Federal Register / Vol. 87, No. 13 / Thursday, January 20, 2022 / Notices 3143 

6These estimates are based upon consultation 

with investment advisers that operate investment 

advisory programs that rely on rule 3a–4. 

7The staff bases this estimate in part on the fact 

that, by business necessity, computer records 

already will be available that contain the 

information in the quarterly reports. 

8This estimate is based on the following 

calculation: (25,852,313 continuing clients × 1 

hour) + (2,127,147 new clients × 1.5 hours) + 

(27,979,460 total clients × (0.25 hours × 4 

statements)) = 57,022,493 hours. 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See 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’’). 

5See Securities Exchange Act Release No. 61358, 

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

02–10) (Concept Release on Equity Market 

Structure). 

prepare, conduct and/or review 

interviews regarding the client’s 

financial situation and investment 

objectives as required by the rule.6

Furthermore, the staff estimates that 

each year the investment advisory 

program sponsors’ staff spends 1 hour 

per client to prepare and mail quarterly 

client account statements, including 

notices to update information.7 Based 

on the estimates above, the Commission 

estimates that the total annual burden of 

the rule’s paperwork requirements is 

57,022,493 hours.8

The estimate of average burden hours 

is made solely for the purposes of the 

Paperwork Reduction Act. The estimate 

is not derived from a comprehensive or 

even a representative survey or study of 

the costs of Commission rules and 

forms. An agency may not conduct or 

sponsor, and a person is not required to 

respond to a collection of information 

unless it displays a currently valid 

control number. 

Written comments are invited on: (a) 

Whether the collections of information 

are necessary for the proper 

performance of the functions of the 

Commission, including whether the 

information has practical utility; (b) the 

accuracy of the Commission’s estimate 

of the burdens of the collections of 

information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burdens of the collections 

of information on respondents, 

including through the use of automated 

collection techniques or other forms of 

information technology. Consideration 

will be given to comments and 

suggestions submitted in writing within 

60 days of this publication. 

Please direct your written comments 

to David Bottom, c/o John R. Pezzullo, 

Director/Chief Information Officer, 

Securities and Exchange Commission, 

100 F Street NE, Washington, DC 20549; 

or send an email to: PRA_Mailbox@

sec.gov. 

Dated: January 14, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–01060 Filed 1–19–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–93973; File No. SR– 

NYSEAMER–2021–54] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Change To Amend the NYSE American 

Equities Price List and Fee Schedule 

January 13, 2022. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on December 

30, 2021, NYSE American LLC (‘‘NYSE 

American’’ 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 selfregulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

certain Standard Rates and requirements 

for transaction fees and credits that add 

and remove liquidity in securities at or 

above $1 and reformat the section of the 

NYSE American Equities Price List and 

Fee Schedule (‘‘Price List’’) setting forth 

transactions fees for all transactions 

other than transactions using Retail 

Order Rates, transactions in securities 

below $1, and transactions by an 

Electronic Designated Market Makers 

(‘‘eDMM’’) in assigned securities. The 

Exchange proposes to implement the fee 

changes effective January 3, 2022. The 

proposed change is available on the 

Exchange’s website at www.nyse.com, at 

the principal office of the Exchange, and 

at the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

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

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

Standard Rates for transaction fees and 

credits that add and remove liquidity in 

securities at or above $1 and reformat 

the section of the Price List setting forth 

transactions fees for all transactions 

other than transactions using Retail 

Order Rates, transactions in securities 

below $1, and transactions by an eDMM 

in assigned securities. 

The proposed changes respond to the 

current competitive environment where 

order flow providers have a choice of 

where to direct liquidity-providing and 

liquidity-removing orders by offering 

further incentives for ETP Holders to 

send additional adding and removing 

liquidity to the Exchange. 

The Exchange proposes to implement 

the fee changes effective January 3, 

2022. 

Competitive Environment 

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.’’ 4

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.’’ 5 Indeed, cash equity trading is 

currently dispersed across 16 


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6See 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. 

7See 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. 

8See Cboe Global Markets U.S. Equities Market 

Volume Summary, available at http://markets.

cboe.com/us/equities/market_share/. 

9See id. 

10See Rule 7.31E(d)(3) (description of MPL 

Order). 

11See Rule 1.1E(dd) (definition of PBBO). 

12As defined in the Fee Schedule, Adding ADV 

means an ETP Holder’s average daily volume of 

shares executed on the Exchange that provided 

liquidity. 

