Federal Register / Vol. 79, No. 240 / Monday, December 15, 2014 / Notices 74143 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See BOX Fee Schedule, Section 1 (as of 

November 2014), available here, http://

boxexchange.com/assets/BOX_Fee_Schedule.pdf. 

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

6 15 U.S.C. 78f(b)(4). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73793; File No. SR– 

NYSEArca-2014–137] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change to Amend the NYSE Arca 

Options Fee Schedule To Amend the 

Application of Routing Fees Effective 

December 1, 2014 

December 9, 2014. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that, on 

November 26, 2014, NYSE Arca, Inc. 

(the ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed 

with the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I, II, and III below, which Items 

have been prepared by the selfregulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The Exchange proposes to amend the 

NYSE Arca Options Fee Schedule (‘‘Fee 

Schedule’’) to amend the application of 

Routing Fees. The Exchange proposes to 

implement the change on December 1, 

2014. 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. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

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

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend the 

Fee Schedule as it relates to the 

application of Routing Fees. The 

purpose of the proposed change is to 

account for recent changes introduced 

on other exchanges that impact the fees 

charged when routing orders. 

The Exchange currently charges OTP 

Holders or OTP Firms (collectively, 

‘‘OTPs’’) a Routing Fee when it routes 

orders to other exchanges for execution. 

The Routing Fee is comprised of an 

$0.11 per contract fee, plus the 

applicable transaction fees assessed by 

the away market for execution of the 

order (which the Exchange is able to 

discern from the away market fee 

schedule). The Routing Fees are 

applicable for both standard and mini 

options and are set forth separately in 

the Fee Schedule. 

Recently, the BOX Options Exchange 

LLC (‘‘BOX’’) adopted per contract 

pricing that varies based upon the 

counter party to the trade. This pricing 

change makes it impossible to know in 

advance of the execution what the 

charges will be for an order routed to 

BOX. For example, a Professional 

Customer order routed to BOX in a nonPenny option would be charged $0.35 

per contract if it traded against another 

Professional Customer or Broker/Dealer, 

but would be charged $0.94 per contract 

if it traded against a Customer.4

In order to provide OTPs with 

certainty regarding the routing fees for 

which they may be liable, the Exchange 

is proposing to amend the Fee Schedule 

as it relates to the application of Routing 

Fees, as set forth in the sections of the 

Fee Schedule relating to Trade-Related 

Charges for Standard Options and 

Trade-Related Charges for Mini Options. 

The proposed amendments would 

specify in both sections that if the actual 

transaction fees assessed by the away 

exchange(s) cannot be determined prior 

to the execution, the Exchange would 

charge the $0.11 per contract fee plus 

the highest per contract charge assessed 

by the away exchange(s) for the relevant 

option class and type of market 

participant (e.g., Customer, Firm, 

Broker/Dealer, Professional Customer or 

Market Maker). 

The Exchange proposes to make other 

non-substantive changes to the Fee 

Schedule. First, the Exchange proposes 

to replace the reference to ‘‘away 

market,’’ with a reference to ‘‘away 

exchange,’’ because the Exchange only 

routes orders to registered exchanges. 

Second, the Exchange proposes to 

replace the term ‘‘charged’’ with the 

term ‘‘assessed,’’ to make it parallel with 

the proposed changes to the Routing 

Fees. Third, the Exchange proposes to 

add the following text as a 

parenthetical: ‘‘calculated on an orderby-order basis since different away 

exchange charge different amounts.’’ 

The Exchange notes that this rule text is 

based on the fee schedule for NYSE 

Amex Options LLC (‘‘NYSE Amex 

Options’’) and represents how the 

Exchange currently calculates the 

Routing Fee. Fourth, the Exchange 

proposes to delete the parenthetical text 

that provides ‘‘applies to both Mini and 

standard option contracts’’ as this 

parenthetical is redundant because the 

Routing Fee is set forth separately in the 

Fee Schedule in the specific sections 

relating to fees for standard options and 

for Mini options. Finally, to provide 

clarity regarding the applicability of 

Routing Fees, the Exchange proposes to 

add the following text, which is based 

on language from the NYSE Amex 

Options fee schedule: ‘‘The Routing Fee 

is in addition to NYSE Arca’s customary 

execution fees applicable to the order.’’ 

