Federal Register / Vol. 89, No. 179 / Monday, September 16, 2024 / Notices 75615 

20 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Exchange initially filed the proposed 

pricing change on March 1, 2024 (SR–GEMX–2024– 

05). On April 29, 2024, the Exchange withdrew that 

filing and submitted SR–GEMX–2024–09. On June 

27, 2024, the Exchange withdrew SR–GEMX–2024– 

09 and submitted SR–GEMX–2024–15. The instant 

filing replaces SR–GEMX–2024–15, which was 

withdrawn on August 26, 2024. 

4The Exchange proposes to exclude the GPS 

Antenna fees from the proposed fee increase 

because, unlike the other fees in General 8, the 

Exchange recently increased its GPS Antenna fees. 

See Securities Exchange Act Release No. 34–99129 

(December 11, 2023), 88 FR 87017 (December 15, 

2023) (SR–GEMX–2023–17). The Exchange also 

proposes to exclude the Cabinet Proximity Option 

Fee for cabinets with power density >10kW from 

the proposed fee increase because the Exchange 

recently established such fee. See Securities 

Exchange Act Release No. 34–100210 (May 22, 

2024), 89 FR 46476 (May 29, 2024) (SR–GEMX– 

2024–11). 

5The term ‘‘Remote Hands Services’’ refers to the 

use of Nasdaq engineers to perform on-site 

technical support tasks in its Data Center on behalf 

of its co-located customers, including the following: 

(1) power cycling of equipment; (2) patching and 

plugging in cabling and circuits; (3) observing, 

describing or reporting on display indicators; (4) 

configuration of hardware components instructed 

by the customer; (5) diagnosis and repairs as 

instructed by the customer; (6) swapping hardware 

components with customer-supplied spares or 

upgrades; (7) troubleshooting heat related issues as 

instructed by the Customer; and (8) returning 

defective equipment to the manufacturer or 

customer. 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to file 

number SR–NYSEARCA–2024–79. 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 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. 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–NYSEARCA–2024– 

79, and should be submitted on or 

before October 7, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.20

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–20910 Filed 9–13–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–100992; File No. SR– 

GEMX–2024–33] 

Self-Regulatory Organizations; Nasdaq 

GEMX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Its Fees for 

Connectivity and Co-Location Services 

September 10, 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 August 

30, 2024, Nasdaq GEMX, LLC (‘‘GEMX’’ 

or ‘‘Exchange’’) 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 

The Exchange proposes to amend the 

Exchange’s fees for connectivity and colocation services, as described further 

below. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/gemx/rules, at the principal 

office of the Exchange, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant 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 purpose of the proposed rule 

change is to amend the Exchange’s fees 

relating to connectivity and co-location 

services.3 Specifically, the Exchange 

proposes to raise its fees for 

connectivity and co-location services in 

General 8 as well as certain fees related 

to its Testing Facilities in Options 7, 

Section 6 by 5.5%, with certain 

exceptions. 

General 8, Section 1 includes the 

Exchange’s fees that relate to 

connectivity, including fees for cabinets, 

external telco/inter-cabinet connectivity 

fees, fees for connectivity to the 

Exchange, fees for connectivity to third 

party services, fees for market data 

connectivity, fees for cabinet power 

install, and fees for additional charges 

and services. General 8, Section 2 

includes the Exchange’s fees for direct 

connectivity services, including fees for 

direct circuit connection to the 

Exchange, fees for direct circuit 

connection to third party services, and 

fees for point of presence connectivity. 

With the exception of the Exchange’s 

GPS Antenna fees and the Cabinet 

Proximity Option Fee for cabinets with 

power density >10kW,4 the Exchange 

proposes to increase its fees throughout 

General 8 by 5.5%, with the exception 

that for Remote Hands Services, at 

General 8, Section 1, the Exchange 

proposes to increase its fee by 1%, from 

$150 to $151.50 per hour.5

In addition to increasing fees in 

General 8, the Exchange also proposes 

to increase certain fees in Options 7, 

Section 6, which relate to the Testing 

Facility. Options 7, Section 6(H) 

provides that subscribers to the Testing 

Facility located in Carteret, New Jersey 

shall pay a fee of $1,000 per hand-off, 

per month for connection to the Testing 

Facility. The hand-off fee includes 

either a 1Gb or 10Gb switch port and a 

cross connect to the Testing Facility. In 

addition, Options 7, Section 6(H) 

provides that subscribers shall also pay 

a one-time installation fee of $1,000 per 

hand-off. The Exchange proposes to 


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75616 Federal Register / Vol. 89, No. 179 / Monday, September 16, 2024 / Notices 

6See Securities Exchange Act Release No. 34– 

81902 (October 19, 2017), 82 FR 49453 (October 25, 

2017) (SR–GEMX–2017–48). 

