69148 Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 

36 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3EDGA’s affiliated exchanges are EDGX 

Exchange, Inc. (‘‘EDGX’’), BATS Exchange, Inc. 

(‘‘BATS’’), and BATS Y-Exchange, Inc. (‘‘BYX’’). On 

January 31, 2014, Direct Edge Holdings LLC (‘‘DE 

Holdings’’), the former parent company of the 

Exchange and EDGA, completed its business 

combination with BATS Global Markets, Inc., the 

parent company of BATS and BYX. See Securities 

Exchange Act Release No. 71449 (January 30, 2014), 

79 FR 6961 (February 5, 2014) (SR–EDGX–2013– 

43). Upon completion of the business combination, 

DE Holdings and BATS Global Markets, Inc. each 

became intermediate holding companies, held 

under a single new holding company. The new 

holding company, formerly named ‘‘BATS Global 

Markets Holdings, Inc.,’’ changed its name to 

‘‘BATS Global Markets, Inc.’’ 

4The Exchange understands that each of the 

BATS Exchanges will separately file substantially 

similar proposed rule changes with the Commission 

to implement the BATS One Feed and its related 

fees. 

5 17 CFR § 242.603(c). 

6See Nasdaq Basic, http:// 

www.nasdaqtrader.com/ 

Trader.aspx?id=nasdaqbasic (last visited May 29, 

2014) (data feed offering the BBO and Last Sale 

information for all U.S. exchange-listed securities 

based on liquidity within the Nasdaq market center, 

as well as trades reported to the FINRA/Nasdaq 

Trade Reporting Facility (‘‘TRF’’)); Nasdaq NLS 

Plus, http://www.nasdaqtrader.com/ 

Trader.aspx?id=NLSplus (last visited July 8, 2014) 

(data feed providing last sale data as well as 

consolidated volume from the following Nasdaq 

OMX markets for U.S. exchange-listed securities: 

Nasdaq, FINRA/Nasdaq TRF, Nasdaq OMX BX, and 

Nasdaq OMX PSX); Securities Exchange Act 

Release No. 72750 (August 4, 2014), 79 FR 46494 

(August 8, 2014) (SR–NYSE–2014–40) (Notice of 

Filing of Proposed Rule Change Establishing the 

NYSE Best Quote & Trades (‘‘BQT’’) Data Feed); 

http://www.nyxdata.com/Data-Products/NYSEBest-Quote-and-Trades (last visited May 27, 2014) 

(data feed providing unified view of BBO and last 

sale information for the NYSE, NYSE Arca, and 

NYSE MKT). 

7See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, at 37503 (June 29, 

2005) (Regulation NMS Adopting Release). 

available publicly. All submissions 

should refer to File Number SR–BATS– 

2014–055 and should be submitted on 

or before December 11, 2014]. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.36

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27442 Filed 11–19–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73596; File No. SR–EDGA– 

2014–25] 

Self-Regulatory Organizations; EDGA 

Exchange, Inc.; Notice of Filing of a 

Proposed Rule Change, and 

Amendment No. 1 Thereto, To 

Establish a New Market Data Product 

Called the BATS One Feed 

November 14, 2014. 

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

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on October 

30, 2014, EDGA Exchange, Inc. (the 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. On November 13, 

2014, the Exchange filed Amendment 

No. 1 to the proposed rule change. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change, as amended, from interested 

persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange filed a proposal to 

establish a new market data product 

called the BATS One Feed. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.directedge.com/, at the 

principal office of the Exchange, and at 

the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to establish a 

new market data product called the 

BATS One Feed. As described more 

fully below, the BATS One Feed is a 

data feed that will disseminate, on a 

real-time basis, the aggregate best bid 

and offer (‘‘BBO’’) of all displayed 

orders for securities traded on EDGA 

and its affiliated exchanges 3

(collectively, the ‘‘BATS Exchanges’’) 

and for which the BATS Exchanges 

report quotes under the Consolidated 

Tape Association (‘‘CTA’’) Plan or the 

Nasdaq/UTP Plan.4 The BATS One Feed 

will also contain the individual last sale 

information for EDGA and each of its 

affiliated exchanges. In addition, the 

BATS One Feed will contain optional 

functionality which will enable 

recipients to elect to receive aggregated 

two-sided quotations from the BATS 

Exchanges for up to five (5) price levels. 

The BATS One Feed offers market 

data vendors and purchasers a suitable 

alternative to the use of consolidated 

data where consolidated data are not 

required to be purchased or displayed. 

The Exchange proposes to offer the 

BATS One Feed voluntarily in response 

to demand from vendors, and 

subscribers that are interested in 

receiving the aggregate BBO and last 

sale information from the BATS 

Exchanges as part of a single data feed. 

Specifically, BATS One can be used by 

industry professionals and retail 

investors looking for a cost effective, 

easy-to-administer, high quality market 

data product with the characteristics of 

the BATS One Feed. 

