Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 83535 

32 15 U.S.C. 78s(b)(3)(A)(ii). 

33 17 CFR 240.19b–4(f)(2). 34 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Exchange Rule 1.5(p). 

any burden on inter-market competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act 

because the proposed modification and 

extension of the Incentive Program 

applies only to the Market Makers in 

SPIKES options, which are traded 

exclusively on the Exchange. 

Additionally, the Exchange does not 

believe that the proposed rule changes 

will impose any burden on inter-market 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act because the 

proposed removal of the fee waivers 

applies only to the Exchange’s 

Proprietary Products (including options 

on SPIKES), which are traded 

exclusively on 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,32 and Rule 

19b–4(f)(2) 33 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 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form 

(https://www.sec.gov/rules/sro.shtml); 

or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

MIAX–2024–39 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to file 

number SR–MIAX–2024–39. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–MIAX–2024–39 and should be 

submitted on or before November 6, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.34

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–23802 Filed 10–15–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101294; File No. SR– 

MEMX–2024–39] 

Self-Regulatory Organizations; MEMX 

LLC; Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change To Amend the Exchange’s Fee 

Schedule Concerning Equities 

Transaction Pricing 

October 9, 2024. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that, on October 

2, 2024, MEMX LLC (‘‘MEMX’’ 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 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 with the 

Commission a proposed rule change to 

amend the Exchange’s fee schedule 

applicable to Members 3 (the ‘‘Fee 

Schedule’’) pursuant to Exchange Rules 

15.1(a) and (c). The Exchange proposes 

to implement the changes to the Fee 

Schedule pursuant to this proposal 

immediately. The text of the proposed 

rule change is provided in Exhibit 5. 

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. 


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83536 Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 

4A ‘‘Retail Order’’ means an agency or riskless 

principal order that meets the criteria of FINRA 

Rule 5320.03 that originates from a natural person 

and is submitted to the Exchange by a Retail 

Member Organization, provided that no change is 

made to the terms of the order with respect to price 

or side of market and the order does not originate 

from a trading algorithm or any other computerized 

methodology. See Exchange Rule 11.21(a). 

5The Exchange initially filed the proposed Fee 

Schedule changes on September 30, 2024 (SR– 

MEMX–2024–37). On October 2, 2024, the 

Exchange withdrew that filing and submitted this 

proposal. 

6Market share percentage calculated as of 

September 30, 2024. The Exchange receives and 

processes data made available through consolidated 

data feeds (i.e., CTS and UTDF). 

7 Id. 

8The Exchange notes that it currently provides 

free executions (i.e., the Exchange charges no fee 

and provides no rebate) for executions of Retail 

Orders with a time-in-force (‘‘TIF’’) instruction of 

Day, Good-‘til-Time (‘‘GTT’’), or Regular Hours 

Only (‘‘RHO’’) that remove liquidity from the 

Exchange upon entry into the System. It is not 

proposing to change that pricing as a part of this 

proposal and as such, this proposal shall only apply 

to Retail Orders with a TIF of Immediate-or-Cancel 

(‘‘IOC’’) or Fill-or-Kill (‘‘FOK’’). 

9See, e.g., the Cboe EDGX Exchange, Inc. equities 

trading fee schedule (available at https://

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

schedule/edgx/), indicating a fee of $0.0030 per 

share for executions of retail orders that remove 

liquidity, and the MIAX Pearl Equities fee schedule 

(available at https://www.miaxglobal.com/markets/ 

us-equities/pearl-equities/fees), indicating a fee of 

$0.00285 per share for executions of retail orders 

that remove liquidity. 

10As set forth on the Fee Schedule, ‘‘ADAV’’ 

means the average daily added volume calculated 

as the number of shares added per day, which is 

calculated on a monthly basis, and ‘‘Displayed 

ADAV’’ means ADAV with respect to displayed 

orders. 

11As set forth on the Fee Schedule, ‘‘TCV’’ means 

total consolidated volume calculated as the volume 

reported by all exchanges and trade reporting 

facilities to a consolidated transaction reporting 

plan for the month for which the fees apply. 

12As set forth on the Fee Schedule, ‘‘Step-Up 

ADAV’’ means ADAV in the relevant baseline 

month subtracted from current ADAV. 

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 Fee Schedule to: 

(i) adopt a reduced fee for executions of 

Retail Orders 4 in securities priced at or 

above $1.00 per share that remove 

liquidity from the Exchange; (ii) modify 

the Liquidity Provision Tiers by 

eliminating the current Liquidity 

Provision Tier 1 and increasing the 

rebate for the current Liquidity 

Provision Tier 2, which will be renamed 

Liquidity Provision Tier 1; (iii) modify 

NBBO Setter Tier 1 by increasing the 

additive rebate that would apply to a 

qualifying Member’s executions of 

certain transactions, eliminating the 

additive rebate that would apply to a 

qualifying Member’s executions of other 

transactions, and modifying the 

required criteria under such tier; (iv) 

modify the Tape B Volume Tier 1 by 

modifying the criteria under such tier; 