7The Consumer Price Index (‘‘CPI’’) is a measure 

of the average change over time in the prices paid 

by urban consumers for a market basket of 

consumer goods and services. The CPI represents 

all goods and services purchased for consumption 

by the reference population (U or W). BLS has 

classified all expenditure items into more than 200 

categories, arranged into eight major groups (food 

and beverages, housing, apparel, transportation, 

medical care, recreation, education and 

communication, and other goods and services). 

Included within these major groups are various 

government-charged user fees, such as water and 

sewerage charges, auto registration fees, and vehicle 

tolls. See https://www.bls.gov/cpi/questions-andanswers.htm. 

8See U.S. Bureau of Labor Statistics, Consumer 

Price Index for All Urban Consumers: All Items in 

U.S. City Average [CPIAUCSL], retrieved from 

FRED, Federal Reserve Bank of St. Louis; https:// 

fred.stlouisfed.org/series/CPIAUCSL, August 23, 

2024. 

9See U.S. Bureau of Labor Statistics (‘‘BLS’’), 

Producer Price Index by Commodity: Final Demand 

[PPIFIS], retrieved from FRED, Federal Reserve 

Bank of St. Louis; https://fred.stlouisfed.org/series/ 

PPIFIS (last updated August 23, 2024). 

10As noted by the BLS, the ‘‘Producer Price Index 

for an industry is a measure of changes in prices 

received for the industry’s output sold outside the 

industry (that is, its net output).’’ See id. 

11Among the industry-specific PPIs is for North 

American Industry Classification System (‘‘NAICS’’) 

Code 518210: ‘‘Data Processing, Hosting and 

Related Services: Hosting, Active Server Pages 

(ASP), and Other Information Technology (IT) 

Infrastructure Provisioning Services,’’ NAICS index 

codes categorize products and services that are 

common to particular industries. According to BLS, 

these codes ‘‘provide comparability with a wide 

assortment of industry-based data for other 

economic programs, including productivity, 

production, employment, wages, and earnings.’’ See 

https://www.bls.gov/ppi/overview.htm. BLS 

describes NAICS 51820 as follows: ‘‘The primary 

output of NAICS 518210 is the provision of 

electronic data processing services. In the broadest 

sense, computer services companies help their 

customers efficiently use technology. The 

processing services market consists of vendors who 

use their own computer systems—often utilizing 

proprietary software—to process customers’ 

transactions and data. Companies that offer 

processing services collect, organize, and store a 

customer’s transactions and other data for recordkeeping purposes.’’ 

12See U.S. Bureau of Labor Statistics, Producer 

Price Index by Industry: Data Processing, Hosting 

and Related Services: Hosting, Active Server Pages 

(ASP), and Other Information Technology (IT) 

Infrastructure Provisioning Services 

[PCU5182105182105], retrieved from FRED, Federal 

Reserve Bank of St. Louis; https://

fred.stlouisfed.org/series/PCU5182105182105 (last 

updated August 23, 2024). 

13See https://www.bls.gov/web/empsit/ 

ceseeb3a.htm (Last updated August 2, 2024); 

https://www.bls.gov/web/empsit/ceseeb8a.htm (Last 

updated August 3, 2024). 

14Unregulated competitors providing 

connectivity and co-location services often have 

annual price increases written into their agreements 

with customers to account for inflation and rising 

costs. 

15See https://www.officialdata.org/us/inflation/ 

2022?endYear=2023&amount=1; see also https://

fred.stlouisfed.org/series/PPIFIS#0. 16See, e.g., Securities Exchange Act Release No. 

34–100004 (April 22, 2024), 89 FR 32465 (April 26, 

2024) (SR–CboeBYX–2024–012). 

increase these aforementioned fees by 

5.5% to require that subscribers to the 

Testing Facility shall pay a fee of $1,055 

per hand-off, per month for connection 

to the Testing Facility and a one-time 

installation fee of $1,055 per hand-off. 