The Exchange believes that the BATS 

One Feed would provide high-quality, 

comprehensive last sale and BBO data 

for the BATS Exchanges in a unified 

view and respond to subscriber demand 

for such a product. The Exchange notes 

that an anticipated end user might use 

the BATS One Feed for purposes of 

identifying an indicative price of Tape 

A, B, and C securities through 

leveraging the depth and breadth of 

BATS Exchanges without having to 

purchase consolidated data and thus it 

would not be a latency-sensitive 

product. The Exchange does not 

anticipate that an end user would, or 

could, use the BATS One Feed data for 

purposes of making order-routing or 

trading decisions. Rather, the Exchange 

notes that under Rule 603 of Regulation 

NMS, the BATS One Feed could not be 

substituted for consolidated data in all 

instances in which consolidated data is 

used and certain subscribers would still 

be required to purchase consolidated 

data for trading and order-routing 

purposes.5

Finally, the proposed BATS One Feed 

would provide investors with new 

options for receiving market data and 

compete with similar market data 

products proposed by the New York 

Stock Exchange, Inc. (‘‘NYSE’’) and 

those currently offered by the Nasdaq 

Stock Market LLC (‘‘Nasdaq’’).6 The 

provision of new options for investors to 

receive market data was a primary goal 

of the market data amendments adopted 

by Regulation NMS.7


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8The Exchange notes that quotations of odd lot 

size, which is generally less than 100 shares, are 

included in the total size of all orders at a particular 

price level in the BATS One Feed but are currently 

not reported by the BATS Exchanges to the 

consolidated tape. 

9For a description of BYX’s RPI Program, see 

BYX Rule 11.24. See also Securities Exchange Act 

Release No. 68303 (November 27, 2012), 77 FR 

71652 (December 3, 2012) (SR–BYX–2012–019) 

(Order Granting Approval of Proposed Rule Change, 

as Modified by Amendment No. 2, to Adopt a Retail 

Price Improvement Program); Securities Exchange 

Act Release No. 67734 (August 27, 2012), 77 FR 

53242 (August 31, 2012) (SR–BYX–2019–019) 

(Notice of Filing of Proposed Rule Change to Adopt 

a Retail Price Improvement Program). 

10See, e.g., Exchange and EDGA Rule 11.13, 

Clearly Erroneous Executions, and BATS and BYX 

Rule 11.17, Clearly Erroneous Executions. 

11 17 CFR 242.200(g); 17 CFR 242.201. 

12Recipients who do not elect to receive the 

BATS One Premium Feed will receive the aggregate 

BBO of the BATS Exchanges under the BATS 

Summary Feed, which, unlike the BATS Premium 

Feed, would not delineate the size available at the 

BBO on each individual BATS Exchange. 13The Exchange intends to file a separate 

proposal establishing the fees for BATS One. 

14 15 U.S.C. 78f. 

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

16 15 U.S.C. 78k–1. 

Description of the BATS One Feed 

The BATS One Feed will contain the 

aggregate BBO of the BATS Exchanges 

for all securities that are traded on the 

BATS Exchanges and for which the 

BATS Exchanges report quotes under 

the CTA Plan or the Nasdaq/UTP Plan. 

The aggregate BBO would include the 

total size of all orders at the BBO 

available on all BATS Exchanges.8 The 

BATS One Feed would also disseminate 

last sale information for each of the 

individual BATS Exchanges 

(collectively with the aggregate BBO, the 

‘‘BATS One Summary Feed’’). The last 

sale information will include the price, 

size, time of execution, and individual 

BATS Exchange on which the trade was 

executed. The last sale message will also 

include the cumulative number of 

shares executed on all BATS Exchanges 

for that trading day. The Exchange will 

disseminate the aggregate BBO of the 

BATS Exchanges and last sale 

information through the BATS One 

Feed no earlier than each individual 

BATS Exchange provides its BBO and 

last sale information to the processors 

under the CTA Plan or the Nasdaq/UTP 

Plan. 

The BATS One Feed would also 

consist of Symbol Summary, Market 

Status, Retail Liquidity Identifier on 

behalf of BYX, Trading Status, and 

Trade Break messages. The Symbol 

Summary message will include the total 

executed volume across all BATS 

Exchanges. The Market Status message 

is disseminated to reflect a change in 

the status of one of the BATS 

Exchanges. For example, the Market 

Status message will indicate whether 

one of the BATS Exchanges is 

experiencing a systems issue or 

disruption and quotation or trade 

information from that market is not 

currently being disseminated via the 

BATS One Feed as part of the 

aggregated BBO. The Market Status 

message will also indicate where BATS 

Exchange is no longer experiencing a 

systems issue or disruption to properly 

reflect the status of the aggregated BBO. 