13See Rule 1.1E(h) (definition of BBO). 

exchanges,6 numerous alternative 

trading systems,7 and broker-dealer 

internalizers and wholesalers, all 

competing for order flow. Based on 

publicly-available information, no 

single exchange currently has more than 

17% market share.8 Therefore, no 

exchange possesses significant pricing 

power in the execution of cash equity 

order flow. More specifically, the 

Exchange currently has less than 1% 

market share of executed volume of cash 

equities trading.9

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. 

In response to this competitive 

environment, the Exchange has 

established incentives for ETP Holders 

who submit orders that provide 

liquidity on the Exchange. The 

proposed fee change is designed to 

attract additional order flow to the 

Exchange by incentivizing ETP Holders 

to send additional adding liquidity to 

the Exchange to qualify for the liquidity 

removing tiers and fees. The Exchange 

has also established incentives for ETP 

Holders to remove liquidity from the 

Exchange. In addition, as detailed 

below, the proposed higher credits for 

Mid-Point Liquidity Orders (‘‘MPL 

Orders’’) 10 adding liquidity to the 

Exchange are intended to create 

incentives for price improving liquidity 

and increasing the quality of order 

execution on the Exchange’s market, 

which benefits all market participants, 

insofar as MPL Orders provide 

opportunities for market participants to 

interact with orders priced at the 

midpoint of the Protected Best Bid and 

Offer (‘‘PBBO’’).11

Proposed Rule Change 

Currently, for transactions in 

securities priced at or above $1.00, other 

than transactions by eDMMs in assigned 

securities, the Exchange offers the 

following credits for displayed orders 

that add liquidity to the Exchange: 

• Displayed orders and MPL Orders 

that add liquidity to the Exchange 

where the ETP Holder has an average 

daily volume (‘‘ADV’’) of at least 

2,500,000 shares (‘‘Adding ADV’’) 12

currently receive a credit of $0.0026 per 

share. 

• Displayed orders and MPL Orders 

that add liquidity to the Exchange 

where an ETP Holder has Adding ADV 

of at least 750,000 shares currently 

receive a $0.0025 credit per displayed 

and MPL share. Where an ETP Holder 

does not have an Adding ADV of at least 

750,000 shares, such orders currently 

receive a $0.0024 per share. 

• Orders that add displayed liquidity 

to the Exchange and that set a new best 

bid or offer (‘‘BBO’’) on NYSE 

American 13 where an ETP Holder has 

an Adding ADV of at least 2,500,000 

shares currently receive a $0.0027 per 

share credit. Where an ETP Holder does 

not have an Adding ADV of at least 

2,500,000 shares, such orders currently 

receive a $0.0026 per share credit. 

• The current fee for orders removing 

liquidity from the Exchange where an 

ETP Holder has an Adding ADV of at 

least 10,000 shares is $0.0026 per share. 

Where an ETP Holder does not have an 

Adding ADV of at least 10,000 shares, 

the Exchange charges $0.0030 per share 

for all executions that remove liquidity 

from the Exchange. 

The Exchange proposes to restructure 

its tier requirements, credits, and fees in 

order to attract liquidity to the 

Exchange. The Exchange has not made 

substantial changes to its pricing in 

several years and believes that some of 

the current tier requirements, credits, 

and fees no longer incentivize ETP 

Holders to send liquidity to the 

Exchange, and therefore should be 

modified. In addition, the Exchange 

believes that harmonizing the tier 

requirements for orders that add 

liquidity and orders that remove 

liquidity from the Exchange will make 

its Price List clearer and more 

transparent for ETP Holders. The 

Exchange believes that this combination 

of changes, taken together, will cause 

ETP Holders to send more liquidity to 

the Exchange. 

Specifically, the Exchange proposes to 

revise these fees and credits by: (a) 

Reorganizing the fees as ‘‘Tier 1,’’ ‘‘Tier 

2,’’ or ‘‘Non-Tier’’; (b) adjusting the 

Adding ADV levels required to qualify 

for Tier 1 and Tier 2 fees and credits 

and harmonizing such levels for orders 

adding liquidity and orders removing 

liquidity; (c) proposing separate fees 

and credits for MPL Orders adding 

liquidity; and (d) adjusting the fees and 

credits available for ETP Holders 

qualifying for proposed Tier 1, Tier 2, 

and Non-Tier rates, as follows. 

