42780 Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 

38The Exchange notified market participants of 

the new fees on December 20, 2021. See Data News 

#2021–11 (December 20, 2021, available at http:// 

www.nasdaqtrader.com/ 

TraderNews.aspx?id=dn2021-11. As such, market 

participants have had ample notice of the proposed 

fee changes and will be able to adjust their 

purchases of exchange services accordingly. 39 15 U.S.C. 78s(b)(3)(A)(ii). 

40 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

MRX relative to its affiliated options 

exchanges; and (iii) a sizeable portion of 

subscribers—approximately 15 

percent—have terminated their 

subscriptions following the 

implementation of the proposed fees, 

demonstrating that customers can and 

do exercise choice in deciding whether 

to purchase market data. 

Nothing in the Proposal burdens 

inter-market competition (the 

competition among self-regulatory 

organizations) because approval of the 

Proposal does not impose any burden 

on the ability of other options exchanges 

to compete. Each of the remaining 15 

options exchanges currently sells its 

market data, and is capable of modifying 

its fees in response to the proposed 

changes by MRX. Moreover, allowing 

MRX, or any new market entrant, to 

waive fees for a period of time to allow 

it to become established encourages 

market entry and thereby ultimately 

promotes competition. 

Nothing in the Proposal burdens 

intra-market competition (the 

competition among consumers of 

exchange data) because each customer 

will be able to decide whether or not to 

purchase the Exchange’s market data, as 

demonstrated by the fact that a 

significant number of the Exchange’s 

customers have already elected to 

terminate their access to such feeds. 

The Exchange 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. 

Because competitors are free to modify 

their own fees in response, and because 

market participants may readily adjust 

their order routing practices, the 

Exchange believes that the degree to 

which fee changes in this market may 

impose any burden on competition is 

extremely limited. If the changes 

proposed herein are unattractive to 

market participants, it is likely that the 

Exchange will lose market share.38

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or 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.39 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: (i) 

necessary or appropriate in the public 

interest; (ii) for the protection of 

investors; or (iii) 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– 

MRX–2022–08 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–MRX–2022–08. 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 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. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–MRX–2022–08 and should 

be submitted on or before August 8, 

2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.40

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–15220 Filed 7–15–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–95262; File No. SR–MRX– 

2022–09] 

Self-Regulatory Organizations; Nasdaq 

MRX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend MRX’s Pricing 

Schedule at Options 7, Section 6 To 

Add Port Fees 

July 12, 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 July 1, 

2022, Nasdaq MRX, LLC (‘‘MRX’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (‘‘SEC’’ or 

‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III, below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

MRX’s Pricing Schedule at Options 7, 

Section 6. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/mrx/rules, at the principal 


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3The Exchange initially filed the proposed 

pricing changes on May 2, 2022 (SR–MRX–2022– 

04) instituting fees for membership, ports and 

market data. On June 29, 2022, the Exchange 

withdrew that filing, and submitted separate filings 

for membership, ports and market data. SR–MRX– 

2022–06 replaced the port fees set forth in SR– 

MRX–2022–04. The instant filing replaces SR– 

MRX–2022–06. 

4See, e.g., Securities Exchange Act Release No 

90076 (October 2, 2020), 85 FR 63620 (October 8, 

2020) (Notice of Filing and Immediate Effectiveness 

of a Proposed Rule Change To Adopt the Initial Fee 

Schedule and Other Fees for MEMX LLC). 

5For example, MIAX Emerald commenced 

operations as a national securities exchange 

registered on March 1, 2019. See Securities 

Exchange Act Release No. 84891 (December 20, 

2018), 83 FR 67421 (December 28, 2018) (File No. 

10–233) (order approving application of MIAX 

Emerald, LLC for registration as a national 

securities exchange). MIAX Emerald filed to adopt 

its transaction fees and certain of its nontransaction fees in its filing SR–EMERALD–2019– 

15. See Securities Exchange Act Release No. 85393 

(March 21, 2019), 84 FR 11599 (March 27, 2019) 

(SR–EMERALD–2019–15) (Notice of Filing and 

Immediate Effectiveness of a Proposed Rule Change 

To Establish the MIAX Emerald Fee Schedule). 

MIAX Emerald waived its one-time application fee 

and monthly Trading Permit Fees assessable to 

EEMs and Market Makers among other fees within 

SR–EMERALD–2019–15. 

6Nasdaq recently announced that, beginning in 

2022, Nasdaq plans to migrate its North American 

markets to Amazon Web Services in a phased 

approach, starting with Nasdaq MRX, a U.S. options 

market. The proposed fee changes are entirely 

unrelated to this effort. 

7 ‘‘Financial Information eXchange’’ or ‘‘FIX’’ is 

an interface that allows Members and their 

Sponsored Customers to connect, send, and receive 

messages related to orders and auction orders to the 

Exchange. Features include the following: (1) 

execution messages; (2) order messages; (3) risk 

protection triggers and cancel notifications; and (4) 

post trade allocation messages. See Supplementary 

Material .03(a) to Options 3, Section 7. 

8 ‘‘Specialized Quote Feed’’ or ‘‘SQF’’ is an 

interface that allows Market Makers to connect, 

send, and receive messages related to quotes, 

Immediate-or-Cancel Orders, and auction responses 

to the Exchange. Features include the following: (1) 

options symbol directory messages (e.g., underlying 

and complex instruments); (2) system event 

messages (e.g., start of trading hours messages and 

start of opening); (3) trading action messages (e.g., 

halts and resumes); (4) execution messages; (5) 

quote messages; (6) Immediate-or-Cancel Order 

messages; (7) risk protection triggers and purge 

notifications; (8) opening imbalance messages; (9) 

auction notifications; and (10) auction responses. 

The SQF Purge Interface only receives and notifies 

of purge requests from the Market Maker. Market 

Makers may only enter interest into SQF in their 

assigned options series. See Supplementary 

Material .03(c) to Options 3, Section 7. 

9SQF Purge is a specific port for the SQF 

interface that only receives and notifies of purge 

requests from the Market Maker. Dedicated SQF 

Purge Ports enable Market Makers to seamlessly 

manage their ability to remove their quotes in a 

swift manner. 

10 ‘‘Ouch to Trade Options’’ or ‘‘OTTO’’ is an 

interface that allows Members and their Sponsored 

Customers to connect, send, and receive messages 

related to orders, auction orders, and auction 

responses to the Exchange. Features include the 

following: (1) options symbol directory messages 

(e.g., underlying and complex instruments); (2) 

system event messages (e.g., start of trading hours 

messages and start of opening); (3) trading action 

messages (e.g., halts and resumes); (4) execution 

messages; (5) order messages; (6) risk protection 

triggers and cancel notifications; (7) auction 

notifications; (8) auction responses; and (9) post 

trade allocation messages. See Supplementary 

Material .03(b) to Options 3, Section 7. 

11Clearing Trade Interface (‘‘CTI’’) is a real-time 

cleared trade update message that is sent to a 

Member after an execution has occurred and 

contains trade details specific to that Member. The 

information includes, among other things, the 

following: (i) The Clearing Member Trade 

Agreement (‘‘CMTA’’) or The Options Clearing 

Corporation (‘‘OCC’’) number; (ii) badge or 

mnemonic; (iii) account number; (iv) information 

which identifies the transaction type (e.g., auction 

type) for billing purposes; and (v) market 

participant capacity. See Options 3, Section 

23(b)(1). 

12FIX DROP is a real-time order and execution 

update message that is sent to a Member after an 

order been received/modified or an execution has 

occurred and contains trade details specific to that 

Member. The information includes, among other 

things, the following: (i) executions; (ii) 

cancellations; (iii) modifications to an existing 

order; and (iv) busts or post-trade corrections. See 

Options 3, Section 23(b)(3). 

13 Disaster Recovery ports provide connectivity to 

the Exchange’s disaster recovery data center, to be 

utilized in the event the Exchange should failover 

during a trading day. 

14One free FIX Port would be provided to each 

Electronic Access Member. The term ‘‘Electronic 

Access Member’’ or ‘‘EAM’’ means a Member that 

is approved to exercise trading privileges associated 

with EAM Rights. See General 1, Section 1(a)(6). 

Also, one free SQF Port would be provided to each 

Market Maker. The term ‘‘Market Makers’’ refers to 

‘‘Competitive Market Makers’’ and ‘‘Primary Market 

Makers’’ collectively. See Options 1, Section 

1(a)(21). The term ‘‘Competitive Market Maker’’ 

means a Member that is approved to exercise 

trading privileges associated with CMM Rights. See 

Options 1, Section 1(a)(12). The term ‘‘Primary 

Market Maker’’ means a Member that is approved 

to exercise trading privileges associated with PMM 

Rights. See Options 1, Section 1(a)(35). 

15One free SQF Port would be provided to each 

Market Maker. The term ‘‘Market Makers’’ refers to 

‘‘Competitive Market Makers’’ and ‘‘Primary Market 

Makers’’ collectively. See Options 1, Section 

1(a)(21). The term ‘‘Competitive Market Maker’’ 

means a Member that is approved to exercise 

trading privileges associated with CMM Rights. See 

Options 1, Section 1(a)(12). The term ‘‘Primary 

Market Maker’’ means a Member that is approved 

to exercise trading privileges associated with PMM 

Rights. See Options 1, Section 1(a)(35). 