The Retail Liquidity Identifier 

indicator message will be disseminated 

via the BATS One Feed on behalf of the 

BYX only pursuant to BYX’s Retail Price 

Improvement (‘‘RPI’’) Program.9 The 

Retail Liquidity Identifier indicates 

when RPI interest priced at least $0.001 

better than BYX’s Protected Bid or 

Protected Offer for a particular security 

is available in the System. The 

Exchange proposes to disseminate the 

Retail Liquidity Indicator via the BATS 

One Feed in the same manner as it is 

currently disseminated through 

consolidated data streams (i.e., pursuant 

to the Consolidated Tape Association 

Plan/Consolidated Quotation Plan, or 

CTA/CQ, for Tape A and Tape B 

securities, and the Nasdaq UTP Plan for 

Tape C securities) as well as through 

proprietary BYX data feeds. The Retail 

Liquidity Identifier will reflect the 

symbol and the side (buy or sell) of the 

RPI interest, but does not include the 

price or size of the RPI interest. In 

particular, like CQ and UTP quoting 

outputs, the BATS One Feed will 

include a field for codes related to the 

Retail Price Improvement Identifier. The 

codes indicate RPI interest that is priced 

better than BYX’s Protected Bid or 

Protected Offer by at least the minimum 

level of price improvement as required 

by the Program. 

The Trade Break message will 

indicate when an execution on a BATS 

Exchange is broken in accordance with 

the individual BATS Exchange’s rules.10

The Trading Status message will 

indicate the current trading status of a 

security on each individual BATS 

Exchange. For example, a Trading 

Status message will be sent when a 

short sale price restriction is in effect 

pursuant to Rule 201 of Regulation SHO 

(‘‘Short Sale Circuit Breaker’’),11 or the 

security is subject to a trading halt, 

suspension or pause declared by the 

listing market. A Trading Status 

message will be sent whenever a 

security’s trading status changes. 

Optional Aggregate Depth of Book. 

The BATS One Feed will also contain 

optional functionality which will enable 

recipients to receive two-sided 

quotations from the BATS Exchanges for 

five (5) price levels for all securities that 

are traded on the BATS Exchanges in 

addition to the BATS One Summary 

Feed (‘‘BATS One Premium Feed’’). For 

each price level on one of the BATS 

Exchanges, the BATS One Premium 

Feed option of the BATS One Feed will 

include a two-sided quote and the 

number of shares available to buy and 

sell at that particular price level.12

Implementation Date 

The Exchange anticipates making 

available the BATS One feed as soon as 

practicable after approval of the 

proposed rule change by the 

Commission and the effectiveness of a 

rule filing to establish the fees for BATS 

One.13

2. Statutory Basis 

The Exchange believes that the 

proposed BATS One Feed is consistent 

with Section 6(b) of the Act,14 in 

general, and furthers the objectives of 

Section 6(b)(5) of the Act,15 in 

particular, in that it is designed to 

prevent fraudulent and manipulative 

acts and practices, to promote just and 

equitable principles of trade, to remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and to 

protect investors and the public interest, 

and that it is not designed to permit 

unfair discrimination among customers, 

brokers, or dealers. This proposal is in 

keeping with those principles in that it 

promotes increased transparency 

through the dissemination of the BATS 

One Feed. The Exchange also believes 

this proposal is consistent with Section 

6(b)(5) of the Act because it protects 

investors and the public interest and 

promotes just and equitable principles 

of trade by providing investors with 

new options for receiving market data as 

requested by market data vendors and 

purchasers that expressed an interest in 

exchange-only data for instances where 

consolidated data is no longer required 

to be purchased and displayed. The 

proposed rule change would benefit 

investors by facilitating their prompt 

access to real-time last sale information 

and best-bid-and-offer information 

contained in the BATS One Feed. 

The Exchange also believes that the 

proposed rule change is consistent with 

Section 11(A) of the Act 16 in that it 

supports (i) fair competition among 

brokers and dealers, among exchange 

markets, and between exchange markets 

and markets other than exchange 

markets and (ii) the availability to 

brokers, dealers, and investors of 

information with respect to quotations 


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17See 17 CFR 242.603. 

18See Securities Exchange Act Release No. 51808 

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

No. S7–10–04). 

19See Nasdaq Basic, http://

www.nasdaqtrader.com/

Trader.aspx?id=nasdaqbasic (last visited May 29, 

2014) (data feed offering the BBO and Last Sale 

information for all U.S. exchange-listed securities 

based on liquidity within the Nasdaq market center, 

as well as trades reported to the FINRA/Nasdaq 

TRF). 

20See Nasdaq NLS Plus, http://

www.nasdaqtrader.com/Trader.aspx?id=NLSplus 

(last visited July 8, 2014) (data feed providing last 

sale data as well as consolidated volume from the 

following Nasdaq OMX markets for U.S. exchangelisted securities: Nasdaq, FINRA/Nasdaq TRF, 

Nasdaq OMX BX, and Nasdaq OMX PSX). 

21See Nasdaq Basic, Doing More with Less, 

available at http://www.brainshark.com/

nasdaqomx/

vu?pi=zG8z33O6ozAgBpz0&tx=preview&preview=1 

and http://www.nasdaqtrader.com/

Trader.aspx?id=nasdaqbasic#vendors. 

