Federal Register / Vol. 89, No. 209 / Tuesday, October 29, 2024 / Notices 86055 

7 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

or Stockholder Nominees before a 

special meeting. The informational 

requirements are designed to enhance 

investor protection by helping to ensure 

among other things, that the Corporation 

and its stockholders have full and 

accurate information about nominating 

stockholders and Stockholder Nominees 

and that such stockholders and 

nominees comply with applicable laws, 

regulations and other requirements. 

The changes that the Exchange is 

proposing with regard to so-called 

‘‘advance notice bylaws’’ in light of the 

recent developments in Delaware law 

are designed to help provide additional 

clarity to stockholders wishing to bring 

business before a stockholder meeting or 

propose a Stockholder Nominee. The 

Exchange believes that this filing 

furthers the objectives of Section 6(b)(5) 

by simplifying the requirements and 

clarifying the information that must be 

disclosed by stockholders. This furthers 

the interests of investors and the public 

by removing potential impediments to 

raising business or proposing 

Stockholder Nominees that may 

otherwise restrict a stockholder’s ability 

to participate in the corporate 

governance of the Corporation. 

Finally, the remaining changes to 

existing provisions of the CGM Bylaws 

are clarifying in nature, and they 

enhance investor protection and the 

public interest by preventing confusion 

with respect to the operation of the 

Bylaw provisions. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

Because the proposed rule change 

relates to the governance of the 

Corporation and not to the operations of 

the Exchange, the Exchange does not 

believe that the proposed rule change 

will impose any burden on competition 

not necessary or appropriate in 

furtherance of the purposes of the Act. 

The proposed rule change is not 

designed to address any competitive 

issue or have any impact on 

competition; rather, adoption of a 

stockholder special meeting provision, 

updating ‘‘advance notice bylaws,’’ and 

other bylaws updates by the Corporation 

are intended to enhance corporate 

governance and accountability to 

stockholders. 

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 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period 

up to 90 days (i) as the Commission may 

designate if it finds such longer period 

to be appropriate and publishes its 

reasons for so finding or (ii) as to which 

the Exchange consents, the Commission 

will: 

A. by order approve or disapprove 

such proposed rule change, or 

B. institute proceedings to determine 

whether the proposed rule change 

should be 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– 

CboeBZX–2024–087 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–CboeBZX–2024–087. 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–CboeBZX–2024–087 and should be 

submitted on or before November 19, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.7

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–25057 Filed 10–28–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101410; File No. SR– 

NYSEARCA–2024–85] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend the NYSE Arca 

Equities Fees and Charges 

October 23, 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 October 

10, 2024, NYSE Arca, Inc. (‘‘NYSE 

Arca’’ or the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II, 

and III below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend the 

NYSE Arca Equities Fees and Charges 

(‘‘Fee Schedule’’) to (1) increase the 

credits payable under certain Mid-Point 

Liquidity (‘‘MPL’’) Order pricing tiers, 

and (2) adopt a lower fee for certain 

Retail Orders that remove liquidity in 

securities with a per share price below 

$1.00. 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. 


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86056 Federal Register / Vol. 89, No. 209 / Tuesday, October 29, 2024 / Notices 

3A MPL Order is a limit order that is not 

displayed and does not route, with a working price 

at the lower (higher) of the midpoint of the 

Protected Best Bid/Offer or its limit price. See 

NYSE Arca Rule 7.31–E(d)(3). 

4Rule 7.31–E(i)(4)(A) provides that an ‘‘order 

designated with a ‘‘retail’’ modifier is an agency 

order or a 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 an ETP Holder, 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.’’ 

5The Exchange originally filed to amend the Fee 

Schedule on October 1, 2024 (SR–NYSEARCA– 

2024–82). SR–NYSEARCA–2024–82 was 

subsequently withdrawn and replaced by this filing. 

6See Securities Exchange Act Release No. 51808 

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

(File No. S7–10–04) (Final Rule) (‘‘Regulation 

NMS’’). 

7See Securities Exchange Act Release No. 61358, 

75 FR 3594, 3597 (January 21, 2010) (File No. S7– 

02–10) (Concept Release on Equity Market 

Structure). 

8See Cboe U.S Equities Market Volume 

Summary, available at https://markets.cboe.com/us/ 

equities/market_share. 

9See FINRA ATS Transparency Data, available at 

https://otctransparency.finra.org/otctransparency/

AtsIssueData. A list of alternative trading systems 

registered with the Commission is available at 

https://www.sec.gov/foia/docs/atslist.htm. 

10See Cboe Global Markets U.S. Equities Market 

Volume Summary, available at http://

markets.cboe.com/us/equities/market_share/. 

11See id. 

12See, e.g., Securities Exchange Act Release No. 

54511 (September 26, 2006), 71 FR 58460, 58461 

(October 3, 2006) (SR–PCX–2005–53). 

