Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 9837 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release Nos. 73328 

(October 9, 2014), 79 FR 62230 (October 16, 2014) 

(SR–MIAX–2014–50); 72567 (July 8, 2014), 79 FR 

40818 (July 14, 2014) (SR–MIAX–2014–34); 72356 

(June 10, 2014), 79 FR 34384 (June 16, 2014) (SR– 

MIAX–2014–26); 71698 (March 12, 2014), 79 FR 

15185 (March 18, 2014) (SR–MIAX–2014–12); 

71700 (March 12, 2014), 79 FR 15188 (March 18, 

2014) (SR–MIAX–2014–13); 71283 (January 10, 

2014), 79 FR 2914 (January 16, 2014) (SR–MIAX– 

2013–63); 71009 (December 6, 2013), 78 FR 75629 

(December 12, 2013) (SR–MIAX–2013–56). 

4The term ‘‘MIAX Select Symbols’’ currently 

means options overlying AA, AAL, AAPL, AIG, 

AMZN, AZN, BABA, BP, C, CBS, CLF, CMCSA, 

EBAY, EEM, EFA, EWJ, FB, FCX, FXI, GE, GILD, 

GLD, GM, GOOG, GOOGL, HTZ, INTC, IWM, IYR, 

JCP, JPM, KO, MO, MRK, NFLX, NOK, NQ, PBR, 

PCLN, PFE, PG, QCOM, QQQ, S, SIRI, SPY, SUNE, 

T, TSLA, USO, VALE, WAG, WFC, WMB, WY, 

XHB, XLE, XLF, XLP, XLU and XOM. 

5The term ‘‘Priority Customer’’ means a person 

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

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

orders in listed options per day on average during 

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

See MIAX Rule 100. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03656 Filed 2–23–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74288; File No. SR–MIAX– 

2015–08] 

Self-Regulatory Organizations; Miami 

International Securities Exchange LLC; 

Notice of Filing and Immediate 

Effectiveness of a Proposed Rule 

Change To Amend Its Fee Schedule 

February 18, 2015. 

Pursuant to the provisions of Section 

19(b)(1) of the Securities Exchange Act 

of 1934 (‘‘Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on February 5, 2015, Miami 

International Securities Exchange LLC 

(‘‘MIAX’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

as described in Items I, II, and III below, 

which Items have been prepared by the 

Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange is filing a proposal to 

amend the MIAX Options Fee Schedule. 

The text of the proposed rule change is 

available on the Exchange’s Web site at 

http://www.miaxoptions.com/filter/

wotitle/rule_filing, at MIAX’s principal 

office, and at the Commission’s Public 

Reference Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

Exchange included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

Exchange has prepared summaries, set 

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

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

Priority Customer Rebate Program (the 

‘‘Program’’) 3 to amend the option 

classes that qualify for the enhanced per 

contract credit for transactions in MIAX 

Select Symbols.4

Under the Program, the Exchange 

credits each Member the per contract 

amount set forth in the Fee Schedule 

resulting from each Priority Customer 5

order transmitted by that Member which 

is executed on the Exchange in all 

multiply-listed option classes 

(excluding mini-options, Priority 

Customer-to-Priority Customer Orders, 

PRIME AOC Responses, PRIME Contraside Orders, PRIME Orders for which 

both the Agency and Contra-side Order 

are Priority Customers, and executions 

related to contracts that are routed to 

one or more exchanges in connection 

with the Options Order Protection and 

Locked/Crossed Market Plan referenced 

in MIAX Rule 1400), provided the 

Member meets certain volume 

thresholds in a month. For each Priority 

Customer order submitted into the 

PRIME Auction as a PRIME Agency 

Order, MIAX shall credit each member 

at the separate per contract rate for 

PRIME Agency Orders; however, no 

rebates will be paid if the PRIME 

Agency Order executes against a Contraside Order which is also a Priority 

Customer. The volume thresholds are 

calculated based on the customer 

average daily volume over the course of 

the month. Volume is recorded for and 

credits are delivered to the Member 

Firm that submits the order to the 

Exchange. The Exchange aggregates the 

contracts resulting from Priority 

Customer orders transmitted and 

executed electronically on the Exchange 

from affiliated Members for purposes of 

the thresholds above, provided there is 

at least 75% common ownership 

between the firms as reflected on each 

firm’s Form BD, Schedule A. In the 

event of a MIAX System outage or other 

interruption of electronic trading on 

MIAX, the Exchange adjusts the 

national customer volume in multiplylisted options for the duration of the 

outage. A Member may request to 

receive its credit under the Program as 

a separate direct payment. 

