annual Eligible Fixed Costs in 

exchange for the opportunity to qualify 

for certain volume rebates.5 Specifically, 

the Manual Billable Volume Rebate is 

designed to encourage Floor Brokers to 

increase their monthly volume in 

billable manual contract sides to qualify 

for a rebate; increasing volumes qualify 

the Floor Broker for a higher level of 

rebate. Additional rebates may be 

earned by meeting the qualification 

levels of the Floor Broker Manual 

Billable Incentive Program.6

Participating Floor Brokers receive their 

rebates payable on a monthly basis.7

Floor Brokers that wish to participate in 

the FB Prepay Program for the following 

calendar year must notify the Exchange 

no later than the last business day of 

December in the current year.8

The Exchange proposes to eliminate 

the Floor Broker Manual Billable 

Incentive Program and accompanying 

monthly rebates 9 and instead provide 

Floor Brokers participating in the FB 

Prepay Program with enhanced 

opportunities for monthly rebates based 

on manual billable transaction volume 

(the ‘‘Manual Billable Rebate Program’’) 

and the QCC Billable Bonus Rebate. The 

calculation of volume on which rebates 

earned through the Manual Billable 

Rebate Program would be paid is based 

on transactions for which at least one 

side is subject to manual transaction 

fees and excludes volume from QCC 

transactions, unless otherwise 

specified.10 The Exchange proposes to 


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11As discussed infra, the Exchange proposes to 

expand entry to the FB Prepay Program to mid-year 

and therefore will remove reference to actual 

‘‘annual’’ costs. See proposed Schedule, Section 

III.E.1. 

12See proposed Fee Schedule, Section III.E.1 

(providing that ‘‘[t]he Manual Billable Rebate 

(including the ‘‘Additional’’ rebates) is payable back 

to the first billable side. Qualifying Participants are 

eligible to receive only one ‘‘Additional’’ rebate’’) 

13See proposed Fee Schedule, Section III.E.1 

(providing that ‘‘Qualifying Participants are eligible 

to receive only one ‘‘Additional’’ rebate’’). 

continue to exclude any volume 

calculated to achieve the Strategy 

Execution Fee Cap, regardless of 

whether the cap is achieved, from the 

Manual Billable Rebate Program because 

fees on such volume are already capped 

and therefore such volume does not 

increase billable manual volume. The 

Exchange will not issue any refunds in 

the event that a Floor Broker 

organization’s prepaid Eligible Fixed 

Costs exceeds actual annual costs.11

The Exchange proposes to modify the 

qualification levels and corresponding 

rebates in the Manual Billable Rebate 

Program as follows. 

• First, the Exchange proposes to add 

a new qualification level that would 

provide for a ($0.05) rebate per billable 

side for Floor Brokers that execute a 

minimum of 500,000 manual billable 

sides. This proposed new qualification 

threshold provides for a lower volume 

threshold than is currently required to 

achieve a rebate, with the distinction 

that it does not include ‘‘combined’’ 

QCC transactions—only manual 

executions. The Exchange believes that 

this proposed qualification threshold 

may make the rebate more achievable 

for Floor Brokers, especially Floor 

Brokers that conduct more manual 

transactions than QCC transactions. 

• Second, the Exchange proposes to 

modify the next-highest qualification 

level from 1 million ‘‘combined manual 

and QCC billable contracts’’ for a rebate 

of ($0.05) per billable side to 1.1 million 

‘‘manual billable sides,’’ which are no 

longer ‘‘combined’’ with QCC 

transactions and to raise the 

corresponding rebate to ($0.07) per 

billable side. This proposed change 

raises the potential rebate along with the 

number of required manual executions 

while at the same time removing QCC 

executions from eligibility. 

• Third, the Exchange proposes to 

remove the existing qualification level 

that offers an ($0.08) rebate per billable 

side for Floor Brokers that execute 3 

million combined manual and QCC 

billable contracts. 

• Finally, the Exchange proposes to 

offer two new ‘‘Additional’’ rebates as 

described below. 

Æ As proposed, a Floor Broker that 

executes at least 7 million ‘‘combined 

manual billable and QCC billable 

contracts’’ is eligible to receive an 

additional rebate of one cent ($0.01) per 

billable side. However, a Floor Broker 

that executes at least 11 million 

‘‘combined manual billable and QCC 

billable contracts’’ is eligible to instead 

receive an additional rebate of two cents 

($0.02). 

The Exchange notes that it is not 

modifying the existing qualification 

level the requires a Floor Broker to 

execute 5 million ‘‘combined manual 

billable and QCC billable contracts’’ to 

achieve a ($0.10) rebate per billable 

side. 

The table below illustrates the 

monthly qualification levels and the 

related rebates that the Exchange 

proposes to make available through the 

Manual Billable Rebate Program, 

payable on a monthly basis: 

Manual billable rebate qualification Rebate per billable side 

Execute 500,000 manual billable sides ................................................................................................................................. ($0.05). 

