Federal Register / Vol. 89, No. 34 / Tuesday, February 20, 2024 / Notices 12893 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

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

the Commission written notice of its intent to file 

the proposed rule change, along with a brief 

description and text of the proposed rule change, 

at least five business days prior to the date of filing 

of the proposed rule change, or such shorter time 

as designated by the Commission. The Exchange 

has satisfied this requirement. 

10 17 CFR 240.19b–4(f)(6). 

11 17 CFR 240.19b–4(f)(6)(iii). 

12For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

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

13 17 CFR 200.30–3(a)(12), (59). 

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

2 17 CFR 240.19b–4. 

undue burden on intermarket 

competition. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A) of the Act 8 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.9

A proposed rule change filed 

pursuant to Rule 19b–4(f)(6) under the 

Act 10 normally does not become 

operative for 30 days after the date of its 

filing. However, Rule 19b–4(f)(6)(iii) 11

permits the Commission to designate a 

shorter time if such action is consistent 

with the protection of investors and the 

public interest. The Exchange has 

requested that the Commission waive 

the 30-day operative delay so that the 

proposal may become operative 

immediately upon filing. The Exchange 

states that a waiver of the operative 

delay would permit the Exchange to 

promptly correct an erroneous internal 

cross reference. The Commission 

believes that the proposed rule change 

presents no novel legal or regulatory 

issues and that waiver of the 30-day 

operative delay is consistent with the 

protection of investors and the public 

interest. Accordingly, the Commission 

hereby waives the 30-day operative 

delay and designates the proposed rule 

change operative upon filing.12

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 shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

MIAX–2024–08 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–MIAX–2024–08. 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–MIAX–2024–08 and should be 

submitted on or before March 12, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–03335 Filed 2–16–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99531; File No. SR– 

CboeEDGX–2024–011] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend Its 

Fee Schedule 

February 13, 2024. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on February 

1, 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 


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

Volume Summary, Month-to-Date (January 24, 

2024), available at https://www.cboe.com/us/ 

equities/market_statistics/. 

4See EDGX Equities Fee Schedule, Standard 

Rates. 

5 Id. 

6See Exchange Rule 11.8(g). 

7See Exchange Rule 11.8(g)(10). 

8See Exchange Rule 1.5(d). 

9See Exchange Rule 1.5(ee). 

10See Securities Exchange Act Release No. 89007 

(June 4, 2020), 85 FR 35454 (June 10, 2020) (SR– 

CboeEDGX–2020–010) (‘‘Notice of Filing of 

Amendment No. 1 and Order Granting Accelerated 

Approval of a Proposed Rule Change, as Modified 

by Amendment No. 1, to Amend the Rule Relating 

to MidPoint Discretionary Orders to Allow Optional 

Offset or Quote Depletion Protection Instructions’’). 

11Fee code 3 is appended to orders adding 

liquidity to EDGX in the pre and post market in 

Tapes A or C securities. 

12Fee code 4 is appended to orders adding 

liquidity to EDGX in the pre and post market in 

Tape B securities. 

13Fee code B is appended to orders adding 

liquidity to EDGX in Tape B securities. 

14Fee code V is appended to orders adding 

liquidity to EDGX in Tape A securities. 

15Fee code Y is appended to orders adding 

liquidity to EDGX in Tape C securities. 

16 ‘‘ADV’’ 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. 

17Fee code ZA is appended to Retail Orders 

adding liquidity to EDGX. 

18Fee code ZO is appended to Retail orders 

adding liquidity to EDGX in the pre and post 

market. 

19Fee code ZM is appended to Retail orders 

marked as Day/RHO or GTX that remove liquidity 

from EDGX upon arrival. 

20Fee code ZR is appended to Retail Orders that 

remove liquidity from EDGX. 