The Exchange proposes modifying the 

Program to amend the option classes 

that qualify for a per contract credit for 

transactions in MIAX Select Symbols. 

MIAX Select Symbols currently include 

options overlying AA, AAL, AAPL, AIG, 

AMZN, AZN, BABA, BP, C, CBS, CLF, 

CMCSA, EBAY, EEM, EFA, EWJ, FB, 

FCX, FXI, GE, GILD, GLD, GM, GOOG, 

GOOGL, HTZ, INTC, IWM, IYR, JCP, 

JPM, KO, MO, MRK, NFLX, NOK, NQ, 

PBR, PCLN, PFE, PG, QCOM, QQQ, S, 

SIRI, SPY, SUNE, T, TSLA, USO, VALE, 

WAG, WFC, WMB, WY, XHB, XLE, 

XLF, XLP, XLU and XOM. The 

Exchange proposes to modify the MIAX 

Select Symbols to add AMAT, AMD, 

BA, BBRY, BIDU, CAT, CELG, CVX, 

DAL, GPRO, HAL, JNJ, KMI, ORCL, RIG, 

VXX, X, XOP, and YHOO. The 

Exchange also proposes to modify the 

MIAX Select Symbols to remove AZN, 

CMCSA, EFA, EWJ, FXI, GOOG, IYR, 

PCLN, SIRI, and XLU. Thus, the 

Exchange will credit each Member the 

per contract rate set forth in the table 

located in the Fee Schedule resulting 

from each Priority Customer order 

transmitted by that Member executed on 

Exchange in AA, AAL, AAPL, AIG, 

AMAT, AMD, AMZN, BA, BABA, 

BBRY, BIDU, BP, C, CAT, CBS, CELG, 

CLF, CVX, DAL, EBAY, EEM, FB, FCX, 

GE, GILD, GLD, GM, GOOGL, GPRO, 

HAL, HTZ, INTC, IWM, JCP, JNJ, JPM, 

KMI, KO, MO, MRK, NFLX, NOK, NQ, 

ORCL, PBR, PFE, PG, QCOM, QQQ, RIG, 

S, SPY, SUNE, T, TSLA, USO, VALE, 

VXX, WAG, WFC, WMB, WY, X, XHB, 

XLE, XLF, XLP, XOM, XOP, and YHOO. 

The per contract credit would be in lieu 

of the applicable credit that would 

otherwise apply to the transaction based 

on the volume thresholds. The 

Exchange notes that all the other aspects 

of the Program would continue to apply 

to the credits (e.g., the aggregation of 

volume of affiliates, exclusion of 

contracts that are routed to away 


tkelley on DSK3SPTVN1PROD with NOTICES
9838 Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 

6See MIAX Options Fee Schedule, p. 3. See also 

Securities Exchange Act Release Nos. 72798 

(August 8, 2014), 79 FR 47695 (August 14, 2014) 

(SR–MIAX–2014–41); 72567 (July 8, 2014), 79 FR 

40818 (July 14, 2014) (SR–MIAX–2014–34); 72356 

(June 10, 2014), 79 FR 34384 (June 16, 2014) (SR– 

MIAX–2014–26); 71698 (March 12, 2014), 79 FR 

15185 (March 18, 2014) (SR–MIAX–2014–12); 

71700 (March 12, 2014), 79 FR 15188 (March 18, 

2014) (SR–MIAX–2014–13); 71283 (January 10, 

2014), 79 FR 2914 (January 16, 2014) (SR–MIAX– 

2013–63); 71009 (December 6, 2013), 78 FR 75629 

(December 12, 2013) (SR–MIAX–2013–56). 

7See MIAX Fee Schedule, Section 1(b). 

8See NYSE Arca, Inc. Fees Schedule, page 4 

(section titled ‘‘Customer Monthly Posting Credit 

Tiers and Qualifications for Executions in Penny 

Pilot Issues’’). 

9See International Securities Exchange, LLC, 

Schedule of Fees, p. 6 (providing reduced fee rates 

for order flow in Select Symbols); NASDAQ OMX 

PHLX, Pricing Schedule, Section I (providing a 

rebate for adding liquidity in SPY); NYSE Arca, Inc. 

Fees Schedule, page 4 (section titled ‘‘Customer 

Monthly Posting Credit Tiers and Qualifications for 

Executions in Penny Pilot Issues’’). 

10 Despite providing credits under the Program, 

the Exchange represents that it will continue to 

have adequate resources to fund its regulatory 

program and fulfill its responsibilities as a selfregulatory organization while the Program will be 

in effect. 

11 15 U.S.C. 78f(b). 

