Federal Register / Vol. 80, No. 13 / Wednesday, January 21, 2015 / Notices 2987 

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). 

6 ‘‘Professional’’ applies to any transaction 

identified by a Member as such pursuant to 

Exchange Rule 16.1. 

7 ‘‘Firm’’ applies to any transaction identified by 

a Member for clearing in the Firm range at the OCC. 

8 ‘‘Market Maker’’ applies to any transaction 

identified by a Member for clearing in the Market 

Maker range at the OCC. 

9 ‘‘Penny Pilot Securities’’ are those issues quoted 

pursuant to Exchange Rule 21.5, Interpretation and 

Policy .01. 

10 ‘‘ADV’’ means average daily volume calculated 

as the number of contracts added or removed, 

combined, per day. 

11 ‘‘TCV’’ means total consolidated volume 

calculated as the volume reported by all exchanges 

to the consolidated transaction reporting plan for 

the month for which the fees apply, excluding 

volume on any day that the Exchange experiences 

an Exchange System Disruption and on any day 

with a scheduled early market close. 

12 ‘‘ADAV’’ means average daily added volume 

calculated as the number of contracts added. 

13 15 U.S.C. 78f. 

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

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74052; File No. SR–BATS– 

2015–02] 

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. 

January 14, 2015. 

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 January 2, 

2015, 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 Substance of 

the Proposed Rule Change 

The Exchange filed a proposal to 

amend the fee schedule applicable to 

Members 5 and non-members 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 modify the 

‘‘Options Pricing’’ section of its fee 

schedule effective immediately, in order 

to modify pricing charged by the 

Exchange’s options platform (‘‘BATS 

Options’’) including adding a new tier 

within the Professional, Firm, and 

Market Maker Penny Pilot Add Volume 

Tiers, a new Market Maker Penny Pilot 

Add Volume Tier, and several 

corresponding changes, as further 

described below. 

The Exchange proposes to add a new 

Non-Customer Take Volume Tier. 

Currently, the Exchange charges $0.48 

per contract for a Professional,6 Firm,7

or Market Maker 8 order in a Penny Pilot 

Security 9 that removes liquidity from 

BATS Options under fee code PP, or, 

where the Member meets the 

requirements of the existing NonCustomer Take Volume Tier under 

footnote 3, i.e. has an ADV 10 equal to 

or greater than 1.00% of average TCV,11

$0.47 per contract for a Professional, 

Firm, or Market Maker order in a Penny 

Pilot Security that removes liquidity 

from BATS Options. The Exchange 

proposes to add an additional NonCustomer Take Volume Tier to footnote 

3 of the fee schedule that will charge 

$0.45 per contract for Professional, 

Firm, and Market Maker orders in a 

Penny Pilot Security that removes 

liquidity from BATS Options where the 

Member: (1) Has an ADAV 12 equal to or 

greater than 1.00% of average TCV; and 

(2) has an ADV equal to or greater than 

2.00% of average TCV. 

The Exchange is also proposing to add 

a new Market Maker Penny Pilot Add 

Volume Tier. Currently, the Exchange 

provides a $0.40 per contract rebate for 

a Market Maker order in a Penny Pilot 

Security that adds liquidity to BATS 

Options under fee code PM. The 

Exchange proposes to add a Market 

Maker Penny Pilot Tier under footnote 

6 of the fee schedule that will provide 

a $0.42 per contract rebate for Market 

Maker orders in a Penny Pilot Security 

that adds liquidity to BATS Options 

where the Member: (1) Has an ADAV 

equal to or greater than 1.00% of 

average TCV; and (2) has an ADV equal 

to or greater than 2.00% of average TCV. 

Finally, the Exchange proposes to 

make several corresponding changes to 

the fee schedule to reflect the proposed 

changes above. Specifically, the 

Exchange is proposing to add the fee 

and rebate proposed above to the 

Standard Rates chart on the fee 

schedule, to add footnote six to fee code 

PM, and to title the current NonCustomer Take Volume Tier in footnote 

3 as ‘‘Non-Customer Take Volume Tier 

1’’ in order to reflect the addition of the 

second tier proposed above. 

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.13

Specifically, the Exchange believes that 

the proposed rule change is consistent 

with Section 6(b)(4) of the Act,14 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 or providers of routing services 

if they deem fee levels to be excessive. 

