78920 Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 

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

2 17 CFR 240.19b–4. 

3The term ‘‘Priority Customer’’ means a person 

or entity that (i) is not a broker or dealer in 

securities, and (ii) does not place more than 390 

orders in listed options per day on average during 

a calendar month for its own beneficial accounts(s). 

The number of orders shall be counted in 

accordance with Interpretation and Policy .01 of 

Exchange Rule 100. See the Definitions section of 

the Fee Schedule and Exchange Rule 100, including 

Interpretation and Policy .01. 

4All references in this filing to ‘‘MIAX Pearl’’ are 

to the options trading facility of MIAX PEARL, LLC. 

Any references to the equities trading facility of 

MIAX PEARL, LLC would be to ‘‘MIAX Pearl 

Equities.’’ See Exchange Rule 1901. 

5The term ‘‘Market Maker’’ means a Member 

registered with the Exchange for the purpose of 

making markets in options contracts traded on the 

Exchange and that is vested with the rights and 

responsibilities specified in Chapter VI of Exchange 

Rules. See the Definitions section of the Fee 

Schedule and Exchange Rule 100. 

6The term ‘‘Member’’ means an individual or 

organization that is registered with the Exchange 

pursuant to Chapter II of Exchange Rules for 

purposes of trading on the Exchange as an 

‘‘Electronic Exchange Member’’ or ‘‘Market Maker.’’ 

Members are deemed ‘‘members’’ under the 

Exchange Act. See the Definitions section of the Fee 

Schedule and Exchange Rule 100. 

7The term ‘‘Excluded Contracts’’ means any 

contracts routed to an away market for execution. 

See the Definitions section of the Fee Schedule. 

8The term ‘‘TCV’’ means total consolidated 

volume calculated as the total national volume in 

those classes listed on MIAX Pearl for the month 

for which the fees apply, excluding consolidated 

volume executed during the period time in which 

the Exchange experiences an ‘‘Exchange System 

Disruption’’ (solely in the option classes of the 

affected Matching Engine (as defined below)). See 

the Definitions section of the Fee Schedule. The 

term ‘‘Exchange System Disruption’’ means an 

outage of a Matching Engine or collective Matching 

Engines for a period of two consecutive hours or 

more, during trading hours. Id. A ‘‘Matching 

Engine’’ is a part of the MIAX Pearl electronic 

system that processes options orders and trades on 

a symbol-by-symbol basis. Some Matching Engines 

will process option classes with multiple root 

symbols, and other Matching Engines may be 

dedicated to one single option root symbol (for 

example, options on SPY may be processed by one 

single Matching Engine that is dedicated only to 

SPY). A particular root symbol may only be 

assigned to a single designated Matching Engine. A 

particular root symbol may not be assigned to 

multiple Matching Engines. Id. The Exchange 

believes that it is reasonable and appropriate to 

select two consecutive hours as the amount of time 

necessary to constitute an Exchange System 

Disruption, as two hours equates to approximately 

1.4% of available trading time per month. The 

Exchange notes that the term ‘‘Exchange System 

Disruption’’ and its meaning have no applicability 

outside of the Fee Schedule, as it is used solely for 

purposes of calculating volume for the threshold 

tiers in the Fee Schedule. 

9The term ‘‘Affiliate’’ means (i) an affiliate of a 

Member of at least 75% common ownership 

between the firms as reflected on each firm’s Form 

BD, Schedule A, or (ii) the Appointed Market Maker 

of an Appointed EEM (or, conversely, the 

Appointed EEM of an Appointed Market Maker). 

An ‘‘Appointed Market Maker’’ is a MIAX Pearl 

Market Maker (who does not otherwise have a 

corporate affiliation based upon common 

ownership with an EEM) that has been appointed 

by an EEM and an ‘‘Appointed EEM’’ is an EEM 

(who does not otherwise have a corporate affiliation 

based upon common ownership with a MIAX Pearl 

Market Maker) that has been appointed by a MIAX 

Pearl Market Maker, pursuant to the following 

process. A MIAX Pearl Market Maker appoints an 

EEM and an EEM appoints a MIAX Pearl Market 

Maker, for the purposes of the Fee Schedule, by 

each completing and sending an executed Volume 

Aggregation Request Form by email to 

membership@miaxoptions.com no later than 2 

business days prior to the first business day of the 

month in which the designation is to become 

effective. Transmittal of a validly completed and 

executed form to the Exchange along with the 

Exchange’s acknowledgement of the effective 

designation to each of the Market Maker and EEM 

will be viewed as acceptance of the appointment. 

The Exchange will only recognize one designation 

per Member. A Member may make a designation 

not more than once every 12 months (from the date 

Please direct your written comments 

to: Austin Gerig, Director/Chief Data 

Officer, Securities and Exchange 

Commission, c/o Oluwaseun Ajayi, 100 

F Street NE, Washington, DC 20549, or 

send an email to: PRA_Mailbox@

sec.gov. 

Dated: September 23, 2024. 

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–22047 Filed 9–25–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101122; File No. SR– 

PEARL–2024–44] 

Self-Regulatory Organizations; MIAX 

PEARL, LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the MIAX Pearl 

Options Fee Schedule 

September 20, 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 

September 11, 2024, MIAX PEARL, LLC 

(‘‘MIAX Pearl’’ 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 is filing a proposal to 

amend the MIAX Pearl Options Fee 

Schedule (‘‘Fee Schedule’’). 

