Federal Register / Vol. 87, No. 61 / Wednesday, March 30, 2022 / Notices 18425 

23 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Exchange initially filed the proposed fee 

changes on March 1, 2022 (SR–CBOE–2022–007). 

On March 14, 2022, the Exchange withdrew that 

filing and submitted this proposal. 

4BOE or FIX Logical Ports provide users the 

ability to enter order/quotes. 

5BOE Bulk Ports provide users with the ability 

to submit single and bulk order messages to enter, 

modify, or cancel orders designated as Post Only 

Orders with a Time-in-Force of Day or GTD with 

an expiration time on that trading day. 

6 Drop Logical Ports grants users the ability to 

receive and/or send drop copies. 

7Purge Ports allow users to submit a cancelation 

for all open orders, or a subset thereof, across 

multiple sessions under the same Executing Firm ID 

(‘‘EFID’’). 

8Spin Ports and GRP Ports are used to request 

and receive a retransmission of data from the 

Exchange’s Multicast PITCH/Top data feeds. 

9For example, if a TPH maintains 3 FIX 

Certification Logical Ports, 1 Purge Certification 

Logical Port, and 1 set of Multicast PITCH Spin 

Server Certification Logical Port, the TPH will be 

assessed $500 per month for Certification Logical 

Port Fees (i.e., 1 FIX, 1 Purge and 1 set of Multicast 

PITCH Spin Server Certification Logical Ports × $0 

and 2 FIX Certification Logical Ports × $250). 

10For example, a TPH may obtain a Certification 

Purge Port free of charge, even if that TPH has not 

otherwise purchased a Purge Port for the live 

production environment. Certification Logical Ports 

are not automatically enabled for each User, but 

rather must be proactively requested by users. 

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–C2–2022–007 and should 

be submitted on or before April 20, 

2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06636 Filed 3–29–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94512; File No. SR–CBOE– 

2022–011] 

Self-Regulatory Organizations; Cboe 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Its Fees 

Schedule 

March 24, 2022. 

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 March 14, 

2022, Cboe Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘Cboe Options’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the Exchange. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Cboe Exchange, Inc. (the ‘‘Exchange’’ 

or ‘‘Cboe Options’’) proposes to amend 

its Fees Schedule. 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://www.cboe.com/ 

AboutCBOE/CBOELegalRegulatory

Home.aspx), 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 

The Exchange proposes to amend its 

Fees Schedule to adopt fees for 

Certification Logical Port fees, effective 

March 1, 2022.3

By way of background, the Exchange 

offers a variety of logical ports, which 

provide users with the ability within the 

Exchange’s System to accomplish a 

specific function through a connection, 

such as order entry, data receipt or 

access to information. Specifically, the 

Exchange offers BOE and FIX Logical 

Ports,4 BOE Bulk Logical Ports,5 Drop 

Logical Ports,6 Purge Ports,7 GRP Ports 

and Multicast PITCH/Top Spin Server 

Ports.8 For each type of the 

aforementioned logical ports that are 

used in the production environment, the 

Exchange also offers corresponding 

ports which provide Trading Permit 

Holders (‘‘TPHs’’) and non-TPHs access 

to the Exchange’s certification 

environment to test proprietary systems 

and applications (i.e., ‘‘Certification 

Logical Ports’’). The certification 

environment facilitates testing using 

replicas of the Exchange’s production 

environment process configurations 

which provide for a robust and realistic 

testing experience. For example, the 

certification environment allows 

unlimited firm-level testing of order 

types, order entry, order management, 

order throughput, acknowledgements, 

risk settings, mass cancelations, and 

purge requests. Historically, the 

Exchange has not assessed fees for 

Certification Logical Ports. The 

Exchange now proposes to establish a 

monthly fee for Certification Logical 

Ports. Particularly, the Exchange 

proposes to adopt a monthly fee of $250 

per Certification Logical Port. However, 

the Exchange notes that it will continue 

to offer free of charge one Certification 

Logical Port per logical port type offered 

in the production environment (i.e., 

BOE, FIX, BOE Bulk, Drop Logical, 

Purge, GRP and Multicast PITCH/Top 

Spin Server Ports) to each TPH or nonTPH, as applicable. Any additional 

Certification Logical Ports will be 

assessed $250 per month per port.9 The 

Exchange notes that purchasing 

additional Certification Logical Ports is 

voluntary and not required in order to 

participate in the production 

environment, including live production 

trading on the Exchange. Additionally, 

TPHs and non-TPHs are not required to 

purchase any particular production 

logical port in order to receive a 

corresponding Certification Logical Port 

free of charge.10 Further, the Exchange 

also notes that other exchanges similarly 


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18426 Federal Register / Vol. 87, No. 61 / Wednesday, March 30, 2022 / Notices 

11See e.g., Nasdaq Stock Market LLC, Equity 7, 

Pricing Schedule, Section 130. See also MIAX 

Options Exchange Fee Schedule, Section 4, Testing 

and Certification Fees. 

