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[Federal Register Volume 89, Number 188 (Friday, September 27, 2024)]
[Notices]
[Pages 79322-79324]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-22129]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101135; File No. SR-PEARL-2024-43]

Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing 
and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX 
Pearl Equities Fee Schedule

September 23, 2024.
    Pursuant to the provisions of 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 10, 2024, MIAX PEARL, LLC (``MIAX 
Pearl'' or ``Exchange'') filed with the Securities and Exchange 
Commission (``Commission'') a proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by the 
Exchange. The Commission is publishing this notice to solicit comments 
on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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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 Equities 
Exchange Fee Schedule (the ``Fee Schedule'') to amend Section 2)e), 
Member and Non-Member Technical Support Request Fee.
    The text of the proposed rule change is available on the Exchange's 
website at https://www.miaxglobal.com/markets/

[[Page 79323]]

us-equities/pearl-equities/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 \3\ proposes to amend Section 2)e), Member and Non-
Member Technical Support Request Fee, to now include in the fee to be 
assessed to Equity Members \4\ and non-Members the cost of materials 
necessary for the Exchange's data center personnel to complete such 
technical support.
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    \3\ References to ``MIAX Pearl'' in this filing are to the 
equities trading facility of MIAX PEARL, LLC. See Exchange Rule 
1901.
    \4\ The term ``Equity Member'' is a Member authorized by the 
Exchange to transact business on MIAX Pearl Equities. See Exchange 
Rule 1901.
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Background
    The Exchange established the technical support request fee at the 
current hourly rate of $200 per hour in 2020.\5\ The Exchange has an 
infrastructure comprised of low latency and ultra-low latency proximity 
solutions in several offsite data center locales offering universal 
access to all Exchange services via a single common connection across a 
variety of high speed network interfaces. The Exchange offers 
connectivity in and between its data center facilities and supports 
direct attachment of all network equipment or direct attached host 
systems of both Equity Member and non-Member users of the Exchange.
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    \5\ See Securities Exchange Act Release No. 90651 (December 11, 
2020), 85 FR 81971 (December 17, 2020) (SR-PEARL-2020-33). See also 
Fee Schedule, Section 2)e).
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    Technical support refers to the use of Exchange engineers to 
perform on-site technical support tasks in the data centers for Equity 
Members and non-Members, including the following support-related tasks: 
(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 Exchange-supplied or customer-
supplied spares or upgrades; (7) troubleshooting heat related issues as 
instructed by customers; and (8) returning defective equipment to the 
manufacturer or customer.
Proposal
    The Exchange proposes to amend Section 2)e), Member and Non-Member 
Technical Support Request Fee, to now include in the fee to be assessed 
to Equity Members and non-Members that request technical support the 
cost of materials necessary for the Exchange to complete such technical 
support in any of the Exchange's data centers. Some examples of 
materials for such technical support may include, but are not limited 
to, fiber optic cables, fiber spool, optical connectors (a device used 
to connect fiber optic cables), and patch cables.
    The Exchange does not propose to assess any amount in excess of the 
cost of any materials that are necessary for the Exchange's on-site 
engineers to complete the requested technical support. The Exchange 
simply proposes to pass through the costs of the materials, if 
necessary, to complete such technical support. At least one competing 
exchange group similarly passes through the cost of materials to their 
customers when performing similar types of services in their data 
centers.\6\
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    \6\ See Nasdaq PHLX LLC Rules, General 8 Connectivity, Section 
1(d) Additional Charges/Services (assessing $264 per hour for Power 
Consulting Service plus the cost of materials, if necessary); The 
Nasdaq Stock Market LLC Rules, General 8: Connectivity, Section 1(d) 
Additional Charges/Services (assessing $264 per hour for Power 
Consulting Service plus the cost of materials, if necessary); Nasdaq 
ISE, LLC Rules, General 8: Connectivity, Section 1(d) Additional 
Charges/Services (assessing $264 per hour for Power Consulting 
Service plus the cost of materials, if necessary).
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2. Statutory Basis
    The Exchange believes that the proposed fees are consistent with 
Section 6(b) of the Act \7\ in general, and furthers the objectives of 
Section 6(b)(4) of the Act \8\ in particular, in that it provides for 
the equitable allocation of reasonable dues, fees and other charges 
among Equity Members and other persons using any facility or system 
which the Exchange operates or controls. The Exchange also believes the 
proposed fees further the objectives of Section 6(b)(5) of the Act \9\ 
in that they are designed to promote just and equitable principles of 
trade, remove impediments to and perfect the mechanism of a free and 
open market and a national market system, and, in general protect 
investors and the public interest and are not designed to permit unfair 
discrimination between customers, issuers, brokers and dealers.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
    \9\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes it is reasonable to include in the cost of 
the technical support request fee the cost of any materials that are 
necessary for the Exchange's on-site engineers to complete the 
requested technical support because the Exchange will only pass through 
the actual costs it is charged by external vendors of such materials. 
The Exchange will not pass through any amount in excess of the cost of 
any materials that are necessary for the Exchange's on-site engineers 
to complete the requested technical support.
    The Exchange believes the proposal is equitable and not unfairly 
discriminatory because the Exchange will pass through the costs of 
materials for requested technical support in an equal manner to all 
Equity Members and non-Members that request technical support in the 
data centers that requires the Exchange to purchase materials to 
complete such request. The cost for materials provided by the 
Exchange's external vendors supplying the materials will be passed 
through directly to the Equity Member or non-Member requesting 
technical support.
    Furthermore, Equity Members and non-Members are not required to use 
the technical support service. The Exchange offers this service as a 
convenience to all Equity Members and non-Members. The Exchange 
believes the proposal is reasonable because it will permit both Equity 
Members and non-Members to request the use of the Exchange's on-site 
data center personnel as technical support and as a convenience in 
order to test or otherwise assess the user's connectivity to the 
Exchange via its data centers, while paying for the cost of any 
materials the Exchange is required to purchase to complete such 
requests.
    Additionally, at least one competing options exchange group passes 
through the cost of materials to their customers when performing 
similar types of services in their data centers.\10\
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    \10\ See supra note 6.
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    Accordingly, the Exchange believes the proposal is reasonable, 
equitable and not unfairly discriminatory.