The proposed increases in fees would 

enable the Exchange to maintain and 

improve its market technology and 

services. The Exchange has not 

increased any of the fees included in the 

proposal since 2017.6 However, since 

2017, there has been notable inflation by 

various measures. 

Between January 2017 and July 2024, 

the dollar had an average inflation rate 

of 3.42% per year, as measured by the 

Consumer Price Index,7 producing a 

cumulative price increase of 28.70%.8

Said otherwise, the value of a dollar of 

revenue collected today is worth only 

77.70% of what it was worth in 2017. 

Additionally, as measured by another 

gauge of inflation, the Producer Price 

Index (‘‘PPI’’), inflation has increased by 

roughly 29% during the same time 

period.9

Meanwhile, a more granular version 

of the PPI exists, which measures 

inflation by category of industry.10 The 

most apt of these industry 

categorizations measures inflation for 

the provision of data processing, hosting 

and related services as well as other 

information technology infrastructure 

provisioning services.11 The Exchange 

believes that this measure of inflation is 

particularly apt because many of the 

colocation and connectivity services 

that the Exchange offers to customers 

involve hosting and providing 

connections for its customers’ 

telecommunications and information 

technology equipment collocated in its 

Data Center. Between January 2017 and 

July 2024, the inflation rate for hosting, 

ASP, and other IT infrastructure 

provisioning services was 15.6%.12

Finally, yet another gauge of 

inflation—average hourly earnings 

(‘‘AHE’’) growth for Computing 

Infrastructure—increased 44% for nonmanagers and 38% for all employees 

from 2017 to 2024.13 This gauge of 

inflation is apt to the extent that the 

Exchange proposes to increase its fees 

for remote hands services, which are 

services performed by engineers and 

other technical personnel to support 

customer connectivity and colocation in 

the Exchange’s Data Center. 

Notwithstanding such significant 

inflation, the Exchange has not 

increased its connectivity fees during 

this time, thereby eroding the value of 

the revenue it collects through such 

fees.14 The proposed fees represent a 

5.5% increase (and for remote hands, a 

1% increase) from the current fees, 

which is far below any of the abovedescribed gauges of inflation since 2017. 

In addition to being far below 

cumulative inflation rates since 2017, 

the Exchange also believes that the 

proposed 5.5%/1% increase is 

reasonable because it is comparable to 

recent inflation rates even for one-year 

periods. For example, in 2022, the 

inflation rate, as measured by the CPI, 

was 8.00% and it was 9.47%, as 

measured by the PPI.15 Although the 

Exchange believes it would be 

reasonable to increase fees by an 

amount equal to the full rates of 

inflation, however measured, to 

reestablish the initial value of the 

revenues it earns through its fees, the 

Exchange does not propose to do this, 

as the Exchange is sensitive to the 

sticker shock that would occur if the 

Exchange raised its fees by 29% or even 

15%. Instead, the Exchange proposes a 

modest 5.5%/1% increase, an amount 

that the Exchange believes to be 

reasonable on its face as it is 

significantly less than various measures 

of inflation discussed above. 

The Exchange believes that it is 

reasonable to increase its fees to 

compensate for inflation because, over 

time, inflation has degraded the value of 

each dollar that the Exchange collects in 

fees, such that the real revenue collected 

today is considerably less than that 

same revenue collected in 2017. The 

Exchange notes that this inflationary 

effect is a general phenomenon that is 

independent of any change in the 

Exchange’s costs in providing its goods 

and services. The Exchange believes 

that it is reasonable for it to offset, in 

part, this erosion in the value of the 

revenues it collects. The Exchange notes 

that other exchanges have filed for 

comparable or higher increases in 

certain connectivity-related fees, based 

in part on similar rationale.16

In addition, the Exchange continues 

to invest in maintaining, improving, and 

enhancing its connectivity and colocation products, services, and 

facilities—for the benefit and often at 

the behest of its customers. Such 

enhancements include refreshing 

hardware and expanding the Exchange’s 

existing co-location facility to offer 

customers additional space and power. 

These investments, and the value they 

provide to customers, far exceed the 

amount of the proposed price increases. 