Execute 1.1 million manual billable sides ............................................................................................................................. ($0.07). 

Execute 5 million combined manual billable and QCC billable contracts ............................................................................ ($0.10). 

Execute 7 million combined manual billable and QCC billable contracts ............................................................................ Additional ($0.01). 

Execute 11 million combined manual billable and QCC billable contracts .......................................................................... Additional ($0.02). 

Consistent with the current Manual 

Billable Rebate Program, Floor Brokers 

who achieve a Rebate Qualification 

level will earn the associated rebate 

back to the first contract and, as noted 

above, Participants that qualify for both 

‘‘Additional’’ rebates are eligible to 

receive only one such rebate.12

The FB Prepay Program also currently 

offers participating Floor Brokers to be 

eligible to qualify for rebates on QCC 

transactions, payable on a monthly 

basis, in addition to the credits set forth 

in Section I.F (QCC Fees & Credits). The 

Exchange proposes to modify the 

volume thresholds required to achieve 

the ‘‘QCC Billable Bonus Rebate. 

Specifically, the Exchange proposes to 

reduce the qualification threshold for 

the ‘‘Prepay Bonus Level’’ from 2 

million to 500,000 ‘‘QCC billable 

contracts.’’ The Exchange also proposes 

to modify the ‘‘Additional Bonus 

Level,’’ which is currently only 

achievable if a Floor Broker that 

conduct volume that is ‘‘100% above 

Prepay Bonus Level,’’ to instead require 

‘‘4 million QCC billable contracts.’’ The 

proposed changes are designed to make 

the Prepay Bonus Level more achievable 

and the Additional Bonus Level more 

difficult to achieve. The Exchange is not 

proposing to modify the rebates 

available to Floor Brokers that achieve 

the new volume thresholds. 

The table below illustrates the 

proposed requirements to achieve the 

QCC Billable Bonus Rebate—both the 

Prepay Bonus Level and the Additional 

Bonus Level. 

QCC billable bonus rebate qualification 

Additional rebate on 

single billable side 

QCC contract 

Additional rebate on two 

billable side 

QCC contract 

Prepay Bonus Level—achieved with 500,000 QCC billable contracts ................................... ($0.02) ($0.04) 

Additional Bonus Level—achieved with 4 million QCC billable contracts .............................. ($0.04) ($0.06) 

As with other rebates, the QCC 

Billable Bonus Rebate would be payable 

back to the first side and Participants 

that qualify for more than one 

‘‘Additional’’ rebate are eligible to 

receive only one such rebate.13

The Exchange further proposes to 

modify Section III.E.1. and Section I.F. 

to increase the maximum Floor Broker 

credits paid for QCC trades and rebates 

paid through the Manual Billable Rebate 

Program to $2,500,000 per month per 


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14See proposed Fee Schedule, Sections III.E.1 

and I.F. (providing, in relevant, part that Floor 

Broker credits paid for QCC trades and rebates paid 

through the Manual Billable Rebate Program shall 

not combine to exceed $2,500,000 per month per 

Floor Broker firm). 

15See proposed Fee Schedule, FB Prepay 

Program (providing, in relevant part, that ‘‘[t]o 

participate in the FB Prepay Program after the first 

of the year, Floor Broker organizations must notify 

the Exchange in writing by emailing optionsbilling@

nyse.com, indicating a commitment to submit 

prepayment for the balance of the calendar year’’ 

and that the notification ‘‘email to enroll in the 

Program must originate from an officer of the Floor 

Broker organization and represents a binding 

commitment through the balance of the calendar 

year.’’). 

16See proposed Fee Schedule, FB Prepay 

Program. 

17See proposed Fee Schedule, Section III.E 

(providing, in relevant part, that ‘‘[t]he Exchange 

will not issue any refunds in the event that a Floor 

Broker organization’s prepaid Eligible Fixed Costs 

exceeds actual costs.’’). The Exchange believes this 

proposed change would add clarity, transparency, 

and internal consistency to the Fee Schedule. 

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

19 15 U.S.C. 78f(b)(4) and (5). 

20See Securities Exchange Act Release No. 51808 

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

(S7–10–04) (‘‘Reg NMS Adopting Release’’). 

21The OCC publishes options and futures volume 

in a variety of formats, including daily and monthly 

volume by exchange, available here: https:// 

www.theocc.com/Market-Data/Market-DataReports/Volume-and-Open-Interest/MonthlyWeekly-Volume-Statistics. 

Floor Broker firm, an increase from the 

current monthly amount of 2,000,000 

(the ‘‘Maximum Combined Rebate/ 

Credit’’).14 The proposed increase is 

designed to encourage Floor Broker 

firms to continue to direct transactions 

to the Exchange, despite increasing 

industry volumes making it less difficult 

to attain the maximum rebate. 