21 ‘‘TCV’’ means total consolidated volume 

calculated as the volume reported by all exchanges 

and trade reporting facilities to a consolidated 

transaction reporting plan for the month for which 

the fees apply. 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend its 

Fee Schedule applicable to its equities 

trading platform (‘‘EDGX Equities’’) as 

follows: (1) by modifying the rate 

associated with fee code DX; (2) by 

introducing a new Add Volume Tier 

and new Non-Displayed Add Volume 

Tier; (3) by modifying certain NonDisplayed Add Volume Tiers; (4) by 

modifying the Cross Asset Tier; and (5) 

by discontinuing Growth Tier 5, NonDisplayed Step-Up Volume Tier 3, and 

Retail Growth Tier 3. The Exchange 

proposes to implement these changes 

effective February 1, 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 14% 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 $0.00003 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. 

Fee Code DX 

The Exchange currently offers fee 

code DX, which is appended to 

Midpoint Discretionary Orders 

(‘‘MDOs’’) 6 using the Quote Depletion 

Protection (‘‘QDP’’) 7 order instruction 

that remove liquidity from the 

Exchange. QDP is designed to provide 

enhanced protections to MDOs by 

tracking significant executions that 

constitute the best bid or offer on the 

EDGX Book 8 and enabling Users 9 to 

avoid potentially unfavorable 

executions by preventing MDOs entered 

with the optional QDP instruction from 

exercising discretion to trade at more 

aggressive prices when QDP has been 

triggered.10 Currently, orders appended 

with fee code DX are assessed a fee of 

$0.00100 per share in securities at or 

above $1.00 and 0.30% of dollar value 

for securities priced below $1.00. The 

Exchange proposes to increase the fee to 

$0.00150 per share in securities at or 

above $1.00. There is no proposed 

change in the fee assessed to securities 

priced below $1.00. The purpose of 

increasing the fee associated with fee 

code DX in securities priced at or above 

$1.00 is for business and competitive 

reasons, as the Exchange believes that 

increasing such fee 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. 

Add Volume Tiers 

Under footnote 1 of the Fee Schedule, 

the Exchange currently offers various 

Add/Remove Volume Tiers. In 

particular, the Exchange offers seven 

Add Volume Tiers that each provide an 

enhanced rebate for Members’ 

qualifying orders yielding fee codes 3,11

4,12 B,13 V,14 and Y 15 where a Member 

reaches certain add volume-based 

criteria. The Exchange now proposes to 

introduce a new Add Volume Tier to 

provide Members an additional manner 

in which they could receive an 

enhanced rebate if certain criteria is 

met. The criteria for proposed Add 

Volume Tier 8 is as follows: 

• Add Volume Tier 8 provides a 

rebate of $0.0034 per share in securities 

priced at or above $1.00 to qualifying 

orders (i.e., orders yielding fee codes 3, 

4, B, V, or Y) where (1) Member has a 

total retail ADV 16 (yielding fee codes 

ZA,17 ZO,18 ZM,19 and ZR20) ≥0.80% of 

the TCV 21 or Member has a total retail 

ADV (yielding fee codes ZA, ZO, ZM, 

and ZR) ≥80,000,000; and (2) Member 

has a total remove ADV ≥0.80% of the 

TCV or Member has a total remove ADV 

≥80,000,000. 

In addition to the Add Volume Tiers 

offered under footnote 1, the Exchange 

also offers a Cross Asset Tier, which is 

designed to incentivize Members to 

achieve certain levels of participation 

on both the Exchange’s equities and 

options platform (‘‘EDGX Options’’). 

The Exchange now proposes to amend 


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22 ‘‘Market Maker Add’’ means any order for the 

account of a registered Market Maker on EDGX 

Options appended with fee code NM or PM. 

23Fee code DM is appended to orders that add 

liquidity using MidPoint Discretionary Order 

within discretionary range. 

24Fee code HA is appended to non-displayed 

orders that add liquidity. 

25Fee code MM is appended to non-displayed 

orders that add liquidity using Mid-Point Peg. 