It is reasonable and consistent with the 

Act for the Commission to allow the 

Exchange to recoup these investments 

by charging fees, lest the Commission 

will disincentivize the Exchange to 

make similar investments in the 


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Federal Register / Vol. 89, No. 179 / Monday, September 16, 2024 / Notices 75617 

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

18 15 U.S.C. 78f(b)(4) and (5). 

19The Consumer Price Index (‘‘CPI’’) is a measure 

of the average change over time in the prices paid 

by urban consumers for a market basket of 

consumer goods and services. The CPI represents 

all goods and services purchased for consumption 

by the reference population (U or W). BLS has 

classified all expenditure items into more than 200 

categories, arranged into eight major groups (food 

and beverages, housing, apparel, transportation, 

medical care, recreation, education and 

communication, and other goods and services). 

Included within these major groups are various 

government-charged user fees, such as water and 

sewerage charges, auto registration fees, and vehicle 

tolls. See https://www.bls.gov/cpi/questions-andanswers.htm. 

20See U.S. Bureau of Labor Statistics, Consumer 

Price Index for All Urban Consumers: All Items in 

U.S. City Average [CPIAUCSL], retrieved from 

FRED, Federal Reserve Bank of St. Louis; https:// 

fred.stlouisfed.org/series/CPIAUCSL, August 23, 

2024. 

21See U.S. Bureau of Labor Statistics (‘‘BLS’’), 

Producer Price Index by Commodity: Final Demand 

[PPIFIS], retrieved from FRED, Federal Reserve 

Bank of St. Louis; https://fred.stlouisfed.org/series/ 

PPIFIS (last updated August 23, 2024). 

22As noted by the BLS, the ‘‘Producer Price Index 

for an industry is a measure of changes in prices 

received for the industry’s output sold outside the 

industry (that is, its net output).’’ See id. 

23Among the industry-specific PPIs is for North 

American Industry Classification System (‘‘NAICS’’) 

Code 518210: ‘‘Data Processing, Hosting and 

Related Services: Hosting, Active Server Pages 

(ASP), and Other Information Technology (IT) 

Infrastructure Provisioning Services,’’ NAICS index 

codes categorize products and services that are 

common to particular industries. According to BLS, 

these codes ‘‘provide comparability with a wide 

assortment of industry-based data for other 

economic programs, including productivity, 

production, employment, wages, and earnings.’’ See 

https://www.bls.gov/ppi/overview.htm. BLS 

describes NAICS 51820 as follows: ‘‘The primary 

output of NAICS 518210 is the provision of 

electronic data processing services. In the broadest 

sense, computer services companies help their 

customers efficiently use technology. The 

processing services market consists of vendors who 

use their own computer systems—often utilizing 

proprietary software—to process customers’ 

transactions and data. Companies that offer 

processing services collect, organize, and store a 

customer’s transactions and other data for recordkeeping purposes.’’ 

24See U.S. Bureau of Labor Statistics, Producer 

Price Index by Industry: Data Processing, Hosting 

and Related Services: Hosting, Active Server Pages 

(ASP), and Other Information Technology (IT) 

Infrastructure Provisioning Services 

[PCU5182105182105], retrieved from FRED, Federal 

Reserve Bank of St. Louis; https://

fred.stlouisfed.org/series/PCU5182105182105 (last 

updated August 23, 2024). 

25See https://www.bls.gov/web/empsit/ 

ceseeb3a.htm (Last updated July 5, 2024); https:// 

www.bls.gov/web/empsit/ceseeb8a.htm (Last 

updated July 5, 2024). 

26As noted above, unregulated competitors 

providing connectivity and co-location services 

often have annual price increases written into their 

agreements with customers to account for inflation 

and rising costs. 

27See https://www.officialdata.org/us/inflation/ 

2022?endYear=2023&amount=1; see also https://

fred.stlouisfed.org/series/PPIFIS#0. 

future—a result that would be 

detrimental to the Exchange’s 

competitiveness as well as the interests 

of market participants and investors. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,17 in general, and furthers the 

objectives of Sections 6(b)(4) and 6(b)(5) 

of the Act,18 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees and other charges 

among members and issuers and other 

persons using any facility, and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

This belief is based on a couple 

factors. First, the current fees do not 

properly reflect the value of the services 

and products, as fees for the services 

and products in question have been 

static in nominal terms, and therefore 

falling in real terms due to inflation. 