Next, the Exchange proposes to 

modify the FB Prepay Program to 

remove reference to a specific year (i.e., 

November 2022) and to instead 

reference ‘‘November of the current 

year’’ as the date that the Exchange will 

use for the calculation of a Floor 

Broker’s Eligible Fixed Costs for the 

following calendar year. The FB Prepay 

Program currently specifies that a Floor 

Broker that commits to the program will 

be invoiced in January for Eligible Fixed 

Costs, based on annualizing their 

Eligible Fixed Costs incurred in 

November 2022. The Exchange believes 

that this proposed change would 

prevent the Exchange from relying on a 

stale date and would add flexibility to 

the program (insofar as it would not 

need to be revised each year). 

Finally, the Exchange proposes to 

allow a Floor Broker to join the Program 

after the first of the year. To do so, 

similar to the protocol required of 

existing Program participants, such 

Floor Broker organizations would notify 

the Exchange in writing by emailing 

optionsbilling@nyse.com and indicating 

their commitment to submit prepayment 

for the balance of the calendar year; the 

email notification would have to 

originate from an officer of the Floor 

Broker organization and would 

represent a binding commitment 

through the balance of the calendar 

year.15 As further proposed, the Floor 

Broker organization would be enrolled 

in the Program beginning on the first 

day of the next full month and would 

be invoiced for that first full month for 

Eligible Fixed Costs and the balance of 

the year, based on annualizing for the 

remainder of the calendar year their 

Eligible Fixed Costs incurred in its first 

full month in the Program.16 The 

Exchange notes that both the current 

and proposed methodology rely on 

recently incurred Eligible Fixed Costs to 

predict anticipated Eligible Fixed Costs. 

For current program Participants the 

Exchange relies on November costs; 

whereas, for later-joining Program 

participants, the Exchange would rely 

on costs incurred in the Floor Broker’s 

first full month in the Program. The 

Exchange believes that this approach 

allows the Exchange the flexibility to 

offer the FB Prepay Program to Floor 

Brokers that did not enroll before the 

end of the prior calendar year, 

including/especially Floor Brokers new 

to the Exchange, without putting these 

Floor Brokers at a competitive 

disadvantage. Finally, consistent with 

the current Program, the Exchange will 

not issue refunds if a Floor Broker 

organization’s prepaid Eligible Fixed 

Costs exceeds its actual costs; however, 

the Exchange proposes to remove 

reference to ‘‘annual’’ costs in the 

current Fee Schedule because this 

phrase would not apply to Floor Brokers 

that join the Program after the first of 

the year.17

Finally, as noted above, the Exchange 

proposes to eliminate the Floor Broker 

Manual Billable Incentive Program. The 

Exchange determined that this program 

was duplicative of the FB Prepay 

Program, which made it difficult for 

Floor Brokers to ascertain the total 

rebates earned. The Exchange believes 

that the proposed adjustments to the 

Prepay Program (including changes to 

the QCC Billable Bonus Rebate 

Qualification) would reduce potential 

confusion and would add clarity and 

transparency to the Fee Schedule. 

Although the Exchange cannot predict 

with certainty whether the proposed 

changes to the FB Prepay Program 

would encourage Floor Brokers to 

participate in the program or to increase 

either their manual billable volume or 

QCC volume, the Exchange believes that 

the proposed changes would continue to 

incent Floor Brokers to participate in 

the FB Prepay Program by adding 

flexibility to the structure of the 

Program, including by allowing Floor 

Brokers to join the Program after the 

first of the year and increasing the 

Maximum Combined Rebate/Credit. All 

Floor Brokers are eligible to participate 

in the FB Prepay Program and qualify 

for the proposed credits and rebates, 

and the credits and rebates are 

achievable in any given month without 

regard to volumes from any other 

month. The Exchange notes that the 

proposed restructuring of the FB Prepay 

Program (including by eliminating the 

Floor Broker Manual Billable Incentive 

Program) would more closely align the 

qualifications for and incentives offered 

through the Program with order flow 

executed by Floor Broker firms 

operating on the Exchange and with 

other fees and credits set forth in the 

Fee Schedule. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

section 6(b) of the Act,18 in general, and 

furthers the objectives of sections 6(b)(4) 

and (5) of the Act,19 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 Proposed Rule Change Is 

Reasonable 

The Exchange operates in a highly 

competitive market. The Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. 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.’’ 20

There are currently 17 registered 

options exchanges competing for order 

flow. Based on publicly-available 

information, and excluding index-based 

options, no single exchange has more 

than 16% of the market share of 

executed volume of multiply-listed 

equity and ETF options trades.21

Therefore, no exchange possesses 

significant pricing power in the 

execution of multiply-listed equity and 


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22Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, see id., the 

Exchange’s market share in equity-based options 

was 6.98% for the month of November 2022 and 

7.60% for the month of November 2023. 