[[Page 79324]]

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.
Intra-Market Competition
    The Exchange believes the proposal to pass through the cost of any 
materials that are necessary for the Exchange's on-site engineers to 
complete the requested technical support will not result in any burden 
on intra-market competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because the Exchange will only 
pass-through the actual costs it is charged by third-party external 
vendors for such materials. At least one competing options exchange 
group similarly passes along charges assessed to those exchanges by 
third-party external vendors supplying materials on behalf of that 
exchange group's customers.\11\
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    \11\ See id.
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    Additionally, the pass through of costs for materials will be 
assessed equally to all Equity Members and non-Members who request 
technical support that requires the Exchange to purchase materials to 
complete the requested support. The Exchange notes that Equity Members 
and non-Members are not required to use the service. The Exchange 
offers this service as a convenience to all Equity Members and non-
Members. The Exchange believes the proposal will not impose any burden 
on intra-market competition because it will permit both Equity Members 
and non-Members to request the use of the Exchange's on-site data 
center personnel as technical support and as a convenience in order to 
test or otherwise assess the user's connectivity to the Exchange via 
its data centers.
Inter-Market Competition
    The Exchange believes that the proposed changes will not result in 
any burden on inter-market competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. As discussed 
above, market participants are not forced to connect to and trade on 
all exchanges. The Exchange believes that the proposed pass-through of 
costs for materials for technical support will not cause any burden on 
inter-market competition because none of these changes impact other 
exchanges' ability to compete.
    Accordingly, the Exchange does not believe its proposed fee changes 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Pursuant to Section 19(b)(3)(A)(ii) of the Act,\12\ and Rule 19b-
4(f)(2) thereunder \13\ the Exchange has designated this proposal as 
establishing or changing a due, fee, or other charge imposed on any 
person, whether or not the person is a member of the self-regulatory 
organization, which renders the proposed rule change effective upon 
filing.
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    \12\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \13\ 17 CFR 240.19b-4.
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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 [email protected]. Please include 
file number SR-PEARL-2024-43 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-2024-43. 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-PEARL-2024-43 and should be 
submitted on or before October 18, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2024-22129 Filed 9-26-24; 8:45 am]
BILLING CODE 8011-01-P
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