The text of the proposed rule change 

is available on the Exchange’s website at 

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

us-options/pearl-options/rule-filings at 

MIAX Pearl’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 

Section (1)(a) of the Fee Schedule, 

Exchange Rebates/Fees—Add/Remove 

Tiered Rebates/Fees, to: (1) amend the 

Priority Customer 3 origin table to 

increase certain Maker rebates in Penny 

Classes (defined below); (2) establish a 

new ‘‘Step-Up Maker Rebate’’ (described 

below) for the MIAX Pearl 4 Market 

Maker 5 origin in Non-Penny Classes; 

and (3) remove certain alternative 

volume criteria and corresponding 

footnotes applicable to executions of 

orders for the Market Maker origin and 

non-Priority Customer, firm, brokerdealer (‘‘BD’’), and non-MIAX Pearl 

Market Maker origin (collectively 

referred to herein as ‘‘Professional 

Members’’). The Exchange initially filed 

this proposal on August 30, 2024 (SR– 

PEARL–2024–39). On September 11, 

2024, the Exchange withdrew SR– 

PEARL–2024–39 and refiled this 

proposal. 

Background 

The Exchange currently assesses 

transaction rebates and fees to all 

market participants which are based 

upon the total monthly volume 

executed by the Member 6 on MIAX 

Pearl in the relevant, respective origin 

type (not including Excluded 

Contracts) 7 (as the numerator) 

expressed as a percentage of (divided 

by) TCV 8 (as the denominator). In 

addition, the per contract transaction 

rebates and fees are applied 

retroactively to all eligible volume for 

that origin type once the respective 

threshold tier has been reached by the 

Member. The Exchange aggregates the 

volume of Members and their 

Affiliates.9 Members that place resting 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 78921 

of its most recent designation), which designation 

shall remain in effect unless or until the Exchange 

receives written notice submitted 2 business days 

prior to the first business day of the month from 

either Member indicating that the appointment has 

been terminated. Designations will become 

operative on the first business day of the effective 

month and may not be terminated prior to the end 

of the month. Execution data and reports will be 

provided to both parties. See the Definitions section 

of the Fee Schedule. 

10The term ‘‘Book’’ means the electronic book of 

buy and sell orders and quotes maintained by the 

System. See Exchange Rule 100. 

11The term ‘‘System’’ means the automated 

trading system used by the Exchange for the trading 

of securities. See Exchange Rule 100. 

12The term ‘‘ABBO’’ means the best bid(s) or 

offer(s) disseminated by other Eligible Exchanges 

(defined in Exchange Rule 1400(g)) and calculated 

by the Exchange based on market information 

received by the Exchange from OPRA. See the 

Definitions section of the Fee Schedule and 

Exchange Rule 100. 

13See Securities Exchange Act Release No. 88992 

(June 2, 2020), 85 FR 35142 (June 8, 2020) (SR– 

PEARL–2020–06). 

14Rebates are denoted in parentheses in the Fee 

Schedule. 

15A Market Maker need only to satisfy one of the 

following three alternative volume criteria in order 

to receive the rebates or fees associated with tier 2 

of the Market Maker origin table: (i) the total 

monthly volume executed by the Market Maker 

collectively in SPY/QQQ/IWM options on MIAX 

Pearl, not including Excluded Contracts, is above 

0.55% of SPY/QQQ/IWM TCV; or (ii) the Market 

Maker adds liquidity collectively in SPY/QQQ/ 

IWM options on MIAX Pearl, not including 

Excluded Contracts, above 0.30% of SPY/QQQ/ 

IWM TCV; or (iii) the Market Maker satisfies the 

requirements of tier 2 of both the NBBO Setter Plus 

Program and tier 2 of the Midpoint Peg Order 

Adding Liquidity at the Midpoint Volume Tiers 

table (referred to herein as the ‘‘Midpoint Volume 

Tiers’’) in the MIAX Pearl Equities Fee Schedule. 

MIAX Pearl Equities Fee Schedule, Sections (1)(c) 

and (1)(e) for a complete description of the volume 

requirements for tier 2 of the NBBO Setter Plus 

Program and tier 2 of the Midpoint Volume Tiers 

table. See also Securities Exchange Act Release No. 

98956 (November 15, 2023), 88 FR 81125 

(November 21, 2023) (SR–PEARL–2023–63) 

(providing more background and explanation of 

both programs for MIAX Pearl Equities); see also 

Fee Schedule, Section (1)(a), Market Maker origin 

table. The term ‘‘SPY/QQQ/IWM TCV’’ means total 

consolidated volume in SPY, QQQ, and IWM 

calculated as the total national volume in SPY, 

QQQ, and IWM for the month for which the fees 

apply, excluding consolidated volume executed 

during the period of time in which the Exchange 

experiences an Exchange System Disruption (solely 

in SPY, QQQ, or IWM options). See the Definitions 

section of the Fee Schedule. 

16Market Makers satisfy the alternative volume 

criteria of tier 3 by adding liquidity in SPY options 

on MIAX Pearl, not including Excluded Contracts, 

above 1.10% of SPY TCV. The term ‘‘SPY TCV’’ 

means total consolidated volume in SPY calculated 

as the total national volume in SPY for the month 

for which the fees apply, excluding consolidated 

volume executed during the period of time in 

which the Exchange experiences an Exchange 

System Disruption (solely in SPY options). See the 

Definitions section of the Fee Schedule. Further, 

Market Makers qualify for: (i) Maker rebates of 

($0.44) per contract in SPY, QQQ and IWM options 

for their Market Maker origin when trading against 

origins other than Priority Customer, and (ii) Maker 

rebates of ($0.42) per contract in SPY, QQQ and 

IWM options for their Market Maker origin when 

trading against Priority Customer origins, if the 

Market Maker satisfies the alternative volume 

criteria of tier 3, described above, of at least 1.10% 

in SPY when adding liquidity. See Fee Schedule, 

Section (1)(a), note ‘‘♦’’. 