The Exchange proposes to define a 

‘‘Tier 1,’’ pursuant to which it would 

make its best rates available to ETP 

Holders with Adding ADV of at least 

3,500,000 shares. This Adding ADV 

requirement of 3,500,000 shares is an 

increase from the current Adding ADV 

level of 2,500,000 shares required for 

ETP Holders to access the Exchange’s 

best rates for orders adding liquidity, 

and from the current Adding ADV level 

of 10,000 shares required for ETP 

Holders to access the Exchange’s best 

rates for orders removing liquidity. As 

proposed, ETP Holders that qualify for 

Tier 1 would be eligible for the 

following rates: 

• A credit of $0.0026 per share for 

orders adding displayed liquidity (no 

change from the current rate); 

• A credit of $0.0030 per share for 

MPL Orders adding liquidity (an 

increase from the current credit of 

$0.0026 per share); 

• A credit of $0.0029 per share for 

orders adding displayed liquidity that 

set a new BBO on the Exchange (an 

increase from the current credit of 

$0.0027 per share); and 

• A fee of $0.0026 per share for orders 

removing liquidity (no change from the 

current rate). 

The Exchange also proposes to define 

a ‘‘Tier 2,’’ setting out rates available to 

ETP Holders with Adding ADV of at 

least 700,000 shares. This Adding ADV 

requirement of 700,000 is a decrease 

from the current Adding ADV level of 

750,000 shares required for ETP Holders 

to access certain pricing for orders 

adding liquidity. (Currently, there is no 

second-tier Adding ADV requirement 

for orders removing liquidity.) As 

proposed, ETP Holders that qualify for 

Tier 2 would be eligible for the 

following rates: 

• A credit of $0.0023 per share for 

orders adding displayed liquidity (a 

decrease from the current credit of 

$0.0025 per share); 

• A credit of $0.0029 per share for 

MPL Orders adding liquidity (an 

increase from the current credit of 

$0.0025 per share); 


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14 15 U.S.C. 78f(b). 15 15 U.S.C. 78f(b)(4) and (5). 

16See Regulation NMS, supra note 6, 70 FR at 

37499. 

• A credit of $0.0024 per share for 

orders adding liquidity that set a new 

BBO on the Exchange (a decrease from 

the current credit of $0.0026 per share); 

and 

• A fee of $0.0027 for orders 

removing liquidity (an increase from the 

current fee of $0.0026 per share). 

The Exchange also proposes to define 

‘‘Non-Tier’’ rates, which would specify 

the rates available to ETP Holders that 

do not qualify for either Tier 1 or Tier 

2, as follows: 

• A credit of $0.0020 per share for 

orders adding displayed liquidity (a 

decrease from the current credit of 

$0.0024 per share); 

• A credit of $0.0024 per share for 

MPL Orders adding liquidity (no change 

from the current rate); 

• A credit of $0.0020 per share for 

orders adding liquidity that set a new 

BBO on the Exchange (a decrease from 

the current credit of $0.0026 per share); 

and 

• A fee of $0.0030 per share for orders 

removing liquidity (no change from the 

current rate). 

The Exchange proposes to keep the 

current credit of $0.0020 per share for 

non-displayed orders adding liquidity 

and the current fee of $0.0005 per share 

for orders executing in the opening or 

closing auctions, without any change. 

Neither of those rates depends on an 

ETP Holder achieving a certain level of 

Adding ADV. 

These proposed changes are intended 

to incentivize ETP Holders to increase 

the liquidity-providing orders they send 

to the Exchange, which would support 

the quality of price discovery on the 

Exchange and provide additional 

liquidity for incoming orders. The 

Exchange believes that by correlating 

the level of credits to the level of 

executed adding volume on the 

Exchange, the Exchange’s fee structure 

would encourage ETP Holders to submit 

more liquidity-providing orders to the 

Exchange that are likely to be executed, 

thereby increasing the potential for 

incoming marketable orders submitted 

to the Exchange to receive an execution. 

As noted above, the Exchange operates 

in a competitive environment, 

particularly as it relates to attracting 

non-marketable orders that add liquidity 

to the Exchange. The Exchange believes 

that the proposed tiering of credits 

applicable to displayed orders, MPL 

Orders, and orders setting a new NYSE 

American BBO for ETP Holders that 

meet the proposed Adding ADV 

requirements would serve as an 

additional incentive for ETP Holders to 

send liquidity to and improve quoting 

on the Exchange in order to qualify for 

such credits. 

In addition, the Exchange believes 

that the proposed changes to the fees for 

removing liquidity, taken together, will 

incentivize submission of additional 

liquidity to a public exchange, thereby 

promoting price discovery and 

transparency and enhancing order 

execution opportunities for ETP 

Holders. As noted, the Exchange 

operates in a competitive environment, 

particularly as it relates to attracting 

non-marketable orders, which add 

liquidity to the Exchange. The Exchange 

does not know how much order flow 

ETP Holders choose to route to other 

exchanges or to off-exchange venues. 