and (v) modify the Displayed Liquidity 

Incentive (DLI) Tiers by increasing the 

rebate and modifying the criteria under 

Displayed Liquidity Incentive Tier 1.5

The Exchange first notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. More 

specifically, the Exchange is only one of 

16 registered equities exchanges, as well 

as a number of alternative trading 

systems and other off-exchange venues, 

to which market participants may direct 

their order flow. Based on publicly 

available information, no single 

registered equities exchange currently 

has more than approximately 15.6% of 

the total market share of executed 

volume of equities trading.6 Thus, in 

such a low-concentrated and highly 

competitive market, no single equities 

exchange possesses significant pricing 

power in the execution of order flow, 

and the Exchange currently represents 

approximately 2% of the overall market 

share.7 The Exchange in particular 

operates a ‘‘Maker-Taker’’ model 

whereby it provides rebates to Members 

that add liquidity to the Exchange and 

charges fees to Members that remove 

liquidity from the Exchange. The Fee 

Schedule sets forth the standard rebates 

and fees applied per share for orders 

that add and remove liquidity, 

respectively. Additionally, in response 

to the competitive environment, the 

Exchange also offers tiered pricing, 

which provides Members with 

opportunities to qualify for higher 

rebates or lower fees where certain 

volume criteria and thresholds are met. 

Tiered pricing provides an incremental 

incentive for Members to strive for 

higher tier levels, which provides 

increasingly higher benefits or discounts 

for satisfying increasingly more 

stringent criteria. 

Removed Retail Volume Fee 

The Exchange currently charges a 

standard fee of $0.0030 per share for 

executions of orders in securities that 

remove liquidity from the Exchange 

(such orders, ‘‘Removed Volume’’). The 

Exchange now proposes to adopt a 

reduced fee of $0.0028 per share for 

executions of Retail Orders in securities 

priced at or above $1.00 per share that 

remove liquidity from the Exchange 

(such orders, ‘‘Removed Retail 

Volume’’).8 As proposed, executions of 

Removed Retail Volume in securities 

priced below $1.00 per share will be 

charged a fee of 0.28% of the total dollar 

value of the transaction, which is the 

same fee that is currently charged for all 

such executions. 

The purpose of reducing the fee for 

executions of Removed Retail Volume is 

to incentivize Members to submit 

additional liquidity-removing Retail 

Orders to the Exchange, thereby 

contributing to a deeper and more 

liquidity market to the benefit of all 

market participants and enhancing the 

attractiveness of the Exchange as a 

trading venue. The Exchange notes that 

the proposed lower fee for executions of 

Removed Retail Volume (i.e. $0.0028) is 

competitive with the fees charged for 

executions of liquidity-removing retail 

orders charged by other exchanges.9

Liquidity Provision Tiers 

The Exchange currently provides a 

base rebate of $0.0015 per share for 

executions of orders in securities priced 

at or above $1.00 per share that add 

displayed liquidity to the Exchange 

(such orders, ‘‘Added Displayed 

Volume’’). The Exchange also currently 

offers Liquidity Provision Tiers 1–6 

under which a Member may receive an 

enhanced rebate for executions of 

Added Displayed Volume by achieving 

the corresponding required volume 

criteria for each such tier. The Exchange 

now proposes to modify the Liquidity 

Provision Tiers by eliminating the 

current Liquidity Provision Tier 1, 

deleting a footnote associated with the 

current Liquidity Provision Tier 1 in the 

Exchange’s Fee Schedule, and renumbering the existing Liquidity 

Provision Tiers 2–6 as Liquidity 

Provision Tiers 1–5 (hereinafter referred 

to as such). The applicable rebates and 

required criteria under Liquidity 

Provision Tiers 1–5 would remain 

unchanged, except for the rebate 

provided under the renamed Liquidity 

Provision Tier 1, which the Exchange is 

proposing to increase, as further 

described below. 

First, with respect to the existing 

Liquidity Provision Tier 1, the Exchange 

currently provides an enhanced rebate 

of $0.0034 per share for executions of 

Added Displayed Volume in securities 

priced at or above $1.00 for Members 

that either: (1) have an ADAV 10

(excluding Retail Orders) that is equal to 

or greater than 0.50% of the TCV,11 or 

(2) a Step-Up ADAV 12 from June 2024 

(excluding Retail Orders) that is equal to 

or greater than 0.07% of the TCV in 

securities priced at or above $1.00 per 

share and an ADAV that is equal to or 


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Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 83537 

13As set forth on the Fee Schedule, ‘‘Remove 

ADV’’ means ADV with respect to orders that 

remove liquidity. 14The pricing for Liquidity Provision Tier 1 is 

referred to by the Exchange on the Fee Schedule 

under the existing description ‘‘Added displayed 

volume, Liquidity Provision Tier 1’’ with a Fee 

Code of ‘‘B1’’, ‘‘D1’’ or ‘‘J1’’, as applicable, to be 

provided by the Exchange on the monthly invoices 

provided to Members. 15As set forth on the Fee Schedule, ‘‘NonDisplayed ADAV’’ means ADAV with respect to 

non-displayed orders (including orders subject to 

Display-Price Sliding that receive price 

improvement when executed and Midpoint Peg 

orders). 