23See, e.g., EDGX Options Exchange Fee 

Schedule, QCC Initiator/Solicitation Rebate Tiers 

(applying ($0.16) per contract rebate up to 999,999 

contracts for QCC transactions when only one side 

of the transaction is a non-customer or ($0.24) per 

contract rebate up to 999,999 contracts for QCC 

transactions with non-customers on both sides); 

BOX Options Fee Schedule at Section IV.D.1. (QCC 

Rebate) (providing for ($0.14) per contract rebate up 

to 999,999 contracts for QCC transactions when 

only one side of the QCC transaction is a brokerdealer or market maker or ($0.22) per contract 

rebate up to 1,499,999 contracts for QCC 

transactions when both parties are a broker-dealer 

or market maker); Nasdaq ISE, Options 7, Section 

6.B. (QCC Rebate) (offering rebates on QCC 

transactions of ($0.14) per contract when only one 

side of the QCC transaction is a non-customer or 

($0.22) per contract when both sides of the QCC 

transaction are non-customers). 

ETF options order flow. More 

specifically, in November 2023, the 

Exchange had less than 8% market 

share of executed volume of multiplylisted equity and ETF options trades.22

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can shift order flow or discontinue or 

reduce use of certain categories of 

products, in response to fee changes. 

Accordingly, competitive forces 

constrain options exchange transaction 

fees. Stated otherwise, changes to 

exchange transaction fees can have a 

direct effect on the ability of an 

exchange to compete for order flow. 

The Exchange believes that the 

proposed credits offered to Floor 

Brokers on QCC transactions and 

manual billable volume offered through 

the FB Prepay Program, as proposed, are 

reasonable because they are designed to 

continue to incent Floor Brokers to 

increase the number of QCC 

transactions and manual billable orders 

executed on the Exchange. The 

Exchange also believes that the 

proposed increase in the maximum 

monthly amount that a Floor Broker 

firm could earn from Floor Broker QCC 

credits or from rebates via the proposed 

changes to the Manual Billable Rebate 

Program (i.e., the Maximum Combined 

Rebate/Credit) is reasonable because it 

is likewise intended to encourage Floor 

Brokers to direct QCC transactions and 

manual billable volume to the 

Exchange. 

With respect to the FB Prepay 

Program, the Exchange also believes that 

the proposed changes are reasonable 

because participation in the program is 

optional, and Floor Brokers can elect to 

participate in the program to be eligible 

to earn the proposed rebates on manual 

billable transactions and QCC 

transactions or not. The Exchange also 

believes that the proposed modification 

of the FB Prepay Program (including the 

proposal to eliminate the Floor Broker 

Manual Billable Incentive Program) is 

reasonable because it is designed to 

simplify the incentives offered through 

the program, to continue to encourage 

Floor Brokers to participate in the FB 

Prepay Program, and to provide 

liquidity on the Exchange. Specifically, 

the Exchange believes that the proposed 

qualifying thresholds for the Manual 

Billable Rebate Program and QCC Bonus 

Rebate are achievable by Floor Broker 

firms based on recent Floor Broker 

activity and in consideration of the 

proposed changes in this filing, and that 

the rebate amounts are designed to 

encourage Floor Brokers to continue to 

direct manual billable volume and QCC 

transactions to the Exchange. The 

Exchange further believes that the 

amounts of the proposed rebates are 

reasonable and comparable to rebate 

amounts offered by another options 

exchange to Floor Brokers on manual 

transactions. 

To the extent that the proposed 

changes attract more volume to the 

Exchange, this increased order flow 

would continue to make the Exchange a 

more competitive venue for order 

execution, which, in turn, promotes just 

and equitable principles of trade and 

removes impediments to and perfects 

the mechanism of a free and open 

market and a national market system. 

The Exchange notes that all market 

participants stand to benefit from any 

increase in volume by Floor Brokers, 

which could promote market depth, 

facilitate tighter spreads and enhance 

price discovery, to the extent the 

proposed change encourages Floor 

Brokers to utilize the Exchange as a 

primary trading venue, and may lead to 

a corresponding increase in order flow 

from other market participants. In 

addition, any increased liquidity on the 

Exchange would result in enhanced 

market quality for all participants. 

The Exchange also believes that the 

proposed change to modify the Program 

to remove reference to a specific year is 

reasonable because it would prevent the 

Exchange from using a benchmark based 

on a stale date and would add flexibility 

to the Program (insofar as it would not 

need to be revised each year). In 

addition, the proposed change to allow 

Floor Brokers to join the Program after 

the first of the year—by prepaying an 

amount (to cover the balance of the 

year) based on their Eligible Fixed Costs 

incurred in their first month in the 

Program—is reasonable for several 

reasons. First, the proposed method 

used to determine the prepayment 

amount for any later-joining Floor 

Brokers is analogous to the Exchange’s 

current method of determining the 

prepayment amount for Program 

participants (i.e., prepayment amount is 

based on the Eligible Fixed Costs 

recently-incurred). Second, the 

Exchange believes that the proposed 

method of determining a (later-joining) 

Floor Broker’s prepayment amount 

would provide the most accurate basis 

for anticipating that Floor Broker’s 

future Eligible Fixed Costs. Moreover, 

the Exchange believes that this 

approach would allow the Exchange the 

flexibility to offer the FB Prepay 

Program to later-joining Floor Brokers, 

including/especially Floor Brokers new 

to the Exchange, without putting these 

Floor Brokers at a competitive 

disadvantage. 