Because the proposed reconfiguration of 

fees for removing liquidity from the 

Exchange involves the introduction of 

new fees and/or new requirements, the 

Exchange does not know how many ETP 

Holders could qualify for such new fees 

based on their current trading profile on 

the Exchange and if they choose to 

direct order flow to the Exchange. 

Without having a view of ETP Holder’s 

activity on other exchanges and offexchange venues, the Exchange has no 

way of knowing whether this proposed 

rule change would result in any ETP 

Holder directing orders to the Exchange. 

The proposed rule change is designed 

to be available to all ETP Holders on the 

Exchange and is intended to provide 

ETP Holders a greater incentive to direct 

more of their orders to the Exchange. 

Finally, the Exchange would delete 

the current presentation of the Standard 

Rates for liquidity adding and removing 

orders and replace it with the following 

table in the Price List, reflecting all of 

the rates proposed above: 

Minimum 

adding ADV 

requirement 

(shares) 

Fees and credits per share 

Adding 

liquidity— 

displayed 

Setting 

new NYSE 

American BBO 

MPL adding 

liquidity 

Adding 

liquidity— 

non-displayed 

Removing 

liquidity 

Executions 

at open 

and close 

Tier 1 ............................ 3,500,000 $(0.0026) $(0.0029) $(0.0030) $(0.0020) $0.0026 $0.0005 

Tier 2 ............................ 700,000 (0.0023) (0.0024) (0.0029) (0.0020) 0.0027 0.0005 

Non-Tier ....................... N/A (0.0020) (0.0020) (0.0024) (0.0020) 0.0030 0.0005 

The Exchange proposes this nonsubstantive change to reorganize and 

enhance the presentation in the Price 

List in order to add clarity and 

transparency, thereby making the Price 

List easier to navigate. 

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,14 in general, and 

furthers the objectives of Sections 

6(b)(4) and (5) of the Act,15 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, is designed to prevent 

fraudulent and manipulative acts and 

practices and to promote just and 

equitable principles of trade, and does 

not unfairly discriminate between 

customers, issuers, brokers or dealers. 

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.’’ 16

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 fee changes. 


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ETP Holders can choose from any one 

of the 16 currently operating registered 

exchanges, and numerous off-exchange 

venues, to route such order flow. 

Accordingly, competitive forces 

constrain exchange transaction fees that 

relate to orders on an exchange. Stated 

otherwise, changes to exchange 

transaction fees can have a direct effect 

on the ability of an exchange to compete 

for order flow. 

The Proposed Fee Change Is Reasonable 

In light of the competitive 

environment in which the Exchange 

currently operates, the proposed rule 

change is a reasonable attempt to 

increase liquidity on the Exchange and 

improve the Exchange’s market share 

relative to its competitors. The 

Exchange believes the proposed change 

is also reasonable because it is designed 

to attract higher volumes of orders 

transacted on the Exchange by ETP 

Holders, which would benefit all market 

participants by offering greater price 

discovery and an increased opportunity 

to trade on the Exchange. 

Proposed Tier Requirements 

The Exchange believes that aligning 

the Adding ADV tier requirements for 

Tier 1 and Tier 2 for orders adding 

liquidity and orders removing liquidity 

will be clearer for investors and will 

eliminate potential investor confusion, 

thereby removing impediments to and 

perfecting the mechanism of a free and 

open market and a national market 

system, and, in general, protecting 

investors and the public interest. 

The Exchange believes that the 

proposed change increasing to 3,500,000 

shares the minimum Adding ADV 

required for ETP Holders to access its 

best pricing for orders adding and 

removing liquidity under proposed Tier 

1 is a reasonable attempt to increase 

liquidity on the Exchange and improve 

the Exchange’s market share relative to 

its competitors. Currently, ETP Holders 

may qualify for the Exchange’s best 

pricing for orders adding liquidity by 

achieving an Adding ADV of 2,500,000 

shares, and may qualify for the 

Exchange’s best pricing for orders 

removing liquidity by achieving an 

Adding ADV of 10,000 shares. The 

Exchange believes that these current 

levels are not a sufficient incentive, and 

that raising these Adding ADV 

requirements to the proposed level of 

3,500,000 shares would incentivize ETP 

Holders to send more of their liquidityadding orders to the Exchange as 

opposed to other venues, so that they 

may qualify for the Exchange’s best 

pricing for adding and removing 

liquidity. 