16The Exchange notes that orders with Fee Code 

B include orders, other than Retail Orders, that 

establish the NBBO. 

17The Exchange notes that orders with Fee Code 

J include orders, other than Retail Orders, that 

establish a new BBO on the Exchange that matches 

the NBBO first established on an away market. 

Orders with Fee Code D include orders that add 

displayed liquidity to the Exchange but that are not 

Fee Code B or J, and thus, orders with Fee Code 

B, D or J include all orders, other than Retail 

Orders, that add displayed liquidity to the 

Exchange. 

18See Securities Exchange Act Release No. 94394 

(March 10, 2022), 87 FR 14923 (March 16, 2022) 

(SR–MEMX–2022–01). 

greater than 0.20% of the TCV in 

securities priced at or above $1.00 per 

share and a Remove ADV 13 that is equal 

to or greater than 0.45% of the TCV. The 

Exchange now proposes to eliminate 

Liquidity Provision Tier 1, as the 

Exchange no longer wishes to, nor is it 

required to, maintain such tier. 

With respect to the newly renumbered Liquidity Provision Tier 1,14

the Exchange currently provides an 

enhanced rebate of $0.0033 per share for 

executions of Added Displayed Volume 

in securities priced at or above $1.00 per 

share for Members that qualify for such 

tier by achieving either: (1) an ADAV 

(excluding Retail Orders) that is equal to 

or greater than 0.40% of the TCV, or (2) 

an ADAV that is equal to or greater than 

0.30% of the TCV in securities priced at 

or above $1.00 per share and a NonDisplayed ADAV 15 that is equal to or 

greater than 6,000,000 shares. The 

Exchange now proposes to increase the 

rebate for executions of Added 

Displayed Volume under Liquidity 

Provision Tier 1 to $0.0034 per share. 

The Exchange is not proposing to 

change the criteria required to qualify 

for renamed Liquidity Provision Tier 1. 

The Exchange is also not proposing to 

change the rebate for executions of 

orders in securities priced below $1.00 

per share under such tier. 

The tiered pricing structure for 

executions of Added Displayed Volume 

under the Liquidity Provision Tiers 

provides an incremental incentive for 

Members to strive for higher volume 

thresholds to receive higher enhanced 

rebates for such executions and, as such, 

is intended to encourage Members to 

maintain or increase their order flow, 

primarily in the form of liquidity-adding 

volume, to the Exchange, thereby 

contributing to a deeper and more liquid 

market to the benefit of all Members and 

market participants. The Exchange 

believes that the Liquidity Provision 

Tiers, as modified by the proposed 

changes described above, reflect a 

reasonable and competitive pricing 

structure that is right-sized and 

consistent with the Exchange’s overall 

pricing philosophy of encouraging 

added and/or displayed liquidity. 

Specifically, the Exchange believes that, 

after giving effect to the proposed 

changes described above, the rebate for 

executions of Added Displayed Volume 

provided under each of the Liquidity 

Provision Tiers 1–5 remains 

commensurate with the corresponding 

required criteria under each such tier 

and is reasonably related to the market 

quality benefits that each such tier is 

designed to achieve. 

NBBO Setter Tier 1 

The Exchange currently offers NBBO 

Setter Tier 1 under which a Member 

may receive an additive rebate of 

$0.0002 per share for a qualifying 

Member’s executions of Added 

Displayed Volume (other than Retail 

Orders) in securities priced at or above 

$1.00 per share that establish the NBBO 

and have a Fee Code B16 (such orders, 

‘‘Setter Volume’’), and an additive 

rebate of $0.0001 per share for 

executions of Added Displayed Volume 

(other than Retail Orders) that do not 

establish the NBBO (i.e., Fee Codes D 

and J) 17 by achieving: (1) an ADAV with 

respect to orders with Fee Code B that 

is equal to or greater than 5,000,000 

shares; or (2) an ADAV with respect to 

orders with Fee Code B that is equal to 

or greater than 2,000,000 shares and an 

ADAV in securities priced at or above 

$1.00 per share (excluding Retail 

Orders) that is equal to or greater than 

0.30% of the TCV in securities priced at 

or above over $1.00 per share. The 

Exchange now proposes to modify 

NBBO Setter Tier 1 by increasing the 

additive rebate that would apply to a 

qualifying Member’s executions of 

Setter Volume (i.e. Fee Code B), 

eliminating the additive rebate that 

would apply to a qualifying Member’s 

executions of Added Displayed Volume 

(other than Retail Orders) that have a 

Fee Code of D or J, and modifying the 

required criteria under such tier. 