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 

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 

MRX proposes to amend its Pricing 

Schedule at Options 7, Section 6, Ports 

and Other Services, to assess port fees, 

which are not assessed today, and 

which have not been assessed since 

MRX’s inception in 2016.3 The 

proposed changes are designed to 

update fees for MRX’s services to reflect 

their current value—rather than their 

value when it was a new exchange six 

years ago—based on MRX’s ability to 

deliver value to its customers through 

technology, liquidity and functionality. 

Newly-opened exchanges often charge 

no fees for certain services, such as 

ports, in order to attract order flow to an 

exchange, and later amend their fees to 

reflect the true value of those services.4

Allowing newly-opened exchanges time 

to build and sustain market share before 

charging non-transactional fees 

encourages market entry and promotes 

competition. The proposed port fees 

within Options 7, Section 6, Ports and 

Other Services, are described below. 

This proposal reflects MRX’s 

assessment that it has gained sufficient 

market share to compete effectively 

against the other 15 options exchanges 

without waiving fees for ports. These 

types of fees are assessed by options 

exchanges that compete with MRX in 

the sale of exchange services. New 

exchanges commonly waive 

connectivity fees to attract market 

participants, facilitating their entry into 

the market and, once there is sufficient 

depth and breadth of liquidity, 

‘‘graduate’’ to compete against 

established exchanges and charge fees 

that reflect the value of their services.5

If MRX is incorrect in this assessment, 

that error will be reflected in MRX’s 

ability to compete with other options 

exchanges.6

The Exchange proposes to amend fees 

for the following ports within Options 7, 

Section 6: (1) FIX,7 (2) SQF; 8 (3) SQF 

Purge; 9 (4) OTTO; 10 (5) CTI; 11 (6) FIX 

DROP; 12 and Disaster Recovery Ports.13

Currently, no fees are being assessed for 

these ports. 

The Exchange proposes to assess no 

fee for the first FIX Port obtained by an 

Electronic Access Member 14 or the first 

SQF Port obtained by a Market Maker.15


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16An ‘‘account number’’ shall mean a number 

assigned to a Member. Members may have more 

than one account number. See Options 1, Section 

1(a)(1). 

17SQF’s Port Fees are assessed a higher dollar fee 

as compared to FIX and OTTO ports ($1,250 vs. 

$650) because the Exchange has to maintain options 

assignments within SQF and manage quoting 

traffic. Market Makers may utilize SQF Ports in 

their assigned options series. Market Maker badges 

are assigned to specific SQF ports to manage the 

option series in which a Market Maker may quote. 

Additionally, because of quoting obligations 

provided for within Options 2, Section 5, Market 

Makers are required to provide liquidity in their 

assigned options series which generates quote 

traffic. The Exchange notes because of the higher 

fee, SQF ports are billed per port, per month while 

FIX and OTTO ports are billed per port, per month, 

per account number. Members may have more than 

one account number. 

18One free FIX Port would be provided to each 

Electronic Access Member. The term ‘‘Electronic 

Access Member’’ or ‘‘EAM’’ means a Member that 

is approved to exercise trading privileges associated 

with EAM Rights. See General 1, Section 1(a)(6). 

Also, one free SQF Port would be provided to each 

Market Maker. The term ‘‘Market Makers’’ refers to 

‘‘Competitive Market Makers’’ and ‘‘Primary Market 

Makers’’ collectively. See Options 1, Section 

1(a)(21). The term ‘‘Competitive Market Maker’’ 

means a Member that is approved to exercise 

trading privileges associated with CMM Rights. See 

Options 1, Section 1(a)(12). The term ‘‘Primary 

Market Maker’’ means a Member that is approved 

to exercise trading privileges associated with PMM 

Rights. See Options 1, Section 1(a)(35). 

19One free SQF Port would be provided to each 

Market Maker. The term ‘‘Market Makers’’ refers to 

‘‘Competitive Market Makers’’ and ‘‘Primary Market 

Makers’’ collectively. See Options 1, Section 

1(a)(21). The term ‘‘Competitive Market Maker’’ 

means a Member that is approved to exercise 

trading privileges associated with CMM Rights. See 

Options 1, Section 1(a)(12). The term ‘‘Primary 

Market Maker’’ means a Member that is approved 

to exercise trading privileges associated with PMM 

Rights. See Options 1, Section 1(a)(35). 

20This includes FIX, SQF, SQF Purge, OTTO, CTI 

and FIX Drop Disaster Recovery Ports. 

21Only Market Makers may quote on MRX. The 

Exchange is proposing non-substantive technical 

amendments to add commas within the 

‘‘Production’’ column of the proposed rule text to 

separate terms. 

22TradeInfo is a user interface that permits a 

Member to: (i) search all orders submitted in a 

particular security or all orders of a particular type, 

regardless of their status (open, canceled, executed, 

etc.); (ii) view orders and executions; and (iii) 

download orders and executions for recordkeeping 

purposes. TradeInfo users may also cancel open 

orders at the order, port or firm mnemonic level 

through TradeInfo. See Options 3, Section 23(b)(2). 

23See Phlx and BX Options 3, Section 7 for a list 

of protocols. 

24For example, a Member may desire to utilize 

multiple FIX or OTTO Ports for accounting 

purposes, to measure performance, for regulatory 

reasons or other determinations that are specific to 

that Member. 

The Exchange proposes to assess a FIX 

Port Fee of $650 per port, per month, 

per account number for each subsequent 

port beyond the first port.16 The 

Exchange proposes to assess an SQF 

Port Fee of $1,250 per port, per month 

for each subsequent port beyond the 

first port.17 The Exchange proposes to 

assess an SQF Purge Port Fee of $1,250 

per port, per month. The Exchange 

proposes to assess an OTTO Port Fee of 

$650 per port, per month, per account 

number. The Exchange proposes to 

assess a CTI Port Fee and a FIX Drop 

Port Fee of $650 per port, per month. 

The Exchange proposes to assess no 

fee for the first FIX Disaster Recovery 

Port obtained by an Electronic Access 

Member 18 or the first SQF Disaster 

Recovery Port obtained by a Market 

Maker.19 The Exchange proposes to 

assess each additional FIX Disaster 

Recovery Port and each additional SQF 

Disaster Recovery Port a fee of $50 per 

port, per month, per account number. 

Additionally, the Exchange proposes to 

assess a Disaster Recovery Fee for SQF 

Purge and OTTO Ports of $50 per port, 

per month, per account number. Finally, 

the Exchange proposes to assess a 

Disaster Recovery Fee for CTI Ports and 

FIX DROP Ports of $50 per port, per 

month. 

The OTTO Port, CTI Port, FIX Port, 

FIX Drop Port and all Disaster Recovery 

Ports 20 are available to all Electronic 

Access Members, and will be subject to 

a monthly cap of $7,500. 

The SQF Port and the SQF Purge Port 

are available to all Market Makers, and 

will be subject to a monthly cap of 

$17,500.21

The Exchange is not amending the 

TradeInfo MRX Interface 22 or the 

Nasdaq MRX Depth of Market, Nasdaq 

MRX Order Feed, Nasdaq MRX Top 

Quote Feed, Nasdaq MRX Trades Feed, 

or Nasdaq MRX Spread Feed Ports; all 

of these aforementioned ports will 

continue to be assessed no fees. 

Additionally, as is the case today, the 

Disaster Recovery Ports for TradeInfo 

and the Nasdaq MRX Depth of Market, 

Nasdaq MRX Order Feed, Nasdaq MRX 

Top Quote Feed, Nasdaq MRX Trades 

Feed and Nasdaq MRX Spread Feed 

Ports will not be assessed a fee. 

Order and Quote Entry Protocols 

Only one order protocol is required 

for an MRX Member to submit orders 

into MRX. The Exchange will provide 

each Electronic Access Member one FIX 

Port at no cost to submit orders into 

MRX. Only one quote protocol is 

required for an MRX Market Maker to 

submit quotes into MRX. The Exchange 

will provide each Market Maker one 

SQF Port at no cost to submit quotes 

into MRX. A quoting protocol, such as 

SQF, is only required to the extent an 

MRX Member has been appointed as a 

Market Maker in an options series 

pursuant to Options 2, Section 1. 

Only MRX Members may utilize ports 

on MRX. Any market participant that 

sends orders to a Member would not 

need to utilize a port. The Member can 

send all orders, proprietary and agency, 

through one port to MRX. Members may 

elect to obtain multiple account 

numbers to organize their business, 

however only one account number and 

one port for orders and one port for 

quotes is necessary for a Member to 

trade on MRX. 

MRX also offers an OTTO protocol. 

Unlike FIX, which offers routing 

capability, OTTO does not permit 

routing. Depending on a Member’s 

business model, Members may elect to 

purchase an OTTO Port in addition to 

the one FIX Port offered at no cost. 

Members may prefer one protocol as 

compared to another protocol, for 

example, the ability to route may cause 

a Member to utilize FIX and a Member 

that desires to execute an order locally 

may utilize OTTO. Also, the OTTO Port 

offers lower latency as compared to the 

FIX Port, which may be attractive to 

Members depending on their trading 

behavior. MRX Members utilizing the 

one FIX Port offered at no cost do not 

need to purchase an OTTO Port. 