Further, the proposal to eliminate the 

Floor Broker Manual Billable Incentive 

Program and accompanying monthly 

rebates is reasonable because it is 

rendered redundant by the proposed 

enhanced opportunities for Floor 

Brokers participating in the FB Prepay 

Program to achieve rebates through the 

Manual Billable Rebate Program and the 

QCC Billable Bonus Rebate. The 

Exchange believes that this proposed 

restructuring is reasonable because it 

may encourage more Floor Brokers to 

sign up for the Program, which may 

result in increased liquidity on the 

Exchange to the benefit of all market 

participants. 

To the extent the proposed changes 

continue to attract greater volume and 

liquidity, the Exchange believes the 

proposed changes would improve the 

Exchange’s overall competitiveness and 

strengthen its market quality for all 

market participants. In the backdrop of 

the competitive environment in which 

the Exchange operates, the proposed 

rule change is a reasonable attempt by 

the Exchange to increase the depth of its 

market and improve its market share 

relative to its competitors. The 

Exchange’s fees are constrained by 

intermarket competition, as Floor 

Brokers may direct their order flow to 

any of the 17 options exchanges, 

including those offering rebates on QCC 

orders 23 and Floor Broker rebates on 

manual billable orders. Thus, Floor 

Brokers have a choice of where they 

direct their order flow, including their 

QCC transactions and manual billable 

orders. The proposed rule changes are 

designed to continue to incent Floor 

Brokers to direct liquidity (and, in 

particular, QCC orders and manual 

billable orders) to the Exchange; to the 

extent Floor Brokers are incented to 


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7754 Federal Register / Vol. 89, No. 24 / Monday, February 5, 2024 / Notices 

aggregate their trading activity at the 

Exchange, that increased liquidity could 

promote market depth, price discovery 

and improvement, and enhanced order 

execution opportunities for market 

participants. 

Finally, the proposed changes to 

remove reference to inapplicable fees 

(i.e., costs for Login and Floor Broker 

Hand Held), to remove now obsolete 

language related to the migration to 

Pillar, as well as the to make conforming 

changes to the Table of Contents (in 

connection with the deletion of Floor 

Broker Incentive Program), and to 

remove superfluous or obsolete text 

from the FB Prepay Program, are 

reasonable because they would add 

clarity, transparency, and internal 

consistency to the Fee Schedule to the 

benefit of all market participants. 

The Proposed Rule Change Is an 

Equitable Allocation of Credits and Fees 

The Exchange believes the proposed 

rule change is an equitable allocation of 

its fees and credits. The proposal is 

based on the amount and type of 

business transacted on the Exchange; 

Floor Brokers are not obligated to 

participate in the FB Prepay Program 

and can choose to execute QCC 

transactions or manual billable 

transactions to earn the various 

proposed credits and rebates or not. In 

addition, the proposed credits and 

rebates are available to all Floor Brokers 

equally, and the proposed monthly limit 

on the amount that Floor Brokers could 

earn from credits and rebates on QCC 

transactions and manual billable 

transactions would apply to all Floor 

Brokers equally. 

The Exchange also notes that the 

proposed changes are designed to 

encourage Floor Brokers that have 

previously enrolled in the FB Prepay 

Program to reenroll for the upcoming 

year, as well as to attract Floor Brokers 

that have not yet participated in the 

program. Moreover, the Exchange 

believes that the proposed modifications 

to the FB Prepay Program are an 

equitable allocation of fees and credits 

because they would apply to 

participating Floor Brokers equally and 

are intended to encourage the role 

performed by Floor Brokers in 

facilitating the execution of orders via 

open outcry, a function which the 

Exchange wishes to support for the 

benefit of all market participants. 