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 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

Fee Schedule to (1) increase the credits 

payable under certain MPL Order 3

pricing tiers, and (2) adopt a lower fee 

for certain Retail Orders 4 that remove 

liquidity in securities with a per share 

price below $1.00 (‘‘Sub-Dollar 

Securities’’), as described below. 

The Exchange proposes to implement 

the fee changes effective October 10, 

2024.5

Background 

The Exchange operates in a highly 

competitive market. 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.’’ 6

While Regulation NMS has enhanced 

competition, it has also fostered a 

‘‘fragmented’’ market structure where 

trading in a single stock can occur 

across multiple trading centers. When 

multiple trading centers compete for 

order flow in the same stock, the 

Commission has recognized that ‘‘such 

competition can lead to the 

fragmentation of order flow in that 

stock.’’ 7 Indeed, equity trading is 

currently dispersed across 16 

exchanges,8 numerous alternative 

trading systems,9 and broker-dealer 

internalizers and wholesalers, all 

competing for order flow. Based on 

publicly available information, no single 

exchange currently has more than 20% 

market share.10 Therefore, no exchange 

possesses significant pricing power in 

the execution of equity order flow. More 

specifically, the Exchange currently has 

less than 12% market share of executed 

volume of equities trading.11

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can move order flow, or discontinue or 

reduce use of certain categories of 

products. While it is not possible to 

know a firm’s reason for shifting order 

flow, the Exchange believes that one 

such reason is because of fee changes at 

any of the registered exchanges or nonexchange venues to which the firm 

routes order flow. Accordingly, 

competitive forces compel the Exchange 

to use exchange transaction fees and 

credits because market participants can 

readily trade on competing venues if 

they deem pricing levels at those other 

venues to be more favorable. 

Proposed Rule Change 

MPL Orders 

In response to this competitive 

environment, the Exchange has already 

established multiple levels of credits for 

MPL Orders that allow ETP Holders to 

passively interact with trading interest 

on the Exchange and offer potential 

price improvement to incoming 

marketable orders submitted to the 

Exchange.12 In order to provide an 

incentive for ETP Holders to provide 

such liquidity, the credits increase 

based on increased levels of volume 

directed to the Exchange. The MPL 

Order pricing tiers are intended to 

incentivize ETP Holders to earn 

increased credits by sending greater 

amounts of liquidity-providing MPL 

Orders in Tapes A, B and C securities 

to the Exchange. 

As noted above, the Exchange 

currently provides multiple levels of 

credits, ranging from $0.0015 per share 

to $0.0030 per share, to ETP Holders 

that send MPL Orders that provide 

liquidity to the Exchange. For the 

current MPL Order pricing tier, the 

amount of the per share credit is based 

on an ETP Holder’s ADV of provided 

liquidity in MPL Orders for Tape A, 

Tape B and Tape C Securities combined 

(‘‘MPL Adding ADV’’). 

Under current MPL Tier 8, for ETP 

Holders that have MPL Adding ADV 

during a billing month of at least 1.5 

million shares, the Exchange currently 

provides a credit of $0.0015 per share in 

Tape A, Tape B and Tape C securities. 

Under current MPL Tier 7, for ETP 

Holders with MPL Adding ADV during 

a billing month of at least 2 million 

shares, the Exchange currently provides 

a credit of $0.0020 per share in Tape A, 

Tape B and Tape C securities. Under 

current MPL Tier 6, the Exchange 

provides a credit of $0.0025 per share in 

Tape A, Tape B and Tape C securities 

to ETP Holders that have MPL Adding 

ADV during a billing month of at least 

3 million shares. ETP Holders can 

alternatively qualify for the MPL Tier 6 

credit if they have MPL Adding ADV 

during the billing month of at least 1 

million shares and have MPL Adding 

ADV, as a percent of Adding ADV, of at 

least 50%. Under current MPL Tier 5, 

the Exchange provides a credit of 

$0.0026 per share in Tape A, Tape B 

and Tape C securities to ETP Holders 

that have MPL Adding ADV during a 

billing month of at least 5 million 

shares. ETP Holders can alternatively 

qualify for the MPL Tier 5 credit if they 

have MPL Adding ADV during the 

billing month of at least 2 million shares 

and have MPL Adding ADV, as a 

percent of Adding ADV, of at least 50%. 

Under MPL Tier 4, for ETP Holders with 

MPL Adding ADV during a billing 

month of at least 13 million shares, the 

Exchange currently provides a credit of 

$0.0027 per share in Tape A, Tape B 


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13The Exchange charges a fee of $0.0030 per 

share for MPL Orders in Tape A, Tape B and Tape 

C Securities that remove liquidity from the 

Exchange that are not designated as ‘‘Retail 

Orders.’’ MPL Orders removing liquidity from the 

Exchange that are designated as Retail Orders are 

subject to a fee of $0.0010 per share. See Fee 

Schedule. 