26Fee code RP is appended to non-displayed 

orders that add liquidity using Supplemental Peg. 

27Fee code HI is appended to non-displayed 

orders that receive price improvement and add 

liquidity to EDGX. 

28See EDGX Rule 11.21(a)(1). A ‘‘Retail Member 

Organization’’ or ‘‘RMO’’ is a Member (or a division 

thereof) that has been approved by the Exchange 

under this Rule to submit Retail Orders. 

29See EDGX Rule 11.21(a)(2). A ‘‘Retail Order’’ is 

an agency or riskless principal order that meets the 

criteria of FINRA Rule 5320.03 that originates from 

a natural person and is submitted to the Exchange 

by a Retail Member Organization, provided that no 

change is made to the terms of the order with 

respect to price or side of the market and the order 

does not originate from a trading algorithm or any 

other computerized methodology. 

the criteria of the Cross Asset Tier as the 

tier has expired. The proposed criteria 

for the Cross Asset Tier is as follows: 

• The Cross Asset Tier provides a 

rebate of $0.0029 per share for securities 

priced at or above $1.00 for qualifying 

orders (i.e., orders yielding fee codes 3, 

4, B, V, or Y) where (1) Member has a 

Tape B & C ADAV ≥6,000,000; and (2) 

Member has an Add ADV on EDGX 

Options ≥300,000 in SPY. 

The proposed Cross Asset Tier will no 

longer have an expiration date as it will 

no longer contain a component criteria 

requiring Members to grow their volume 

over a certain baseline month. In 

conjunction with the proposed 

modifications to the Cross Asset Tier, 

the Exchange also proposes to remove 

the definition of Market Maker Add 22

from the fee schedule as this term is no 

longer being utilized. 

Also under footnote 1, the Exchange 

offers four Non-Displayed Add Volume 

Tiers that each provide an enhanced 

rebate for Members’ qualifying orders 

yielding fee codes DM,23 HA,24 MM,25

and RP,26 where a Member reaches 

certain volume-based criteria offered in 

each tier. The Exchange now proposes 

to introduce a new Non-Displayed Add 

Volume Tier to provide Members an 

additional manner in which they could 

receive an enhanced rebate if certain 

criteria is met. The criteria for proposed 

Non-Displayed Add Volume Tier 5 is as 

follows: 

• Non-Displayed Add Volume Tier 5 

provides a rebate of $0.0026 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where (1) Member has a total retail ADV 

(yielding fee codes ZA, ZO, ZM, and 

ZR) ≥0.80% of the TCV or Member has 

a total retail ADV (yielding fee codes 

ZA, ZO, ZM, and ZR) ≥80,000,000; and 

(2) Member has a total remove ADV 

≥0.80% of the TCV or Member has a 

total remove ADV ≥80,000,000. 

In addition to introducing proposed 

Non-Displayed Add Volume Tier 5, the 

Exchange also proposes to amend NonDisplayed Add Volume Tiers 1–3 by 

removing the second prong of criteria 

from each of the three tiers and 

modifying the TCV requirement for 

Non-Displayed Add Volume Tiers 2 and 

3. Currently, the criteria for NonDisplayed Add Volume Tiers 1–3 is as 

follows: 

• Non-Displayed Add Volume Tier 1 

provides a rebate of $0.0015 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.05% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI,27 MM or RP; or 

Member has an ADAV ≥5,000,000 for 

Non-Displayed orders that yield fee 

codes DM, HA, HI, MM or RP. 

• Non-Displayed Add Volume Tier 2 

provides a rebate of $0.0020 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.08% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI, MM or RP; or 

Member has an ADAV ≥8,000,000 for 

Non-Displayed orders that yield fee 

codes DM, HA, HI, MM or RP. 