Similarly, the Exchange believes that 

adjusting the current Adding ADV 

requirement of 750,000 shares to 

700,000 shares for orders adding 

displayed liquidity under proposed Tier 

2, and adding specified fees under 

proposed Tier 2 for orders removing 

liquidity for ETP Holders with at least 

700,000 shares, will enable more ETP 

Holders to qualify for this tier, thereby 

incentivizing more ETP Holders to send 

their orders to the Exchange. This, in 

turn, would increase liquidity on the 

Exchange and improve the Exchange’s 

market share relative to its competitors. 

The proposed 700,000 share Adding 

ADV requirement is a reduction from 

the current requirement of 750,000 

shares to qualify for certain credits for 

orders adding liquidity, and would 

introduce a Tier 2 Adding ADV 

requirement for orders removing 

liquidity. The Exchange believes that 

establishing the Tier 2 Adding ADV 

requirement at this level would 

incentivize ETP Holders to send more of 

their liquidity-adding orders to the 

Exchange, so that they may qualify for 

Tier 2 pricing for adding and removing 

liquidity. 

Proposed Fees and Credits 

The Exchange believes that the 

proposed changes to the credits 

available for orders adding liquidity to 

the Exchange are reasonable. The 

Exchange believes it is reasonable to 

increase the credits available under Tier 

1 and Tier 2 for MPL Orders adding 

liquidity as it is expected to create 

incentives for ETP Holders to add priceimproving liquidity to the Exchange and 

increase the quality of order execution 

on the Exchange’s market, which 

benefits all market participants, as MPL 

Orders provide opportunities for market 

participants to interact with orders 

priced at the midpoint of the PBBO. The 

Exchange also believes it is reasonable 

to increase the credits available under 

Tier 1 for orders setting a new BBO on 

the Exchange, as it is expected provide 

incentives for ETP Holders to provide 

aggressively-priced orders that improve 

the market by setting the BBO on the 

Exchange. Similarly, the Exchange 

believes that lowering the credits 

available under Tier 2 and at the NonTier level for orders adding displayed 

liquidity and for orders setting a new 

BBO on the Exchange is reasonable 

because the current higher credits did 

not result in greater liquidity as the 

Exchange had anticipated. The 

Exchange believes it is reasonable to 

revise credits when such incentives 

become underutilized. 

The Exchange believes that the 

proposed changes to the fees for orders 

removing liquidity to the Exchange are 

reasonable. The purpose of these 

changes is to encourage additional 

liquidity on the Exchange because 

market participants benefit from the 

greater amounts of displayed liquidity 

present on a public exchange. The 

Exchange believes that the proposed 

new fees will incentivize additional 

liquidity on a public exchange to qualify 

for lower fees for removing liquidity, 

thereby promoting price discovery and 

transparency and enhancing order 

execution opportunities for ETP 

Holders. The proposal is thus 

reasonable because all ETP Holders 

would benefit from such increased 

levels of liquidity. 

Because the proposal involves the 

introduction of new requirements as 

well as new fee and credit levels, the 

Exchange does not know how many ETP 

Holders could qualify for the new fees 

and credits based on their current 

trading profile on the Exchange and if 

they choose to direct order flow to the 

Exchange. As previously noted, without 

a view of ETP Holder activity on other 

exchanges and off-exchange venues, the 

Exchange has no way of knowing 

whether the proposed rule change 

would result in any ETP Holder 

qualifying for a particular tier, credit, or 

fee. The Exchange believes the proposed 

changes are reasonable as it would 

provide an incentive for ETP Holders to 

direct their order flow to the Exchange 

and provide meaningful added levels of 

liquidity in order to qualify for the 

credits, thereby contributing to depth 

and market quality on the Exchange. 

Proposed Non-Substantive Reformatting 

The Exchange believes that the 

proposed changes are reasonable 

because they are clarifying and nonsubstantive. The changes are designed 

to make the Price List easier to read and 

more user-friendly. The Exchange 

believes that this proposed format will 

provide additional transparency of 

Exchange fees and credits, to the benefit 

of market participants and the investing 

public. The Exchange believes the 

change is reasonable and would not be 

inconsistent with the public interest and 

the protection of investors because 

investors will not be harmed and in fact 

would benefit from increased clarity 

and transparency on the Price List, 

thereby reducing potential confusion. 