However, Members may elect to utilize 

both order entry protocols, depending 

on how they organize their business. 

Because the Exchange is providing one 

FIX Port at no cost, the use of an OTTO 

Port is optional. OTTO provides MRX 

Members with an additional choice as to 

the type of protocol that they may use 

to submit orders to the Exchange. 

Today, Nasdaq Phlx LLC (‘‘Phlx’’) and 

Nasdaq BX, Inc. (‘‘BX’’) offer only a FIX 

Port to submit orders on those options 

markets.23

Further, while only one protocol is 

necessary to submit orders into MRX, 

Members may choose to purchase a 

greater number of order entry ports, 

depending on that Member’s business 

model.24 To the extent that Electronic 

Access Members chose to utilize more 

than one FIX Port, the Electronic Access 

Member would be assessed $650 per 

port, per month, per account number for 

each subsequent optional port beyond 

the first port. To the extent that Market 

Makers chose to utilize more than one 

SQF Port, the Market Maker would be 

assessed $1,250 per port, per month for 

each subsequent optional port beyond 

the first port. Additionally, to the extent 

a Member expended more than $7,500 

for FIX Ports or more than $17,500 for 

SQF Ports, the Exchange would not 

charge an MRX Member for additional 

FIX or SQF Ports, respectively, beyond 

the cap. 

Other Protocols 

The Exchange’s proposal to offer an 

SQF Purge Port for $1,250 per port, per 

month is optional. The SQF Purge Port 


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25TradeInfo is free. 

26See MRX Options 3, Section 18, Detection of 

Loss. This risk protection is free. 

27See MRX Options 3, Section 15(a)(3)(B). 

Thresholds may be set by Members based on 

percentage, volume, delta or vega. This risk 

protection is free. 

28The Exchange maintains ports in a number of 

ways to ensure that ports are properly connected to 

the Exchange at all times. This includes offering 

testing, ensuring all ports are up-to-date with the 

latest code releases, as well as ensuring that all 

ports meet the Exchange’s information security 

specifications. 

29See GEMX Options 7, Section 6.C. (Ports and 

Other Services). 30See 15 U.S.C. 78f(b). 31See 15 U.S.C. 78f(b)(4) and (5). 32See NetCoalition, 615 F.3d at 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)). 33See Securities Exchange Act Release No. 51808 

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

(‘‘Regulation NMS Adopting Release’’). 

is designed to assist Market Makers in 

the management of, and risk control 

over, their quotes. Market Makers may 

utilize a purge port to reduce 

uncertainty and to manage risk by 

purging all quotes in their assigned 

options series. Of note, Market Makers 

may only enter interest into SQF in their 

assigned options series. Additionally, 

the SQF Purge Port may be utilized by 

a Market Maker in the event that the 

Member has a system issue and 

determines to purge from the order 

book. The SQF Purge Port is optional as 

Market Makers have various ways of 

purging their quotes from the order 

book. First of all, a Market Maker may 

cancel quotes through SQF in their 

assigned option series. Second, 

TradeInfo permits the cancellation of 

open orders at the order, port or firm 

mnemonic level.25 Third, in the event of 

a loss of communication with the 

Exchange, MRX offers the ability to 

cancel all of a Member’s open quotes via 

a cancel-on-disconnect control.26

Fourth, MRX offers Market Makers the 

ability, with respect to simple orders, to 

establish pre-determined levels of risk 

exposure which would be utilized to 

automatically remove quotes in all 

series of an options class.27

Accordingly, the Exchange believes that 

the SQF Purge Port provides an efficient 

option to other available services which 

allow a Market Maker to cancel quotes. 

CTI Ports and FIX DROP Ports are 

optional as Members have various ways 

of receiving information concerning 

open orders and executed transactions. 

First, FIX and OTTO provide Members 

with real-time order executions similar 

to the Clearing Trade Interface and FIX 

DROP. Second, TradeInfo provides 

Members with the ability to query open 

orders and order executions real-time, at 

no cost, similar to the Clearing Trade 

Interface and FIX DROP. Third, 

Members receive free daily reports 

listing open orders and trade executions 

from the Exchange. While not real-time, 

the Open Orders Report and Trade 

Detail Report provides Members with 

information similar to the Clearing 

Trade Interface and FIX DROP. 

Disaster Recovery 

With respect to Disaster Recovery 

Ports, the Exchange proposes to assess 

no fee for the first FIX Disaster Recovery 

Port obtained by an Electronic Access 

Member or the first SQF Disaster 

Recovery Port obtained by a Market 

Maker. The Exchange proposes to assess 

no fees for these ports to provide 

Members with continuous access to 

MRX in the event of a failover at no 

cost. Electronic Access Members only 

require one FIX Disaster Recovery Port 

to submit orders in the event of a 

failover. Market Makers only require 

one SQF Disaster Recovery Port to 

submit quotes in the event of a failover. 

Electronic Access Members may elect to 

purchase additional optional FIX 

Disaster Recovery Ports for $50 per port, 

per month, per account number. Market 

Makers may elect to purchase additional 

optional SQF Disaster Recovery Ports 

for $50 per port, per month, per account 

number. The additional FIX and SQF 

Disaster Recovery Ports are not 

necessary to connect to the Exchange in 

the event of a failover because the 

Exchange has provided Members with a 

FIX Disaster Recovery Port and an SQF 

Disaster Recovery Port at no cost. 

Further, the Exchange’s proposal to 

offer Disaster Recovery Ports for SQF 

Purge Ports and OTTO Ports for $50 per 

port, per month, per account number 

and Disaster Recovery Ports for CTI 

Ports and FIX DROP Ports for $50 per 

port, per month is optional. As noted 

herein, today, there are other 

alternatives for these ports. The 

purchase of an SQF Purge Port, OTTO 

Port, CTI Port, and FIX DROP Port in 

production is optional and, therefore, so 

is the purchase of Disaster Recovery 

Ports for these ports. The proposed 

Disaster Recovery Port fees are intended 

to encourage Members to be efficient 

when purchasing Disaster Recovery 

Ports. Similar to all other ports, Disaster 

Recovery Ports need to be maintained 

by the Exchange.28

Finally, in the event that an MRX 

Member elects to subscribe to multiple 

ports, the Exchange offers a monthly cap 

beyond which a Member would be 

assessed no additional fees in a given 

month. As noted above, the SQF Port 

and the SQF Purge Port are subject to a 

monthly cap of $17,500 and the OTTO 

Port, CTI Port, FIX Port, FIX Drop Port 

and all Disaster Recovery Ports are 

subject to a monthly cap of $7,500. 

As noted herein, these different 

protocols are not all necessary to 

conduct business on MRX; a Member 

may choose among protocols based on 

their business workflow. The proposed 

port fees are similar to fees assessed by 

GEMX.29

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,30 in general, and furthers the 

objectives of Sections 6(b)(4) and 6(b)(5) 

of the Act,31 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees, and other charges 

among members and issuers and other 

persons using any facility, and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. 

The proposed changes to the Pricing 

Schedule are reasonable in several 

respects. As a threshold matter, the 

Exchange is subject to significant 

competitive forces in the market for 

order flow, which constrains its pricing 

determinations. The fact that the market 

for order flow is competitive has long 

been recognized by the courts. In 

NetCoalition v. Securities and Exchange 

Commission, the D.C. Circuit stated, 

‘‘[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 broker-dealers 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’. . . .’’ 32

The Commission and the courts have 

repeatedly expressed their preference 

for competition over regulatory 

intervention to determine prices, 

products, and services in the securities 

markets. In Regulation NMS, while 

adopting a series of steps to improve the 

current market model, 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.’’ 33

Congress directed the Commission to 

‘‘rely on ‘competition, whenever 


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42784 Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 

34See NetCoalition, 615 F.3d at 534–35; see also 

H.R. Rep. No. 94–229 at 92 (1975) (‘‘[I]t is the intent 

of the conferees that the national market system 

evolve through the interplay of competitive forces 

as unnecessary regulatory restrictions are 

removed.’’). 

35See Securities Exchange Act Release No. 59039 

(December 2, 2008), 73 FR 74,770 (December 9, 

2008) (SR–NYSEArca–2006–21). 

36 Id. 

37See U.S. Securities and Exchange Commission, 

‘‘Staff Guidance on SRO Rule filings Relating to 

Fees’’ (May 21, 2019), available at https://

www.sec.gov/tm/staff-guidance-sro-rule-filings-fees. 

38See e.g. Securities Exchange Act Release Nos. 