17Market Makers satisfy the alternative volume 

criteria of tier 4 if the Market Maker’s executions 

solely in SPY options on MIAX Pearl, not including 

Excluded Contracts, is above 2.50% of SPY TCV. 

liquidity, i.e., orders resting on the 

Book 10 of the MIAX Pearl System,11 are 

paid the specified ‘‘maker’’ rebate (each 

a ‘‘Maker’’), and Members that execute 

against resting liquidity are assessed the 

specified ‘‘taker’’ fee (each a ‘‘Taker’’). 

For opening transactions and ABBO 12

uncrossing transactions, per contract 

transaction rebates and fees are waived 

for all market participants. Finally, 

Members are assessed lower transaction 

fees and receive lower rebates for order 

executions in standard option classes in 

the Penny Interval Program 13 (‘‘Penny 

Classes’’) than for order executions in 

standard option classes which are not in 

the Penny Interval Program (‘‘NonPenny Classes’’), where Members are 

assessed higher transaction fees and 

receive higher rebates. 

Proposal To Amend the Priority 

Customer Origin Table To Increase 

Certain Maker Rebates in Penny Classes 

First, the Exchange proposes to 

amend the Priority Customer origin 

table to increase the Maker rebates in 

tiers 1 and 2 for Priority Customer 

orders in Penny Classes that trade 

against all origins. Currently, the 

Priority Customer origin table provides 

certain volume criteria thresholds for all 

tiers that are based upon the total 

monthly volume executed in all option 

classes by a Priority Customer on MIAX 

Pearl as a percentage of TCV. Pursuant 

to the Priority Customer origin table, 

Priority Customers qualify for the 

following Maker rebates when Priority 

Customer orders in Penny Classes trade 

against all origins: (i) ($0.25) 14 per 

contract in tiers 1 and 2 if the Priority 

Customer executes above 0.00% to at 

least 0.40% of TCV; (ii) ($0.45) per 

contract in tier 3 if the Priority 

Customer executes above 0.40% to at 

least 0.85% of TCV; (iii) ($0.49) per 

contract in tier 4 if the Priority 

Customer executes above 0.85% to at 

least 1.25% of TCV; and (iv) ($0.52) per 

contract in tiers 5 and 6 if the Priority 

Customer executes above 1.25% of TCV. 

The Exchange now proposes to amend 

the Priority Customer origin table to 

increase the Maker rebates in tiers 1 and 

2 from ($0.25) to ($0.31) per contract for 

Priority Customer orders in Penny 

Classes that trade against all origins. 

The Exchange does not propose to 

amend any of the volume threshold 

criteria or the Maker rebates or Taker 

fees in any other tier for Priority 

Customer orders. The purpose of this 

proposed change is for business and 

competitive reasons in order to attract 

additional Penny Class volume from 

Members by increasing the Maker 

rebates for options transactions in 

Penny Classes in tiers 1 and 2 for 

Priority Customer orders. The Exchange 

believes that this may, in turn, 

encourage Members to submit more 

Priority Customer orders, leading to 

increased liquidity on the Exchange to 

the benefit of all market participants by 

providing more trading opportunities 

and tighter spreads. 

Proposal To Establish the Step-Up 

Maker Rebate for Market Maker Orders 

in Non-Penny Classes 

Next, the Exchange proposes to 

amend the Market Maker origin table to 

establish a new ‘‘Step-Up Maker 

Rebate,’’ which will be noted as footnote 

‘‘(i)’’ following the table of transaction 

rebates and fees for the Market Maker 

origin in Section (1)(a) of the Fee 

Schedule. Currently, pursuant to the 

Market Maker origin table, Market 

Makers qualify for the following Maker 

rebates when Market Maker orders in 

Non-Penny Classes trade against all 

origins: (i) ($0.30) per contract in tier 1 

if the Market Maker executes above 

0.00% to at least 0.20% of TCV; (ii) 

($0.30) per contract in tier 2 if the 

Market Maker executes above 0.20% to 

at least 0.50% of TCV, or satisfies one 

of the three alternative volume criteria 

of tier 2; 15 (iii) ($0.60) per contract in 

tier 3 if the Market Maker executes 

above 0.50% to at least 0.85% of TCV, 

or satisfies the alternative volume 

criteria of tier 3; 16 (iv) ($0.65) per 

contract in tier 4 if the Market Maker 

executes above 0.85% to at least 1.25% 

of TCV, or satisfies the alternative 

volume criteria of tier 4; 17 (v) ($0.70) 

per contract in tier 5 if the Market 

Maker executes above 1.25% to at least 

1.40% of TCV; and (vi) ($0.85) per 

contract in tier 6 if the Market Maker 

executes above 1.40% of TCV. 

The Exchange now proposes that a 

Market Maker may qualify for a Step-Up 

Maker Rebate of ($0.86) per contract for 

Market Maker orders in Non-Penny 

Classes, instead of the otherwise 

applicable tiered Maker rebate described 

above for tiers 1 through 6. In order to 

receive the proposed Step-Up Maker 

Rebate, a Market Maker must have an 

increase in the percentage of their added 

liquidity in Non-Penny Classes, 

represented as a percentage of TCV, of 

at least 0.12% as compared to the 


khammond on DSKJM1Z7X2PROD with NOTICES
78922 Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 

18The Exchange will use a baseline for added 

liquidity in Non-Penny Classes of 0.00% of TCV for 

market participants that become Market Makers of 

the Exchange after July 2024 for the purpose of the 

Step-Up Maker Rebate calculation. 

19The Exchange notes that at the end of the 

sunset period, the Step-Up Maker Rebate will no 

longer apply unless the Exchange files a rule filing 

pursuant to Rule 19b–4 of the Exchange Act with 

the Commission to amend the criteria terms or 

update the baseline month to a more recent month. 