14See Fee Schedule, Section III. Standard Rates— 

Transactions (applicable when Tier Rates do not 

apply). 

and Tape C securities. Under MPL Tier 

3, for ETP Holders with MPL Adding 

ADV during a billing month of at least 

15 million shares, the Exchange 

currently provides a credit of $0.0028 

per share in Tape A, Tape B and Tape 

C securities. Under MPL Tier 2, for ETP 

Holders with MPL Adding ADV during 

a billing month of at least 25 million 

shares, the Exchange currently provides 

a credit of $0.0029 per share in Tape A, 

Tape B and Tape C securities. Finally, 

under MPL Tier 1, for ETP Holders with 

MPL Adding ADV during a billing 

month of at least 30 million shares, the 

Exchange currently provides a credit of 

$0.0030 per share in Tape A, Tape B 

and Tape C securities.13

The Exchange now proposes to 

increase the credits payable for MPL 

Tier 1, MPL Tier 2, MPL Tier 3 and MPL 

Tier 4, as follows: 

• Increase the credit payable for MPL 

Tier 1, from $0.0030 per share to 

$0.0033 per share in Tape A, Tape B 

and Tape C securities, without any 

change to the volume requirement to 

qualify for the proposed higher MPL 

Tier 1 credit; 

• Increase the credit payable for MPL 

Tier 2, from $0.0029 per share to 

$0.0032 per share in Tape A, Tape B 

and Tape C securities, without any 

change to the volume requirement to 

qualify for the proposed higher MPL 

Tier 2 credit; 

• Increase the credit payable for MPL 

Tier 3, from $0.0028 per share to 

$0.0031 per share in Tape A, Tape B 

and Tape C securities, without any 

change to the volume requirement to 

qualify for the proposed higher MPL 

Tier 3 credit; and 

• Increase the credit payable for MPL 

Tier 4, from $0.0027 per share to 

$0.0029 per share in Tape A, Tape B 

and Tape C securities, without any 

change to the volume requirement to 

qualify for the proposed higher MPL 

Tier 4 credit. 

With this proposed change, the MPL 

Order Tiers pricing tier would appear as 

follows: 

MPL order tiers 

Tier 

Minimum requirement Credit for MPL adding 

MPL adding 

ADV 

MPL adding ADV as 

percent of adding ADV Tape A Tape B and Tape C 

MPL Tier 1 ............................................. 30 Million ............................................... .......................................... ($0.0033) ($0.0033) 

MPL Tier 2 ............................................. 25 Million ............................................... .......................................... (0.0032) (0.0032) 

MPL Tier 3 ............................................. 15 Million ............................................... .......................................... (0.0031) (0.0031) 

MPL Tier 4 ............................................. 13 Million ............................................... .......................................... (0.0029) (0.0029) 

MPL Tier 5 ............................................. 5 Million or ............................................. .......................................... (0.0026) (0.0026) 

2 Million ................................................. 50 

MPL Tier 6 ............................................. 3 Million or ............................................. .......................................... (0.0025) (0.0025) 

1 Million ................................................. 50 

MPL Tier 7 ............................................. 2 Million ................................................. .......................................... (0.0020) (0.0020) 

MPL Tier 8 ............................................. 1.5 Million .............................................. .......................................... (0.0015) (0.0015) 

The goal of the proposed rule change 

is to incentivize ETP Holders to increase 

the number of MPL Orders they post on 

the Exchange’s Book, which would 

provide additional price improvement 

opportunities for incoming orders, and 

thus qualify for the proposed higher per 

share credits. MPL Orders allow for 

additional opportunities for passive 

interaction with trading interest on the 

Exchange and are designed to offer 

potential price improvement to 

incoming marketable orders submitted 

to the Exchange. The Exchange believes 

that by correlating the level of the credit 

to the level of MPL Adding ADV, the 

Exchange’s fee structure would 

incentivize ETP Holders to submit more 

liquidity-providing MPL Orders to the 

Exchange, thereby increasing the 

potential for price improvement to 

incoming marketable orders submitted 

to the Exchange. 

The Exchange believes adopting 

increased credits payable under the 

MPL Tiers 1, 2, 3 and 4 would provide 

an incentive for ETP Holders to send 

increased order flow to qualify for these 

tiers. As noted above, the Exchange 

operates in a competitive environment, 

particularly as it relates to attracting 

MPL Orders that are posted on the 

Exchange’s Book. Since the Exchange is 

not amending the volume requirement 

to qualify for MPL Tiers 1, 2, 3 and 4, 

the Exchange believes that the proposed 

higher credits would incentivize ETP 

Holders to route a greater number of 

liquidity-providing orders to the 

Exchange to qualify for the proposed 

higher credits. 