The Exchange also believes that the 

proposed change to modify the Program 

to remove reference to a specific year is 

equitable because it would prevent the 

Exchange from using a benchmark based 

on a stale date. In addition, the 

proposed change to allow Floor Brokers 

to join the Program after the first of the 

year—by prepaying an amount (to cover 

the balance of the year) based on their 

Eligible Fixed Costs incurred in their 

first month in the Program—is equitable 

for several reasons. First, the proposed 

method used to determine the 

prepayment amount for any later-joining 

Floor Brokers is analogous to the 

Exchange’s current method of 

determining the prepayment amount for 

Program participants (i.e., prepayment 

amount is based on the Eligible Fixed 

Costs recently-incurred). Second, the 

Exchange believes that the proposed 

method of determining a (later-joining) 

Floor Broker’s prepayment amount 

would provide the most accurate basis 

for anticipating that Floor Broker’s 

future Eligible Fixed Costs. Moreover, 

the Exchange believes that this 

approach would allow the Exchange the 

flexibility to offer the FB Prepay 

Program to later-joining Floor Brokers, 

including/especially Floor Brokers new 

to the Exchange, without putting these 

Floor Brokers at a competitive 

disadvantage. 

Further, the proposal to eliminate the 

Floor Broker Manual Billable Incentive 

Program and accompanying monthly 

rebates is equitable because it is 

rendered redundant by the proposed 

enhanced opportunities for Floor 

Brokers participating in the FB Prepay 

Program to achieve rebates through the 

Manual Billable Rebate Program and the 

QCC Billable Bonus Rebate. The 

Exchange believes that this proposed 

restructuring is reasonable because it 

may encourage more Floor Brokers to 

sign up for the Program, which may 

result in increased liquidity on the 

Exchange to the benefit of all market 

participants 

Moreover, the proposed changes are 

designed to continue to incent Floor 

Brokers to encourage ATP Holders to 

aggregate their executions—including 

QCC transactions and manual orders— 

at the Exchange as a primary execution 

venue. To the extent that the proposed 

change achieves its purpose in attracting 

more Floor Broker volume to the 

Exchange, this increased order flow 

would continue to make the Exchange a 

more competitive venue for, among 

other things, order execution. Thus, the 

Exchange believes the proposed rule 

changes would improve market quality 

for all market participants on the 

Exchange and, as a consequence, attract 

more order flow to the Exchange, 

thereby improving market-wide quality 

and price discovery. 

The Proposed Rule Change Is Not 

Unfairly Discriminatory 

The Exchange believes the proposed 

fees, credits, and rebates applicable to 

Floor Brokers on QCC transactions and 

manual billable transactions are not 

unfairly discriminatory because they are 

based on the amount and type of 

business transacted on the Exchange, 

and Floor Brokers are not obligated to 

execute QCC or manual billable volume, 

or to participate in the FB Prepay 

Program. Further, the proposal to 

eliminate the Floor Broker Manual 

Billable Incentive Program and 

accompanying monthly rebates is not 

unfairly discriminatory because it is 

rendered redundant by the proposed 

enhanced opportunities for Floor 

Brokers participating in the FB Prepay 

Program to achieve rebates through the 

Manual Billable Rebate Program and the 

QCC Billable Bonus Rebate. The 

Exchange believes that this proposed 

restructuring is reasonable because it 

may encourage more Floor Brokers to 

sign up for the Program, which may 

result in increased liquidity on the 

Exchange to the benefit of all market 

participants. In addition, the proposed 

changes, including the increase of the 

Maximum Combined Rebate/Credit, 

would apply to all similarly-situated 

Floor Brokers on an equal and nondiscriminatory basis. The proposed 

credits and rebates are also not unfairly 

discriminatory to non-Floor Brokers 

because Floor Brokers serve an 

important function in facilitating the 

execution of orders on the Exchange, 

which the Exchange wishes to 

encourage and support to promote price 

improvement opportunities for all 

market participants. 

The Exchange also believes that the 

proposed change to modify the Program 

to remove reference to a specific year is 

not unfairly discriminatory because it 

would apply equally to all Program 

participants and would prevent the 

Exchange from using a benchmark based 

on a stale date In addition, the proposed 

change to allow Floor Brokers to join the 

Program after the first of the year—by 

prepaying an amount (to cover the 

balance of the year) based on their 

Eligible Fixed Costs incurred in their 

first month in the Program—is not 

unfairly discriminatory for several 

reasons. First, the proposed method 

used to determine the prepayment 

amount for any later-joining Floor 

Brokers is analogous to the Exchange’s 

current method of determining the 

prepayment amount for Program 

participants (i.e., prepayment amount is 

based on the Eligible Fixed Costs 

recently-incurred). Second, the 


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Federal Register / Vol. 89, No. 24 / Monday, February 5, 2024 / Notices 7755 

24See Reg NMS Adopting Release, supra note 20, 

at 37499. 

25See note 21, supra. 

26See note 22, supra. 

27See note 23, supra. 

Exchange believes that the proposed 

method of determining a (later-joining) 

Floor Broker’s prepayment amount 

would provide the most accurate basis 

for anticipating that Floor Broker’s 

future Eligible Fixed Costs. Moreover, 

the Exchange believes that this 

approach would allow the Exchange the 

flexibility to offer the FB Prepay 

Program to later-joining Floor Brokers, 

including/especially Floor Brokers new 

to the Exchange, without putting these 

Floor Brokers at a competitive 

disadvantage. 

