77576 Federal Register / Vol. 79, No. 247 / Wednesday, December 24, 2014 / Notices 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(2). 

5A Member is defined as ‘‘any registered broker 

or dealer that has been admitted to membership in 

the Exchange.’’ See Exchange Rule 1.5(n). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–73880; File No. SR–BATS– 

2014–071] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Related to Fees for Use 

of BATS Exchange, Inc. 

December 18, 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 December 

17, 2014, BATS Exchange, Inc. (the 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. The 

Exchange has designated the proposed 

rule change as one establishing or 

changing a member due, fee, or other 

charge imposed by the Exchange under 

section 19(b)(3)(A)(ii) of the Act 3 and 

Rule 19b–4(f)(2) thereunder,4 which 

renders the proposed rule change 

effective upon filing with the 

Commission. 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 filed a proposal to 

make several non-substantive 

amendments to the fee schedule 

applicable to Members 5 and nonmembers of the Exchange pursuant to 

BATS Rules 15.1(a) and (c). Changes to 

the fee schedule pursuant to this 

proposal are effective upon filing. 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at http://www.batstrading.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 make a 

number of clarifying, non-substantive 

changes to its fee schedule in order to 

convert the existing fee schedule into a 

chart format, including eliminating 

certain redundancies from and 

providing additional clarity to the 

language in the existing fee schedule. 

The Exchange believes that these 

changes will provide greater 

transparency to Members about how the 

Exchange assesses fees and calculates 

rebates, as well as allowing Members to 

more easily validate their bills on a 

monthly basis. The Exchange notes that 

none of these changes substantively 

amend any fee or rebate, nor do they 

alter the manner in which the Exchange 

assesses fees or calculates rebates. 

Specifically, the Exchange is proposing 

the following: 

• To make clear that rebates are indicated 

by parentheses. 

• To state the following: The rates listed in 

the Standard Rates table apply unless a 

Member’s transaction is assigned a fee code 

other than a standard fee code. If a Member’s 

transaction is assigned a fee code other than 

a standard fee code, the rates listed in the Fee 

Codes table will apply. Footnotes provide 

further explanatory text or, where annotated 

to fee codes, indicate variable rate changes, 

provided the conditions in the footnote are 

met. Unless otherwise noted, all routing fees 

or rebates in the Fee Codes and Associated 

Fees table are for removing liquidity from the 

destination venue. 

• To add a section and chart titled 

‘‘Standard Rates,’’ which will include the 

standard fees and rebates for securities priced 

both at or above $1.00 and below $1.00 for 

adding liquidity, removing liquidity, and 

routing and removing liquidity from another 

venue as well as the standard fee codes 

associated with these rates. 

• To add a section titled ‘‘Fee Codes and 

Associated Fees,’’ which will include the fee 

or rebate, the fee code, and a description for 

each possible execution that could occur on 

the Exchange or on another venue. 

• To add a section titled ‘‘Definitions,’’ 

which will include definitions that are 

defined in the current fee schedule. These 

include the definitions listed below, which 

are identical to definitions contained on the 

Exchange’s current fee schedule. All 

references to ‘‘per share’’ mean ‘‘per share 

executed.’’ ‘‘ADAV’’ means average daily 

added volume calculated as the number of 

shares added and ‘‘ADV’’ means average 

daily volume calculated as the number of 

shares added or removed, combined, per day. 

‘‘Step-Up Add TCV’’ means ADAV as a 

percentage of TCV in January 2014 subtracted 

from current ADAV as a percentage of TCV. 

For purposes of Equities Pricing, ‘‘Options 

Step-Up Add TCV’’ means ADAV as a 

percentage of TCV in January 2014 subtracted 

from current ADAV as a percentage of TCV, 

using the definitions of ADAV and TCV as 

provided under Options Pricing. ADAV and 

ADV are calculated on a monthly basis, 

excluding shares added or removed on any 

day that the Exchange’s system experiences 

a disruption that lasts for more than 60 

minutes during regular trading hours 

(‘‘Exchange System Disruption’’), on any day 

with a scheduled early market close and on 

the last Friday in June (the ‘‘Russell 

Reconstitution Day’’). Routed shares are not 

included in ADAV or ADV calculation. With 

prior notice to the Exchange, a Member may 

aggregate ADAV or ADV with other Members 

that control, are controlled by, or are under 

common control with such Member (as 

evidenced on such Member’s Form BD). 

‘‘TCV’’ means total consolidated volume 

calculated as the volume reported by all 

exchanges and trade reporting facilities to a 

consolidated transaction reporting plan for 

the month for which the fees apply. The 

Exchange excludes volume on any day that 

the Exchange experiences an Exchange 

System Disruption, on any day with a 

scheduled early market close and the Russell 

Reconstitution Day. 