• Non-Displayed Add Volume Tier 3 

provides a rebate of $0.0025 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.10% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI, MM or RP; or 

Member has an ADAV ≥10,000,000 for 

Non-Displayed orders that yield fee 

codes DM, HA, HI, MM or RP. 

The proposed criteria for NonDisplayed Add Volume Tiers 1–3 is as 

follows: 

• Non-Displayed Add Volume Tier 1 

provides a rebate of $0.0015 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.05% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI, MM or RP. 

• Non-Displayed Add Volume Tier 2 

provides a rebate of $0.0020 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.10% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI, MM or RP. 

• Non-Displayed Add Volume Tier 3 

provides a rebate of $0.0025 per share 

for securities priced at or above $1.00 

for qualifying orders (i.e., orders 

yielding fee codes DM, HA, MM, or RP) 

where Member has an ADAV ≥0.12% of 

TCV for Non-Displayed orders that yield 

fee codes DM, HA, HI, MM or RP. 

Together, the proposed addition of 

Add Volume Tier 8 and Non-Displayed 

Add Volume Tier 5, proposed 

amendment to the Cross Asset Tier, and 

proposed amendments to NonDisplayed Add Volume Tiers 1–3 are 

each intended to provide Members an 

opportunity to earn an enhanced rebate 

by increasing their order flow to the 

Exchange, which further contributes to 

a deeper, more liquid market and 

provides 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, 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. 

In addition to the proposed additions 

and modifications to footnote 1 

discussed above, the Exchange now 

proposes to discontinue Growth Tier 5 

and Non-Displayed Step-Up Volume 

Tier 3 as the Exchange no longer wishes 

to, nor is required to, maintain such 

tiers. More specifically, the proposed 

change removes these tiers as the 

Exchange would rather redirect future 

resources and funding into other 

programs and tiers intended to 

incentivize increased order flow. 

Retail Volume Tiers 

Under footnote 2 of the Fee Schedule, 

the Exchange currently offers various 

Retail Volume Tiers which provide an 

enhanced rebate for Retail Member 

Organizations (‘‘RMOs’’) 28 an 

opportunity to receive an enhanced 

rebate from the standard rebate for 

Retail Orders 29 that add liquidity (i.e., 

yielding fee code ZA or ZO). Currently, 

the Exchange offers one Retail Growth 

Tiers where an RMO is eligible for an 

enhanced rebate for qualifying orders 

(i.e., yielding fee code ZA or ZO) 

meeting certain add volume-based 

criteria, including ‘‘growing’’ its volume 

over a certain baseline month. The 

Exchange now proposes to discontinue 

Retail Growth Tier 3 as the Exchange no 

longer wishes to, nor is required to, 


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30 15 U.S.C. 78f(b). 

31 15 U.S.C. 78f(b)(5). 

32 Id. 

33 15 U.S.C. 78f(b)(4). 

34See, e.g., BZX Equities Fee Schedule, Footnote 

1, Add/Remove Volume Tiers. 

35See, e.g., EDGX Equities Fee Schedule, 

Footnote 1, Add/Remove Volume Tiers. 

36See e.g., EDGX Equity Fee Schedule, Fee Codes 

and Associated Fees. For example, orders with a fee 

code of BB, N, or W are assessed a fee of $0.00300. 

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. 

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.30 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 31 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) 32 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) 33 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) introduce a new Add Volume Tier 

and new Non-Displayed Add Volume 

Tier; (2) modify certain Non-Displayed 

Add Volume Tiers; and (3) modify the 

Cross Asset Tier 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. Additionally, the Exchange 

notes that relative volume-based 

incentives and discounts have been 

widely adopted by exchanges,34

including the Exchange,35 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: (1) introduce a new Add 