20See The Nasdaq Stock Market LLC (‘‘Nasdaq’’), 

Options 7 Pricing Schedule, Section 2, Nasdaq 

Options Market—Fees and Rebates, note 6, 

available at https://listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules/Nasdaq%20Options%207 

(last visited August 21, 2024) (providing $0.86 per 

contract rebate to market makers that add liquidity 

in non-penny classes for market makers that qualify 

for tier 6 for adding liquidity in penny classes); see 

also Cboe BZX Exchange, Inc. (‘‘BZX’’) Options Fee 

Schedule, Transaction Fees, Standard Rates table, 

available at https://www.cboe.com/us/options/ 

membership/fee_schedule/bzx/ (last visited August 

21, 2024) (providing tiered rebates ranging from 

$0.40 to $0.88 per contract for market makers that 

add liquidity in non-penny classes). 

21See, e.g., Cboe EDGX Exchange, Inc. (‘‘EDGX’’) 

Options Fee Schedule, Footnotes, Market Maker 

Volume Tiers, Tier 2, available at https://

www.cboe.com/us/options/membership/fee_

schedule/edgx/ (last visited August 21, 2024) 

(providing a reduced fee for a market maker that 

meets certain volume criteria, including a 

requirement that the marker maker’s step up 

average daily added volume in market maker orders 

from July 2019 is greater than or equal to 0.10% of 

their OCC customer volume); see also NYSE Arca, 

Inc. (‘‘Arca’’) Options Fees and Charges, TradeRelated Charges for Standard Options, Customer 

Penny Posting Credit Tiers table, available at 

https://www.nyse.com/publicdocs/nyse/markets/ 

arca-options/NYSE_Arca_Options_Fee_

Schedule.pdf (last visited August 21, 2024) (in 

general, providing enhanced rebate for a firm that 

has an increase of at least 0.15% of TCADV in 

added liquidity over the firm’s March 2020 level of 

added liquidity). 

22See, generally, Fee Schedule, Section (1)(a), 

Market Maker origin table. See also supra note 15. 

23See MIAX Pearl Equities Fee Schedule, 

Sections (1)(c) and (1)(e) for a complete description 

of the volume requirements for tier 2 of the NBBO 

Setter Plus Program and tier 2 of the Midpoint 

Volume Tiers table. See also Securities Exchange 

Act Release No. 98956 (November 15, 2023), 88 FR 

81125 (November 21, 2023) (SR–PEARL–2023–63) 

(providing more background and explanation of 

both programs for MIAX Pearl Equities). 

Market Maker’s July 2024 18 added 

liquidity in Non-Penny Classes. 

The Exchange proposes that the StepUp Maker Rebate will expire no later 

than January 31, 2025 (referred to herein 

as the ‘‘sunset period’’),19 which will be 

stated in the same proposed footnote 

‘‘(i)’’ in the Fee Schedule. The Exchange 

will issue an alert to market participants 

should the Exchange determine that the 

Step-Up Maker Rebate will expire 

earlier than January 31, 2025 or if the 

Exchange determines to amend the 

criteria or rate applicable to the Step-Up 

Maker Rebate prior to the end of the 

sunset period, and file a corresponding 

rule filing pursuant to Rule 19b–4 of the 

Exchange Act with the Commission. 

The proposed Step-Up Maker Rebate 

of ($0.86) per contract is the same or 

within the range of similar rebates 

offered by competing options exchanges 

for transactions by market makers in 

Non-Penny Classes.20 The Exchange 

notes at least two competing options 

exchanges provide similar calculations 

for enhanced rebates or reduced fees for 

certain types of market participant 

orders by utilizing a volume comparison 

of the current month to a prior baseline 

month.21 Accordingly, the proposed 

calculation for the Step-Up Maker 

Rebate is not a new or novel concept for 

the method in which to provide an 

enhanced rebate to market participants. 

The purpose of this proposed change 

is to provide an incentive for Market 

Makers to provide liquidity in NonPenny Classes in order to receive the 

enhanced Step-Up Maker Rebate of 

($0.86) per contract instead of the tiered 

rebate that would otherwise be 

applicable for such transactions. The 

Exchange believes that the proposed 

Step-Up Maker Rebate will encourage 

Market Makers to add more liquidity in 

Non-Penny Classes, thereby promoting 

price discovery and contributing to a 

deeper and more liquid market, which 

benefits all market participants and 

enhances the attractiveness of the 

Exchange as a trading venue. The 

purpose of including the proposed 

sunset period in the Fee Schedule is to 

provide clarity to Market Makers that, 

unless the Exchange determines to 

amend or otherwise modify the Step-Up 

Maker Rebate, the Step-Up Maker 

Rebate will expire at the end of the 

sunset period. 

Proposal To Remove Certain Alternative 

Volume Criteria and Corresponding 

Footnotes 

Next, the Exchange proposes to 

amend Section (1)(a) of the Fee 

Schedule to remove certain alternative 

volume criteria and corresponding 

footnotes applicable to executions of 

orders for the Market Maker and 

Professional Member origins. 

The Exchange proposes to remove 

footnote ‘‘#’’ following the Marker 

Maker origin table in Section (1)(a) of 

the Fee Schedule and the corresponding 

alternative volume criteria in tier 2 of 

the Market Maker origin table. As 

described above, the Exchange provides 

four alternative volume calculation 

methods pursuant to which a Market 

Maker may obtain the fees and rebates 

in tier 2 of the Market Maker origin 

table.22 The fourth volume calculation 

method in tier 2 of the Market Maker 

origin table is the cross-asset volume 

based requirement, denoted by footnote 

‘‘#’’ following the Marker Maker origin 

table, which requires Market Makers to 

satisfy the requirements of tier 2 of both 

the NBBO Setter Plus Program and tier 

2 of the Midpoint Volume Tiers in the 

MIAX Pearl Equities Fee Schedule.23

The Exchange now proposes to remove 

the cross-asset volume calculation 

method and corresponding footnote ‘‘#’’ 

such that there will no longer be a crossasset volume requirement for Market 

Makers to satisfy in order to reach the 

tier 2 rebates and fees of the Market 

Maker origin table. The Exchange does 

not propose to amend the other three 

alternative volume calculation methods 

that Market Makers can satisfy in order 

to reach the tier 2 rebates and fees of the 

Market Maker origin table. 