The Proposed Change Is an Equitable 

Allocation of Fees and Credits 

The Exchange believes its proposal 

equitably allocates its fees among its 

market participants. The Exchange 

believes its proposal equitably allocates 

its fees among its market participants by 


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Federal Register / Vol. 87, No. 13 / Thursday, January 20, 2022 / Notices 3147 

17For example, Cboe EDGX offers credits for 

adding non-retail displayed liquidity ranging from 

$0.0016 to $0.0034 and fees for removing liquidity 

from $0.00275 to $0.0030. See https://

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

schedule/edgx/. 

fostering liquidity provision and 

stability in the marketplace. 

Proposed Tier Requirements 

The Exchange believes its proposal 

equitably allocates its fees and credits 

among its market participants because 

all ETP Holders that participate on the 

Exchange may receive the proposed fees 

and credits if they elect to send their 

orders to the Exchange and meet the 

minimum Adding ADV requirement 

corresponding to the fee or credit. 

Without having a view of ETP Holders’ 

activity on other markets and offexchange venues, the Exchange has no 

way of knowing whether this proposed 

rule change would result in any ETP 

Holder sending more of their orders to 

the Exchange. The Exchange cannot 

predict with certainty how many ETP 

Holders would avail themselves of this 

opportunity, but additional orders 

would benefit all market participants 

because it would provide greater 

execution opportunities on the 

Exchange. The Exchange anticipates 

that multiple ETP Holders would 

endeavor to send more of their orders 

for execution on the Exchange in order 

to meet the proposed requirements for 

Tier 1 and/or Tier 2 pricing, thereby 

earning the proposed higher credits and 

paying the proposed lower fees. 

The Exchange further believes that the 

proposed change is equitable because it 

is reasonably related to the value to the 

Exchange’s market quality associated 

with higher volume in orders. The 

Exchange believes that the proposed 

pricing adjustments would attract order 

flow and liquidity to the Exchange, 

thereby contributing to price discovery 

on the Exchange and benefiting 

investors generally. 

The Exchange believes that the 

proposed rule change is equitable 

because maintaining or increasing the 

proportion of 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 proposal neither targets nor will 

it have a disparate impact on any 

particular category of market 

participant. All ETP Holders would be 

eligible to qualify for the proposed 

credits if they meet the proposed 

Adding ADV requirements for each 

proposed tier. The Exchange believes 

that offering 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 meet 

the Adding ADV requirements to qualify 

for the Exchange’s best prices, the 

proposal would provide a second tier 

with lower requirements that could 

allow those ETP Holders to still qualify 

for preferential credits and fees. The 

proposal will also not adversely impact 

their ability to qualify for other credits 

or fees provided by the Exchange. 

Proposed Fees and Credits 

The Exchange believes the proposal 

equitably allocates fees and credits 

among market participants because all 

ETP Holders that participate on the 

Exchange may qualify for the proposed 

credits and fees. The Exchange believes 

that the proposed changes, taken 

together, will incentivize ETP Holders 

to send additional adding liquidity to 

achieve lower fees 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 it 

would apply to all similarly situated 

ETP Holders that add or remove 

liquidity. The proposed change also is 

equitable because it would be consistent 

with the applicable rate on other 

marketplaces.17

As previously noted, the Exchange 

operates in a competitive environment, 

particularly as it relates to attracting 

orders that add liquidity to the 

Exchange. The Exchange does not know 

how much order flow ETP Holders 

choose to route to other exchanges or to 

off-exchange venues. Because the 

proposed reconfiguration of the fees 

involves the introduction of 

requirements as well as new fees and 

credits, the Exchange does not know 

how many ETP Holders could qualify 

for the new rates based on their current 

trading profiles on the Exchange and if 

they choose to direct order flow to the 

Exchange. Without having a view of 

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 orders to the Exchange. 

Proposed Non-Substantive Reformatting 

The Exchange believes that the 

proposed changes are equitable because 

they are clarifying and non-substantive. 

The changes are designed to make the 

Price List easier to read and more userfriendly. The Exchange believes that 

this proposed format will provide 

additional transparency of Exchange 

fees and credits, to the benefit of market 

participants and the investing public. 

The Exchange believes the change is 

reasonable and would not be 

inconsistent with the public interest and 

the protection of investors because 

investors will not be harmed and in fact 

would benefit from increased clarity 

and transparency on the Price List, 

thereby reducing potential confusion. 

The Exchange believes that the 

proposed reformatted the Price List is 

equitable because the resulting 

streamlined Price List would continue 

to apply to all ETP Holders on an equal 

basis. 