22See Securities Exchange Act Release No. 72750 

(August 4, 2014), 79 FR 46494 (August 8, 2014) 

(SR–NYSE–2014–40) (Notice of Filing of Proposed 

Rule Change Establishing the NYSE BQT Data 

Feed); http://www.nyxdata.com/Data-Products/

NYSE-Best-Quote-and-Trades (last visited May 27, 

2014) (data feed providing unified view of BBO and 

last sale information for the NYSE, NYSE Arca, and 

NYSE MKT). 

for and transactions in securities. 

Furthermore, the proposed rule change 

is consistent with Rule 603 of 

Regulation NMS,17 which provides that 

any national securities exchange that 

distributes information with respect to 

quotations for or transactions in an NMS 

stock do so on terms that are not 

unreasonably discriminatory. 

In adopting Regulation NMS, the 

Commission granted self-regulatory 

organizations and broker-dealers 

increased authority and flexibility to 

offer new and unique market data to 

consumers of such data. It was believed 

that this authority would expand the 

amount of data available to users and 

consumers of such data and also spur 

innovation and competition for the 

provision of market data. The Exchange 

believes that the data products proposed 

herein are precisely the sort of market 

data products that the Commission 

envisioned when it adopted Regulation 

NMS. The Commission concluded that 

Regulation NMS—by lessening 

regulation of the market in proprietary 

data—would itself further the Act’s 

goals of facilitating efficiency and 

competition: 

[E]fficiency is promoted when brokerdealers who do not need the data beyond the 

prices, sizes, market center identifications of 

the NBBO and consolidated last sale 

information are not required to receive (and 

pay for) such data. The Commission also 

believes that efficiency is promoted when 

broker-dealers may choose to receive (and 

pay for) additional market data based on their 

own internal analysis of the need for such 

data.18

By removing ‘‘unnecessary regulatory 

restrictions’’ on the ability of exchanges 

to sell their own data, Regulation NMS 

advanced the goals of the Act and the 

principles reflected in its legislative 

history. 

If the free market should determine 

whether proprietary data is sold to 

broker-dealers at all, it follows that the 

price at which such data is sold should 

be set by the market as well. The BATS 

One Feed is precisely the sort of market 

data product that the Commission 

envisioned when it adopted Regulation 

NMS. 

The BATS One Feed would be 

distributed and purchased on a 

voluntary basis, in that neither the 

BATS Exchanges nor market data 

distributors are required by any rule or 

regulation to make this data available. 

Accordingly, distributors and users can 

discontinue use at any time and for any 

reason, including due to an assessment 

of the reasonableness of fees charged. 

The Exchange believes that the 

proposed BATS One Feed will offer an 

alternative to the use of consolidated 

data products and proprietary data 

products offered by the NYSE and 

Nasdaq. Nasdaq Basic is a product that 

includes two feeds, QBBO, which 

provides BBO information for all U.S. 

exchange-listed securities on Nasdaq 

and NLS Plus, which provides last sale 

data as well as consolidated volume 

from the following Nasdaq OMX 

markets for U.S. exchange-listed 

securities: Nasdaq, FINRA/Nasdaq 

TRF,19 Nasdaq OMX BX, and Nasdaq 

OMX PSX.20 According to Nasdaq, 

seven vendors and more than 1,000 

firms subscribe to Nasdaq Basic, 

including 9 out of 10 of the largest 

banks.21

Likewise, the NYSE has proposed 

NYSE BQT, which would include the 

BBO and last sale information for the 

NYSE, NYSE Arca, and NYSE MKT.22

The Exchange believes the BATS One 

Feed will offer a competitive alternative 

to the existing Nasdaq Basic product 

and the proposed NYSE product. 

In addition, the proposal would not 

permit unfair discrimination because 

the product will be available to all of the 

Exchange’s customers and market data 

vendors on an equivalent basis. In 

addition, any customer that wishes to 

purchase one or more of the individual 

data feeds offered by the BATS 

Exchanges would be able to do so. 

In addition, the Exchange does not 

believe that the proposal would permit 

unfair discrimination among customers, 

brokers, or dealers and thus is 

consistent with the Act because the 

Exchange will be offering the product 

on terms that a competing vendor could 

offer a competing product. Specifically, 

the proposed data feed does not 

represent Exchange core data, but rather 

a new product that represents an 

aggregation and consolidation of 

existing, previously filed individual 

market data products of the BATS 

Exchanges. As such, a competing 

vendor could similarly obtain the 

underlying data feeds and perform a 

similar aggregation and consolidation 

function to create the same data product 

with the same latency and cost as the 

Exchange. 

The Exchange has taken into 

consideration its affiliated relationship 

with EDGX, BYX, and BZX in its design 

of the BATS One Feed to assure that 

vendors would be able to offer a similar 

product on the same terms as the 

Exchange, both from the perspective of 

latency and cost. As discussed above, 

the Exchange proposes to offer the 

BATS One Feed voluntarily in response 

to demand from vendors, and 

subscribers that are interested in 

receiving the aggregate BBO and last 

sale information from the BATS 

Exchanges as part of a single data feed. 