77292 (March 4, 2016), 81 FR 12770 (March 10, 

2016) (SR–ISEMercury–2016–02) (Notice of Filing 

and Immediate Effectiveness of Proposed Rule 

Change To Establish the Schedule of Fees); 77409 

(March 21, 2016), 81 FR 16240 (March 25, 2016) 

(SR–ISEMercury–2016–05) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Amend the Schedule of Fees); 81 FR 16238 

(March 21, 2016), 81 FR 16238 (March 25, 2016) 

(SR–ISEMercury–2016–06) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Amend the Schedule of Fees); 77841 (May 16, 

2016), 81 FR 31986 (SR–ISEMercury–2016–11) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the Schedule of 

Fees); 82537 (January 19, 2018), 83 FR 3784 

(January 26, 2018) (SR–MRX–2018–01) (Notice of 

Filing and Immediate Effectiveness of Proposed 

Rule Change To Amend the Schedule of Fees To 

Introduce a New Pricing Model); 82990 (April 4, 

2018), 83 FR 15434 (April 10, 2018) (SR–MRX– 

2018–10) (Notice of Filing and Immediate 

Effectiveness of Proposed Rule Change To Amend 

Chapter IV of the Exchange’s Schedule of Fees); 

28677 (June 14, 2018), 83 FR 28677 (June 20, 2018) 

(SR–MRX–2018–19) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Increase Certain Route-Out Fees Set Forth in 

Section II.A of the Schedule of Fees); 84113 

(September 13, 2018), 83 FR 47386 (September 19, 

2018) (SR–MRX–2018–27) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Relocate the Exchange’s Schedule of Fees); 

85143 (February 14, 2019), 84 FR 5508 (February 

21, 2019) (SR–MRX–2019–02) (Notice of Filing and 

Immediate Effectiveness of a Proposed Rule Change 

To Amend the Pricing Schedule at Options 7, 

Section 3); 85313 (March 14, 2019), 84 FR 10357 

(March 20, 2019) (SR–MRX–2019–05) (Notice of 

Filing and Immediate Effectiveness of a Proposed 

Rule Change Relating to PIM Fees and Rebates); 

86326 (July 8, 2019), 84 FR 33300 (July 12, 2019) 

(SR–MRX–2019–14) (Notice of Filing and 

Immediate Effectiveness of a Proposed Rule Change 

To Adopt Complex Order Pricing); 88022 (January 

23, 2020), 85 FR 5263 (January 29, 2020) (SR–MRX– 

2020–02) (Notice of Filing and Immediate 

Effectiveness of Proposed Rule Change To Amend 

MRX Pricing Schedule); 89046 (June 11, 2020), 85 

FR 36633 (June 17, 2020) (SR–MRX–2020–11) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend Its Pricing 

Schedule at Options 7); 89320 (July 15, 2020), 85 

FR 44135 (July 21, 2020) (SR–MRX–2020–14) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend Its Pricing 

Schedule at Options 7, Section 5, Other Options 

Fees and Rebates, in Connection With the Pricing 

for Orders Entered Into the Exchanges Price 

Improvement Mechanism); 90503 (November 24, 

2020), 85 FR 77317 (December 1, 2020) (SR–MRX– 

2020–18) (Notice of Filing and Immediate 

Effectiveness of Proposed Rule Change To Amend 

Its Pricing Schedule at Options 7 for Orders Entered 

Into the Exchange’s Price Improvement 

Mechanism); 90434 (November 16, 2020), 85 FR 

74473 (November 20, 2020) (SR–MRX–2020–19) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Rule Change To the Exchange’s Pricing 

Schedule at Options 7 To Amend Taker Fees for 

Regular Orders); 90455 (November 18, 2020), 85 FR 

75064 (November 24, 2020) (SR–MRX–2020–21) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the Pricing 

Schedule); and 91687 (April 27, 2021), 86 FR 23478 

(May 3, 2021) (SR–MRX–2021–04) (Notice of Filing 

and Immediate Effectiveness of Proposed Rule 

Change To Amend the Exchange’s Pricing Schedule 

at Options 7). Note that ISE Mercury is an earlier 

name for MRX. 

39See Securities Exchange Act Release No. 86326 

(July 8, 2019), 84 FR 33300 (July 12, 2019) (SR– 

MRX–2019–14) (Notice of Filing and Immediate 

Effectiveness of a Proposed Rule Change to Adopt 

Complex Order Pricing). 

40One distinction is that ISE offered its Members 

access to Nasdaq Precise in 2019 and since that 

time. MRX has never offered Precise. ‘‘Nasdaq 

Precise’’ or ‘‘Precise’’ is a front-end interface that 

allows EAMs and their Sponsored Customers to 

send orders to the Exchange and perform other 

related functions. Features include the following: 

(1) order and execution management: enter, modify, 

and cancel orders on the Exchange, and manage 

executions (e.g., parent/child orders, inactive 

orders, and post-trade allocations); (2) market data: 

access to real-time market data (e.g., NBBO and 

Exchange BBO); (3) risk management: set 

customizable risk parameters (e.g., kill switch); and 

(4) book keeping and reporting: comprehensive 

audit trail of orders and trades (e.g., order history 

and done away trade reports). See ISE 

Supplementary Material .03(d) of Options 3, 

Section 7. Precise is also available on GEMX. 

41Since 2019, ISE has assessed the following port 

fees: a FIX Port Fee of $300 per port, per month, 

per mnemonic, an SQF Port Fee and SQF Purge Port 

Fee of $1,100 per port, per month, an OTTO Port 

Fee of $400 per port, per month, per mnemonic 

with a monthly cap of $4,000, a CTI Port Fee and 

FIX DROP Port Fee of $500 per port, per month, per 

mnemonic. See Securities Exchange Act Release 

No. 82568 (January 23, 2018), 83 FR 4086 (January 

29, 2018) (SR–ISE–2018–07) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Assess Fees for OTTO Port, CTI Port, FIX Port, 

FIX Drop Port and Disaster Recovery Port 

Connectivity). Of note, ISE assessed port fees prior 

to 2019 as well. 

42See note 40, supra. 

possible, in meeting its regulatory 

responsibilities for overseeing the SROs 

and the national market system.’ ’’ 34 As 

a result, the Commission has 

historically relied on competitive forces 

to determine whether a fee proposal is 

equitable, fair, reasonable, and not 

unreasonably or unfairly discriminatory. 

‘‘If competitive forces are operative, the 

self-interest of the exchanges themselves 

will work powerfully to constrain 

unreasonable or unfair behavior.’’ 35

Accordingly, ‘‘the existence of 

significant competition provides a 

substantial basis for finding that the 

terms of an exchange’s fee proposal are 

equitable, fair, reasonable, and not 

unreasonably or unfairly 

discriminatory.’’ 36 In its 2019 guidance 

on fee proposals, Commission staff 

indicated that they would look at factors 

beyond the competitive environment, 

such as cost, only if a ‘‘proposal lacks 

persuasive evidence that the proposed 

fee is constrained by significant 

competitive forces.’’ 37

History of MRX Operations 

Over the years, MRX has amended its 

transactional pricing to remain 

competitive and attract order flow to the 

Exchange.38

In June 2019, MRX commenced 

offering complex orders.39 With the 

addition of complex order functionality, 

MRX offered Members certain order 

types, an opening process, auction 

capabilities and other trading 

functionality that was nearly identical 

to functionality available on ISE.40 By 

way of comparison, ISE assessed fees for 

ports 41 in 2019 while offering the same 

suite of functionality as MRX, with a 

limited exception.42

Ports Are Subject to Significant 

Substitution-Based Competitive Forces 

An exchange can show that a product 

is ‘‘subject to significant substitutionbased competitive forces’’ by 

introducing evidence that customers can 

substitute the product for products 

offered by other exchanges. 

Chart 1 below shows the January 2022 

market share for multiply-listed options 

by exchange. Of the 16 operating 

options exchanges, none currently has 

more than a 13.1% market share, and 

MRX has the smallest market share at 

1.8%. Customers widely distribute their 

transactions across exchanges according 

to their business needs and the ability 

of each exchange to meet those needs 

through technology, liquidity and 

functionality. Average market share for 

the 16 options exchanges is 6.26 

percent, with the median at 5.8, and a 

range between 1.8 and 13.1 percent. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 42785 

43For example, a Member may desire to utilize 

multiple FIX ports for accounting purposes, to 

measure performance, for regulatory reasons or 

Continued 

Market share is the percentage of 

volume on a particular exchange 

relative to the total volume across all 

exchanges, and indicates the amount of 

order flow directed to that exchange. 

High levels of market share enhance the 

value of trading and ports. 

Chart 2 below compares the number 

of firms purchasing FIX and SQF Ports 

from MRX to the number of firms 

purchasing such services from the four 

MRX-affiliated options exchanges, 

GEMX, ISE, The Nasdaq Stock Market 

LLC (‘‘NOM’’) and Phlx. 

Chart 2 shows that fewer firms 

purchased MRX ports in March 2022 

than the ports of its options exchange 

affiliates. As described in detail below, 

only one order protocol is required to 

submit orders to MRX. Quoting 

protocols are only required to the extent 

an MRX Member has been appointed as 

a Market Maker in an options series 

pursuant to Options 2, Section 1, and 

only one quoting protocol is necessary 

to quote on MRX. Members may choose 

a greater number of order or quote entry 

ports, beyond the first FIX Port and the 

first SQF Port which are proposed to be 

offered at no cost, depending on that 

Member’s particular business model.43


khammond on DSKJM1Z7X2PROD with NOTICESEN18JY22.004</GPH> EN18JY22.005</GPH>

70 

60 

50 

20 

10 

0 

Chart 1: Market Share by Exchange for January 2022 

1 ARCA 

PHU< 

CBOI! 

SAT$ 

NOM 

AME)( 

ISi! 