The Exchange notes that OTPs can 

avoid having their orders routed to away 

markets by utilizing specific, nonroutable order types if they so choose. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Securities Exchange 

Act of 1934 (the ‘‘Act’’),5 in general, and 

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

of the Act,6 in particular, because it 

provides for the equitable allocation of 

reasonable dues, fees, and other charges 

among its members, issuers and other 

persons using its facilities and does not 

unfairly discriminate between 

customers, issuers, brokers or dealers. 

The Exchange believes that the 

proposed fee change is reasonable and 

equitable because charging market 

participants a set per contract rate in 

those instances when an order is routed 

to an away exchange provides market 

participants with certainty, which will 

enable them to make informed decisions 

regarding whether to continue to 

designate such orders as eligible for 

routing to away exchanges. The 

Exchange further believes that the 

proposed fee change to charge the 

highest rate charged by the away 


emcdonald on DSK67QTVN1PROD with NOTICES
74144 Federal Register / Vol. 79, No. 240 / Monday, December 15, 2014 / Notices 

7 15 U.S.C. 78s(b)(3)(A). 

8 17 CFR 240.19b–4(f)(2). 

9 15 U.S.C. 78s(b)(2)(B). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

exchange if the Exchange cannot discern 

the per contract charge in the option 

class in question in advance of the 

execution is reasonable and equitable 

because the Exchange cannot know in 

advance what the charge would be on 

the away exchange. If the Exchange 

charged the lowest feasible charge, the 

Exchange could end up bearing the 

costs of routing an order to an away 

exchange. The Exchange notes that— 

just as they do today—to avoid 

incurring any Routing Fee in preference 

of an execution on the Exchange, OTPs 

are able to designate their orders as nonroutable. 

The Exchange believes that the 

proposed non-substantive changes to 

the Fee Schedule are reasonable and 

equitable because they provide 

transparency in the Fee Schedule 

regarding how the Exchange calculates 

transaction fees, including Routing Fees, 

and eliminate redundant rule text. 

The Exchange further believes that 

this proposed change is not unfairly 

discriminatory either as it applies 

equally to all OTPs that send orders to 

the Exchange. 

Finally, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily favor competing venues. In such 

an environment, the Exchange must 

continually review, and consider 

adjusting, its fees and credits to remain 

competitive with other exchanges. For 

the reasons described above, the 

Exchange believes that the proposed 

rule change reflects this competitive 

environment. 

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 that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange believes the proposed fee 

change is reasonably designed to be fair 

and equitable, and therefore, will not 

unduly burden any particular group of 

market participants trading on the 

Exchange vis-a`-vis another group (i.e., 

Market Markers versus non-Market 

Makers) as it applies equally to all OTP 

Holders that send routable orders to the 

Exchange. 

The Exchange notes that it operates in 

a highly competitive market in which 

market participants can readily favor 

competing venues. In such an 

environment, the Exchange must 

continually review, and consider 

adjusting, its fees and credits to remain 

competitive with other exchanges. For 

the reasons described above, the 

Exchange believes that the proposed 

rule change reflects this competitive 

environment. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received from 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 7 of the Act and 

subparagraph (f)(2) of Rule 19b–4 8

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

under Section 19(b)(2)(B) 9 of the Act to 

determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NYSEArca–2014–137 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–NYSEArca–2014–137. This 

file number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

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

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

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

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE., 

Washington, DC 20549 on official 

business days between the hours of 

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

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change; 

the Commission does not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. All submissions 

should refer to File Number SR– 

NYSEArca–2014–137, and should be 

submitted on or before January 5, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–29241 Filed 12–12–14; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73797; File No. SR–EDGA– 

2014–32] 

Self-Regulatory Organizations; EDGA 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change to Rules 1.5 and 11.3 of 

EDGA Exchange, Inc. 

December 9, 2014. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on November 

28, 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 


emcdonald on DSK67QTVN1PROD with NOTICES