12 15 U.S.C. 78f(b)(4). 

exchanges, exclusion of mini-options 

. . . etc.).6

For example, if Member Firm ABC, 

Inc. (‘‘ABC’’) has enough Priority 

Customer contracts to achieve 0.5% of 

the national customer volume in 

multiply-listed option contracts during 

the month of October, ABC will receive 

a credit of $0.15 for each Priority 

Customer contract executed in the 

month of October. However, any 

qualifying Priority Customer 

transactions during such month that 

occurred in AA, AAL, AAPL, AIG, 

AMAT, AMD, AMZN, BA, BABA, 

BBRY, BIDU, BP, C, CAT, CBS, CELG, 

CLF, CVX, DAL, EBAY, EEM, FB, FCX, 

GE, GILD, GLD, GM, GOOGL, GPRO, 

HAL, HTZ, INTC, IWM, JCP, JNJ, JPM, 

KMI, KO, MO, MRK, NFLX, NOK, NQ, 

ORCL, PBR, PFE, PG, QCOM, QQQ, RIG, 

S, SPY, SUNE, T, TSLA, USO, VALE, 

VXX, WAG, WFC, WMB, WY, X, XHB, 

XLE, XLF, XLP, XOM, XOP, and YHOO 

would be credited at the $0.20 per 

contact rate versus the standard credit of 

$0.15. Similarly, if Member Firm XYZ, 

Inc. (‘‘XYZ’’) has enough Priority 

Customer contracts to achieve 2.5% of 

the national customer volume in 

multiply-listed option contracts during 

the month of October, XYZ will receive 

a credit of $0.18 for each Priority 

Customer contract executed in the 

month of October. However, any 

qualifying Priority Customer 

transactions during such month that 

occurred in AA, AAL, AAPL, AIG, 

AMAT, AMD, AMZN, BA, BABA, 

BBRY, BIDU, BP, C, CAT, CBS, CELG, 

CLF, CVX, DAL, EBAY, EEM, FB, FCX, 

GE, GILD, GLD, GM, GOOGL, GPRO, 

HAL, HTZ, INTC, IWM, JCP, JNJ, JPM, 

KMI, KO, MO, MRK, NFLX, NOK, NQ, 

ORCL, PBR, PFE, PG, QCOM, QQQ, RIG, 

S, SPY, SUNE, T, TSLA, USO, VALE, 

VXX, WAG, WFC, WMB, WY, X, XHB, 

XLE, XLF, XLP, XOM, XOP, and YHOO 

would be credited at the $0.20 per 

contact rate versus the standard credit of 

$0.18. 

The purpose of the amendment to the 

Program is to further encourage 

Members to direct greater Priority 

Customer trade volume to the Exchange 

in these high volume symbols. Increased 

Priority Customer volume will provide 

for greater liquidity, which benefits all 

market participants on the Exchange. 

The practice of incentivizing increased 

retail customer order flow in order to 

attract professional liquidity providers 

(Market-Makers) is, and has been, 

commonly practiced in the options 

markets. As such, marketing fee 

programs,7 and customer posting 

incentive programs,8 are based on 

attracting public customer order flow. 

The practice of providing additional 

incentives to increase order flow in high 

volume symbols is, and has been, 

commonly practiced in the options 

markets.9 The Program similarly intends 

to attract Priority Customer order flow, 

which will increase liquidity, thereby 

providing greater trading opportunities 

and tighter spreads for other market 

participants and causing a 

corresponding increase in order flow 

from such other market participants in 

these select symbols. Increasing the 

number of orders sent to the Exchange 

will in turn provide tighter and more 

liquid markets, and therefore attract 

more business overall. 

The credits paid out as part of the 

program will be drawn from the general 

revenues of the Exchange.10 The 

Exchange calculates volume thresholds 

on a monthly basis. 

2. Statutory Basis 

The Exchange believes that its 

proposed rule change is consistent with 

Section 6(b) of the Act 11 in general, and 

furthers the objectives of Section 6(b)(4) 

of the Act 12 in particular, in that it is 

an equitable allocation of reasonable 

fees and other charges among Exchange 

members. 