BOX 

, MIAX 

!;OGX 

, MPR~ 

a 

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: GllMX 

i lill<OP 

MIIX 

Market Share - Exchange 

iii I II 111 II - au II 1111111 Ill II I 11 IIIU I 11 1111!1111111111 1u% 

• 1111111111 H 1111 11111 iii a ii&& I J 11.2,i; 

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:1111111111111111111 111 II I I 111111 111 I I al& IIIIIIIIIIIHlllallll -,7% 

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11111111 IIIIN I ill ------••1111•• - 6.2% 

11111 1111111 111111111 111111111 4.8% 

.• IIIIIIH!IIIII llll IHlllllllll 111111111111111 ,U'lll 

4.0'll', 

Ill - .9% 

IIIIIIUIIUI IIIIIIHHIIIIIIIII 2.5% 

2.2% 

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5.11% 

Option Exchanges - Parent Company 

faoxf 

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t-ivsiii1

· 

l ... l!O'1⁄4: .. , 

Chart 2: Number of Firms Purchasing Ports and Purchasing Trading Services from 

Options Venues (March 2022) 

Nasdaq Option Venues - March 2022 

Fix and SQF ports Trading 

IIIMRX 

11 BXOP 

GEMX 

1111 ISE 

UNOM 

PHLX 
42786 Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 

other determinations that are specific to that 

Member. 

44As noted above, one port would be required to 

submit orders and one port would be required to 

submit quotes. 

45Phlx only offers FIX and SQF ports while MRX 

offers FIX, OTTO and SQF ports for order and quote 

entry. 

46The chart displays the log volume for MRX and 

all other options exchanges combined. It is 

‘‘normalized’’ by subtracting each day’s value from 

the first trading day of the year (January 3, 2022). 

The straight lines represent the average normalized 

log volumes from January 3, 2022 through April 29, 

2022 and from May 2, 2022 through June 23, 2022, 

respectively. 

However, Members do not need more 

than one order entry port and one quote 

port to submit interest to MRX. 

The experience of MRX’s affiliates 

shows that the number of ports that 

members choose to purchase varies 

widely. For example, a review of the 

Phlx exchange in April 2022 shows that, 

among its member organizations that 

purchase ports, approximately 26 

percent purchased 1 SQF or FIX port, 

another 26 percent purchased between 2 

and 5 ports, 21 percent purchased 

between 6 and 10 ports, and 28 percent 

purchased more than 11 ports. This 

means that any MRX Member has the 

option of reducing its purchase of port 

services without purchasing a substitute 

product by, for example, reconfiguring 

its systems to change the number of 

ports from 16 to 14.44

By way of comparison, the number of 

ports that MRX Members purchased in 

April 2022 also varies widely. For 

example, approximately 23 percent 

purchased 1 SQF, FIX or OTTO Port,45

another 43 percent purchased between 2 

and 5 ports, 13 percent purchased 

between 6 and 10 ports, and 20 percent 

purchased more than 11 ports. MRX 

Members, similar to Phlx member 

organizations, have the option of 

reducing their port purchases without 

purchasing a substitute product. 

All of these statistics must be viewed 

in the context of a field with relatively 

low barriers to entry. MRX, like many 

new entrants to the field, offered ports 

for free to establish itself and gain 

market share. As new entrants enter the 

field, MRX can also expect competition 

from these new entrants. Those new 

entrants, like MRX, are likely to set port, 

or other fees to zero, increasing 

marketplace competition. Chart 3 below 

demonstrates that since the inception of 

its membership, port and market data 

fees, MRX volumes declined. 

Specifically, since May 2, 2022, MRX 

saw a larger drop in its average daily 

volume (-11%) than all other options 

exchanges (-5%) since MRX’s fees were 

added on May 2, 2022 when compared 

to their respective year-to-date volumes 

through April 29, 2022. This pattern 

indicates that the adoption of MRX 

membership, port, and market data fees 

impacted MRX’s volume negatively. 

In summary, MRX port fees are 

subject to significant substitution-based 

competitive forces due to its 

consistently low percentage of market 

share, the relatively small number of 

purchasers for each product, and the 

purchasers that either cancelled or are 

reviewing their subscriptions. 

Implementation of the proposed fees is 

therefore consistent with the Act. 

The Exchange believes that there are 

many factors that may cause a market 

participant to decide to become a 

member of a particular exchange. 

Among various factors, the Exchange 

believes market participants consider: 

(i) an exchange’s available liquidity in 

options series; (ii) trading functionality 

offered on a particular market; (iii) 

product offerings; (iv) customer service 

on an exchange; and (v) transactional 

pricing. The Exchange believes that the 

decision to become a member of an 

exchange, particularly as a registered 

market maker, is a complex one that is 

not solely based on non-transactional 

costs assessed by an exchange. Market 

participants weigh the tradeoff between 

where they choose to deploy liquidity 

versus where trading opportunities 

exist. Of course, the cost of ports may 

factor into a decision to become a 

member of a certain exchange, but the 

Exchange believes it is by no means the 

only factor when comparing exchanges. 

Market Makers 

Market makers play an important role 

on options exchanges as they provide 


khammond on DSKJM1Z7X2PROD with NOTICESEN18JY22.006</GPH>

Chart 3: MRX Options Volume as Compared to Options Volume on 15 Other 

Options Exchanges in 202246 

0.5 

0.4 

0.3 

G.I 0.2 

E 

:::s 0.1 

g_ 0.0 

_, g1 -0.1 

~ -0.2 ... N 

·;;; -0.3 

E -o.4 

~ -0.5 

-0.6 

-0.7 

-0.8 

-0.9 

Jan 1 Feb1 Mari Ap1·1 May1 Jun 1 Jul 1 
Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 42787 

47See Phlx, ISE, GEMX, MRX, BX and NOM 

Options 2, Section 3; Cboe Exchange, Inc. (‘‘Cboe’’) 

Rule 5.50; BOX Exchange LLC (‘‘BOX’’) Rule 8030; 

MIAX Rule 602; and NYSE Arca, Inc. (‘‘NYSE 

Arca’’) Rule 6.35–O. 

48See ISE, GEMX and MRX, Phlx, BX and NOM 

Options 2, Section 5; Cboe Rule 5.52; BOX Rule 

8050; MIAX Rule 604; and NYSE Arca Rule 6.37A– 

O. 

49Options markets refer to the primary market 

maker on an exchange in several ways. 

50See BX Options 2, Section 4; ISE, GEMX and 

MRX, and Phlx Options 2, Section 5; BOX Rule 

8055; MIAX Rule 604; and NYSE Arca Rule 6.37A– 

O. 

51See BX Options 2, Section 4; ISE, GEMX and 

MRX, Phlx and NOM Options 2, Section 5; and 

Cboe Rule 5.52; BOX Rule 8040. 

52See ISE, GEMX, MRX, Phlx and BX Options 3, 

Section 13; MIAX Rule 515A; Cboe Rule 5.37; and 

BOX Rules 7150 and 7245. 

53See Phlx and ISE Options 3, Section 14; MIAX 

Rule 518; Cboe Rule 5.33; BOX Rule 7240; and 

NYSE Arca Rule 6.91–O. 

54See ISE, GEMX, MRX, Phlx, BX and NOM 

Options 3, Section 7; MIAX Rule 615; Cboe Rule 

5.6; BOX Rule 7110; and NYSE Arca Rule 6.62–O. 

55See Cboe Rule 5.85; BOX Rule 7130; and NYSE 

Arca Rule 6.76–O. 

56See Phlx, ISE, GEMX and MRX Options 3, 

Section 10; and BOX Rule 7135. 

57See BX Options 3, Section 10. While BX’s rule 

permits both price/time and size pro-rata allocation, 

all symbols on BX are currently designated as Price/ 

Time. See also BOX Rules 7130 and 7135. MIAX’s 

rule permits both Price-Time and Pro-Rata 

allocation. See also MIAX Rule 514. 

58See ISE, GEMX and MRX Options 3, Section 

11; NYSE American Rules 971.1NY and 971.2NY; 

and Cboe Rule 5.39. 

59See ISE, GEMX, MRX, Phlx, BX and NOM 

Options 3, Section 8; Cboe Rule 5.31, MIAX Rule 

503, BOX Rule 7070, and NYSE Arca Rule 6.64–O. 

60Today, Phlx, Cboe, BOX, NYSE Arca, and 

NYSE American LLC have an options trading floor. 

Trading floors require an on-floor presence to 

execute options transactions. 

61There are certain features of open outcry 

trading that are difficult to replicate in an electronic 

trading environment. The Exchange has observed, 

and understands from various market participants, 

that they have difficulty executing certain orders, 

such as larger orders and high-risk and complicated 

strategies, in an all-electronic trading configuration 

without the element of human interaction to 

negotiate pricing for these orders. 

62See e.g., options on the Nasdaq-100 Index®

available on ISE, GEMX and Phlx as well as Cboe’s 

Market Volatility Index®. Currently, MRX does not 

list any proprietary products. 