First, the Exchange proposes to 

increase the additive rebate under 

NBBO Setter Tier 1 to $0.0003 per share 

for a qualifying Member’s executions of 

Added Displayed Volume with a Fee 

Code of B. Additionally, the Exchange 

proposes to eliminate the additive 

rebate of $0.0001 per share for a 

qualifying Member’s executions with a 

Fee Code of D or J, and as such, the 

additive rebate under NBBO Setter Tier 

1 as proposed will only apply to a 

qualifying Member’s executions of 

Added Displayed Volume with a Fee 

Code of B. The Exchange notes that 

when the NBBO Setter Tier was 

originally implemented by the 

Exchange, the additive rebate similarly 

only applied to executions with a Fee 

Code B,18 and as such, the purpose of 

eliminating the additive rebate is to 

revert back to the former application, as 

well as for business and competitive 

reasons, as the Exchange believes the 

elimination of such additive rebate 

would allow the Exchange to focus on 

incentivizing Setter Volume with a 

higher rebate while also decreasing the 

Exchange’s expenditures with respect to 

the Exchange’s transaction pricing, 

which would enable the Exchange to 

redirect future resources and funding 

into other incentives and tiers intended 

to incentive increased order flow. 

Second, the Exchange is proposing to 

modify the required criteria under 

NBBO Setter Tier 1. As noted above, 

currently, a Member qualifies for such 

tier by achieving (1) an ADAV with 

respect to orders with Fee Code B that 

is equal to or greater than 5,000,000 

shares; or (2) an ADAV with respect to 

orders with Fee Code B that is equal to 

or greater than 2,000,000 shares and an 

ADAV in securities priced at or above 

$1.00 per share (excluding Retail 

Orders) that is equal to or greater than 

0.30% of the TCV in securities priced at 

or above over $1.00 per share. Now, the 

Exchange proposes to modify the 

required criteria under NBBO Setter 

Tier 1 such that a Member would now 

qualify for such tier by achieving an 

ADAV with respect to orders with a Fee 

Code B that is equal to or greater than 

0.05% of the TCV. Thus, such proposed 

change modifies the Fee Code B ADAV 

criteria in the first alternative from a 

share-based ADAV to a percentage of 

the TCV ADAV, and eliminates the 

second alternative criteria altogether. 

The Exchange believes that the 

proposed modified criteria provides an 

incremental incentive for Members to 

strive for higher ADAV in NBBO setting 

orders (i.e. Fee Code B) on the Exchange 

to receive the additive rebate for 

qualifying executions of Added 

Displayed Volume under such tier, and 

thus, it is designed to encourage 

Members that do not currently qualify 

for such tier to increase their overall 


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83538 Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 

19The pricing for the Tape B Volume Tier is 

referred to by the Exchange on the Fee Schedule 

under the description ‘‘Tape B Volume Tier’’ with 

a Fee Code of ‘‘b’’ to be appended to the otherwise 

applicable Fee Code assigned by the Exchange on 

the monthly invoices for qualifying executions. 

20As set forth on the Fee Schedule, the term 

‘‘quoting requirement’’ means the requirement that 

a Member’s NBBO Time be at least 25%, and the 

term ‘‘NBBO Time’’ means the aggregate of the 

percentage of time during regular trading hours 

during which one of a Member’s market participant 

identifiers (‘‘MPIDs’’) has a displayed order of at 

least one round lot at the national best bid or the 

national best offer. 

21As set forth on the Fee Schedule, the term 

‘‘securities requirement’’ means the requirement 

that a Member meets the quoting requirement in the 

applicable number of securities per trading day. 

Currently, each of DLI Tiers 1 and 2 has a securities 

requirement that may be achieved by a Member 

meeting the quoting requirement in the specified 

number of securities traded on the Exchange. 

22See the Exchange’s Fee Schedule (available at 

https://info.memxtrading.com/fee-schedule/) for 

additional details regarding the Exchange’s DLI 

Tiers. See also Securities Exchange Act Release No. 

92150 (June 10, 2021), 86 FR 32090 (June 16, 2021) 

(SR–MEMX–2021–07) (notice of filing and 

immediate effectiveness of fee changes adopted by 

the Exchange, including the adoption of DLI). 

23The Exchange is also proposing to amend the 

definition of ‘‘quoting requirement’’ under the 

Definitions and Notes section under the DLI Tiers 

pricing table on the fee schedule in light of this 

proposed increase in the NBBO time required to 

achieve DLI Tier 1. Specifically, the Exchange is 

proposing that the term quoting requirement shall 

now mean the percentage of NBBO Time required 

under the relevant DLI Tier criteria (i.e., rather than 

including the numeric value of the required NBBO 

Time in the definition). 

24The pricing for DLI Tier 1 is referred to by the 

Exchange on the Fee Schedule under the existing 

description ‘‘Added displayed volume, DLI Tier 1’’ 

with a Fee Code of Bq1, Bq1 or Jq1, as applicable. 

25 15 U.S.C. 78f. 

26 15 U.S.C. 78f(b)(4) and (5). 

orders that add liquidity to the 

Exchange. The Exchange also believes 

that the criteria change reflects a 

reasonable and competitive pricing 

structure that is right-sized and 

consistent with the Exchange’s overall 

pricing philosophy of encouraging 

added and/or displayed liquidity. The 

Exchange believes that the proposed 

modified criteria would further 

incentivize increased order flow to the 

Exchange, thereby contributing to a 

deeper and more liquid market to the 

benefit of all Members. 