The Exchange does not know how 

much order flow ETP Holders choose to 

route to other exchanges or to offexchange venues. Without having a 

view of ETP Holders’ activity on other 

markets and off-exchange venues, the 

Exchange has no way of knowing 

whether the proposed fee change would 

result in any ETP Holder sending more 

of its liquidity-providing orders to the 

Exchange to qualify for the proposed 

higher credits. The Exchange cannot 

predict with certainty how many ETP 

Holders would avail themselves of this 

opportunity, but additional liquidityproviding orders would benefit all 

market participants because it would 

provide greater execution opportunities 

on the Exchange. The Exchange believes 

the proposed higher credits would 

provide an incentive for ETP Holders to 

submit additional MPL Orders to the 

Exchange to qualify for such credits. 

Sub-Dollar Retail Day Remove Tier 

As described below, the Exchange 

proposes to adopt a new pricing tier that 

would provide ETP Holders the ability 

to pay a lower fee for Retail Orders in 

Sub-Dollar Securities with a time-inforce of Day that remove liquidity from 

the Exchange. Currently, the Exchange 

charges a fee equal to 0.3% of the total 

dollar value for all orders in Sub-Dollar 

Securities that remove liquidity.14

Specifically, the Exchange proposes to 

adopt a new pricing tier titled SubDollar Retail Day Remove Tier under 

Section VIII. Tier Rates—Round Lots 

and Odd Lots (Per Share Price Below 

$1.00). As proposed, ETP Holders that, 

during the billing month, have Retail 

Orders in Sub-Dollar Securities with a 


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86058 Federal Register / Vol. 89, No. 209 / Tuesday, October 29, 2024 / Notices 

15Pursuant to Section I. of the Fee Schedule, the 

term ‘‘CADV’’ means, unless otherwise stated, the 

United States consolidated average daily volume of 

transactions reported to a securities information 

processor (‘‘SIP’’). Transactions that are not 

reported to a SIP are not included in the CADV. If 

CADV is preceded by a reference to a Tape or to 

Sub-Dollar, then CADV would refer to all 

consolidated average daily volume of transactions 

reported to a SIP for all securities in that Tape or 

to all Sub-Dollar securities. 

16 15 U.S.C. 78f(b). 

17 15 U.S.C. 78f(b)(4) and (5). 

18See Regulation NMS, supra note 6, 70 FR at 

37499. 

19See Securities Exchange Act Release No. 51808, 

84 FR 5202, 5253 (February 20, 2019) (File No. S7– 

05–18) (Final Rule). 

20See Cboe U.S. Equities Market Volume 

Summary, available at https://markets.cboe.com/us/ 

equities/market_share. See generally https://

www.sec.gov/fast-answers/divisionsmarketregmr

exchangesshtml.html. 

21See FINRA ATS Transparency Data, available 

at https://otctransparency.finra.org/

otctransparency/AtsIssueData. A list of alternative 

trading systems registered with the Commission is 

available at https://www.sec.gov/foia/docs/ 

atslist.htm. 

22See Cboe Global Markets U.S. Equities Market 

Volume Summary, available at http://

markets.cboe.com/us/equities/market_share/. 

time-in-force of Day equal to 0.20% of 

CADV 15 in Sub-Dollar Securities that 

remove liquidity would be charged a fee 

of 0.20% of total dollar value. ETP 

Holders that meet the proposed volume 

requirement would qualify to pay the 

proposed lower fee for Retail Orders in 

Sub-Dollar Securities with a time-inforce of Day that remove liquidity. 

The purpose of the proposed rule 

change is to encourage greater 

participation from ETP Holders and 

promote liquidity in Retail Orders. The 

Exchange believes that the proposed 

rule change to adopt a volume 

requirement to qualify for the proposed 

fee reduction would incentivize ETP 

Holders to direct a greater number of 

Retail Orders in Sub-Dollar Securities to 

the Exchange that remove liquidity. As 

described above, ETP Holders have a 

choice of where to send their Retail 

Orders in Sub-Dollar Securities that 

remove liquidity. The Exchange believes 

that the proposed rule change to reduce 

fees paid by ETP Holders for Retail 

Orders in Sub-Dollar Securities could 

lead to more ETP Holders choosing to 

route such orders for execution to the 

Exchange rather than to a competing 

exchange. 

While the Exchange proposes to adopt 

a volume threshold for the proposed 

new pricing tier, the Exchange believes 

ETP Holders will to be able to meet the 

proposed requirement given the 

increased trading in Sub-Dollar 

Securities in recent months. ETP 

Holders that trade in Sub-Dollar 

Securities would benefit by paying a 

lower fee for Retail Orders with a timein-force of Day if they choose to send 

such orders to the Exchange. Based on 

their current trading profile on the 

Exchange, a number of ETP Holders 

would currently qualify for the 

proposed lower fee. However, without 

having a view of ETP Holders’ activity 

on other markets and off-exchange 

venues, the Exchange has no way of 

knowing whether this proposed rule 

change would result in other ETP 

Holders directing orders to the 

Exchange in order to qualify for the 

proposed lower fee. The Exchange 

cannot predict with certainty how many 

ETP Holders would avail themselves of 

this opportunity, but increased activity 

of Retail Orders in Sub-Dollar Securities 

would benefit all market participants 

because it would provide greater 

execution opportunities on the 

Exchange. 