Second, exchange fees are constrained 

by the fact that market participants can 

choose among 17 different venues for 

options trading, and therefore no single 

venue can charge excessive fees for its 

products without losing customers and 

market share. 

Real Exchange Fees Have Fallen 

As explained above, the Exchange has 

not increased any of the fees included 

in the proposal since 2017. This means 

that such fees have fallen in real terms 

due to inflation, which has been notable 

by various measures. 

Between January 2017 and August 

2024, the dollar had an average inflation 

rate of 3.42% per year, as measured by 

the Consumer Price Index,19 producing 

a cumulative price increase of 

28.70%.20 Said otherwise, the value of 

a dollar of revenue collected today is 

worth only 77.70% of what it was worth 

in 2017. 

Additionally, as measured by another 

gauge of inflation, the Producer Price 

Index (‘‘PPI’’), inflation has increased by 

roughly 29% during the same time 

period.21

Meanwhile, a more granular version 

of the PPI exists, which measures 

inflation by category of industry.22 The 

most apt of these industry 

categorizations measures inflation for 

the provision of data processing, hosting 

and related services as well as other 

information technology infrastructure 

provisioning services.23 The Exchange 

believes that this measure of inflation is 

particularly apt because many of the 

colocation and connectivity services 

that the Exchange offers to customers 

involve hosting and providing 

connections for its customers’ 

telecommunications and information 

technology equipment collocated in its 

Data Center. Between January 2017 and 

July 2024, the inflation rate for hosting, 

ASP, and other IT infrastructure 

provisioning services was 15.6%.24

Finally, yet another gauge of 

inflation—average hourly earnings 

(‘‘AHE’’) growth for Computing 

Infrastructure—increased 44% for nonmanagers and 38% for all employees 

from 2017 to 2024.25 This gauge of 

inflation is apt to the extent that the 

Exchange proposes to increase its fees 

for remote hands services, which are 

services performed by engineers and 

other technical personnel to support 

customer connectivity and colocation in 

the Exchange’s Data Center. 

Notwithstanding inflation, the 

Exchange historically has not increased 

its fees every year.26 As noted above, the 

Exchange has not increased the fees in 

this proposal for over 6 years. The 

proposed fees represent a 5.5% increase 

(and for remote hands, a 1% increase) 

from the current fees, which is far below 

inflation since 2017, however measured. 

In addition to being far below the 

inflation rate since 2017, the Exchange 

also believes that the proposed 5.5%/ 

1% increase is reasonable because it is 

comparable to recent inflation rates for 

one-year periods. For example, in 2022, 

the inflation rate, as measured by the 

CPI, was 8.00% and it was 9.47%, as 

measured by the PPI.27 Although the 

Exchange believes it would be 

reasonable to increase fees by an 

amount equal to the full rates of 

inflation, however measured, to 

reestablish the initial value of the 

revenues it earns through its fees, the 

Exchange does not propose to do this, 

as the Exchange is sensitive to the 

sticker shock that would occur if the 

Exchange raised its fees by 29% or even 

15%. Instead, the Exchange proposes a 

modest 5.5% increase, an amount that 

the Exchange believes to be reasonable 

on its face as it is significantly less than 

various measures of inflation discussed 

above. 

The Exchange believes that it is 

reasonable to increase its fees to 

compensate for inflation because, over 

time, inflation has degraded the value of 

each dollar that the Exchange collects in 

fees, such that the real revenue collected 

today is considerably less than that 

same revenue collected in 2017. The 

Exchange notes that this inflationary 

effect is a general phenomenon that is 

independent of any change in the 

Exchange’s costs in providing its goods 

and services. The Exchange believes 

that it is reasonable for it to offset, in 

part, this erosion in the value of the 

revenues it collects. 


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75618 Federal Register / Vol. 89, No. 179 / Monday, September 16, 2024 / Notices 

28See Nasdaq, Options Market Statistics (Last 

updated January 11, 2024), available at https://

www.nasdaqtrader.com/ 

Trader.aspx?id=OptionsVolumeSummary. 

29See Securities Exchange Act Release No. 59039 

(December 2, 2008), 73 FR 74770 (December 9, 

2008) (SR–NYSEArca–2006–21). 