63Service bureaus may obtain ports on behalf of 

Members. The Exchange would only assign a badge 

and/or mnemonic to a Member to be utilized to 

submit quotes and/or orders to the Exchange. 

liquidity. In options markets, registered 

market makers are assigned options 

series 47 and are required to quote in 

those options series for a specified time 

period during the day.48 Typically, a 

lead or primary market maker 49 will be 

required to quote for a longer period of 

time during the day as compared to 

other market makers registered on an 

exchange.50 Additionally, market 

makers are typically required to quote 

within a certain width on options 

markets.51 Greater liquidity on options 

markets benefits all market participants 

by providing more trading opportunities 

and attracting greater participation by 

market makers. An increase in the 

activity of market makers in turn 

facilitates tighter spreads. Market 

participants are attracted to options 

markets that have ample liquidity and 

tighter spreads in options series. 

Trading Functionality 

An exchange’s trading functionality 

attracts market participants who may 

elect, for example, to submit an order 

into a price improving auction,52 enter 

a complex order,53 or utilize a particular 

order type.54 Different options 

exchanges offer different trading 

functionality to their members. For 

example, with respect to priority and 

allocation of an order book, some 

options exchanges have price/time 

allocation,55 some have a size pro-rata 

allocation,56 while other exchanges offer 

both allocation models.57 The allocation 

methodology on a particular options 

exchange’s order book may attract 

certain market participants. Also, the 

manner in which some options markets 

structure their solicitation auction,58 or 

opening process,59 may be attractive to 

certain market participants. Finally, 

some exchanges have trading floors 60

which may accommodate trading for 

certain market participants or trading 

firms.61

Product Offerings 

Introducing new and innovative 

products to the marketplace designed to 

meet customer demands may attract 

market participants to a particular 

options venue. New products in the 

options industry may allow market 

participants greater trading and hedging 

opportunities, as well as new avenues to 

manage risks. The listing of new options 

products enhances competition among 

market participants by providing 

investors with additional investment 

vehicles, as well as competitive 

alternatives, to existing investment 

products. An exchange’s proprietary 

product offering may attract order flow 

to a particular exchange to trade a 

particular options product.62

Transaction Pricing 

The pricing available on a particular 

exchange may impact a market 

participant’s decision to submit order 

flow to a particular options venue. The 

options industry is competitive. Clear 

substitutes to the Exchange exist in the 

market for options security transaction 

services; the Exchange is only one of 

sixteen options exchanges to which 

market participants may direct their 

order flow. Within this environment, 

market participants can freely, and often 

do, shift their order flow among the 

Exchange and competing venues in 

response to changes in their respective 

pricing schedules. 

Fees for Ports 

The proposed port fees described 

below are in line with those of other 

markets. Setting a fee above competitors 

is likely to drive away customers, so the 

most efficient price-setting strategy is to 

set prices at the same level as other 

firms. 

As noted above, market participants 

may choose to become a member of one 

or more options exchanges based on the 

market participant’s business model. A 

very small number of market 

participants choose to become a member 

of all sixteen options exchanges. It is not 

a requirement for market participants to 

become members of all options 

exchanges, in fact, certain market 

participants conduct an options 

business as a member of only one 

options market. Most firms that actively 

trade on options markets are not 

currently Members of MRX and do not 

purchase port services at MRX. Ports are 

only available to MRX Members or 

service bureaus, and only an MRX 

Member may utilize a port.63

Using options markets that Nasdaq 

operates as points of comparison, less 

than a third of the firms that are 

members of at least one of the options 

markets that Nasdaq operates are also 

Members of MRX (approximately 29%). 

The Exchange notes that no firm is a 

Member of MRX only. Few, if any, firms 

have purchased port services at MRX, 

notwithstanding the fact that ports are 

currently free, because MRX currently 

has less liquidity than other options 

markets. As explained above, MRX has 

the smallest market share of the 16 

options exchanges, representing only 

approximately 1.8% of the market, and, 

for certain market participants, the 

current levels of liquidity may be 

insufficient to justify the costs 

associated with becoming a Member and 

connecting to the Exchange, 

notwithstanding the fact that ports are 

currently free. 

The decision to become a member of 

an exchange, particularly for registered 

market makers, is complex, and not 

solely based on the non-transactional 

costs assessed by an exchange. As noted 

herein, specific factors include, but are 

not limited to: (i) an exchange’s 

available liquidity in options series; (ii) 

trading functionality offered on a 

particular market; (iii) product offerings; 

(iv) customer service on an exchange; 


khammond on DSKJM1Z7X2PROD with NOTICES
42788 Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 

64See Options Order Protection and Locked/ 

Crossed Market Plan (August 14, 2009), available at 

https://www.theocc.com/getmedia/7fc629d9-4e54- 

4b99-9f11-c0e4db1a2266/options_order_protection_

plan.pdf. 

65MRX Members may elect to not route their 

orders by marking an order as ‘‘do-not-route.’’ In 

this case, the order would not be routed. See 

Options 3, Section 7(m). 

66Market Makers on MRX are required to obtain 

one SQF port to submit quotes into MRX. 

67Service bureaus provide access to market 

participants to submit and execute orders on an 

exchange. On MRX, a Service Bureau may be a 

Member. Some MRX Members utilize a Service 

Bureau for connectivity and that Service Bureau 

may not be a Member. Some market participants 

utilize a Service Bureau who is a Member to submit 

orders. As noted herein only MRX Members may 

submit orders or quotes through ports. 

68Sponsored Access is an arrangement whereby 

a member permits its customers to enter orders into 

an exchange’s system that bypass the member’s 

trading system and are routed directly to the 

Exchange, including routing through a service 

bureau or other third-party technology provider. 

69This may include utilizing a Floor Broker and 

submitting the trade to one of the five options 

trading floors. 

70A ‘‘badge’’ shall mean an account number, 

which may contain letters and/or numbers, 

assigned to Market Makers. A Market Maker 

account may be associated with multiple badges. 

See MRX Options 1, Section 1(a)(5). 

71A ‘‘mnemonic’’ shall mean an acronym 

comprised of letters and/or numbers assigned to 

Electronic Access Members. An Electronic Access 

Member account may be associated with multiple 

mnemonics. See MRX Options 1, Section 1(a)(23). 

72Only Members and service bureaus may request 

ports on MRX, and only Members may utilize ports 

on MRX through their assigned badge or mnemonic. 

See Options 1, Section 1(a)(5) and (23). 

and (v) transactional pricing. Becoming 

a member of the exchange does not 

‘‘lock’’ a potential member into a market 

or diminish the overall competition for 

exchange services. The decision to 

become a member of an exchange is 

made at the beginning of the 

relationship, and is no less subject to 

competition than trading fees or ports. 

In lieu of becoming a member at each 

options exchange, a market participant 

may join one exchange and elect to have 

their orders routed in the event that a 

better price is available on an away 

market. Nothing in the Order Protection 

Rule requires a firm to become a 

Member at MRX.64 If MRX is not at the 

NBBO, MRX will route an order to any 

away market that is at the NBBO to 

prevent a trade-through and also ensure 

that the order was executed at a superior 

price.65

With respect to the submission of 

orders, Members may also choose not to 

purchase any port at all from the 

Exchange, and instead rely on the port 

of a third party to submit an order.66 For 

example, a third-party broker-dealer 

Member of MRX may be utilized by a 

retail investor to submit orders into an 

Exchange. An institutional investor may 

utilize a broker-dealer, a service 

bureau,67 or request sponsored access 68

through a member of an exchange in 

order to submit a trade directly to an 

options exchange.69 A market 

participant may either pay the costs 

associated with becoming a member of 

an exchange or, in the alternative, a 

market participant may elect to pay 

commissions to a broker-dealer, pay fees 

to a service bureau to submit trades, or 

pay a member to sponsor the market 

participant in order to submit trades 

directly to an exchange. Market 

participants may elect any of the above 

models and weigh the varying costs 

when determining how to submit trades 

to an exchange. Depending on the 

number of orders to be submitted, 

technology, ability to control 

submission of orders, and projected 

revenues, a market participant may 

determine one model is more cost 

efficient as compared to the alternatives. 

Only if a market participant elects to 

become a Member of MRX will the 

market participant need to utilize a port 

to submit orders and/or quotes into 

MRX. Once an applicant is approved for 

membership on MRX and becomes a 

Member, the Exchange assigns the 

Member a badge 70 and/or mnemonic 71

to submit quotes and/or orders to the 

Exchange through the applicable port. 

An MRX Member may have one or more 

accounts numbers and may assign 

badges or mnemonics to those account 

numbers. Membership approval grants a 

Member a right to exercise trading 

privileges on MRX, which includes the 

submission of orders and/or quotes into 

the Exchange through a secure port by 

utilizing the badge and/or mnemonic 

assigned to a specific Member by the 

Exchange. The Exchange utilizes ports 

as a secure method for Members to 

submit orders and/or quotes into the 

Exchange’s match engine and for the 

Exchange to send messages related to 

those orders and/or quotes to its 

Members. 

MRX is obligated to regulate its 

Members and secure access to its 

environment. In order to properly 

regulate its Members and secure the 

trading environment, MRX takes 

measures to ensure access is monitored 

and maintained with various controls. 

Ports are a method utilized by the 

Exchange to grant Members secure 

access to communicate with the 

Exchange and exercise trading rights. 

When a market participant elects to be 

a Member of MRX, and is approved for 

membership by MRX, the Member is 

granted trading rights to enter orders 

and/or quotes into MRX through secure 

ports. 