Further, the proposal to eliminate the 

Floor Broker Manual Billable Incentive 

Program and accompanying monthly 

rebates is not unfairly discriminatory 

because it is rendered redundant by the 

proposed enhanced opportunities for 

Floor Brokers participating in the FB 

Prepay Program to achieve rebates 

through the Manual Billable Rebate 

Program and the QCC Billable Bonus 

Rebate. The Exchange believes that this 

proposed restructuring is reasonable 

because it may encourage more Floor 

Brokers to sign up for the Program, 

which may result in increased liquidity 

on the Exchange to the benefit of all 

market participants. 

To the extent that the proposed 

changes attract more QCC orders and 

manual orders to the Exchange, this 

increased order flow would continue to 

make the Exchange a more competitive 

venue for order execution. Thus, the 

Exchange believes the proposed rule 

change would improve market quality 

for all market participants on the 

Exchange and, as a consequence, attract 

more order flow to the Exchange, 

thereby improving market-wide quality 

and price discovery. The resulting 

increased volume and liquidity would 

provide more trading opportunities and 

tighter spreads to all market participants 

and thus would promote just and 

equitable principles of trade, remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system and, in 

general, protect investors and the public 

interest. 

Finally, the Exchange believes that it 

is subject to significant competitive 

forces, as described below in the 

Exchange’s statement regarding the 

burden on competition. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

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

the Act, the Exchange does not believe 

that the proposed rule change would 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

Instead, as discussed above, the 

Exchange believes that the proposed 

changes would encourage the 

submission of additional liquidity to a 

public exchange, thereby promoting 

market depth, price discovery and 

transparency and enhancing order 

execution opportunities for all market 

participants. As a result, the Exchange 

believes that the proposed change 

furthers the Commission’s goal in 

adopting Regulation NMS of fostering 

integrated competition among orders, 

which promotes ‘‘more efficient pricing 

of individual stocks for all types of 

orders, large and small.’’ 24

Intramarket Competition. The 

proposed modification of the FB Prepay 

Program and the proposed credits and 

rebates offered to Floor Brokers manual 

billable orders are designed to incent 

participation in the FB Prepay Program 

and to attract additional order flow to 

the Exchange, which could increase the 

volumes of contracts traded on the 

Exchange. Greater liquidity benefits all 

market participants on the Exchange, 

and increased QCC and manual billable 

transactions could increase 

opportunities for execution of other 

trading interest. The proposed rebates 

available through the Manual Billable 

Rebate Program and QCC Billable Bonus 

Rebate would be available to all Floor 

Brokers that choose to participate in the 

FB Prepay Program and meet the 

qualifying criteria for such rebates. The 

proposed increase of the Maximum 

Combined Rebate/Credit would likewise 

apply equally to all similarly-situated 

Floor Brokers. To the extent that there 

is an additional competitive burden on 

non-Floor Brokers, the Exchange 

believes that any such burden would be 

appropriate because Floor Brokers serve 

an important function in facilitating the 

execution of orders and price discovery 

for all market participants. 

Intermarket Competition. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily favor one of the 

17 competing option exchanges if they 

deem fee levels at a particular venue to 

be excessive. In such an environment, 

the Exchange must continually adjust its 

fees to remain competitive with other 

exchanges and to attract order flow to 

the Exchange. Based on publiclyavailable information, and excluding 

index-based options, no single exchange 

has more than 16% of the market share 

of executed volume of multiply-listed 

equity and ETF options trades.25

Therefore, no exchange possesses 

significant pricing power in the 

execution of multiply-listed equity and 

ETF options order flow. More 

specifically, in November 2023, the 

Exchange had less than 8% market 

share of executed volume of multiplylisted equity and ETF options trades.26

The Exchange believes that the 

proposed changes reflect this 

competitive environment because they 

modify the Exchange’s fees and credits 

in a manner designed to continue to 

incent Floor Brokers to direct trading 

interest (particularly QCC transactions 

and manual orders) to the Exchange, to 

provide liquidity and to attract order 

flow. To the extent that Floor Brokers 

are encouraged to participate in the FB 

Prepay Program and/or incentivized to 

utilize the Exchange as a primary 

trading venue for all transactions, all of 

the Exchange’s market participants 

should benefit from the improved 

market quality and increased 

opportunities for price improvement. 

The Exchange notes that it operates in 

a highly competitive market in which 

market participants can readily favor 

competing venues. In such an 

environment, the Exchange must 

continually review, and consider 

adjusting, its fees and credits to remain 

competitive with other exchanges. For 

the reasons described above, the 

Exchange believes that the proposed 

rule change reflects this competitive 

environment. 

The Exchange further believes that the 

proposed change could promote 

competition between the Exchange and 

other execution venues, including those 

that currently offer rebates on QCC 

transactions and manual billable 

volume,27 by encouraging additional 

orders to be sent to the Exchange for 

execution. 