30 Id. 31 15 U.S.C. 78s(b)(3)(A)(ii). 

In addition, the Exchange continues 

to invest in maintaining, improving, and 

enhancing its connectivity and colocation products, services, and 

facilities—for the benefit and often at 

the behest of its customers. Such 

enhancements include refreshing 

hardware and expanding the Exchange’s 

existing co-location facility to offer 

customers additional space and power. 

Again, these investments, and the value 

they provide to customers, far exceed 

the amount of the proposed price 

increases. It is reasonable and consistent 

with the Act for the Commission to 

allow the Exchange to recoup these 

investments by charging fees, lest the 

Commission will disincentivize the 

Exchange to make similar investments 

in the future—a result that would be 

detrimental to the Exchange’s 

competitiveness as well as the interests 

of market participants and investors. 

Customers Have a Choice in Trading 

Venue 

Customers face many choices in 

where to trade options. Market 

participants will continue to choose 

trading venues and the method of 

connectivity based on their specific 

needs. No broker-dealer is required to 

become a Member of the Exchange. 

There is no regulatory requirement that 

any market participant connect to any 

one exchange, nor that any market 

participant connect at a particular 

connection speed or act in a particular 

capacity on the Exchange, or trade any 

particular product offered on an 

exchange. Moreover, membership is not 

a requirement to participate on the 

Exchange. Indeed, the Exchange is 

unaware of any one exchange whose 

membership includes every registered 

broker-dealer. The Exchange also 

believes substitutable products and 

services are available to market 

participants, including, among other 

things, other options exchanges that a 

market participant may connect to in 

lieu of the Exchange, indirect 

connectivity to the Exchange via a thirdparty reseller of connectivity, and/or 

trading of options products within 

markets which do not require 

connectivity to the Exchange, such as 

the Over-the-Counter markets. 

There are currently 17 exchanges 

offering options trading services. No 

single options exchange trades more 

than 14% of the options market by 

volume and only one of the 17 options 

exchanges has a market share over 10 

percent.28 This broad dispersion of 

market share demonstrates that market 

participants can and do exercise choice 

in trading venues. Further, low barriers 

to entry mean that new exchanges may 

rapidly enter the market and offer 

additional substitute platforms to 

further compete with the Exchange and 

the products it offers. 

As such, the Exchange must set its 

fees, including its fees for connectivity 

and co-location services and products, 

competitively. If not, customers may 

move to other venues or reduce use of 

the Exchange’s services. ‘‘If competitive 

forces are operative, the self-interest of 

the exchanges themselves will work 

powerfully to constrain unreasonable or 

unfair behavior.’’ 29 Accordingly, ‘‘the 

existence of significant competition 

provides a substantial basis for finding 

that the terms of an exchange’s fee 

proposal are equitable, fair, reasonable, 

and not unreasonably or unfairly 

discriminatory.’’ 30 Disincentivizing 

market participants from purchasing 

Exchange connectivity would only serve 

to discourage participation on the 

Exchange, which ultimately does not 

benefit the Exchange. Moreover, if the 

Exchange charges excessive fees, it may 

stand to lose not only connectivity 

revenues but also other revenues, 

including revenues associated with the 

execution of orders. 

In summary, the proposal represents 

an equitable allocation of reasonable 

dues, fees and other charges because 

Exchange fees have fallen in real terms 

and customers have a choice in trading 

venue and will exercise that choice and 

trade at another venue if exchange fees 

are not set competitively. 

No Unfair Discrimination 

The Exchange believes that the 

proposed fee changes are not unfairly 

discriminatory because the fees are 

assessed uniformly across all market 

participants that voluntarily subscribe 

to or purchase connectivity and colocation services or products, which are 

available to all customers. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

Nothing in the proposal burdens 

inter-market competition (the 

competition among self-regulatory 

organizations) because approval of the 

proposal does not impose any burden 

on the ability of other exchanges to 

compete. The Exchange operates in a 

highly competitive market in which 

market participants can determine 

whether or not to connect to the 

Exchange based on the value received 

compared to the cost of doing so. 

Indeed, market participants have 

numerous alternative exchanges that 

they may participate on and direct their 

order flow, as well as off-exchange 

venues, where competitive products are 

available for trading. 