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

13 15 U.S.C. 78f(b)(5). 

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

15See Cboe Options Fees Schedule, Logical 

Connectivity Fees. 

16See e.g., Nasdaq Stock Market LLC, Equity 7, 

Pricing Schedule, Section 130. See also MIAX 

Options Exchange Fee Schedule, Section 4, Testing 

and Certification Fees. 

17Although many Users use Certification Logical 

Ports on a daily basis, the Exchange notes frequency 

of use of Certification Logical Ports varies by User 

and depends on a User’s business needs. To the 

extent a User purchases additional Certification 

Logical Ports and its respective needs change or it 

determines it no longer wishes to maintain excess 

Certification Logical Ports, the User is free to cancel 

such ports for the following month(s). 

18See Securities Exchange Act Release No. 73639 

(November 19, 2014), 79 FR 72251 (December 5, 

2014) (File No. S7–01–13) (Regulation SCI Adopting 

Release). 

assess fees related to their respective 

testing environments.11

Lastly, the Exchange does not intend 

to prorate Certification Logical Ports for 

the first month of service and intends to 

make this clear in the notes section 

under the Logical Connectivity Fees 

section of the Fees Schedule. 

2. Statutory Basis 

The Exchange believes the proposed 

rule change is consistent with the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) and the rules and regulations 

thereunder applicable to the Exchange 

and, in particular, the requirements of 

Section 6(b) of the Act.12 Specifically, 

the Exchange believes the proposed rule 

change is consistent with the Section 

6(b)(5) 13 requirements that the rules of 

an exchange be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in regulating, clearing, settling, 

processing information with respect to, 

and facilitating transactions in 

securities, to remove impediments to 

and perfect the mechanism of a free and 

open market and a national market 

system, and, in general, to protect 

investors and the public interest. 

Additionally, the Exchange believes the 

proposed rule change is consistent with 

Section 6(b)(4) of the Act,14 which 

requires that Exchange rules provide for 

the equitable allocation of reasonable 

dues, fees, and other charges among its 

Trading Permit Holders and other 

persons using its facilities. 

As noted above, the Exchange’s 

certification environment provides a 

robust and realistic testing experience 

using a replica of the Exchange’s 

production environment process 

configurations. This environment 

enables market participants to manage 

risk more effectively through testing 

software development changes in 

certification prior to implementing them 

in the live trading environment, thereby 

reducing the likelihood of a potentially 

disruptive system failure in the live 

trading environment, which has the 

potential to affect all market 

participants. As such, the Exchange 

believes it’s reasonable to adopt a 

Certification Logical Port fee as it better 

enables the Exchange to continue to 

maintain and improve its testing 

environment, which the Exchange 

believes serves to improve live 

production trading on the Exchange. 

The Exchange also believes the 

proposed Certification Logical Port fee 

is reasonable because while such ports 

will no longer be completely free, TPHs 

and non-TPHs will continue to be 

entitled to receive free of charge one 

Certification Logical Port for each type 

of logical port that is currently offered 

in the production environment. Notably, 

the Exchange believes one Certification 

Logical Port per logical port type will be 

sufficient for most users and indeed 

anticipates that the majority of users 

will not purchase additional 

Certification Logical Ports. More 

specifically, while the Exchange has no 

way of predicting with certainty the 

impact of the proposed changes, it 

anticipates approximately 41% of Users 

to be assessed fees for Certification 

Logical Ports (i.e., request Certification 

Ports in excess of the Certification 

Logical Ports provided free of charge). 

For those users who wish to obtain 

additional Certification Logical Ports 

based on their respective business 

needs, they are able to do so for a 

modest fee. Indeed, the proposed fee is 

lower than the fees assessed for the 

corresponding logical ports used in the 

Exchange’s production environment.15

Additionally, the Exchange notes other 

exchanges similarly assess fees relating 

to their respective testing 

environments.16 Further, the decision to 

purchase additional ports is optional 

and no market participant is required or 

under any regulatory obligation to 

purchase excess Certification Logical 

Ports in order to access the Exchange’s 

certification environment.17

The Exchange believes the proposed 

fee is also equitable and not unfairly 

discriminatory because it applies 

uniformly to all market participants that 

choose to obtain additional Certification 

Logical Ports. The Exchange also 

believes the proposed fee is reasonable, 

equitable and not unfairly 

discriminatory because it is designed to 

encourage market participants to be 

efficient with their respective 

Certification Logical Port usage. Without 

some sort of fee for its Certification 

Logical Ports, the Exchange believes that 

TPHs and non-TPHs may be less 

efficient in testing their systems, 

potentially resulting in excessive time 

and resources being consumed by the 

Exchange in supporting testing and 

certifying TPHs and non-TPHs to the 

detriment of all market participants as 

Exchange resources are diverted away 

from other trading operations. 