Volume-based rebates and fees such 

as the ones currently maintained on 

BATS Options as well as the new NonCustomer Take Volume Tier 2 and the 


asabaliauskas on DSK5VPTVN1PROD with NOTICES
2988 Federal Register / Vol. 80, No. 13 / Wednesday, January 21, 2015 / Notices 

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

16 17 CFR 240.19b–4(f)(2). 

new Market Maker Penny Pilot Add 

Volume Tier proposed herein, have 

been widely adopted by equities and 

options exchanges and are equitable 

because they are open to all Members on 

an equal basis and provide additional 

benefits or discounts that are reasonably 

related to the value to an exchange’s 

market quality associated with higher 

levels of market activity, such as higher 

levels of liquidity provision and/or 

growth patterns, and introduction of 

higher volumes of orders into the price 

and volume discovery processes. 

Further, the Exchange believes the 

proposed Non-Customer Take Volume 

Tier 2 is a reasonable and equitable 

allocation of fees and rebates because 

the requirement that the Member has an 

ADAV equal to or greater than 1.00% of 

average TCV combined with the 

requirement that a Member achieve an 

ADV of equal to or greater than 2.00% 

of average TCV will provide such 

enhancements in market quality on 

BATS Options by incentivizing 

increased participation on BATS 

Options. This is especially true as 

compared to Non-Customer Take 

Volume Tier 1, which has no ADAV 

component, meaning that Non-Customer 

Take Volume Tier 2 will act to 

incentivize Members to add liquidity on 

BATS Options in order to receive 

further reduced fees. Similarly, the 

Exchange believes that the new Market 

Maker Penny Pilot Add Volume Tier is 

a reasonable and equitable allocation of 

fees and rebates it will incentivize 

Members to both add and remove 

liquidity from the Exchange in order to 

meet the ADV and ADAV thresholds 

required to receive the enhanced 

rebates. 

The Exchange notes that it is not 

proposing to modify any existing tiers, 

but rather to add new tiers that will 

provide Members with additional ways 

to receive higher rebates or pay lower 

fees. As such, under the proposal a 

Member will receive either the same or 

a higher rebate or be charged either the 

same or a lower fee than they would 

today. Accordingly, the Exchange 

believes that the proposed additions to 

the Exchange’s tiered pricing structure 

and incentives are not unfairly 

discriminatory because they will, except 

as noted below, apply uniformly to all 

Members and are consistent with the 

overall goals of enhancing market 

quality on BATS Options which also 

benefits all Members. The Exchange 

believes that restricting the availability 

of the proposed rebates in Penny Pilot 

Securities associated with the Market 

Maker Add Volume Tier to Market 

Maker orders is reasonable and 

equitably allocated as well as not 

unreasonably discriminatory because 

Market Makers are subject to additional 

regulatory requirements not applicable 

for Professional and Firm orders and 

such Market maker orders are not 

currently eligible for certain enhanced 

rebate tiers available to Professional and 

Firm orders under the Professional and 

Firm Penny Pilot Add Volume Tiers. 

The Exchange notes that all nonCustomer orders (i.e., Professional, Firm 

and Market Maker orders) will be 

eligible for the reduced fees proposed as 

under the Non-Customer Take Volume 

Tier 2. 

The Exchange reiterates 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 to be 

excessive or providers of routing 

services if they deem fee levels to be 

excessive. 

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. With respect 

to the proposed new tiered rebates, the 

Exchange does not believe that any such 

changes burden competition, but 

instead, enhance competition, as they 

are intended to increase the 

competitiveness of and draw additional 

volume to BATS Options. The Exchange 

also believes the proposed tiers would 

further enhance competition because 

they are similar to pricing tiers currently 

available on both the Exchange and 

other exchanges. 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 

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 15 and paragraph (f)(2) of Rule 

19b–4 thereunder.16 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 rulecomments@sec.gov. Please include File 

Number SR–BATS–2015–02 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–2015–02. 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 will also be available for 


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Federal Register / Vol. 80, No. 13 / Wednesday, January 21, 2015 / Notices 2989 

17 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3A Member is defined as ‘‘any registered broker 

or dealer that has been admitted to membership in 

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

4See Securities Exchange Act Release No. 61885 

(April 9, 2010), 75 FR 20018 (April 16, 2010) (SR– 

BATS–2010–002). 