The Exchange also proposes to 

remove footnote ‘‘**’’ and the 

corresponding alternative volume 

criteria following the table of fees and 

rebates for Market Maker orders and 

Professional Member orders in Section 

(1)(a) of the Fee Schedule. Footnote 

‘‘**’’ provides that Market Makers and 

Professional Members may qualify for 

the Maker rebate and the Taker fee 

associated with the highest tier for 

transactions in Non-Penny Classes if the 

Market Maker or Professional Member 

executes more than 0.30% volume in 

Non-Penny Classes, not including 

Excluded Contracts, as compared to the 

TCV in all MIAX Pearl-listed option 

classes, in the respective origin (i.e., 

either Market Maker origin or 

Professional Member origin). For 

purposes of qualifying for such rates, 

the Exchange aggregates the volume 

transacted by Members and their 

Affiliates in the following origin types 

in Non-Penny Classes: (1) MIAX Pearl 

Market Makers, and (2) non-Priority 

Customer, Firm, BD, and non-MIAX 

Pearl Market Makers, i.e., Professional 

Members. The Exchange now proposes 

to remove footnote ‘‘**’’ and the 

corresponding alternative volume 

calculation method from the Fee 

Schedule. 

The Exchange also proposes to 

remove footnote ‘‘∧’’ and the 

corresponding alternative volume 

criteria following the table of fees and 

rebates for Professional Members in 

Section (1)(a) of the Fee Schedule. 

Footnote ‘‘∧’’ provides that Professional 

Members may qualify for Maker rebates 

equal to the greater of: (A) ($0.37) for 

Penny Classes and ($0.65) for NonPenny Classes, or (B) the amount set 

forth in the applicable tier reached by 

the Professional Member in the relevant 

origin, if the Member and their Affiliates 

execute at least 1.25% volume in the 

relevant month, in Priority Customer 

origin type, in all options classes, not 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 78923 

24 15 U.S.C. 78f(b). 

25 15 U.S.C. 78f(b)(4). 

26 15 U.S.C. 78f(b)(1) and (b)(5). 

27See Securities Exchange Act Release No. 51808 

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

28See the ‘‘Market Share’’ section of the 

Exchange’s website, available at https://

www.miaxglobal.com/ (last visited August 22, 

2024). 

29See id. 

30See Securities Exchange Act Release No. 85304 

(March 13, 2019), 84 FR 10144 (March 19, 2019) 

(SR–PEARL–2019–07). 

31See, generally, Chapter VI of the Exchange’s 

Rules. 

including Excluded Contracts, as 

compared to the TCV in all MIAX Pearl 

listed option classes. 

The purpose of these changes is for 

business and competitive reasons as 

well as to reduce complexity and 

provide clarity within the Fee Schedule. 

The Exchange initially established each 

of the above-described alternative 

volume calculations in order to attract 

Market Maker and/or Professional 

Member order flow. The Exchange 

recently conducted an internal review 

and analysis of fees and rebates and 

determined that it was appropriate to 

remove the alternative volume 

calculations described above. The 

Exchange’s standard volume calculation 

methods (and the two alternative 

volume calculation methods for tier 2 of 

the Marker Maker origin) remain highly 

competitive such that they should 

enable the Exchange to continue to 

attract Market Maker and Professional 

Member order flow and maintain market 

share. The Exchange also notes that no 

Member has recently achieved any of 

the three alternative volume calculation 

methods that the Exchange proposes to 

remove from the Fee Schedule; 

accordingly, the Exchange believes it 

will reduce complexity within the Fee 

Schedule and provide greater clarity to 

remove the alternative volume 

calculation methods that are not 

utilized. 

Implementation 

The proposed changes are 

immediately effective. 

2. Statutory Basis 

The Exchange believes that its 

proposal to amend the Fee Schedule is 

consistent with Section 6(b) of the Act 24

in general, and furthers the objectives of 

Section 6(b)(4) of the Act,25 in that it is 

an equitable allocation of reasonable 

dues, fees and other charges among 

Exchange Members and issuers and 

other persons using its facilities, and 

6(b)(5) of the Act,26 in that it is 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 facilitating 

transactions in securities, to remove 

impediments to and perfect the 

mechanisms of a free and open market 

and a national market system and, in 

general, to protect investors and the 

public interest. 

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.’’ 27

There are currently 17 registered 

options exchanges competing for order 

flow. Based on publicly-available 

information, and excluding index-based 

options, no single exchange had more 

than approximately 14–15% of the 

multiply-listed equity options market 

share for the month of July 2024.28

Therefore, no exchange possesses 

significant pricing power. More 

specifically, the Exchange had a market 

share of approximately 3.45% of 

executed volume of multiply-listed 

equity options for the month of July 

2024.29

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can discontinue or reduce use of certain 

categories of products and services, 

terminate an existing membership or 

determine to not become a new member, 

and/or shift order flow, in response to 

transaction fee changes. For example, on 

February 28, 2019, the Exchange filed 

with the Commission a proposal to 

increase Taker fees in certain tiers for 

options transactions in certain Penny 

Classes for Priority Customers and 

decrease Maker rebates in certain tiers 

for options transactions in Penny 

Classes for Priority Customers (which 

fee was to be effective March 1, 2019).30

The Exchange experienced a decrease in 

total market share for the month of 

March 2019, after the proposal went 

into effect. Accordingly, the Exchange 

believes that its March 1, 2019, fee 

change, to increase certain transaction 

fees and decrease certain transaction 

rebates, may have contributed to the 

decrease in MIAX Pearl’s market share 

and, as such, the Exchange believes 

competitive forces constrain the 

Exchange’s, and other options 

exchanges, ability to set transaction fees 

and market participants can shift order 

flow based on fee changes instituted by 

the exchanges. 