Volume Tier and new Non-Displayed 

Add Volume Tier; (2) modify certain 

Non-Displayed Add Volume Tiers; and 

(3) modify the Cross Asset Tier is 

reasonable because the new and revised 

tiers will be available to all Members 

and provide all Members with an 

opportunity to receive an enhanced 

rebate, including additional 

opportunities to receive an enhanced 

rebate with the addition of proposed 

Add Volume Tier 8 and proposed NonDisplayed Add Volume Tier 5. The 

Exchange further believes its proposal 

to: (1) introduce a new Add Volume 

Tier and new Non-Displayed Add 

Volume Tier; (2) modify certain NonDisplayed Add Volume Tiers; and (3) 

modify the Cross Asset Tier 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 

modified criteria in proposed NonDisplayed Add Volume Tiers 1–3 and 

the Cross Asset Tier is slightly more 

difficult than the current criteria found 

in those respective tiers, 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. 

The Exchange believes that its 

proposal to eliminate current Growth 

Tier 5, Non-Displayed Step-Up Volume 

Tier 3, and Retail Growth Tier 3 is 

reasonable because the Exchange is not 

required to maintain these tiers, nor is 

it required to provide Members an 

opportunity to receive enhanced 

rebates. The Exchange believes its 

proposal to eliminate these tiers is also 

equitable and not unfairly 

discriminatory because it applies to all 

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

available for any Member). The 

Exchange also notes that the proposed 

rule change to remove these tiers 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 Growth 

Tier 5, Non-Displayed Step-Up Volume 

Tier 3, and Retail Growth Tier 3 enables 

the Exchange to redirect resources and 

funding into other programs and tiers 

intended to incentivize increased order 

flow. 

Further, the Exchange believes that its 

proposal to modify the fee associated 

with fee code DX 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 increased fee of 

$0.0015 per share is reasonable and 

appropriate because while it is slightly 

higher than the existing fee, it remains 

lower than other fees assessed by the 

Exchange in order to remove liquidity.36

The Exchange further believes that the 

proposed increase to the fee associated 

with fee code DX is not unfairly 

discriminatory because it applies to all 

Members equally, in that all Members 

will be assessed the higher fee upon 

submitting orders appended with fee 

codes DX. 

Without having a view of activity on 

other markets and off-exchange 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 


ddrumheller on DSK120RN23PROD with NOTICES1
Federal Register / Vol. 89, No. 34 / Tuesday, February 20, 2024 / Notices 12897 

37Supra note 3. 

38See Securities Exchange Act Release No. 51808 

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

39NetCoalition 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)). 

40 15 U.S.C. 78s(b)(3)(A). 

41 17 CFR 240.19b–4(f). 

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 Add Volume Tier 8, at least 

one Member will be able to satisfy the 

proposed Cross Asset Tier, at least one 

Member will be able to satisfy proposed 

Non-Displayed Tier 1, at least two 

Members will be able to satisfy 

proposed Non-Displayed Tier 2, at least 

one Member will be able to satisfy 

proposed Non-Displayed Tier 3, and at 

least one Member will be able to satisfy 

proposed Non-Displayed Add Volume 

Tier 5. 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: (1) introduce 

a new Add Volume Tier and new NonDisplayed Add Volume Tier; (2) modify 

certain Non-Displayed Add Volume 

Tiers; and (3) modify the Cross Asset 

Tier will apply to all Members equally 

in that all Members are eligible for the 

proposed new and revised tiers, have a 

reasonable opportunity to meet the 

proposed new and revised tiers’ criteria 

and will receive the enhanced rebate on 

their qualifying orders if such criteria is 

met. Further, the proposed change to the 

fee associated with fee code DX do not 

impose an unnecessary burden as all 

Members will be subject to the higher 

fee assessed to orders appended with fee 

code DX. 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 existing pricing incentives 

and adopting new 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 Growth Tier 5, NonDisplayed Step-Up Volume Tier 3, and 

Retail Growth Tier 3 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 

eliminate Growth Tier 5, Non-Displayed 

Step-Up Volume Tier 3, and Retail 

Growth Tier 3 will not impose any 

burden on intramarket competition 

because the changes apply to all 

Members uniformly, as in, the tiers 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 14% of the market share.37

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.’’ 38 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’. . . .’’.39 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. 