The proposed changes are not 

otherwise intended to address any other 

issues, and the Exchange is not aware of 

any significant problems that market 

participants would have in complying 

with the proposed changes. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,16 in general, and 

furthers the objectives of Sections 

6(b)(4) and (5) of the Act,17 in particular, 

because it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members, 

issuers and other persons using its 

facilities and does not unfairly 

discriminate between customers, 

issuers, brokers or dealers. 

The Proposed Fee Change Is Reasonable 

As discussed above, the Exchange 

operates in a highly fragmented and 

competitive market. 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.’’ 18

As the Commission itself recognized, 

the market for trading services in NMS 

stocks has become ‘‘more fragmented 

and competitive.’’ 19 Indeed, equity 

trading is currently dispersed across 16 

exchanges,20 numerous alternative 

trading systems,21 and broker-dealer 

internalizers and wholesalers, all 

competing for order flow. Based on 

publicly-available information, no 

single exchange currently has more than 

20% market share (whether including or 

excluding auction volume).22 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 or reduce use of certain 

categories of products, in response to fee 

changes. Accordingly, the Exchange’s 

fees are reasonably constrained by 

competitive alternatives and market 

participants can readily trade on 

competing venues if they deem pricing 

levels at those other venues to be more 

favorable. 

MPL Orders 

The Exchange believes the proposed 

changes to MPL Tiers 1, 2, 3 and 4 are 

reasonable because the increased credits 

payable under these tiers would provide 

an incentive for ETP Holders to route 

greater amounts of liquidity-providing 

orders to the Exchange. As noted above, 

the Exchange operates in a highly 

competitive environment, particularly 

for attracting order flow that provides 

liquidity on an exchange. The Exchange 

believes it is reasonable to provide the 

higher credits under MPL Tiers 1, 2, 3, 

and 4 for orders that provide liquidity 

if an ETP Holder meets the qualification 

for such pricing tiers. 

The Exchange believes the proposed 

increased credits are reasonable as they 

would provide an additional incentive 

for ETP Holders to qualify for these new 

tiers and direct their order flow to the 

Exchange and provide meaningful 

added levels of liquidity, thereby 

contributing to the depth, market 

quality, and price improvement on the 

Exchange. 

On the backdrop of the competitive 

environment in which the Exchange 

currently operates, the proposed rule 

change is a reasonable attempt by the 

Exchange to increase its liquidity and 

improve its market share relative to its 

competitors. 

Sub-Dollar Retail Day Remove Tier 

The Exchange believes it is reasonable 

to adopt the proposed Sub-Dollar Retail 

Day Remove pricing tier because the 

Exchange believes the proposed lower 

fee under the proposed pricing tier 

would encourage greater participation 

from ETP Holders, which could result in 

increased execution of Retail Orders in 

Sub-Dollar Securities. In this regard, an 

ETP Holder that does not qualify for the 

proposed lower fees would continue to 

pay the current fee applicable to Retail 


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23See Fee Schedule, Retail Tiers under Section 

VII. Tier Rates—Round Lots and Odd Lots (Per 

Share Price $1.00 or Above). 

24See Rebate to Add Non-Displayed Midpoint 

Liquidity, at http://nasdaqtrader.com/Trader.

aspx?id=PriceListTrading2. 

25See Standard Rates under I. Transaction Fees 

(other than for Transactions by an eDMM in 

Securities Assigned to an eDMM), at https://

www.nyse.com/publicdocs/nyse/markets/nyseamerican/NYSE_America_Equities_Price_List.pdf. 

Orders in Sub-Dollar Securities that 

remove liquidity. The proposed new 

pricing tier would create an added 

financial incentive for ETP Holders to 

bring additional retail flow to a public 

market. The proposed new pricing tier 

is also reasonable because it would 

reduce the costs of ETP Holders that 

represent retail flow and potentially also 

reduce costs to their customers. 

The Exchange believes that it is 

reasonable that only Retail Orders in 

Sub-Dollar Securities with a time-inforce designation of Day that remove 

liquidity would count toward qualifying 

for the Sub-Dollar Retail Day Remove 

Tier. The Exchange notes that it 

currently offers lower fees for Retail 

Orders with a time-in-force of Day that 

remove liquidity in securities with a per 

share price of $1.00 or above under 

Retail Tiers 1, 2, and 3 and under Retail 

Step-Up Tier.23 The Exchange believes 

that the proposed volume requirement 

to qualify for the proposed lower fee is 

reasonable because it is within a range 

that the Exchange believes would 

continue to incentivize ETP Holders to 

submit Retail Orders in Sub-Dollar 

Securities to the Exchange to qualify for 

the proposed lower fee. 