As noted herein, there is no legal or 

regulatory requirement that a market 

participant become a Member of MRX, 

or, if it is a Member, to purchase port 

services beyond the one quoting 

protocol or one order entry protocol 

necessary to quote or submit orders on 

MRX, which the Exchange proposes to 

provide at no cost in addition to one FIX 

Disaster Recovery Port and one SQF 

Disaster Recovery Port, which are also 

being provided at no cost.72 As noted 

above, Members may freely choose to 

rely on one or many ports, depending 

on their business model. 

The Exchange’s proposal to amend 

port fees is reasonable, equitable and 

not unfairly discriminatory as MRX is 

providing MRX Electronic Access 

Members one FIX Port to submit orders 

and MRX Market Makers one SQF Port 

to submit quotes to MRX, at no cost, in 

addition to providing one FIX Disaster 

Recovery Port and one SQF Disaster 

Recovery Port at no cost; all other ports 

offered by MRX are optional. 

The proposed fees reflect the ongoing 

services provided to maintain and 

support the ports. In order to submit 

orders into MRX, only one order 

protocol is required, and MRX is 

providing Electronic Access Members 

one FIX Port at no cost. Quoting 

protocols are only required to the extent 

an MRX Member has been appointed as 

a Market Maker in an options series 

pursuant to Options 2, Section 1. 

Similarly, only one quoting protocol is 

necessary to quote on MRX and MRX is 

providing Market Makers one SQF Port 

at no cost. As noted above, only 

Members may utilize ports. A Member 

can send all orders, proprietary and 

agency, through one port to MRX and all 

quotes through one port. Therefore, for 

the foregoing reasons, it is reasonable to 

assess no fee for the first FIX Port 

obtained by an Electronic Access 

Member or the first SQF Port obtained 

by a Market Maker. Further it is 

equitable and not unfairly 

discriminatory to assess no fee for the 

first FIX Port to Electronic Access 

Members as all Electronic Access 

Members would be entitled to one FIX 

Port at no cost. Also, it is equitable and 

not unfairly discriminatory to assess no 

fee for the first SQF Port to Market 

Makers as all Market Makers would be 

entitled to one SQF Port at no cost. 

The Exchange’s proposal to assess 

Members $650 per port, per month, per 

account number for FIX Ports beyond 

the first port and $1,250 per port, per 

month for SQF Ports beyond the first 

port is reasonable because these ports 

are optional and Members only require 

one FIX Port to submit orders to MRX 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 42789 

73See MRX Options 2, Section 5. 

74See MRX Options 2, Section 4. 

75See Phlx and BX Options 3, Section 7 for a list 

of protocols. 

76TradeInfo is free. 77See MRX Options 3, Section 18, Detection of 

Loss. This risk protection is free. 

78See MRX Options 3, Section 15(a)(3)(B). 

Thresholds may be set by Members based on 

percentage, volume, delta or vega. This risk 

protection is free. 

and one SQF Port to submit quotes to 

MRX. Additionally, to the extent a 

Member expended more than $7,500 for 

FIX Ports or more than $17,500 for SQF 

Ports, the Exchange would not charge an 

MRX Member for additional FIX or SQF 

Ports beyond the cap. The fees for the 

proposed additional FIX and SQF Ports 

are equitable and not unfairly 

discriminatory because any Member 

may elect additional ports. Electronic 

Access Members would be subject to the 

same fees for FIX Ports and Market 

Makers would be subject to the same 

fees for SQF Ports. Unlike other market 

participants, Market Makers are 

required to provide continuous twosided quotes on a daily basis,73 and are 

subject to various obligations associated 

with providing liquidity.74 Also, 

account numbers are free on MRX. 

The Exchange’s proposal to assess 

$650 per port, per month, per account 

number for an OTTO Port is reasonable 

because OTTO is optional. The 

Exchange is offering a FIX Port at no 

cost to submit orders to MRX. In 

addition to the FIX Port, all Members 

may elect to purchase OTTO to submit 

orders to MRX. Unlike FIX, which offers 

routing capability, OTTO does not 

permit routing. Depending on a 

Member’s business model, Members 

may elect to purchase an OTTO Port in 

addition to the FIX Port, which is being 

provided at no cost. Members may 

prefer one protocol as compared to 

another protocol. For example, the 

ability to route may cause a Member to 

utilize FIX and a Member that desires to 

execute an order locally may utilize 

OTTO. Also, the OTTO Port offers lower 

latency as compared to the FIX Port, 

which may be attractive to Members 

depending on their trading behavior. 

MRX Members utilizing the FIX Por, 

which is offered at no cost, do not need 

to utilize OTTO. Members may elect to 

utilize both order entry protocols, 

depending on how they organize their 

business. OTTO provides MRX 

Members with an additional choice as to 

the type of protocol that they may use 

to submit orders to the Exchange. 

Today, Phlx and BX offer only a FIX 

Port to submit orders on those options 

markets.75 The proposed OTTO fee is 

equitable and not unfairly 

discriminatory because any Member 

may elect to purchase an optional OTTO 

Port and would be subject to the same 

fee. 

The Exchange’s proposal to offer an 

SQF Purge Port for $1,250 per port, per 

month is reasonable because this port is 

optional. The SQF Purge Port is 

designed to assist Market Makers in the 

management of, and risk control over, 

their quotes. Market Makers may utilize 

a purge port to reduce uncertainty and 

to manage risk by purging all quotes in 

their assigned options series. Of note, 

Market Makers may only enter interest 

into SQF in their assigned options 

series. Additionally, the SQF Purge Port 

may be utilized by a Market Maker in 

the event that the Member has a system 

issue and determines to purge from the 

order book. The SQF Purge Port is 

optional as Market Makers have various 

ways of purging their quotes from the 

order book. First of all, a Market Maker 

may cancel quotes through SQF in their 

assigned options series in the same 

manner as they may cancel quotes with 

an SQF Purge Port. Second, TradeInfo 

permits the cancellation of open orders 

at the order, port or firm mnemonic 

level.76 Third, in the event of a loss of 

communication with the Exchange, 

MRX offers the ability to cancel all of a 

Member’s open quotes via a cancel-ondisconnect control.77 Fourth, MRX 

offers Market Makers the ability, with 

respect to simple orders, to establish 

pre-determined levels of risk exposure 

which would be utilized to 

automatically remove quotes in all 

series of an options class.78

Accordingly, the Exchange believes that 

the SQF Purge Port provides an efficient 

alternative to other available services 

which allow a Market Maker to cancel 

quotes. The proposed SQF Purge Port is 

equitable and not unfairly 

discriminatory because any Member 

may elect to purchase an optional SQF 

Purge Port and would be subject to the 

same fee. 

The Exchange’s proposal to assess 

$650 per port, per month for CTI Ports 

and FIX DROP Ports is reasonable 

because these ports are optional because 

Members have various ways of receiving 

information concerning open orders and 

executed transactions. First, FIX and 

OTTO provide Members with real-time 

order executions similar to the Clearing 

Trade Interface and FIX DROP. Second, 

TradeInfo provides Members with the 

ability to query open orders and order 

executions real-time, at no cost, similar 

to the Clearing Trade Interface and FIX 

DROP. Third, Members receive free 

daily reports listing open orders and 

trade executions, while not real-time, 

the Open Orders Report and Trade 

Detail Report provides Members with 

information similar to the Clearing 

Trade Interface and FIX DROP. The 

proposed CTI and FIX DROP Ports are 

equitable and not unfairly 

discriminatory because any Member 

may elect to purchase an optional CTI 

Port or FIX DROP Port and would be 

subject to the same fee. 

The Exchange’s proposal to assess no 

fee for the first FIX Disaster Recovery 

Port or the first SQF Disaster Recovery 

Port is reasonable because it will 

provide Members with continuous 

access to MRX in the event of a failover, 

at no cost. Further it is equitable and not 

unfairly discriminatory to assess no fee 

for the first FIX Disaster Recovery Port 

to Electronic Access Members as all 

Electronic Access Members would be 

entitled to one FIX Disaster Recovery 

Port at no cost. Also, it is equitable and 

not unfairly discriminatory to assess no 

fee for the first SQF Disaster Recovery 

Port to Market Makers as all Market 

Makers would be entitled to one SQF 

Disaster Recovery Port at no cost. 

The Exchange’s proposal to assess 

Members $50 per port, per month, per 

account number for optional FIX 

Disaster Recovery Ports beyond the first 

port offered at no cost and $50 per port, 

per month, per account number for 

optional SQF Disaster Recovery Ports 

beyond the first port offered at no cost 

is reasonable because these ports are 

optional and Members only require one 

FIX Disaster Recovery Port to submit 

orders to MRX in the event of a failover 

and one SQF Disaster Recovery Port to 

submit quotes to MRX in the event of a 

failover. Additionally, to the extent a 

Member expended more than $7,500 for 

Disaster Recovery Ports, the Exchange 

would not charge an MRX Member for 

additional Disaster Recovery Ports 

beyond the cap. The fees for the 

proposed additional FIX and SQF 

Disaster Recovery Ports are equitable 

and not unfairly discriminatory because 

any Member may elect additional ports 

and would be subject to the same fees. 