Proposal To Amend the Priority 

Customer Origin Table To Increase 

Certain Maker Rebates in Penny Classes 

The Exchange believes its proposal to 

amend the Priority Customer origin to 

increase the Maker rebates in tiers 1 and 

2 from ($0.25) to ($0.31) per contract for 

Priority Customer orders in Penny 

Classes that trade against all origins is 

reasonable, equitable and not unfairly 

discriminatory because it would further 

incentivize Priority Customer orders to 

the Exchange. The Exchange believes 

that this may, in turn, encourage 

Members to submit more Priority 

Customer orders, leading to increased 

liquidity on the Exchange to the benefit 

of all market participants by providing 

more trading opportunities and tighter 

spreads. The Exchange believes the 

proposed increased Maker rebates in 

tiers 1 and 2 for Priority Customer 

orders in Penny Classes is equitable and 

not unfairly discriminatory because it 

will apply equally to all market 

participants who provide Priority 

Customer orders in Penny Classes. 

Proposal To Establish the Step-Up 

Maker Rebate for Market Maker Orders 

in Non-Penny Classes 

The Exchange believes its proposal to 

establish the Step-Up Maker Rebate is 

reasonable, equitably allocated and not 

unfairly discriminatory because it 

provides Market Makers with an 

additional incentive to achieve a certain 

volume threshold on the Exchange in 

Non-Penny Classes. The Exchange 

believes that the proposed Step-Up 

Maker Rebate is reasonable because it 

may encourage Market Makers to add 

more liquidity in Non-Penny Classes, 

thereby promoting price discovery and 

contributing to a deeper and more liquid 

market, which benefits all market 

participants and enhances the 

attractiveness of the Exchange as a 

trading venue. 

The Exchange believes that it is 

equitable and not unfairly 

discriminatory to provide the Step-Up 

Maker Rebate only to Market Maker 

orders because Market Makers have 

market-making obligations and 

regulatory requirements, which 

normally do not apply to other types of 

market participants, such as 

Professional Members.31 Market Makers 

additionally have obligations to make 

continuous markets, engage in a course 

of dealings reasonably calculated to 


khammond on DSKJM1Z7X2PROD with NOTICES
78924 Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 

32See supra note 20. 

33See supra note 21. 

contribute to the maintenance of a fair 

and orderly market, and not make bids 

or offers or enter into transactions that 

are inconsistent with a course of 

dealings. The Exchange believes the 

proposed Step-Up Maker Rebate is 

equitable and not unfairly 

discriminatory because it will be 

available equally to all Market Makers 

and will be provided in an equal 

manner to all Market Makers that satisfy 

the volume threshold requirements of 

the Step-Up Maker Rebate. 

The proposed Step-Up Maker Rebate 

promotes just and equitable principles 

of trade, fosters cooperation and 

coordination with persons engaged in 

facilitating transactions in securities, 

and protects investors and the public 

interest because the proposed Step-Up 

Maker Rebate may encourage Market 

Makers to send more orders to the 

Exchange in Non-Penny Classes, which 

are typically less liquid as compared to 

Penny Classes. To the extent that Market 

Maker order flow in Non-Penny classes 

is increased by the proposal, market 

participants may increasingly compete 

for the opportunity to trade on the 

Exchange, including sending more 

orders which will have the potential to 

be assessed lower fees and higher 

rebates. The resulting increased volume 

and liquidity in Non-Penny Classes may 

benefit all Exchange participants by 

providing more trading opportunities 

and tighter spreads in option classes 

that are typically less liquid. 

Additionally, the Exchange believes 

the proposed Step-Up Maker Rebate of 

($0.86) per contract is reasonable 

because it is the same, or within the 

range, of similar rebates offered by 

competing options exchanges for 

transactions by market makers in NonPenny Classes.32 Also, the proposed 

calculation of the Step-Up Maker Rebate 

is reasonable and not unfairly 

discriminatory because it is similar to 

the calculation method utilized by at 

least two competing options exchanges 

that provide enhanced rebates or 

reduced fees for certain types of market 

participant orders by taking a volume 

comparison of the current month to a 

prior baseline month.33 Accordingly, 

this approach to determining an 

enhanced rebate (or reduced fee) is not 

new or novel. 

The Exchange believes that it is 

reasonable to include the sunset period 

in the Fee Schedule to provide clarity to 

all Market Makers that, unless the 

Exchange determines to amend or 

otherwise modify the Step-Up Maker 

Rebate, the Step-Up Maker Rebate will 

expire at the end of the sunset period. 

The Exchange believes it is 

reasonable, equitable and not unfairly 

discriminatory to use a baseline for 

added liquidity in Non-Penny Classes of 

0.00% of TCV for market participants 

that become Market Makers of the 

Exchange after July 2024 for the purpose 

of the Step-Up Maker Rebate calculation 

because it will provide an additional 

incentive for prospective firms to 

become Market Makers. The Exchange 

believes this will incentivize new 

Market Makers to trade on the 

Exchange, which will add to price 

discovery, enhance liquidity and market 

quality, and contribute to a more robust 

and well-balanced market ecosystem on 

the Exchange to the benefit of all 

Members and market participants. The 

Exchange notes that the proposed StepUp Maker Rebate will not adversely 

impact any Market Maker’s ability to 

qualify for reduced fees or enhanced 

rebates offered under other pricing tiers/ 

incentives on the Exchange. Should a 

Market Maker not meet the required 

criteria of the Step-Up Maker Rebate, 

the Market Maker will merely not 

receive the corresponding enhanced 

rebate. 