Tape B Volume Tier 

The Exchange currently offers Tape B 

Volume Tier 1 under which a Member 

may receive an additive rebate of 

$0.0002 per share for executions of 

Added Displayed Volume (excluding 

Retail Orders) in Tape B Securities 

(such orders, ‘‘Tape B Volume’’) by 

achieving a Tape B ADAV that is equal 

to or greater than 0.30% of the Tape B 

TCV (excluding Retail Orders).19 Now, 

the Exchange proposes to modify the 

required criteria under such tier such 

that a Member would qualify for such 

tier by achieving a Tape B ADAV that 

is equal to or greater than 0.25% of the 

Tape B TCV (excluding Retail Orders). 

The purpose of modifying the 

required criteria is for business and 

competitive reasons, as the Exchange 

believes that such changes would 

facilitate Members to meet such tier by 

lowering the Tape B TCV requirement. 

The Exchange believes that the 

proposed changes would incentivize 

Members to submit additional order 

flow in Tape B Securities, thereby 

promoting price discovery and market 

quality on the Exchange. 

Displayed Liquidity Incentive (‘‘DLI’’) 

Tiers 

The Exchange currently offers DLI 

Tiers 1 and 2 under which a Member 

may receive an enhanced rebate for 

executions of Added Displayed Volume 

by achieving the corresponding required 

criteria for each such tier. The DLI Tiers 

are designed to encourage Members, 

through the provision of an enhanced 

rebate for executions of Added 

Displayed Volume, to promote price 

discovery and market quality by quoting 

at the NBBO for a significant portion of 

each day (i.e., through the applicable 

quoting requirement 20) in a broad base 

of securities (i.e., through the applicable 

securities requirement 21), thereby 

benefitting the Exchange and investors 

by providing improved trading 

conditions for all market participants 

through narrower bid-ask spreads and 

increased depth of liquidity available at 

the NBBO in a broad base of securities 

and committing capital to support the 

execution of orders.22 Now, the 

Exchange proposes to modify DLI Tier 

1 by modifying the required criteria and 

increasing the rebate for executions of 

Added Displayed Volume under such 

tier. 

Currently, under DLI Tier 1, the 

Exchange provides a rebate of $0.0031 

per share for executions of Added 

Displayed Volume for Members that 

qualify for such tier by achieving: (1) an 

NBBO Time of at least 25% in an 

average of at least 1,000 securities per 

trading day during the month; and (2) 

an ADAV equal to or greater than 0.10% 

of the TCV. Now, the Exchange 

proposes to modify the required criteria 

under DLI Tier 1 such that a Member 

would qualify for such tier by achieving: 

an NBBO time of at least 50% in an 

average of at least 1,000 securities per 

trading day during the month.23 The 

Exchange also proposes to increase the 

rebate for a qualifying Members’ 

executions of Added Displayed Volume 

under DLI Tier 1 from $0.0031 per share 

to $0.0034 per share. 24

The purpose of increasing the quoting 

requirement under DLI Tier 1 is 

intended to encourage Members to 

promote price discovery and market 

quality by quoting at the NBBO for a 

significant portion of each day (i.e., 

through the applicable quoting 

requirement) in a large number of 

securities, thereby benefitting the 

Exchange and investors by providing 

improved trading conditions for all 

market participants through narrower 

bid-ask spreads and increased depth of 

liquidity available at the NBBO. The 

purpose of removing the former criteria 

(2) under DLI Tier 1 is intended to make 

it easier for Members to meet such tier 

and incentivize increased order flow to 

the Exchange in the form of orders at the 

NBBO. The purpose of increasing the 

rebate is similarly to incentivize 

increased order flow to the Exchange, 

including in the form of orders at the 

NBBO, thereby contributing to a deeper 

and more liquid market to the benefit of 

all market participants. The Exchange is 

not proposing to change the rebates 

provided under such tiers for executions 

of orders in securities priced below 

$1.00 per share. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the provisions of Section 6 of the Act,25

in general, and with Sections 6(b)(4) and 

6(b)(5) of the Act,26 in particular, in that 

it provides for the equitable allocation 

of reasonable dues, fees and other 

charges among its Members and other 

persons using its facilities and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

As discussed above, the Exchange 

operates in a highly fragmented and 

competitive market in which market 

participants can readily direct order 

flow to competing venues if they deem 

fee levels at a particular venue to be 

excessive or incentives to be 

insufficient, and the Exchange 

represents only a small percentage of 

the overall market. The Commission and 

the courts have repeatedly expressed 

their 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 


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Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 83539 

27Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005). 28 15 U.S.C. 78f(b)(4) and (5). 29See supra note 26. 

broader forms that are most important to 

investors and listed companies.’’ 27

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can shift order flow or discontinue to 

reduce use of certain categories of 

products, in response to new or 

different pricing structures being 

introduced into the market. 