• To add a section titled ‘‘General Notes,’’ 

that will include the following notes: Unless 

otherwise indicated, rebates and charges for 

adding, removing or routing liquidity are 

listed as per share rebates and charges; the 

Exchange notes that to the extent a Member 

does not qualify for any of the tiers listed 

below, the rates listed in the above section 

titled ‘‘Fee Codes and Associated Fees’’ will 

apply; to the extent a Member qualifies for 

higher rebates and/or lower fees than those 

provided by a tier for which such Member 

qualifies, the higher rebates and/or lower fees 

shall apply; and variable rates provided by 

tiers apply only to executions in securities 

priced at or above $1.00. 

• To add a series of footnotes describing 

already existing enhanced rebates including 

Add Volume Tiers, Step-Up Tiers, CrossAsset Step-Up Tiers, and NBBO Setter and 

Joiner Tiers (which includes one nonsubstantive typo correction to add 

parentheses around the $0.0001 rebate 

offered for NBBO Setter Tier 1) that are not 

covered in the Fee Codes and Associated 

Fees section described above. 

• To add a series of footnotes describing 

all fees and rebates for securities priced 

below $1.00 that either execute on the 

Exchange or another venue, to the extent 

applicable. 

• To add new sections and charts titled 

‘‘Logical Port Fees,’’ ‘‘Market Data Fees,’’ and 

‘‘Physical Connection Fees,’’ which, other 

than being in chart form, will be identical to 

the current fee schedule. 

• To eliminate the lead-in text that reads 

‘‘The following is the Schedule of Fees 

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Federal Register / Vol. 79, No. 247 / Wednesday, December 24, 2014 / Notices 77577 

6 15 U.S.C. 78f. 

7 15 U.S.C. 78f(b)(4) and (5). 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(2). 10 17 CFR 200.30–3(a)(12). 

(pursuant to Rule 15.1(a) and (c)) for BATS 

Exchange, Inc. (‘‘BZX Exchange’’ or ‘‘BZX’’). 

The Schedule of Fees is divided into Equities 

Pricing, Options Pricing and Physical 

Connection Charges.’’ 

The Exchange notes that it is not 

proposing any amendments to the 

Options Pricing section of its fee 

schedule at this time. 

The Exchange proposes to implement 

the amendments to its fee schedule 

effective immediately. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder that 

are applicable to a national securities 

exchange, and, in particular, with the 

requirements of section 6 of the Act.6

Specifically, the Exchange believes that 

the proposed rule change is consistent 

with sections 6(b)(4) of the Act and 

6(b)(5) of the Act,7 in that it provides for 

the equitable allocation of reasonable 

dues, fees and other charges among 

members and other persons using any 

facility or system which the Exchange 

operates or controls. The Exchange 

notes that it operates in a highly 

competitive market in which market 

participants can readily direct order 

flow to competing venues if they deem 

fee levels at a particular venue to be 

excessive. 

The Exchange believes that the 

proposed changes are reasonable and 

equitable because they are nonsubstantive and the Exchange is not 

changing any fees or rebates that apply 

to trading activity on the Exchange or 

routed executions. Further, the changes 

are designed to make the fee schedule 

easier to read and for Members to 

validate the bills that they receive from 

the Exchange. The Exchange also 

believes that the proposal is nondiscriminatory because it applies 

uniformly to all Members, and again, 

the Exchange is not making any changes 

to existing fees and rebates. Finally, the 

Exchange believes that the proposed fee 

schedule will be clearer and less 

confusing for investors and will 

eliminate potential investor confusion, 

thereby removing impediments to and 

perfecting the mechanism of a free and 

open market and a national market 

system, and, in general, protecting 

investors and the public interest. 

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. 

To the contrary, the Exchange believes 

that the changes will both make the fee 

schedule easier to read and 

simultaneously provide Members with 

an easier way to validate their bills on 

a monthly basis, both of which the 

Exchange believes are important 

components of customer service and 

which will allow the Exchange to better 

compete for order flow. The Exchange 

reiterates that the changes are only to 

the format of the fee schedule and are 

entirely non-substantive. As stated 

above, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily direct order flow to competing 

venues if the [sic] deem fee structures to 

be unreasonable or excessive. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has not solicited, and 

does not intend to solicit, comments on 

this proposed rule change. The 

Exchange has not received any written 

comments from members or other 

interested parties. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

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

of the Act 8 and paragraph (f)(2) of Rule 

19b–4 thereunder.9 At any time within 

60 days of the filing of the proposed rule 

change, the Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission 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– 

BATS–2014–071 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE., Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–BATS–2014–071. 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–BATS– 

2014–071 and should be submitted on 

or before January 14, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2014–30123 Filed 12–23–14; 8:45 am] 

BILLING CODE 8011–01–P 

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