Proposal To Remove Certain Alternative 

Volume Criteria and Corresponding 

Footnotes 

The Exchange believes its proposal to 

remove the alternative volume criteria 

and corresponding footnotes described 

above that are applicable to executions 

of orders for the Market Maker and 

Professional Member origins is 

reasonable, equitably allocated and not 

unfairly discriminatory. The Exchange 

initially established each of the above 

alternative volume criteria in order to 

attract Market Maker and Professional 

Member order flow. The Exchange 

recently conducted an internal review 

and analysis of fees and rebates and 

determined that it was reasonable, 

equitable and not unfairly 

discriminatory to remove the alternative 

volume calculations described above. 

The Exchange believes its standard 

volume calculation methods (and the 

two remaining alternative volume 

calculation methods for tier 2 of the 

Marker Maker origin) remain highly 

competitive such that they should 

enable the Exchange to continue to 

attract Market Maker and Professional 

Member order flow and maintain market 

share. 

The Exchange believes these proposed 

changes are equitable and not unfairly 

discriminatory because no Member has 

recently achieved any of the three 

alternative volume calculation methods 

that the Exchange proposes to remove 

from the Fee Schedule. As such, no 

Member will currently be impacted by 

the removal of these alternative volume 

calculation methods. The Exchange 

further believes that the removal of 

these alternative volume calculations 

will reduce complexity within the Fee 

Schedule and provide greater clarity to 

all Members, particularly since these 

methods are not utilized. Less 

complexity and greater clarity in the Fee 

Schedule helps promote just and 

equitable principles of trade and 

removes impediments to and perfects 

the mechanisms of a free and open 

market and a national market system. 

The Exchange also believes it is 

equitable and not unfairly 

discriminatory to remove the alternative 

volume criteria described above because 

with the proposed changes, the 

Exchange’s standard volume criteria 

(and the two remaining alternative 

volume calculation methods for tier 2 of 

the Marker Maker origin) will continue 

to apply equally to all Market Maker 

and Professional Member order flow, in 

each origin respectively. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule changes will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

Intra-Market Competition 

The Exchange does not believe that 

any of the proposed changes will 

impose any burden on intra-market 

competition. 

Proposal To Amend the Priority 

Customer Origin Table To Increase 

Certain Maker Rebates in Penny Classes 

The Exchange believes its proposal to 

amend the Priority Customer origin to 

increase the Maker rebates in tiers 1 and 

2 from ($0.25) to ($0.31) per contract for 

Priority Customer orders in Penny 

Classes that trade against all origins will 

not impose any burden on intra-market 

competition. Instead, the Exchange 

believes this proposed change will 

promote competition because it will 

further incentivize Priority Customer 

orders to the Exchange. The Exchange 

believes that this may, in turn, 

encourage Members to submit more 

Priority Customer orders, leading to 

increased liquidity on the Exchange to 

the benefit of all market participants by 

providing more trading opportunities 

and tighter spreads. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 78925 

34See supra note 28. 

35See id. 

36 15 U.S.C. 78s(b)(3)(A)(ii). 

37 17 CFR 240.19b–4(f)(2). 

Proposal To Establish the Step-Up 

Maker Rebate for Market Maker Orders 

in Non-Penny Classes 

The Exchange believes its proposal to 

establish the Step-Up Maker Rebate will 

not impose any burden on intra-market 

competition because it provides all 

Market Makers with an additional 

incentive to achieve a certain volume 

threshold on the Exchange in NonPenny Classes. The Exchange believes 

that this may encourage Market Makers 

to add more liquidity in Non-Penny 

Classes, thereby promoting price 

discovery and contributing to a deeper 

and more liquid market, which benefits 

all market participants and enhances the 

attractiveness of the Exchange as a 

trading venue. Again, the Exchange 

believes that this proposed change 

promotes competition to the benefit of 

all market participants on the Exchange, 

particularly in Non-Penny Classes, 

which are traditionally less liquid. The 

resulting increased volume and 

liquidity in Non-Penny Classes may 

benefit all Exchange participants by 

providing more trading opportunities 

and tighter spreads in option classes 

that are typically less liquid. 

The Exchange also believes that using 

a baseline for added liquidity in NonPenny Classes of 0.00% of TCV for 

market participants that become Market 

Makers of the Exchange after July 2024 

for the purpose of the Step-Up Maker 

Rebate calculation will incentivize new 

market participants to trade on the 

Exchange and become Market Makers. 

In turn, this may add to price discovery, 

enhance liquidity and market quality, 

and contribute to a more robust and 

well-balanced market ecosystem on the 

Exchange to the benefit of all Members 

and market participants. Greater 

liquidity benefits all Members by 

providing more trading opportunities 

and encourages Members to send 

additional orders to the Exchange, 

thereby contributing to robust levels of 

liquidity, which benefits all market 

participants. As described above, the 

opportunity to qualify for the proposed 

new Step-Up Maker Rebate will 

continue to be available to all Market 

Makers that meet the associated volume 

requirement. As such the Exchange does 

not believe the proposed changes would 

impose any burden on intra-market 

competition that is not necessary or 

appropriate in furtherance of the 

purpose of the Act. 

Proposal To Remove Certain Footnotes 

and Alternative Volume Criteria 

The Exchange believes its proposal to 

remove the alternative volume criteria 

and corresponding footnotes described 

above that are applicable to executions 

of orders for the Market Maker and 

Professional Member origins will not 

impose any burden on intra-market 

competition. Each of these alternative 

volume criteria were established in 

order to attract Market Maker and 

Professional Member order flow. Based 

on the Exchange’s recent internal review 

and analysis of fees and rebates, the 

Exchange believes its standard volume 

calculation methods (and the two 

remaining alternative volume 

calculation methods for tier 2 of the 

Marker Maker origin) remain highly 

competitive such that they should 

enable the Exchange to continue to 

attract Market Maker and Professional 

Member order flow. 