The Exchange’s proposal to offer 

Disaster Recovery Ports for SQF Purge 

Ports, and OTTO Ports at $50 per port, 

per month, per account number and CTI 

Ports, and FIX DROP Ports for $50 per 

port, per month is reasonable because 

these ports are optional. As noted 

herein, there are other alternatives for 

all of these ports today, the purchase of 

an SQF Purge Port, OTTO Port, CTI 

Port, and FIX DROP Port in production 

is optional and, therefore, so is the 

purchase of Disaster Recovery Ports for 

these ports. The proposed Disaster 

Recovery Port fees are intended to 

encourage Members to be efficient when 


khammond on DSKJM1Z7X2PROD with NOTICES
42790 Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 

79See GEMX Options 7, Section 6.C. (Ports and 

Other Services). 

80See GEMX Options 7, Section 6.C. (Ports and 

Other Services). 

81See MRX Options 2, Section 5. 

82See MRX Options 2, Section 4. 

83See MRX Options 3, Section 15(a)(3). Market 

Makers are offered risk protections to permit them 

to manage their risk more effectively. 

84 15 U.S.C. 78s(b)(3)(A)(ii). 

purchasing Disaster Recovery Ports. The 

proposed Disaster Recovery Ports are 

equitable and not unfairly 

discriminatory because any Member 

may elect to purchase an optional 

Disaster Recovery Port and would be 

subject to the same fee, depending on 

the port. 

Finally, in the event that an MRX 

Member elects to subscribe to multiple 

ports, the Exchange offers a monthly cap 

beyond which a Member would be 

assessed no additional fees for month. 

As noted above, the SQF Port and the 

SQF Purge Port are subject to a monthly 

cap of $17,500 and the OTTO Port, CTI 

Port, FIX Port, FIX Drop Port and all 

Disaster Recovery Ports are subject to a 

monthly cap of $7,500. These caps are 

reasonable because they allow Members 

to cap their fees beyond a certain level 

if they elect to purchase multiple ports 

in a given month. The caps are also 

equitable and not unfairly 

discriminatory because any Member 

will be subject to the cap, provided they 

exceeded the appropriate dollar amount 

in a given month. 

The proposed port fees are similar to 

the fees assessed by GEMX.79

After 6 years, MRX proposes to 

commence assessing port fees, just as all 

other options exchanges. The 

introduction of these fees will not 

impede a Member’s access to MRX, but 

rather will allow MRX to continue to 

compete and grow its marketplace so 

that it may continue to offer a robust 

trading architecture, a quality opening 

process, an array of simple and complex 

order types and auctions, and 

competitive transaction pricing. If MRX 

is incorrect in its assessment of the 

value of its services, that assessment 

will be reflected in MRX’s ability to 

compete with other options exchanges. 

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 its proposal 

remains competitive with other options 

markets, and will offer market 

participants with another choice of 

venue to transact options. 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, or 

rebate opportunities available at other 

venues to be more favorable. Because 

competitors are free to modify their own 

fees in response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which fee 

changes in this market may impose any 

burden on competition is extremely 

limited. 

By way of example, today, with the 

exception of Precise, ISE has identical 

functionality to MRX. Market 

participants may elect to become 

members of ISE instead of MRX if those 

market participants believe that the 

order flow on ISE provides more value 

than the order flow on MRX. ISE has 

more market share (6.2%) as compared 

to MRX (1.8%). A market participant 

may evaluate the fees assessed by ISE, 

its market share, and proprietary 

products, among other things, and 

determine to become a member of ISE 

instead of MRX if it determines the 

proposed fees to be unreasonable. 

The proposed port fees are similar to 

port fees assessed by GEMX 80 for 

similar connectivity. As a consequence, 

competition will not be burdened by the 

proposed fees. Only one order protocol 

is required to submit orders to MRX, 

and the Exchange proposes to offer one 

FIX Port and one FIX Disaster Recovery 

Port to Electronic Access Members at no 

cost. This would provide Members with 

the ability to continuously submit 

orders to MRX, even in the event of a 

failover. Likewise, only one quoting 

protocol is required to submit quotes to 

MRX, and the Exchange proposes to 

offer one SQF Port and one SQF Disaster 

Recovery Port to Market Makers at no 

cost. This would provide Market Makers 

with the ability to continuously submit 

quotes to MRX, even in the event of a 

failover. 

Only one account number is 

necessary per Member and account 

numbers are free. 

The remainder of the proposed port 

fees are for optional ports (additional 

FIX and SQF Ports, additional FIX and 

SQF Disaster Recovery Ports, SQF Purge 

Port, OTTO Port, CTI Port, FIX DROP 

Port and Disaster Recovery Ports for 

SQF Purge Ports, OTTO Ports, CTI Ports, 

and FIX DROP Ports). These different 

protocols are not all necessary to 

conduct business on MRX. Members 

choose among the protocols based on 

their business workflow. The proposed 

fees do not impose an undue burden on 

competition because the Exchange 

would uniformly assess the port fees to 

all Members and would uniformly apply 

monthly caps. Market participants may 

also connect to third parties instead of 

directly to the Exchange. 

With respect to the higher fees 

assessed for SQF Ports and SQF Purge 

Ports, the Exchange notes that only 

Market Makers may utilize these ports. 

Market Makers are required to provide 

continuous two-sided quotes on a daily 

basis,81 and are subject to various 

obligations associated with providing 

liquidity.82 As a result of these quoting 

obligations, the SQF Port and SQF Purge 

Port are designed to handle higher 

throughput to permit Market Makers to 

bundle orders to meet their obligations. 

The technology to permit Market 

Makers to submit a greater number of 

quotes, in addition to the various risk 

protections 83 afforded to these market 

participants when quoting, accounts for 

the higher SQF Port and SQF Purge Port 

fees. Greater liquidity benefits all 

market participants by providing more 

trading opportunities and attracting 

greater participation by Market Makers. 

Also, an increase in the activity of 

Market Makers in turn facilitates tighter 

spreads. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or 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.84 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: (i) 

necessary or appropriate in the public 

interest; (ii) for the protection of 

investors; or (iii) 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. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 87, No. 136 / Monday, July 18, 2022 / Notices 42791 

85 17 CFR 200.30–3(a)(12). 

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– 

MRX–2022–09 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–MRX–2022–09. 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. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–MRX–2022–09 and should 

be submitted on or before August 8, 

2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.85

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–15223 Filed 7–15–22; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #17524; Alaska 

Disaster Number AK–00052 Declaration of 

Economic Injury] 

Administrative Declaration of an 

Economic Injury Disaster for the State 

of Alaska 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a notice of an 

Economic Injury Disaster Loan (EIDL) 

declaration for the State of ALASKA 

dated 07/12/2022. 

Incident: Lowell Point Landslide and 

Lowell Point Road Closure. 

Incident Period: 05/07/2022 through 

06/10/2022. 

DATES: Issued on 07/12/2022. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 04/12/2023. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW, Suite 6050, 

Washington, DC 20416, (202) 205–6734. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

Administrator’s EIDL declaration, 

applications for economic injury 

disaster loans may be filed at the 

address listed above or other locally 

announced locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties: Kenai Peninsula 

Borough. 

Contiguous Counties: 

Alaska: Chugach REAA, Iditarod Area 

REAA, Kodiak Island Borough, Lake 

and Peninsula Borough, MatanuskaSusitna Borough, Municipality of 

Anchorage. 

The Interest Rates are: 

Percent 

Businesses and Small Agricultural Cooperatives without 

Credit Available Elsewhere ..... 2.935 

Non-Profit Organizations without 

Credit Available Elsewhere ..... 1.875 

The number assigned to this disaster 

for economic injury is 175240. 

The State which received an EIDL 

Declaration #17524 is Alaska. 

(Catalog of Federal Domestic Assistance 

Number 59008) 

Isabella Guzman, 

Administrator. 

[FR Doc. 2022–15264 Filed 7–15–22; 8:45 am] 

BILLING CODE 8026–09–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #17522 and #17523; 

MICHIGAN Disaster Number MI–00108] 

Administrative Declaration of a 

Disaster for the State of Michigan 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a notice of an 

Administrative declaration of a disaster 

for the State of Michigan dated 07/12/ 

2022. 

Incident: Tornado. 

Incident Period: 05/20/2022. 

DATES: Issued on 07/12/2022. 

Physical Loan Application Deadline 

Date: 09/12/2022. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 04/12/2023. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW, Suite 6050, 

Washington, DC 20416, (202) 205–6734. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

Administrator’s disaster declaration, 

applications for disaster loans may be 

filed at the address listed above or other 

locally announced locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties: Otsego. 

Contiguous Counties: 

Michigan: Antrim, Charlevoix, 

Cheboygan, Crawford, Kalkaska, 

Montmorency, Oscoda. 

The Interest Rates are: 

Percent 

For Physical Damage: 

Homeowners with Credit Available Elsewhere .................... 3.375 

Homeowners without Credit 

Available Elsewhere ............ 1.688 

Businesses with Credit Available Elsewhere .................... 5.870 

Businesses without Credit 

Available Elsewhere ............ 2.935 

Non-Profit Organizations with 

Credit Available Elsewhere 1.875 


khammond on DSKJM1Z7X2PROD with NOTICES