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 40 and paragraph (f) of Rule 

19b–4 41 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 


ddrumheller on DSK120RN23PROD with NOTICES1
12898 Federal Register / Vol. 89, No. 34 / Tuesday, February 20, 2024 / Notices 

42 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The proposed fee change is based on a recent 

proposal by Nasdaq Phlx LLC (‘‘Phlx’’) to adopt fees 

for purge ports. See Securities Exchange Act 

Release No. 97825 (June 30, 2023), 88 FR 43405 

(July 7, 2023) (SR–Phlx–2023–28). 

4The term ‘‘Market Makers’’ refers to Lead Market 

Makers (‘‘LMMs’’), Primary Lead Market Makers 

(‘‘PLMMs’’), and Registered Market Makers 

(‘‘RMMs’’) collectively. See Exchange Rule 100. 

5The term ‘‘System’’ means the automated 

trading system used by the Exchange for the trading 

of securities. See Exchange Rule 100. 

6See Securities Exchange Act Release No. 98732 

(October 12, 2023), 88 FR 71913 (October 18, 2023) 

(SR–MIAX–2023–37). 

7See Securities Exchange Act Release No. 99088 

(December 5, 2023), 88 FR 85958 (December 11, 

2023) (SR–MIAX–2023–43). 

8MIAX Pearl Options is the options market of 

MIAX PEARL, LLC (‘‘MIAX Pearl’’), which also 

operates an equities trading facility called MIAX 

Pearl Equities. See Exchange Rule 100 and MIAX 

Pearl Rule 1901. 

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–2024–011 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–2024–011. 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–2024–011 and should be 

submitted on or before March 12, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.42

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–03340 Filed 2–16–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99526; File No. SR–MIAX– 

2024–07] 

Self-Regulatory Organizations; Miami 

International Securities Exchange, 

LLC; Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change To Amend Its Fee Schedule for 

Purge Ports 

February 13, 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 

31, 2024, Miami International Securities 

Exchange, LLC (‘‘MIAX’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) a 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the Exchange. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend the 

MIAX Options Exchange Fee Schedule 

(the ‘‘Fee Schedule’’) to amend fees for 

Purge Ports.3

The text of the proposed rule change 

is available on the Exchange’s website at 

https://www.miaxglobal.com/markets/ 

us-options/miax-options/rule-filings, at 

MIAX’s principal office, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

fees for Purge Ports, which is a function 

enabling Market Makers 4 to cancel all 

open quotes or a subset of open quotes 

through a single cancel message. The 

Exchange currently provides Market 

Makers the option to purchase Purge 

Ports to assist in their quoting activity. 

Purge Ports provide Market Makers with 

the ability to send purge messages to the 

Exchange System.5 Purge Ports are not 

capable of sending or receiving any 

other type of messages or information. 

The use of Purge Ports is completely 

optional and no rule or regulation 

requires that a Market Maker utilize 

them. 

The Exchange initially filed the 

proposal on September 29, 2023 (SR– 

MIAX–2023–37) (the ‘‘Initial 

Proposal’’).6 On November 22, 2023, the 

Exchange withdrew the Initial Proposal 

and replaced with a revised filing (SR– 

MIAX–2023–43) (the ‘‘Second 

Proposal’’).7 On January 31, 2024, the 

Exchange withdrew the Second 

Proposal and replaced it with this 

further revised filing (the ‘‘Third 

Proposal’’) (SR–MIAX–2024–07). 

The Exchange is including a cost 

analysis in this filing to justify the 

proposed fees. As described more fully 

below, the cost analysis includes, 

among other things, descriptions of how 

the Exchange allocated costs among it 

and its affiliated exchanges for similar 

proposed fee changes (separately 

between MIAX Pearl Options 8 and 


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