The Exchange believes that the 

proposal to modify the Program to 

expand the number of option classes 

that qualify for the credit for 

transactions in MIAX Select Symbols is 

fair, equitable and not unreasonably 

discriminatory. The credit for 

transactions in the select symbols is 

reasonably designed because it will 

incent providers of Priority Customer 

order flow to send that Priority 

Customer order flow to the Exchange in 

order to receive a credit in a manner 

that enables the Exchange to improve its 

overall competitiveness and strengthen 

its market quality for all market 

participants. The Program which 

provides increased incentives in high 

volume select symbols is also 

reasonably designed to increase the 

competitiveness of the Exchange with 

other options exchanges that also offer 

increased incentives to higher volume 

symbols. The proposed changes to the 

rebate Program are fair and equitable 

and not unreasonably discriminatory 

because it will apply equally to all 

Priority Customer orders in the select 

symbols. All similarly situated Priority 

Customer orders in the select symbols 

are subject to the same rebate schedule, 

and access to the Exchange is offered on 

terms that are not unfairly 

discriminatory. In addition, the Program 

is equitable and not unfairly 

discriminatory because, while only 

Priority Customer order flow qualifies 

for the Program, an increase in Priority 

Customer order flow will bring greater 

volume and liquidity, which benefit all 

market participants by providing more 

trading opportunities and tighter 

spreads. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange believes that the proposed 

change would increase both intermarket 

and intramarket competition by 

incenting Members to direct their 

Priority Customer orders in the select 

symbols to the Exchange, which will 

enhance the quality of quoting and 

increase the volume of contracts traded 

here in those symbols. To the extent that 

there is additional competitive burden 

on non-Priority Customers or trading in 

non-select symbols, the Exchange 

believes that this is appropriate because 

the proposed changes to the rebate 

program should incent Members to 

direct additional order flow to the 

Exchange and thus provide additional 

liquidity that enhances the quality of its 

markets and increases the volume of 

contracts traded here in those symbols. 

To the extent that this purpose is 

achieved, all the Exchange’s market 

participants should benefit from the 

improved market liquidity in such 

select symbols. Enhanced market 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 80, No. 36 / Tuesday, February 24, 2015 / Notices 9839 

13 15 U.S.C. 78s(b)(3)(A)(ii). 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6)(iii). 

quality and increased transaction 

volume that results from the anticipated 

increase in order flow directed to the 

Exchange will benefit all market 

participants and improve competition 

on the Exchange in such select symbols. 

The Exchange notes that it operates in 

a highly competitive market in which 

market participants can readily favor 

competing venues if they deem fee 

levels at a particular venue to be 

excessive. In such an environment, the 

Exchange must continually adjust its 

fees to remain competitive with other 

exchanges and to attract order flow to 

the Exchange. The Exchange believes 

that the proposed rule change reflects 

this competitive environment because it 

reduces the Exchange’s fees in a manner 

that encourages market participants to 

direct their customer order flow, to 

provide liquidity, and to attract 

additional transaction volume to the 

Exchange. Given the robust competition 

for volume among options markets, 

many of which offer the same products, 

implementing a volume based customer 

rebate program to attract order flow like 

the one being proposed in this filing is 

consistent with the above-mentioned 

goals of the Act. This is especially true 

for the smaller options markets, such as 

MIAX, which is competing for volume 

with much larger exchanges that 

dominate the options trading industry. 

MIAX has a nominal percentage of the 

average daily trading volume in options, 

so it is unlikely that the customer rebate 

program could cause any competitive 

harm to the options market or to market 

participants. Rather, the customer rebate 

program is a modest attempt by a small 

options market to attract order volume 

away from larger competitors by 

adopting an innovative pricing strategy. 

The Exchange notes that if the rebate 

program resulted in a modest percentage 

increase in the average daily trading 

volume in options executing on MIAX, 

while such percentage would represent 

a large volume increase for MIAX, it 

would represent a minimal reduction in 

volume of its larger competitors in the 

industry. The Exchange believes that the 

proposal will help further competition, 

because market participants will have 

yet another additional option in 

determining where to execute orders 

and post liquidity if they factor the 

benefits of a customer rebate program 

into the determination. 

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.13 At any time 

within 60 days of the filing of the 

proposed rule change, the Commission 

summarily may temporarily suspend 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. If the Commission 

takes such action, the Commission shall 

institute proceedings to determine 

whether the proposed rule should be 

approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

MIAX–2015–08 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549. 

All submissions should refer to File 

Number SR–MIAX–2015–08. 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 Web site (http://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 Web site 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 such 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–MIAX– 

2015–08 and should be submitted on or 

before March 17, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–03659 Filed 2–23–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74296; File No. SR–EDGX– 

2015–10] 

Self-Regulatory Organizations; EDGX 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Rule 8.15 

Entitled ‘‘Imposition of Fines for Minor 

Violation(s) of Rules’’ 

February 18, 2015. 

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 February 

5, 2015, EDGX Exchange, Inc. (the 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Exchange has 

designated this proposal as a ‘‘noncontroversial’’ proposed rule change 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(6)(iii) 

thereunder,4 which renders it effective 

upon filing with the Commission. 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 filed a proposal to 

amend Rule 8.15 entitled ‘‘Imposition of 


tkelley on DSK3SPTVN1PROD with NOTICES