Specifically, BATS One can be used by 

industry professionals and retail 

investors looking for a cost effective, 

easy-to-administer, high quality market 

data product with the characteristics of 

the BATS One Feed. The BATS One 

Feed would help protect a free and open 

market by providing vendors and 

subscribers additional choices in 

receiving this type of market data, thus 

promoting competition and innovation. 

With respect to latency, the path for 

distribution by the Exchange of BATS 

One Feed would not be faster than a 

vendor that independently created a 

BATS One-like product could distribute 

its own product. As such, the proposed 

BATS One data feed is a data product 

that a competing vendor could create 

and sell without being in a 

disadvantaged position relative to the 

Exchange. In recognition that the 

Exchange is the source of its own 

market data and is affiliated with EDGX, 

BATS and BYX, the Exchange 

represents that the source of the market 

data it would use to create the proposed 

BATS One Feed is available to other 

vendors. Specifically, the Exchange 

would use the following data feeds to 

create the proposed BATS One Feed, 

each of which is available to other 

vendors: The Exchange’s EdgeBook 

Depth feed, the EdgeBook Depth feed for 

EDGX, the BYX PITCH Feed, and the 

BATS PITCH Feed. The BATS 

Exchanges will continue to make 


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23The combined external distribution fee for the 

individual data feeds of the BATS Exchanges is 

$12,500.00 per month. The monthly external 

distribution fee is $2,500 per month for the 

EdgeBook Depth feed for the Exchange, $2,500 per 

month for the EdgeBook Depth feed for EDGA, 

$2,500 for the BYX PITCH Feed, and $5,000 for the 

BATS PITCH Feed. 

24See supra note 6. 

25 Id. 

26See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, at 37503 (June 29, 

2005) (Regulation NMS Adopting Release). 

27See Nasdaq Basic, http://

www.nasdaqtrader.com/

Trader.aspx?id=nasdaqbasic (last visited May 29, 

2014) (data feed offering the BBO and Last Sale 

information for all U.S. exchange-listed securities 

based on liquidity within the Nasdaq market center, 

as well as trades reported to the FINRA/Nasdaq 

TRF). 

28See Nasdaq NLS Plus, http://

www.nasdaqtrader.com/Trader.aspx?id=NLSplus 

(last visited July 8, 2014) (data feed providing last 

sale data as well as consolidated volume from the 

following Nasdaq OMX markets for U.S. exchangelisted securities: Nasdaq, FINRA/Nasdaq TRF, 

Nasdaq OMX BX, and Nasdaq OMX PSX). 

29See Securities Exchange Act Release No. 72750 

(August 4, 2014), 79 FR 46494 (August 8, 2014) 

(SR–NYSE–2014–40) (Notice of Filing of Proposed 

Rule Change Establishing the NYSE BQT Data 

Feed); http://www.nyxdata.com/Data-Products/

NYSE-Best-Quote-and-Trades (last visited May 27, 

2014) (data feed providing unified view of BBO and 

last sale information for the NYSE, NYSE Arca, and 

NYSE MKT). 

30See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, at 37503 (June 29, 

2005) (Regulation NMS Adopting Release). 

available these individual underlying 

feeds, and thus, the source of the market 

data it would use to create the proposed 

BATS One feed is the same as the 

source available to other vendors. 

In order to create the BATS One Feed, 

the Exchange will receive the individual 

data feeds from each BATS Exchange 

and, in turn, aggregate and summarize 

that data to create the BATS One Feed. 

This is the same process a competing 

vendor would undergo should it create 

a market data product similar to the 

BATS One Feed to distribute to its end 

users. In addition, the servers of most 

competing vendors are likely located in 

the same facilities as the Exchange, and, 

therefore, should receive the individual 

data feed from each BATS Exchange on 

or about the same time the Exchange 

would for it to create the BATS One 

Feed. Therefore, a competing vendor 

that is located in the same facilities as 

the Exchange could obtain the 

underlying data feeds from the BATS 

Exchanges on the same latency basis as 

the system that would be performing the 

aggregation and consolidation of the 

proposed BATS One Feed and provide 

the same type of product to its 

customers with the same latency they 

could achieve by purchasing the BATS 

One Feed from the Exchange. As such, 

the Exchange would not have any unfair 

advantage over competing vendors with 

respect to obtaining data from the 

individual BATS Exchanges, in fact, the 

technology supporting the BATS One 

Feed would similarly need to obtain the 

Exchange’s data feed as well and even 

this connection would be on a level 

playing field with a competing vendor 

located at the same facility as the 

Exchange. The Exchange has designed 

the BATS One data feed so that it would 

not have a competitive advantage over 

a competing vendor with respect to the 

speed of access to those underlying data 

feeds. Likewise, the BATS One data feed 

would not have a speed advantage visa`-vis competing vendors located in the 

same data center as the Exchange with 

respect to access to end user customers, 

whether those end users are also located 

in the same data center or not. 