Additionally, similar to its production 

environment, the Exchange’s 

certification environment does not have 

unlimited system capacity to support 

unlimited testing. As such, the proposed 

fee structure also ensures that firms that 

use the most capacity pay for that 

capacity, rather than placing that 

burden on market participants that have 

more modest needs. The Exchange lastly 

believes that its proposed fee is aligned 

with the goals of the Commission in 

facilitating a competitive market for all 

firms that trade on the Exchange and of 

ensuring that critical market 

infrastructure has ‘‘levels of capacity, 

integrity, resiliency, availability, and 

security adequate to maintain their 

operational capability and promote the 

maintenance of fair and orderly 

markets.’’ 18

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 intramarket or 

intermarket competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange does not believe that the 

proposed rule change will impose any 

burden on intramarket competition 

because as the proposed change applies 

uniformly to all market participants. 

Additionally, the Exchange does not 

believe that the proposed fee creates an 

undue burden on competition because 

the Exchange will continue to offer free 

of charge one Certification Logical Port 

per each logical port type offered in the 

production environment. Although the 

Exchange now proposes to charge users 

for additional Certification Logical 

Ports, the Exchange believes without 

some sort of fee assessed for excess 

Certification Logical Ports, TPHs and 

non-TPHs may be less efficient in 

testing their systems, potentially 

resulting in excessive time and 

resources being consumed by the 

Exchange and also potentially impacting 

the certification environment’s capacity 


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Federal Register / Vol. 87, No. 61 / Wednesday, March 30, 2022 / Notices 18427 

19See Securities Exchange Act Release No. 51808 

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

20NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. 

Cir. 2010) (quoting Securities Exchange Act Release 

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

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

21 15 U.S.C. 78s(b)(3)(A). 

22 17 CFR 240.19b–4(f). 

23 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

thresholds. The proposed fee structure 

therefore would ensure that market 

participants that pay the proposed fee 

are the ones that demand the most 

resources from the Exchange. Also as 

discussed, the purchase of additional 

ports is optional and based on the 

business needs of each market 

participant. Moreover, such market 

participants will continue to benefit 

from access to the certification 

environment, which the Exchange 

believes provides a robust and realistic 

testing experience via a replica of the 

production environment. 

The Exchange does not believe that 

the proposed rule changes will impose 

any burden on intermarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act. 

Particularly, the proposed change 

applies only to the Exchange’s 

certification environment. Additionally, 

the Exchange notes that it operates in a 

highly competitive market. TPHs have 

numerous alternative venues that they 

may participate on and direct their 

order flow, including 15 other options 

exchanges, as well as off-exchange 

venues, where competitive products are 

available for trading. Indeed, 

participants can readily choose to send 

their orders to other exchanges, and, 

additionally off-exchange venues, if 

they deem overall fee levels at those 

other venues to be more favorable. 

Moreover, 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.’’ 19 The 

fact that this market is competitive has 

also long been recognized by the courts. 

In NetCoalition v. Securities and 

Exchange Commission, the D.C. Circuit 

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

that competition for order flow is 

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

the U.S. national market system, buyers 

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

agents, have a wide range of choices of 

where to route orders for execution’; 

[and] ’no exchange can afford to take its 

market share percentages for granted’ 

because ’no exchange possesses a 

monopoly, regulatory or otherwise, in 

the execution of order flow from broker 

dealers’ . . . .’’.20 Accordingly, the 

Exchange does not believe its proposed 

fee change imposes any burden on 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

The Exchange neither solicited nor 

received comments on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 21 and paragraph (f) of Rule 

19b–4 22 thereunder. At any time within 

60 days of the filing of the proposed rule 

change, the Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission will institute proceedings 

to determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

CBOE–2022–011 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–CBOE–2022–011. 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 (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 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. All submissions 

should refer to File Number SR–CBOE– 

2022–011 and should be submitted on 

or before April 20, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–06634 Filed 3–29–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94506; File No. SR– 

CboeBZX–2022–020] 

Self-Regulatory Organizations; Cboe 

BZX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend the 

Fee Schedule 

March 24, 2022. 

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 March 14, 

2022, Cboe BZX Exchange, Inc. 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 


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