Nothing in the proposal burdens 

intra-market competition (the 

competition among consumers) because 

the Exchange’s connectivity and colocation services are available to any 

customer under the same fee schedule 

as any other customer, and any market 

participant that wishes to purchase such 

services can do so on a nondiscriminatory basis. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act.31 At any time 

within 60 days of the filing of the 

proposed rule change, the Commission 

summarily may temporarily suspend 

such rule change if it appears to the 

Commission that such action is: (i) 

necessary or appropriate in the public 

interest; (ii) for the protection of 

investors; or (iii) otherwise in 

furtherance of the purposes of the Act. 

If the Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 89, No. 179 / Monday, September 16, 2024 / Notices 75619 

32 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Exchange initially filed the proposed 

pricing change on March 1, 2024 (SR–MRX–2024– 

04). On April 29, 2024, the Exchange withdrew that 

filing and submitted SR–MRX–2024–10. On June 

27, 2024, the Exchange withdrew SR–MRX–2024– 

10 and submitted SR–MRX–2024–18. The instant 

filing replaces SR–MRX–2024–18, which was 

withdrawn on August 26, 2024. 

4The Exchange proposes to exclude the GPS 

Antenna fees from the proposed fee increase 

because, unlike the other fees in General 8, the 

Exchange recently increased its GPS Antenna fees. 

See Securities Exchange Act Release No. 34–99130 

(December 11, 2023), 88 FR 87009 (December 15, 

2023) (SR–MRX–2023–24). The Exchange also 

proposes to exclude the Cabinet Proximity Option 

Fee for cabinets with power density >10kW from 

the proposed fee increase because the Exchange 

recently established such fee. See Securities 

Exchange Act Release No. 34–100200 (May 21, 

2024), 89 FR 46183 (May 28, 2024) (SR–MRX– 

2024–12). 

5The term ‘‘Remote Hands Services’’ refers to the 

use of Nasdaq engineers to perform on-site 

technical support tasks in its Data Center on behalf 

of its co-located customers, including the following: 

(1) power cycling of equipment; (2) patching and 

plugging in cabling and circuits; (3) observing, 

describing or reporting on display indicators; (4) 

configuration of hardware components instructed 

by the customer; (5) diagnosis and repairs as 

instructed by the customer; (6) swapping hardware 

components with customer-supplied spares or 

upgrades; (7) troubleshooting heat related issues as 

instructed by the Customer; and (8) returning 

defective equipment to the manufacturer or 

customer. 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

GEMX–2024–33 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–GEMX–2024–33. 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–GEMX–2024–33 and should be 

submitted on or before October 7, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.32

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–20909 Filed 9–13–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–100990; File No. SR–MRX– 

2024–34] 

Self-Regulatory Organizations; Nasdaq 

MRX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Its Fees for 

Connectivity and Co-Location Services 

September 10, 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 August 

26, 2024, Nasdaq MRX, LLC (‘‘MRX’’ or 

‘‘Exchange’’) 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 self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend the 

Exchange’s fees for connectivity and colocation services, as described further 

below. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/mrx/rules, at the principal 

office of the Exchange, and at the 

Commission’s Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant 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 purpose of the proposed rule 

change is to amend the Exchange’s fees 

relating to connectivity and co-location 

services.3 Specifically, the Exchange 

proposes to raise its fees for 

connectivity and co-location services in 

General 8 as well as certain fees related 

to its Testing Facilities in Options 7, 

Section 7 by 5.5%, with certain 

exceptions. 

General 8, Section 1 includes the 

Exchange’s fees that relate to 

connectivity, including fees for cabinets, 

external telco/inter-cabinet connectivity 

fees, fees for connectivity to the 

Exchange, fees for connectivity to third 

party services, fees for market data 

connectivity, fees for cabinet power 

install, and fees for additional charges 

and services. General 8, Section 2 

includes the Exchange’s fees for direct 

connectivity services, including fees for 

direct circuit connection to the 

Exchange, fees for direct circuit 

connection to third party services, and 

fees for point of presence connectivity. 

With the exception of the Exchange’s 

GPS Antenna fees and the Cabinet 

Proximity Option Fee for cabinets with 

power density >10kW,4 the Exchange 

proposes to increase its fees throughout 

General 8 by 5.5%, with the exception 

that for Remote Hands Services, at 

General 8, Section 1, the Exchange 

proposes to increase its fee by 1%, from 

$150 to $151.50 per hour.5

In addition to increasing fees in 

General 8, the Exchange also proposes 

to increase certain fees in Options 7, 

Section 7, which relate to the Testing 


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