Accordingly, competitive forces 

constrain the Exchange’s transaction 

fees and rebates, and market 

participants can readily trade on 

competing venues if they deem pricing 

levels at those other venues to be more 

favorable. The Exchange believes the 

proposal reflects a reasonable and 

competitive pricing structure designed 

to encourage market participants to 

strive for higher volume on the 

Exchange, which the Exchange believes 

would promote price discovery and 

enhance liquidity and market quality on 

the Exchange to the benefit of all 

Members and market participants. 

The Exchange believes that its 

proposal to charge a reduced fee for 

executions of Removed Retail Volume is 

reasonable, equitable, and not unfairly 

discriminatory. Specifically, the 

Exchange believes such proposal is 

reasonable, as it is reasonably designed 

to incentivize Members to submit 

additional Retail Orders to the 

Exchange, thereby contributing to a 

deeper and more liquidity market to the 

benefit of all market participants and 

enhancing the attractiveness of the 

Exchange as a trading venue. Thus, the 

Exchange believes the proposal reflects 

a reasonable attempt to deepen liquidity 

on the Exchange, particularly as the 

Exchange believes the proposed 

reduction in the fee for executions of 

Removed Retail Volume (i.e., $0.0002 

per share lower than the standard fee for 

Removed Volume) is not excessive and 

is instead reasonably related to the 

market quality benefits it is intended to 

achieve. The Exchange also believes that 

the proposed fee for executions of 

Removed Retail Volume is equitable and 

not unfairly discriminatory, as such fee 

would be charged uniformly to all 

executions of such orders for all 

Members. 

The Exchange notes that volumebased incentives (such as Liquidity 

Provision Tiers, NBBO Setter Tiers, the 

Tape B Volume Tier, and DLI Tiers) 

have been widely adopted by exchanges 

(including the Exchange), and are 

reasonable, equitable, and not unfairly 

discriminatory because they are open to 

all members on an equal basis and 

provide additional benefits or discount 

that are reasonably related to the value 

to an exchange’s market quality 

associated with higher levels of market 

activity, such as higher levels of 

liquidity provision and/or growth 

patterns, and the introduction of higher 

volumes of orders into the price and 

volume discovery process. The 

Exchange believes that Liquidity 

Provision 1, as modified by the 

proposed change to the rebate under 

such tier, NBBO Setter Tier 1, as 

modified by the proposed removal of 

the additive rebate as it applies towards 

executions with Fee Codes D and J and 

the proposed changes to the required 

criteria under such tier, Tape B Volume 

Tier 1, as modified by the proposed 

changes to the required criteria under 

such tier, and DLI Tier 1, as modified by 

the proposed change to the rebate and 

required criteria under such tier, are 

reasonable, equitable and not unfairly 

discriminatory for these same reasons, 

as such tiers would provide Members 

with an incremental incentive to 

achieve certain volume thresholds on 

the Exchange, are available to all 

Members on an equal basis, and, as 

described above, are designed to 

encourage Members to maintain or 

increase their order flow, including in 

the form of displayed, liquidity-adding, 

and/or NBBO-setting orders to the 

Exchange in order to qualify for an 

enhanced rebate for executions of 

Added Displayed Volume or Setter 

Volume, as applicable, thereby 

contributing to a deeper, more liquid 

and well balanced market ecosystem on 

the Exchange to the benefit of all 

Members and market participants. The 

Exchange also believes that such tiers 

reflect a reasonable and equitable 

allocation of fees and rebates, as the 

Exchange believes that the enhanced 

rebate for executions of Added 

Displayed Volume under the proposed 

modified Liquidity Provision Tier 1, 

Tape B Volume Tier 1 and DLI Tier 1, 

and the additive rebate for executions of 

Setter Volume under the proposed 

modified NBBO Setter Tier 1, each 

remain commensurate with the 

corresponding required criteria under 

each such tier and is reasonably related 

to the market quality benefits that each 

such tier is designed to achieve, as 

described above. 

For the reasons discussed above, the 

Exchange submits that the proposal 

satisfies the requirements of Sections 

6(b)(4) and 6(b)(5) of the Act 28 in that 

it provides for the equitable allocation 

of reasonable dues, fees and other 

charges among its Members and other 

persons using its facilities and is not 

designed to unfairly discriminate 

between customers, issuers, brokers, or 

dealers. As described more fully below 

in the Exchange’s statement regarding 

the burden on competition, the 

Exchange believes that its transaction 

pricing is subject to significant 

competitive forces, and that the 

proposed fees and rebates described 

herein are appropriate to address such 

forces. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposal will result in any burden 

on competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. Instead, as 

discussed above, the proposal is 

intended to incentivize market 

participants to direct additional order 

flow to the Exchange, which the 

Exchange believes would promote price 

discovery and enhance liquidity and 

market quality on the Exchange to the 

benefit of all Members and market 

participants. As a result, the Exchange 

believes the proposal would enhance its 

competitiveness as a market that attracts 

actionable orders, thereby making it a 

more desirable destination venue for its 

customers. For these reasons, the 

Exchange believes that the proposal 

furthers the Commission’s goal in 

adopting Regulation NMS of fostering 

competition among orders, which 

promotes ‘‘more efficient pricing of 

individual stocks for all types of orders, 

large and small.’’ 29

Intramarket Competition 

As discussed above, the Exchange 

believes that the proposal would 

maintain a tiered pricing structure that 

is still consistent with the Exchange’s 

overall pricing philosophy of 

encouraging added and/or displayed 

liquidity and would incentivize market 

participants to direct additional order 

flow to the Exchange through volumebased tiers, thereby enhancing liquidity 

and market quality on the Exchange to 

the benefit of all Members, as well as 

enhancing the attractiveness of the 

Exchange as a trading venue, which the 

Exchange believes, in turn, would 

continue to encourage market 

participants to direct additional order 

flow to the Exchange. Greater liquidity 

benefits all Members by providing more 

trading opportunities and encourages 

Members to send additional orders to 

the Exchange, thereby contributing to 


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83540 Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 

30See supra note 26. 

31NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. 

Cir. 2010) (quoting Securities Exchange Act Release 

No. 59039 (December 2, 2008), 73 FR 74770, 74782– 

83 (December 9, 2008) (SR–NYSE–2006–21)). 

32 15 U.S.C. 78s(b)(3)(A)(ii). 

33 17 CFR 240.19b–4(f)(2). 

robust levels of liquidity, which benefits 

all market participants. 

The Exchange does not believe that 

the proposed changes would impose 

any burden on intramarket competition 

because such changes will incentivize 

members to submit additional order 

flow, thereby contributing to a more 

robust and well-balanced market 

ecosystem on the Exchange to the 

benefit of all Members as well as 

enhancing the attractiveness of the 

Exchange as a trading venue, which the 

Exchange believes, in turn, would 

continue to encourage market 

participants to direct additional order 

flow to the Exchange. 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. The opportunity 

to qualify for the modified Liquidity 

Provision Tiers, NBBO Setter Tiers, 

Tape B Volume Tier, and DLI Tiers, and 

thus receive the corresponding 

enhanced rebates or discounted fees, as 

applicable, would be available to all 

Members that meet the associated 

volume requirements in any month. As 

described above, the Exchange believes 

that the required criteria under each 

such tier are commensurate with the 

corresponding rebate under such tier 

and are reasonably related to the 

enhanced liquidity and market quality 

that such tier is designed to promote. 

The Exchange does not believe that the 

proposed change to adopt a reduced fee 

for executions of Removed Retail 

Volume would impose any burden on 

intramarket competition because such 

changes will apply to all Members 

uniformly, in that the opportunity to 

qualify for the discounted fees is 

available to all Members that submit 

Retail Orders to the Exchange. For the 

foregoing reasons, the Exchange believes 

the proposed changes would not impose 

any burden on intramarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act. 

Intermarket Competition 

As noted above, the Exchange 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if they deem fee levels at a 

particular venue to be excessive or 

incentives to be insufficient. Members 

have numerous alternative venues that 

they may participate on and direct their 

order flow to, including 15 other 

equities exchanges and numerous 

alternative trading systems and other 

off-exchange venues. As noted above, no 

single registered equities exchange 

currently has more than approximately 

15.6% of the total market share of 

executed volume of equities trading. 

Thus, in such a low-concentrated and 

highly competitive market, no single 

equities exchange possesses significant 

pricing power in the execution of order 

flow. Moreover, the Exchange believes 

that the ever-shifting market share 

among the exchanges from month to 

month demonstrates that market 

participants can shift order flow or 

discontinue to reduce use of certain 

categories of products, in response to 

new or different pricing structures being 

introduced into the market. 

Accordingly, competitive forces 

constrain the Exchange’s transaction 

fees and rebates and market participants 

can readily choose to send their orders 

to other exchange and off-exchange 

venues if they deem fee levels at those 

other venues to be more favorable. As 

described above, the proposed changes 

represent a competitive proposal 

through which the Exchange is seeking 

to incentivize market participants to 

direct additional order flow to the 

Exchange through volume-based tiers, 

which have been widely adopted by 

exchanges, including the Exchange. 

Accordingly, the Exchange believes the 

proposal would not burden, but rather 

promote, intermarket competition by 

enabling it to better compete with other 

exchanges that offer similar pricing 

structures and incentives to market 

participants. 

Additionally, the Commission has 

repeatedly expressed its preference for 

competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. Specifically, in Regulation 

NMS, the Commission highlighted the 

importance of market forces in 

determining prices and SRO revenues 

and, also, recognized that current 

regulation of the market system ‘‘has 

been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 30 The 

fact that this market is competitive has 

also long been recognized by the courts. 