The Proposed Fee Change is an 

Equitable Allocation of Credits and Fees 

MPL Orders 

The Exchange believes that the 

adoption of increased credits under 

MPL Tiers 1, 2, 3 and 4 is equitable 

because the magnitude of the additional 

credit is not unreasonably high in 

comparison to the credit paid with 

respect to other pricing tiers on the 

Exchange, and in comparison to the 

credits paid by other exchanges for 

orders that provide midpoint liquidity. 

For example, ETP Holders currently 

receive credits in Tape A, Tape B and 

Tape C securities that range between 

$0.0010 per share and $0.0038 per share 

under Standard and Tiered rates. With 

respect to credits paid by the Exchange’s 

competitors, the Nasdaq Stock Market 

LLC provides a credit of $0.0028 per 

share to add non-displayed midpoint 

liquidity in Tape A, Tape B and Tape 

C Securities on that market for firms 

that add midpoint liquidity that 

represents 0.30% TCV or more 24 NYSE 

American LLC, an affiliate of the 

Exchange, also currently provides a 

credit of $0.0030 per share to add MPL 

liquidity on that market for members 

that add greater than 3.5 million 

shares.25

The Exchange believes the proposed 

rule change would improve market 

quality for all market participants on the 

Exchange and, as a consequence, attract 

more liquidity to the Exchange thereby 

improving market-wide quality. ETP 

Holders that currently qualify for credits 

associated with MPL Orders will 

continue to receive credits when they 

provide liquidity to the Exchange. The 

Exchange believes that recalibrating the 

credits for providing liquidity will 

continue to attract order flow and 

liquidity to the Exchange, thereby 

providing additional price improvement 

opportunities on the Exchange and 

benefiting investors generally. As to 

those market participants that do not 

presently qualify for the credits 

associated with MPL Orders, the 

proposal will not adversely impact their 

existing pricing or their ability to 

qualify for other credits provided by the 

Exchange. 

Sub-Dollar Retail Day Remove Tier 

The Exchange believes that the 

proposed adoption of the Sub-Dollar 

Retail Day Remove pricing tier is 

equitable. The proposed new pricing 

tier is intended to provide ETP Holders 

an incentive to send a greater number of 

Retail Orders in Sub-Dollar Securities to 

the Exchange in order to pay a lower fee 

for such orders when removing liquidity 

from the Exchange, thereby increasing 

the number of orders that are executed 

on the Exchange, promoting price 

discovery and transparency and 

enhancing order execution 

opportunities and improving overall 

liquidity on a public exchange. The 

Exchange also believes that the 

proposed change is equitable because 

the proposed new pricing tier would 

apply to all similarly situated ETP 

Holders that remove liquidity. As 

previously noted, the Exchange operates 

in a competitive environment, 

particularly as it relates to attracting 

Retail Orders to the Exchange. 

The Exchange believes that a number 

of ETP Holders could qualify for the 

proposed lower fee based on their 

current trading profile on the Exchange 

if they choose to direct more of their 

order flow to the Exchange. However, 

without having a view of an ETP 

Holder’s activity on other exchanges 

and off-exchange venues, the Exchange 

has no way of knowing whether this 

proposed rule change would result in 

any ETP Holder directing Retail Orders 

to the Exchange in order to qualify for 

the proposed lower fee. The Exchange 

believes the proposed rule change 

would improve market quality for all 

market participants on the Exchange 

and, as a consequence, attract more 

Retail Orders to the Exchange, thereby 

improving market-wide quality and 

price discovery. 

The Exchange also believes the 

proposed Sub-Dollar Retail Day Remove 

Tier is equitable and not unfairly 

discriminatory because it is available to 

all ETP Holders on an equal basis. The 

Exchange does not believe that it is 

unfairly discriminatory to offer lower 

fees to ETP Holders as these participants 

would be subject to meeting prescribed 

volume requirements. The Exchange 

believes that the proposed rule change 

is also equitable and not unfairly 

discriminatory because maintaining or 

increasing the proportion of Retail 

Orders in exchange-listed securities that 

are executed on a registered national 

securities exchange (rather than relying 

on certain available off-exchange 

execution methods) would contribute to 

investors’ confidence in the fairness of 

their transactions and would benefit all 

investors by deepening the Exchange’s 

liquidity pool, supporting the quality of 

price discovery, promoting market 

transparency and improving investor 

protection. 