The Proposed Fee Change Is Not 

Unfairly Discriminatory 

Proposed Tier Requirements 

The Exchange believes that the 

proposal is not unfairly discriminatory. 

In the prevailing competitive 

environment, ETP Holders are free to 

disfavor the Exchange’s pricing if they 

believe that alternatives offer them 

better value. The Exchange believes it is 

not unfairly discriminatory to provide 

revised requirements and corresponding 

tiered fees and credits, as the proposed 

fees and credits would be provided on 

an equal basis to all ETP Holders that 

meet the proposed tier requirements. 

Further, the Exchange believes the 

proposed fees and credits would 

incentivize ETP Holders that meet the 

new tiered requirements to send more 

orders to the Exchange. Since the 

minimum Adding ADV requirements 

and some of the proposed fees and 

credits would be new, no ETP Holder 

currently qualifies for them. As noted, 

without a view of ETP Holder 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 Holders 

qualifying for the proposed adding tiers. 

The Exchange believes the proposal is 

reasonable as it would provide an 

incentive for ETP Holders to direct their 

order flow to the Exchange and provide 

meaningful added levels of liquidity in 

order to qualify for the credits, thereby 


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3148 Federal Register / Vol. 87, No. 13 / Thursday, January 20, 2022 / Notices 

18 15 U.S.C. 78f(b)(8). 

19See Securities Exchange Act Release No. 51808, 

70 FR 37495, 37498–99 (June 29, 2005) (S7–10–04) 

(Final Rule). 

20 15 U.S.C. 78s(b)(3)(A). 

21 17 CFR 240.19b–4(f)(2). 

22 15 U.S.C. 78s(b)(2)(B). 

contributing to depth and market 

quality on the Exchange. 

In addition, the Exchange believes 

that the proposal is not unfairly 

discriminatory because it neither targets 

nor will it have a disparate impact on 

any particular category of market 

participant. All ETP Holders that 

provide liquidity could be eligible to 

qualify for the proposed credits under 

Tier 1 or Tier 2 if they meet the 

proposed Adding ADV requirements. 

The Exchange believes that offering 

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 adding 

liquidity credits, the proposal will not 

adversely impact their ability to qualify 

for other credits provided by the 

Exchange. Finally, the submission of 

orders is optional for ETP Holders in 

that they could choose whether to 

submit orders to the Exchange and, if 

they do, they can choose the extent of 

their 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. 

Proposed Fees and Credits 

The Exchange believes that that the 

proposed fees and credits for ETP 

Holders that add or remove liquidity 

will incentivize submission of 

additional liquidity to a public 

exchange to qualify for the revised fees 

and credits, thereby promoting price 

discovery and transparency and 

enhancing order execution 

opportunities for ETP Holders. The 

proposal does not permit unfair 

discrimination because the proposed 

rates would be applied to all similarly 

situated ETP Holders and other market 

participants, who would all be eligible 

for the same rates on an equal basis. 

Accordingly, no ETP Holder already 

operating on the Exchange would be 

disadvantaged by this allocation of fees 

and credits. 

Finally, the Exchange notes that 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. 

Proposed Non-Substantive Reformatting 

The Exchange believes that the 

proposed reformatted the Price List is 

not unfairly discriminatory because the 

resulting streamlined Price List would 

continue to apply to all ETP Holders 

equally. The Exchange believes that the 

reformatted Price List, as proposed, will 

be clearer and less confusing for 

investors and will eliminate potential 

confusion, thereby removing 

impediments to and perfecting the 

mechanism of a free and open market 

and a national market system, and, in 

general, protecting investors and the 

public interest. The Exchange believes 

the change is reasonable and would not 

be inconsistent with the public interest 

and the protection of investors because 

investors will not be harmed and in fact 

would benefit from increased clarity 

and transparency on the Price List, 

thereby reducing potential confusion. 

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,18 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 fee change 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.’’ 19

Intramarket Competition. The 

Exchange believes the proposed change 

would not impose any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. The proposed 

change is designed to attract additional 

orders to the Exchange. The Exchange 

believes that the proposed changes 

would incentivize market participants 

to direct their orders to the Exchange. 

Greater overall order flow, trading 

opportunities, and pricing transparency 

benefit all market participants on the 

Exchange by enhancing market quality 

and continuing to encourage ETP 

Holders to send orders, thereby 

contributing towards a robust and wellbalanced market ecosystem. 

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 

currently has less than 1% market share 

of executed volume of equities trading. 