Finally, the proposed changes to 

remove reference to inapplicable fees 

(i.e., costs for Login and Floor Broker 

Hand Held) and to make conforming 

changes to the Table of Contents (to 

reflect deletion of Floor Broker 

Incentive Program), and to remove 

superfluous or obsolete text from the FB 

Prepay Program are not designed to 

address any competitive issue but are 

instead designed to add clarity, 

transparency, and internal consistency 

to the Fee Schedule. 

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. 


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7756 Federal Register / Vol. 89, No. 24 / Monday, February 5, 2024 / Notices 

28 15 U.S.C. 78s(b)(3)(A). 

29 17 CFR 240.19b–4(f)(2). 

30 15 U.S.C. 78s(b)(2)(B). 31 17 CFR 200.30–3(a)(12). 

1See Blue Tractor ETF Trust and Blue Tractor 

Group, LLC, Investment Company Act Release No. 

33682 (Nov. 14, 2019) (notice) and Investment 

Company Act Release No. 33710 (Dec. 10, 2019) 

(order). 

2See Blue Tractor ETF Trust and Blue Tractor 

Group, LLC, Investment Company Act Release No. 

34194 (Feb. 10, 2021) (notice) and Investment 

Company Act Release No. 34221 (Mar. 9, 2021) 

(order). 

3Except as specifically noted in the application 

for the Amended Order, all representations and 

conditions contained in the application first 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to section 

19(b)(3)(A) 28 of the Act and 

subparagraph (f)(2) of Rule 19b–4 29

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

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) 30 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 (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

NYSEAMER–2024–06 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–NYSEAMER–2024–06. 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–NYSEAMER–2024–06 and should 

be submitted on or before February 26, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–02160 Filed 2–2–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Investment Company Act Release No. 

35121; 812–15209] 

Blue Tractor ETF Trust and Blue 

Tractor Group, LLC 

January 31, 2024. 

AGENCY: Securities and Exchange 

Commission (‘‘Commission’’). 

ACTION: Notice of an application to 

amend a prior order for exemptive 

relief. 

SUMMARY OF APPLICATION: Applicants 

request an order (‘‘Amended Order’’) 

that would amend a prior order to 

permit a Fund (as defined below) to 

engage in short sales with respect to the 

same types of instruments that a Fund 

is permitted to hold as long positions. 

APPLICANTS: Blue Tractor ETF Trust and 

Blue Tractor Group, LLC 

(‘‘Applicants’’). 

FILING DATES: The application was filed 

on March 19, 2021, and amended on 

August 12, 2021, February 15, 2022, 

June 3, 2022, June 7, 2023 and January 

30, 2024. 

HEARING OR NOTIFICATION OF HEARING: 

An order granting the requested relief 

will be issued unless the Commission 

orders a hearing. Interested persons may 

request a hearing by emailing the 

Commission’s Secretary at SecretarysOffice@sec.gov and serving Applicants 

with a copy of the request by email, if 

an email address is listed for the 

relevant Applicant below, or personally 

or by mail, if a physical address is listed 

for the relevant Applicant below. 

Hearing requests should be received by 

the Commission by 5:30 p.m. on 

February 26, 2024 and should be 

accompanied by proof of service on the 

Applicants, in the form of an affidavit, 

or, for lawyers, a certificate of service. 

Pursuant to rule 0–5 under the 

Investment Company Act of 1940 

(‘‘Act’’), hearing requests should state 

the nature of the writer’s interest, any 

facts bearing upon the desirability of a 

hearing on the matter, the reason for the 

request, and the issues contested. 

Persons who wish to be notified of a 

hearing may request notification by 

emailing to the Commission’s Secretary. 

ADDRESSES: The Commission: 

Secretarys-Office@sec.gov. Applicants: 

MMundt@stradley.com. 

FOR FURTHER INFORMATION CONTACT: 

Deepak T. Pai, Senior Counsel; Trace W. 

Rakestraw, Senior Special Counsel, at 

(202) 551–6825 (Division of Investment 

Management, Chief Counsel’s Office). 

SUPPLEMENTARY INFORMATION: For 

Applicants’ representations, legal 

analysis, and conditions, please refer to 

Applicants’ fifth amended and restated 

application, dated January 30, 2024, 

which may be obtained via the 

Commission’s website by searching for 

the file number at the top of this 

document, or for an Applicant using the 

Company name search field, on the 

SEC’s EDGAR system. The SEC’s 

EDGAR system may be searched at, 

https://www.sec.gov/edgar/searchedgar/ 

legacy/companysearch.html. You may 

also call the SEC’s Public Reference 

Room at (202) 551–8090. 

I. Introduction 

1. On December 10, 2019, the 

Commission issued an order 1 (as 

subsequently amended,2 the ‘‘Prior 

Order’’) 3 under section 6(c) of the Act 


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