The Proposed Fee Change Is Not 

Unfairly Discriminatory 

MPL Orders 

The Exchange believes that the 

adoption of increased credits under 

MPL Tiers 1, 2, 3 and 4 is not unfairly 

discriminatory. Moreover, the proposed 

higher credits neither targets nor will it 

have a disparate impact on any 

particular category of market 

participant. The Exchange believes it is 

not unfairly discriminatory to provide 

the increased per share credits under 

MPL Tiers 1, 2, 3, and 4 as each such 

credit would be provided on an equal 

basis to all ETP Holders that add 

liquidity by meeting the volume 

requirement of MPL Tiers 1, 2, 3, and 

4. The Exchange believes the proposed 

increased per share credits would 

incentivize ETP Holders to send more of 

their MPL Orders to the Exchange to 

qualify for such credits. The proposed 

higher credits would apply equally to 

all ETP Holders as each would be 

required to provide liquidity in MPL 

Orders for Tape A, Tape B and Tape C 

Securities combined during the billing 

month regardless of whether an ETP 

Holder currently meets the requirement 

of another pricing tier. 


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86060 Federal Register / Vol. 89, No. 209 / Tuesday, October 29, 2024 / Notices 

26 15 U.S.C. 78f(b)(8). 

27See Regulation NMS, supra note 6, 70 FR 

37498–99. 

28 15 U.S.C. 78s(b)(3)(A)(ii). 

29 17 CFR 240.19b–4. 

Sub-Dollar Retail Day Remove Tier 

The Exchange believes that the 

adoption of the proposed Sub-Dollar 

Retail Day Remove pricing tier is not 

unfairly discriminatory. The Exchange 

also believes that the proposal to adopt 

a volume requirement to qualify for the 

proposed fee reduction is not unfairly 

discriminatory. In the prevailing 

competitive environment, ETP Holders 

are free to disfavor the Exchange’s 

pricing if they view the proposed fee as 

excessive. Moreover, the proposal 

neither targets nor will it have a 

disparate impact on any particular 

category of market participant. The 

Exchange believes that the proposed 

rule change will incentivize ETP 

Holders to direct a greater number of 

Retail Orders to a public exchange to 

qualify for the proposed reduced fee for 

removing liquidity, thereby promoting 

price discovery and transparency and 

enhancing order execution 

opportunities for ETP Holders. The 

proposal does not permit unfair 

discrimination because the proposed 

volume requirement for removing 

liquidity would be applied to all 

similarly situated ETP Holders, who 

would all be eligible to pay a reduced 

fee on an equal basis. Accordingly, no 

ETP Holder already operating on the 

Exchange would be disadvantaged by 

this allocation of fees. The Exchange 

believes it is not unfairly discriminatory 

to provide lower fees for removing 

liquidity as the proposed fee would be 

provided on an equal basis to all ETP 

Holders that remove liquidity by 

meeting the proposed volume 

requirement. Further, the Exchange 

believes the proposed reduced fee 

would provide an incentive for ETP 

Holders to execute more of their Retail 

Orders on the Exchange. 

Finally, the submission of orders to 

the Exchange is optional for ETP 

Holders in that they could choose 

whether to submit orders to the 

Exchange and, if they do, the extent of 

its activity in this regard. The Exchange 

believes that it is subject to significant 

competitive forces, as described below 

in the Exchange’s statement regarding 

the burden on competition. 

For the foregoing reasons, the 

Exchange believes that the proposal is 

consistent with the Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with Section 6(b)(8) of 

the Act,26 the Exchange believes that the 

proposed rule change would not impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Instead, as 

discussed above, the Exchange believes 

that the proposed changes would 

encourage the submission of additional 

liquidity to a public exchange, thereby 

promoting market depth, price 

discovery and transparency and 

enhancing order execution 

opportunities for ETP Holders. As a 

result, the Exchange believes that the 

proposed change furthers the 

Commission’s goal in adopting 

Regulation NMS of fostering integrated 

competition among orders, which 

promotes ‘‘more efficient pricing of 

individual stocks for all types of orders, 

large and small.’’ 27

Intramarket Competition. The 

proposed changes are designed to attract 

additional order flow to the Exchange. 

The Exchange believes that the adoption 

of higher credits under MPL Tiers 1, 2, 

3 and 4, would continue to incentivize 

market participants to direct more 

orders to the Exchange, and in 

particular, liquidity-providing MPL 

Orders. Greater liquidity benefits all 

market participants on the Exchange by 

providing more trading opportunities. 

The proposed changes to the MPL Order 

pricing tiers should incentivize ETP 

Holders to send liquidity-providing 

orders to the Exchange, thereby 

contributing to robust levels of liquidity, 

which would benefit all market 

participants on the Exchange. The 

proposed higher credits would be 

available to all similarly-situated market 

participants, and, as such, the proposed 

changes would not impose a disparate 

burden on competition among market 

participants on the Exchange. The 

proposed rule change is also designed to 

attract Retail Orders in Sub-Dollar 

Securities to the Exchange. The 

Exchange believes that the proposed 

change would incentivize market 

participants to direct retail order flow to 

a public market. Greater overall order 

flow, trading opportunities, and pricing 

transparency would benefit all market 

participants on the Exchange by 

enhancing market quality and would 

continue to encourage ETP Holders to 

send their orders to the Exchange, 

thereby contributing towards a robust 

and well-balanced market ecosystem. 