With regard to cost, the Exchange will 

file a separate rule filing with the 

Commission to establish fees for BATS 

One which would be designed to ensure 

that vendors could compete with the 

Exchange by creating a similar product 

as the BATS One Feed. The pricing the 

Exchange would charge for the BATS 

One Feed would not be lower than the 

cost to a vendor of receiving the 

underlying data feeds and of 

maintaining servers in the same facility 

as the Exchange to receive the data feeds 

with no greater latency than the 

Exchange. The pricing the Exchange 

would charge clients for the BATS One 

Feed compared to the cost of the 

individual data feeds from the BATS 

Exchanges would enable a vendor to 

receive the underlying data feeds and 

offer a similar product on a competitive 

basis and with no greater latency than 

the Exchange. The Distribution Fees that 

the Exchange intends to propose for the 

BATS One Feed would be equal to the 

combined fee of subscribing to each 

individual data feed,23 therefore, 

enabling a vendor to create a competing 

product based on the individual data 

feeds and charge its clients a fee that it 

believes reflects the value of the 

aggregation and consolidation function 

that is competitive with BATS One Feed 

pricing. The Exchanges believes that the 

incremental cost to a particular vendor 

for aggregation can be supported by the 

vendor’s revenue opportunity and may 

be inconsequential if such vendor 

already has systems in place to perform 

these functions as part of creating its 

proprietary market data products and is 

able to allocate these costs over 

numerous products and customer 

relationships. For these reasons, the 

Exchange believes that vendors could 

readily offer a product similar to the 

BATS One Feed on a competitive basis 

at a similar cost. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will result in 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act, as amended. 

Because other exchanges already offer 

similar products,24 the Exchange’s 

proposed BATS One Feed will enhance 

competition. Specifically, the BATS 

One Feed was developed to compete 

with similar market data products 

offered by Nasdaq and proposed by the 

NYSE.25 The BATS One Feed will foster 

competition by providing an alternative 

market data product to those offered by 

Nasdaq and the NYSE. This proposed 

new data feed provides investors with 

new options for receiving market data, 

which was a primary goal of the market 

data amendments adopted by 

Regulation NMS.26

The proposed BATS One Feed would 

enhance competition by offering a 

market data product that is designed to 

compete directly with similar products 

offered by the NYSE and Nasdaq. 

Nasdaq Basic is a product that includes 

two feeds, QBBO, which provides BBO 

information for all U.S. exchange-listed 

securities on Nasdaq and NLS Plus, 

which provides last sale data as well as 

consolidated volume from the following 

Nasdaq OMX markets for U.S. exchangelisted securities: Nasdaq, FINRA/Nasdaq 

TRF,27 Nasdaq OMX BX, and Nasdaq 

OMX PSX.28 Likewise, NYSE BQT 

includes BBO and last sale information 

for the NYSE, NYSE Arca, and NYSE 

MKT.29 As a result, Nasdaq Basic and 

NYSE BQT comprise a significant view 

of the market on any given day and both 

include data from multiple trading 

venues. As the BATS Exchanges are 

consistently one of the top exchange 

operators by market share for U.S. 

equities trading, excluding opening and 

closing auction volume, the data 

included within the BATS One Feed 

will provide investors with an 

alternative to Nasdaq Basic and NYSE 

BQT and a new option for obtaining a 

broad market view, consistent with the 

primary goal of the market data 

amendments adopted by Regulation 

NMS.30

The Exchange believes the BATS One 

Feed will further enhance competition 

by providing External Distributors with 

a data feed that allows them to more 

quickly and efficiently integrate into 

their existing products. Today, 

Distributors subscribe to various market 


rmajette on DSK2VPTVN1PROD with NOTICES
69152 Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 

31See EDGA Rule 13.8, EDGX Rule 13.8, BZX 

Rule 11.22(a) and (c), and BYX Rule 11.22 (a) and 

(c) for a description of the depth of book feeds 

offered by each of the BATS Exchanges. 32See supra note 22. 

data products offered by single 

exchanges and resell that data, either 

separately or in the aggregate, to their 

subscribers as part of the their own 

market data offerings. Distributors may 

incur administrative costs when 

consolidating and augmenting the data 

to meet their subscriber’s need. 

Consequently, many External 

Distributors will simply choose to not 

take the data because of the effort and 

cost required to aggregate data from 

separate feeds into their existing 

products. Those same Distributors have 

expressed interest in the BATS One 

Feed so that they may easily incorporate 

aggregated or summarized BATS 

Exchange data into their own products 

without themselves incurring the costs 

of the repackaging and aggregating the 

data it would receive by subscribing to 

each market data product offered by the 

individual BATS Exchanges. The 

Exchange, therefore, believes that by 

providing market data that encompasses 

combined data from affiliated 

exchanges, the Exchange enables certain 

External Distributors with the ability to 

compete in the provision of similar 

content with other External Distributors, 

where they may not have done so 

previously if they were required to 

subscribe to the depth-of-book feeds 

from each individual BATS Exchange. 