In such an environment, the Exchange 

must continually adjust its fees and 

credits to remain competitive with other 

exchanges and with off-exchange 

venues. Because competitors are free to 

modify their own fees and credits in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

does not believe its proposed fee change 

can impose any burden on intermarket 

competition. 

The Exchange believes that the 

proposed change 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 

The foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 20 of the Act and 

subparagraph (f)(2) of Rule 19b–4 21

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

At any time within 60 days of the 

filing of such 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 

under Section 19(b)(2)(B) 22 of the Act to 

determine whether the proposed rule 


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Federal Register / Vol. 87, No. 13 / Thursday, January 20, 2022 / Notices 3149 

23 17 CFR 200.30–3(a)(12). 

1Regulation NMS, adopted by the Commission in 

June 2005, redesignated the national market system 

rules previously adopted under Section 11A of the 

Exchange Act. Rule 11Ac1–5 under the Exchange 

Act was redesignated Rule 605 of Regulation NMS. 

See Securities Exchange Act Release No. 51808 

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

2018, Commission amended Rule 605(a)(2) to 

require market centers to keep reports required 

pursuant to Rule 605(a)(1) posted on an internet 

website that is free of charge and readily accessible 

to the public for a period of three years from the 

initial date of posting on the internet website. See 

Securities Exchange Act Release No. 84528 

(November 2, 2018), 83 FR 58338 (November 19, 

2018). 

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– 

NYSEAMER–2021–54 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–NYSEAMER–2021–54. 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. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NYSEAMER–2021–54 and 

should be submitted on or before 

February 10, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–00979 Filed 1–19–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No 270–488, OMB Control No. 

3235–0542] 

Submission for OMB Review; 

Comment Request 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Extension: 

Rule 605 of Regulation NMS 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.) (‘‘PRA’’), the 

Securities and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for approval of 

extension of the previously approved 

collection of information provided for in 

Rule 605 (17 CFR 242.605) under the 

Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.) (‘‘Exchange Act’’). 

Rule 605 of Regulation NMS,1

formerly known as, Rule 11Ac1–5, 

requires market centers to make 

available to the public monthly order 

execution reports in electronic form. 

The Commission believes that many 

market centers retain most, if not all, of 

the underlying raw data necessary to 

generate these reports in electronic 

format. Once the necessary data is 

collected, market centers could either 

program their systems to generate the 

statistics and reports, or transfer the 

data to a service provider (such as an 

independent company in the business of 

preparing such reports or a selfregulatory organization) that would 

generate the statistics and reports. 

The collection of information 

obligations of Rule 605 apply to all 

market centers that receive covered 

orders in national market system 

securities. The Commission estimates 

that approximately 319 market centers 

are subject to the collection of 

information obligations of Rule 605. 

Each of these respondents is required to 

respond to the collection of information 

on a monthly basis. 

The Commission staff estimates that, 

on average, Rule 605 causes each 

respondent to spend 6 hours per month 

to collect the data necessary to generate 

the reports, or 72 hours per year. With 

an estimated 319 market centers subject 

to Rule 605, the total data collection 

time burden to comply with the 

monthly reporting requirement is 

estimated to be 22,968 hours per year. 

Based on discussions with industry 

sources, the Commission staff estimates 

that an individual market center could 

retain a service provider to prepare a 

monthly report using the data collected 

for approximately $2,978 per month or 

$35,736 per year. This per-respondent 

estimate is based on the rate that a 

market center could expect to obtain if 

it negotiated on an individual basis. 

Based on the $2,978 estimate, the 

monthly cost to all 319 market centers 

to retain service providers to prepare 

reports would be approximately 

$949,982, and the total annual cost for 

all 319 market centers would be 

approximately $11,399,784. 

The collection of information 

obligation imposed by Rule 605 is 

mandatory. The response will be 

available to the public and will not be 

kept confidential. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA unless it displays a 

currently valid OMB control number. 

The public may view background 

documentation for this information 

collection at the following website: 

www.reginfo.gov. Find this particular 

information collection by selecting 

‘‘Currently under 30-day Review—Open 

for Public Comments’’ or by using the 

search function. Written comments and 

recommendations for the proposed 

information collection should be sent 

within 30 days of publication of this 

notice to (i) www.reginfo.gov/public/do/ 

PRAMain and (ii) David Bottom, 

Director/Chief Information Officer, 

Securities and Exchange Commission, 

c/o John Pezzullo, 100 F Street NE, 

Washington, DC 20549, or by sending an 

email to: PRA_Mailbox@sec.gov. 


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