The proposed fee reduction would be 

available to all similarly situated market 

participants, and, as such, the proposed 

change would not impose a disparate 

burden on competition among market 

participants on the Exchange. 

Additionally, the proposed change 

would apply to all ETP Holders equally 

in that all ETP Holders would have a 

reasonable opportunity to meet the 

volume requirement to qualify for the 

proposed fee reduction and would pay 

a lower fee for removing liquidity if 

such criteria is met. 

Intermarket Competition. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily choose to send 

their orders to other exchange and offexchange venues if they deem fee levels 

at those other venues to be more 

favorable. As noted above, the 

Exchange’s market share of intraday 

trading (i.e., excluding auctions) is 

currently less than 12%. In such an 

environment, the Exchange must 

continually review, and consider 

adjusting its fees and rebates to remain 

competitive with other exchanges and 

with off-exchange venues. Because 

competitors are free to modify their own 

fees and credits in response, the 

Exchange does not believe its proposed 

fee change can impose any burden on 

intermarket competition. 

The Exchange believes that the 

proposed changes could promote 

competition between the Exchange and 

other execution venues, including those 

that currently offer similar order types 

and comparable transaction pricing, by 

encouraging additional orders to be sent 

to the Exchange for execution. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

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,28 and Rule 19b–4(f)(2) 

thereunder 29 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 selfregulatory organization, which renders 

the proposed rule change effective upon 

filing. 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. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 209 / Tuesday, October 29, 2024 / Notices 86061 

30 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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– 

NYSEARCA–2024–85 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–NYSEARCA–2024–85. This 

file number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

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

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

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

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549 on official 

business days between the hours of 

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

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. Do not include 

personal identifiable information in 

submissions; you should submit only 

information that you wish to make 

available publicly. We may redact in 

part or withhold entirely from 

publication submitted material that is 

obscene or subject to copyright 

protection. All submissions should refer 

to file number SR–NYSEARCA–2024– 

85, and should be submitted on or 

before November 19, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.30

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–25049 Filed 10–28–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101421; File No. SR–C2– 

2024–016] 

Self-Regulatory Organizations; Cboe 

C2 Exchange, Inc.; Notice of Filing of 

a Proposed Rule Change With Respect 

to Amendments to the Seventh 

Amended and Restated Bylaws (the 

‘‘CGM Bylaws’’) of its Parent 

Corporation, Cboe Global Markets, Inc. 

(‘‘Cboe’’ or ‘‘Corporation’’) 

October 23, 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 

11, 2024, Cboe C2 Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘C2’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Cboe C2 Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘C2’’) is filing with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) a proposed rule 

change with respect to amendments to 

the Seventh Amended and Restated 

Bylaws (the ‘‘CGM Bylaws’’) of its 

parent corporation, Cboe Global 

Markets, Inc. (‘‘Cboe’’ or ‘‘Corporation’’). 

The text of the proposed rule change is 

provided in Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

website (http://markets.cboe.com/us/ 

options/regulation/rule_filings/ctwo/), 

at the Exchange’s Office of the 

Secretary, and at the Commission’s 

Public Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

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 

At Cboe’s annual meeting held on 

May 16, 2024, Cboe’s stockholders 

considered two advisory proposals that 

would provide Cboe stockholders with 

the right to call a special meeting of the 

stockholders provided that a certain 

threshold percentage of stockholders 

propose to call such a meeting. The two 

proposals were submitted separately. 

One of the proposals was submitted by 

an individual stockholder (‘‘Stockholder 

Proposal’’). The other proposal was 

submitted by Cboe Management 

(‘‘Management Proposal’’). The 

Stockholder Proposal, which did not 

pass but received 45% of the votes cast, 

requested that the CGM Board take steps 

to enable stockholders having at least 

10% of Cboe’s voting power to call a 

special meeting of the stockholders. The 

Management Proposal, which passed 

with 65% of the votes cast, requested 

that the CGM Board take steps to enable 

stockholders having at least 25% of 

Cboe’s voting power to call a special 

meeting of the stockholders. 

The Nominating & Governance 

Committee of the CGM Board reviewed 

the voting results of the Stockholder 

Proposal and the Management Proposal 

and discussed the stockholder voting 

standards and rights contemplated by 

the CGM Bylaws. Following this review, 

the Nominating & Governance 

Committee recommended to the CGM 

Board, and the CGM Board approved, 

certain changes to the CGM Bylaws to 

implement the Management Proposal. 

The CGM Board also approved 

amending the CGM Bylaws to improve 

the governance processes of Cboe, to 

make certain provisions more consistent 

with Delaware General Corporation Law 

(‘‘DGCL’’), and to make clarifying and 

cleanup changes to the CGM Bylaws. 

The proposed rule change amends the 


khammond on DSKJM1Z7X2PROD with NOTICES