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– 

2015–02 and should be submitted on or 

before February 11, 2015. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–00837 Filed 1–20–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–74050; File No. SR–BYX– 

2015–01] 

Self-Regulatory Organizations; BATS 

Y-Exchange, Inc.; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change Related to Fees for Use 

of BATS Y-Exchange, Inc. 

January 14, 2015. 

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 January 2, 

2015, BATS Y-Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BYX’’) 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 

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 filed a proposal to 

amend the fee schedule applicable to 

Members 3 and non-members of the 

Exchange pursuant to BYX 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 modify its 

fee schedule effective immediately in 

order to: (1) adopt pricing for the 

Exchange’s historical market data; (2) 

adopt physical connection fees; and (3) 

add Membership Fees. 

Historical Market Data 

The Exchange proposes to begin 

charging a fee for providing historical 

data to data recipients upon request. 

The Exchange currently provides 

historical data upon request on an ad 

hoc basis, but proposes to begin 

charging a fee due to the infrastructure 

costs of storing and providing such data. 

As proposed, the Exchange will begin to 

charge for the following three products 

through either of these distribution 

methods: (1) Historical top of book data 

from the Exchange’s TOP data feed 

(‘‘Historical TOP Data’’), (2) historical 

data from the Exchange’s PITCH data 

feed (‘‘Historical PITCH Data’’), and (3) 

historical transaction data from the 

Exchange’s Last Sale Feed (‘‘Historical 

Last Sale Data’’), which are described in 

Exchange Rule 11.22(h). The Exchange 

notes that the same historical data 

products are offered for a fee by other 

market centers, including BATS 

Exchange, Inc. (‘‘BZX’’), which are 

offered for the same prices as those 

proposed herein.4

The proposed cost of user-accessible 

BYX Historical TOP Data, BYX 

Historical PITCH Data or BYX Historical 

Last Sale Data is $500 per month of data 

accessed by any individual user. The 

Exchange’s databases will contain up to 

90 days of data at any point in time. For 

data that the Exchange provides on an 

external hard drive to a market 

participant the proposed cost is $2,500 

per 1 terabyte (TB) drive generated by 

the Exchange. Each of the proposed 

costs set forth above applies per data 

product. For instance, an individual 

user that obtained access to BYX 

Historical Top Data would pay $500 for 

access to a particular month’s data, and 

if that user also wanted access to BYX 

Historical Last Sale Data, the individual 

user would need to pay another $500 for 

such access. Similarly, a market 

participant would pay $2,500 for an 

external hard drive containing BYX 

Historical TOP Data that fits on a 1 TB 

drive (internal use only); such 

participant would have to pay 

separately for a 1 TB drive containing 

BYX Historical Last Sale Data or BYX 

Historical PITCH Data. 

Membership Fees 

The Exchange is also proposing to 

charge an Annual Membership Fee for 

Members of the Exchange of $2,500, 

which will support their Exchange 

membership for the calendar year. The 

fee will be charged per Member firm. 

Beginning in January 2015, the 

Exchange plans to charge an Annual 

Membership Fee which will be assessed 

on all Members as of a date determined 

by the Exchange in January of each year. 

For any month in which a firm is 

approved for membership with the 

Exchange after the January renewal 

period, the Annual Membership Fee 

will be pro-rated beginning on the date 

on which membership is approved and 

based on the number of remaining 

trading days in that year. The fee will 

be assessed in the month following 

membership approval. For example, if a 

firm applies and is accepted for 

membership with the Exchange on 

February 15, 2015, the new Member will 

be assessed a pro-rated Annual 

Membership Fee for the period 

beginning on February 15 through the 

end of 2015. The fee will be assessed in 

the next month’s billing cycle, which in 

this case, would be March 2015. Such 

fees will be non-refundable. However, 

where a Member is pending a voluntary 

termination of rights as a Member 

pursuant to Rule 2.8 prior to the date 

any Annual Membership Fee for a given 

year will be assessed (i.e., January 1, 

2015) and the Member does not utilize 

the facilities of the Exchange while such 

voluntary termination of rights is 

pending, then the Member will not be 

obligated to pay the Annual 

Membership Fee. The Exchange believes 

this to be appropriate because there is 


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