Although the Exchange considers the 

acceptance of the BATS One Feed by 

External Distributors as important to the 

success of the product, depending on 

their needs, External Distributors may 

choose not to subscribe to the BATS 

One Feed and may rather receive the 

BATS Exchange individual market data 

products and incorporate them into 

their specific market data products. For 

example, the BATS Premium Feed 

provides depth-of-book information for 

up to five price levels while each of the 

BATS Exchange’s individual data feeds 

offer complete depth-of-book and are 

not limited to five price levels.31 Those 

subscribers who wish to view the 

complete depth-of-book from each 

individual BATS Exchange may prefer 

to subscribe to one or all of individual 

BATS Exchange depth-of-book data 

feeds instead of the BATS One Feed. 

The BATS One Feed simply provides 

another option for Distributors to choose 

from when selecting a product that 

meets their market data needs. 

Subscribers who seek a broader market 

view but do not need complete depthof- book may select the BATS One Feed 

while subscribers that seek the complete 

depth-of-book information may 

subscribe to the depth-of-book feeds of 

each individual BATS Exchanges. 

Exchange Not the Exclusive 

Distributor of BATS One. Although the 

BATS Exchanges are the exclusive 

distributors of the individual data feeds 

from which certain data elements would 

be taken to create the BATS One Feed, 

the Exchange would not be the 

exclusive distributor of the aggregated 

and consolidated information that 

would compose the proposed BATS 

One Feed. Vendors would be able, if 

they chose, to create a data feed with the 

same information as the BATS One Feed 

and distribute it to their clients on a 

level-playing field with respect to 

latency and cost as compared to the 

Exchange’s proposed BATS One Feed. 

The pricing the Exchange would charge 

for the BATS One Feed would not be 

lower than the cost to a vendor of 

receiving the underlying data feeds and 

of maintaining servers in the same 

facility as the Exchange to receive the 

data feeds with no greater latency than 

the Exchange. In addition, the pricing 

the Exchange would charge clients for 

the BATS One Feed compared to the 

cost of the individual data feeds from 

the BATS Exchanges would enable a 

vendor to receive the underlying data 

feeds and offer a similar product on a 

competitive basis and with no greater 

latency than the Exchange. 

Latency. The BATS One Feed is not 

intended to compete with similar 

products offered by External 

Distributors. Rather, it is intended to 

assist External Distributors in 

incorporating aggregated and 

summarized data from the BATS 

Exchanges into their own market data 

products that are provided to the end 

user. Therefore, Distributors will receive 

the data, who will, in turn, make 

available BATS One Feed to their end 

users, either separately or as 

incorporated into the various market 

data products they provide. As stated 

above, Distributors have expressed a 

desire for a product like the BATS One 

Feed so that they may easily incorporate 

aggregated or summarized BATS 

Exchange data into their own products 

without themselves incurring the 

administrative costs of repackaging and 

aggregating the data it would receive by 

subscribing to each market data product 

offered by the individual BATS 

Exchanges. 

Notwithstanding the above, the 

Exchange believes that External 

Distributors may create a product 

similar to BATS One Feed based on the 

market data products offered by the 

individual BATS Exchanges with no 

greater latency than the Exchange. As 

discussed above, in order to create the 

BATS One Feed, the Exchange will 

receive the individual data feeds from 

each BATS Exchange and, in turn, 

aggregate and summarize that data to 

create the BATS One Feed. This is the 

same process an External Distributor 

would undergo should it create a market 

data product similar to the BATS One 

Feed to distribute to its end users. In 

addition, the servers of most External 

Distributors are likely located in the 

same facilities as the Exchange, and, 

therefore, should receive the individual 

data feed from each BATS Exchange on 

or about the same time the Exchange 

would for it to create the BATS One 

Feed. 

The Exchange has designed the BATS 

One data feed so that it would not have 

a competitive advantage over a 

competing vendor with respect to the 

speed of access to those underlying data 

feeds. Likewise, the BATS One data feed 

would not have a speed advantage visa`-vis competing vendors located in the 

same data center as the Exchange with 

respect to access to end user customers, 

whether those end users are also located 

in the same data center or not. 

Therefore, the Exchange believes that it 

will not incur any potential latency 

advantage that will result in any burden 

on competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

Cost. With regard to cost, the 

Exchange will file a separate rule filing 

with the Commission to establish fees 

for BATS One that would be designed 

to ensure that vendors could compete 

with the Exchange by creating a similar 

product as the BATS One Feed. The 

pricing the Exchange would charge 

clients for the BATS One Feed 

compared to the cost of the individual 

data feeds from the BATS Exchanges 

would enable a vendor to receive the 

underlying data feeds and offer a similar 

product on a competitive basis and with 

no greater latency than the Exchange. 