The Exchange believes these proposed 

changes do not impose any burden on 

intra-market competition because no 

Member has recently achieved any of 

the three alternative volume calculation 

methods that the Exchange proposes to 

remove from the Fee Schedule. As such, 

no Member will currently be impacted 

by the removal of these alternative 

volume calculation methods. 

Inter-Market Competition 

The Exchange does not believe that 

the proposed changes will impose any 

burden on inter-market competition and 

the Exchange notes that it operates in a 

highly competitive market in which 

market participants can readily favor 

competing venues if they deem fee 

levels at a particular venue to be 

excessive, or rebate opportunities 

available at other venues to be more 

favorable. There are currently 18 

registered options exchanges competing 

for order flow. Based on publiclyavailable information, and excluding 

index-based options, no single exchange 

had more than approximately 14–15% 

of the multiply-listed equity options 

market share for the month of July 

2024.34 Therefore, no exchange 

possesses significant pricing power. 

More specifically, the Exchange had a 

market share of approximately 3.45% of 

executed volume of multiply-listed 

equity options for the month of July 

2024.35

In such an environment, the Exchange 

must continually adjust its rebates and 

tiers to remain competitive with other 

options exchanges. Because competitors 

are free to modify their own fees and 

tiers in response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which fee 

changes in this market may impose any 

burden on competition is extremely 

limited. The Exchange believes that the 

proposed rule changes reflect this 

competitive environment because they 

modify the Exchange’s tiers and rebates 

in a manner that encourages market 

participants to continue to provide 

liquidity and to send order flow to the 

Exchange. 

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 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act,36 and Rule 

19b–4(f)(2) 37 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 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– 

PEARL–2024–44 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–PEARL–2024–44. 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 


khammond on DSKJM1Z7X2PROD with NOTICES
78926 Federal Register / Vol. 89, No. 187 / Thursday, September 26, 2024 / Notices 

38 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. 

4Section 103.00 (‘‘Foreign Private Issuers’’) 

provides that, for purposes of the Manual, the terms 

‘‘foreign private issuer’’ and ‘‘non-U.S. company’’ 

have the same meaning and are defined in 

accordance with the SEC’s definition of foreign 

private issuer set out in Rule 3b–4(c) of the 

Securities Exchange Act of 1934. 

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–PEARL–2024–44 and should be 

submitted on or before October 17, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.38

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–22025 Filed 9–25–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101117; File No. SR–NYSE– 

2024–50] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Adopt New 

Section 101.01 and Amend Section 

103.00 of the NYSE Listed Company 

Manual To Explain the Application of 

the Domestic and International 

Standards for Initial Listing of 

Common Equity Securities for Foreign 

Private Issuers 

September 20, 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 

September 10, 2024, New York Stock 

Exchange LLC (‘‘NYSE’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (the 

‘‘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 adopt 

proposed new Section 101.01 of the 

NYSE Listed Company Manual to 

explain the application to foreign 

private issuers of the domestic and 

international standards for initial listing 

of common equity securities. 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 minimum quantitative standards 

for the initial listing of common equity 

securities of domestic companies are set 

forth in Section 102.01 (‘‘Minimum 

Numerical Standards—Domestic 

Companies—Equity Listings’’) of the 

NYSE Listed Company Manual (the 

‘‘Manual’’). Section 103.01 (‘‘Minimum 

Numerical Standards Non-U.S. 

Companies Equity Listings’’) of the 

Manual sets forth minimum quantitative 

standards for the initial listing of 

common equity securities of foreign 

private issuers.4 Notwithstanding the 

existence of separate listing standards 

for foreign private issuers, Section 

103.00 of the Manual provides that 

foreign private issuers may list their 

common equity securities either under 

the quantitative standards for foreign 

private issuers set forth in Section 

103.01 or the Exchange’s domestic 

listing criteria set forth in Section 

102.01. As stated in Section 103.00, the 

foreign private issuer must meet all of 

the criteria within the standards under 

which it qualifies for listing, but is not 

required to meet the requirements of 

both of those sections in order for its 

common equity securities to qualify for 

listing. 

It has been the Exchange’s experience 

in recent years that almost all foreign 

private issuer applicants whose 

common equity securities qualify for 

listing on the Exchange do so by 

meeting the domestic listing 

requirements of Section 102.01. 

However, the Exchange has become 

aware that there is a certain level of 

confusion in the marketplace about how 

to understand the listing standards as 

they apply to foreign private issuer 

applicants. 

To provide greater clarity as to how 

the domestic and international listing 

standards relate to each other with 

regard to the listing of common equity 

securities, the Exchange proposes to 

adopt proposed new Section 101.01 

(‘‘Domestic and Foreign Private Issuer 

Quantitative Listing Standards’’). As 

proposed, Section 101.01 would read as 

follows: 

101.01 Domestic and Foreign Private Issuer 

Quantitative Listing Standards 

Section 102.01 (‘‘Minimum Numerical 

Standards—Domestic Companies—Equity 

Listings’’) sets forth the minimum 

quantitative standards for the listing of 

common equity securities of domestic 

companies. In addition, the Exchange also 

lists applicants that are foreign private 

issuers (as defined in Section 103.00 

(‘‘Foreign Private Issuers’’)) under Section 

102.01 where such applicants are qualified 

for listing thereunder. However, if a foreign 

private issuer applicant does not meet all of 

the requirements for the listing of common 

equity securities applicable to domestic 

issuers under Section 102.01, the Exchange 

will determine whether such foreign private 

issuer qualifies for listing under the 

quantitative standards for common equity 

securities set forth in Section 103.01 

(‘‘Minimum Numerical Standards Non-U.S. 

Companies Equity Listings’’). It is important 


khammond on DSKJM1Z7X2PROD with NOTICES