In NetCoalition v. SEC, the D.C. Circuit 

stated as follows: ‘‘[n]o one disputes 

that competition for order flow is 

‘fierce.’ . . . As the SEC explained, ‘[i]n 

the U.S. national market system, buyers 

and sellers of securities, and the brokerdealers that act as their order-routing 

agents, have a wide range of choices of 

where to route orders for execution’; 

[and] ‘no exchange can afford to take its 

market share percentages for granted’ 

because ‘no exchange possesses a 

monopoly, regulatory or otherwise, in 

the execution of order flow from broker 

dealers’ . . . . ’’.31 Accordingly, the 

Exchange does not believe its proposed 

pricing 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 

The Exchange neither solicited nor 

received comments on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act 32 and Rule 

19b–4(f)(2) 33 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 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

MEMX–2024–39 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–MEMX–2024–39. This file 


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Federal Register / Vol. 89, No. 200 / Wednesday, October 16, 2024 / Notices 83541 

34 17 CFR 200.30–3(a)(12). 

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–MEMX–2024–39 and should be 

submitted on or before November 6, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.34

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–23799 Filed 10–15–24; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #20703 and #20704; 

SOUTH CAROLINA Disaster Number SC– 

20012] 

Presidential Declaration Amendment of 

a Major Disaster for the State of South 

Carolina 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Amendment 6. 

SUMMARY: This is an amendment of the 

Presidential declaration of a major 

disaster for the State of South Carolina 

(FEMA–4829–DR), dated September 29, 

2024. 

DATES: Issued on October 9, 2024. 

Physical Loan Application Deadline 

Date: November 29, 2024. 

Economic Injury (EIDL) Loan 

Application Deadline Date: June 30, 

2025. 

ADDRESSES: Visit the MySBA Loan 

Portal at https://lending.sba.gov to 

apply for a disaster assistance loan. 

FOR FURTHER INFORMATION CONTACT: 

Vanessa Morgan, Office of Disaster 

Recovery & Resilience, U.S. Small 

Business Administration, 409 3rd Street 

SW, Suite 6050, Washington, DC 20416, 

(202) 205–6734. 

SUPPLEMENTARY INFORMATION: The notice 

of the President’s major disaster 

declaration for the State of South 

Carolina, dated September 29, 2024, is 

hereby amended to include the 

following areas as adversely affected by 

the disaster: 

Incident: Hurricane Helene. 

Incident Period: September 25, 2024 

and continuing. 

Primary Counties (Physical Damage and 

Economic Injury Loans): Chester, 

Kershaw, Orangeburg. 

Contiguous Counties (Economic Injury 

Loans Only): 

South Carolina: Berkeley, 

Chesterfield, Clarendon, Darlington, 

Dorchester, Lee. 

All other information in the original 

declaration remains unchanged. 

(Catalog of Federal Domestic Assistance 

Number 59008) 

Rafaela Monchek, 

Deputy Associate Administrator, Office of 

Disaster Recovery & Resilience. 

[FR Doc. 2024–23806 Filed 10–15–24; 8:45 am] 

BILLING CODE 8026–09–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #20751 and #20752; 

TENNESSEE Disaster Number TN–20019] 

Presidential Declaration of a Major 

Disaster for Public Assistance Only for 

the State of Tennessee 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a Notice of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the State of Tennessee (FEMA–4832– 

DR), dated October 9, 2024. 

DATES: Issued on October 9, 2024. 

Physical Loan Application Deadline 

Date: December 9, 2024. 

Economic Injury (EIDL) Loan 

Application Deadline Date: July 9, 2025. 

ADDRESSES: Visit the MySBA Loan 

Portal at https://lending.sba.gov to 

apply for a disaster assistance loan. 

FOR FURTHER INFORMATION CONTACT: 

Vanessa Morgan, Office of Disaster 

Recovery & Resilience, U.S. Small 

Business Administration, 409 3rd Street 

SW, Suite 6050, Washington, DC 20416, 

(202) 205–6734. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

President’s major disaster declaration on 

October 9, 2024, Private Non-Profit 

organizations that provide essential 

services of a governmental nature may 

file disaster loan applications online 

using the MySBA Loan Portal https://

lending.sba.gov or other locally 

announced locations. Please contact the 

SBA disaster assistance customer 

service center by email at 

disastercustomerservice@sba.gov or by 

phone at 1–800–659–2955 for further 

assistance. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Incident: Tropical Storm Helene. 

Incident Period: September 26, 2024 

and continuing. 

Primary Counties: Carter, Claiborne, 

Cocke, Grainger, Greene, Hamblen, 

Hawkins, Jefferson, Johnson, 

Sullivan, Unicoi, Washington. 

The Interest Rates are: 

Percent 

For Physical Damage: 

Non-Profit Organizations with 

Credit Available Elsewhere ... 3.250 

Non-Profit Organizations without Credit Available Elsewhere ..................................... 3.250 

For Economic Injury: 

Non-Profit Organizations without Credit Available Elsewhere ..................................... 3.250 

The number assigned to this disaster 

for physical damage is 207518 and for 

economic injury is 207520. 

(Catalog of Federal Domestic Assistance 

Number 59008) 

Rafaela Monchek, 

Deputy Associate Administrator, Office of 

Disaster Recovery & Resilience. 

[FR Doc. 2024–23805 Filed 10–15–24; 8:45 am] 

BILLING CODE 8026–09–P 


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