The Distribution Fees that the Exchange 

proposes for the BATS One Feed are 

equal to the combined fee of subscribing 

to each individual data feed,32 therefore, 

enabling a vendor to create a competing 

product based on the individual data 

feeds and charge its clients a fee that it 

believes reflects the value of the 

aggregation and consolidation function 

that is competitive with BATS One Feed 

pricing. The Exchanges believes that the 

incremental cost to a particular vendor 

for aggregation can be supported by the 

vendor’s revenue opportunity and may 

be inconsequential if such vendor 

already has systems in place to perform 


rmajette on DSK2VPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 224 / Thursday, November 20, 2014 / Notices 69153 

33See Securities Exchange Act Release No. 72689 

(July 28, 2014), 79 FR 44917 (August 1, 2014) (SR– 

EDGA–2014–16). 

34See Letter from Suzanne Hamlet Shatto to the 

Commission, dated August 19, 2014 (SR–EDGA– 

2014–16) (‘‘Shatto Letter’’) (letter commenting on 

companion EDGA filing that proposes to offer the 

same feed). 

35But see Letter from Sal Arnuk and Joe Saluzzi, 

Themis Trading LLC, to Elizabeth M. Murphy, 

Secretary, Commission, dated August 21, 2014 (SR– 

BATS–2014–028) (‘‘Themis Letter’’); Letter from Ira 

D. Hammerman, General Counsel, SIFMA, to Kevin 

O’Neill, Deputy Secretary, Commission, dated 

August 22, 2014 (SR–BATS–2014–028) (‘‘SIFMA 

Letter’’) (letters commenting on companion BATS 

filing that proposes to offer the same feed). 

36See Securities Exchange Act Release No. 73098 

(September 15, 2014), 79 FR 56415 (September 19, 

2014). 

37 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

these functions as part of creating its 

proprietary market data products and is 

able to allocate these costs over 

numerous products and customer 

relationships. For these reasons, the 

Exchange believes that vendors could 

readily offer a product similar to the 

BATS One Feed on a competitive basis 

at a similar cost. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

A similar proposed rule change was 

initially filed with the Commission on 

July 14, 2014 and published for 

comment in the Federal Register on 

August 1, 2014.33 The Commission 

received one comment letter in response 

to that proposed rule change.34 In 

addition, two letters were submitted to 

the Commission commenting on a 

companion BZX filing that proposed to 

offer the same feed.35 On September 15, 

2014, the Commission extended its 

review period until October 30, 2014.36

On October 29, 2014, the Exchange 

withdrew the initial proposed rule 

change. The points raised by the Themis 

Letter and Shatto Letter are either not 

responsive to the issues raised in the 

proposal or aimed at existing elements 

of U.S. market structure that have been 

previously approved by the 

Commission. 

The thrust of the SIFMA Letter is 

aimed at the proposed fees which are 

being removed from this proposed rule 

change and are to be filed with the 

Commission via a separate rule filing. 

While the SIFMA Letter correctly states 

that the Exchange has marketed the 

BATS One Feed since August 1, 2014, 

the SIFMA Letter incorrectly asserts that 

the Exchange has offered the BATS One 

Feed since that same date. All of the 

Exchange’s marketing materials have 

included statements that the BATS One 

Feed’s implementation was pending to 

SEC approval, and at no point has the 

Exchange offered the BATS One product 

for any use other than for testing and 

certification. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 45 days of the date of 

publication of this notice in the Federal 

Register or within such longer period 

up to 90 days of such date (i) as the 

Commission may designate if it finds 

such longer period to be appropriate 

and publishes its reasons for so finding 

or (ii) as to which the Exchange 

consents, the Commission shall: 

(A) By order approve or disapprove 

such proposed rule change, or 

(B) institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

EDGA–2014–25 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–EDGA–2014–25. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

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

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549, on official 

business days between the hours of 

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

filing also will be available for 

inspection and copying at the principal 

office of EDGA. All comments received 

will be posted without change; the 

Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR–EDGA– 

2014–25 and should be submitted on or 

before December 11, 2014. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.37

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–27445 Filed 11–19–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73593; File No. SR– 

NYSEMKT–2014–95] 

Self-Regulatory Organizations; NYSE 

MKT LLC; Notice of Filing of Proposed 

Rule Change Amending Rule 13— 

Equities and Related Rules Governing 

Order Types and Modifiers To Clarify 

the Nature of Order Types 

November 14, 2014. 

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

Securities Exchange Act of 1934 

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

notice is hereby given that, on October 

31, 2014, NYSE MKT LLC (‘‘Exchange’’ 

or ‘‘NYSE MKT’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the self-regulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

Rule 13—Equities and related rules 

governing order types and modifiers. 

The text of the proposed rule change is 

available on the Exchange’s Web site at 

www.nyse.com, at the principal office of 

the Exchange, and at the Commission’s 

Public Reference Room. 


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