Federal Register / Vol. 82, No. 171 / Wednesday, September 6, 2017 / Notices 42141 

65 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. 

4 15 U.S.C. 78s(b)(1). 

5 17 CFR 240.19b–4. 

6See, IEX Trader Alert #2017–027 available at 

https://www.iextrading.com/trading/alerts/2017/ 

027/. 

7See Securities Exchange Act Release No. 81195 

(July 24, 2017), 82 FR 35250 (July 28, 2017) (SR– 

IEX–2017–11). 

8The Exchange notes that orders taking or adding 

non-displayed liquidity prior to or after the 

Opening Process, will continue to receive Fee Close 

I, either alone or in conjunction with other 

applicable Fee Codes. 

9See Rule 11.231(a). 

10See Rule 1.160(z). 

11See IEX Fee Schedule, Transaction Fees, bullet 

three. 

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 will also 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 No. SR–BatsBYX– 

2017–19 and should be submitted on or 

before September 27, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.65

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–18792 Filed 9–5–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81502; File No. SR–IEX– 

2017–28] 

Self-Regulatory Organizations; 

Investors Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Related to Fees 

Pursuant to Rule 15.110 

August 30, 2017. 

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

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b19b–4 

thereunder,3 notice is hereby given that, 

on August 16, 2017, the Investors 

Exchange LLC (‘‘IEX’’ or the 

‘‘Exchange’’) 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 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 

Pursuant to the provisions of Section 

19(b)(1) under the Securities Exchange 

Act of 1934 (‘‘Act’’),4 and Rule 19b–4 

thereunder,5 Investors Exchange LLC 

(‘‘IEX’’ or ‘‘Exchange’’) is filing with the 

Commission a proposed rule change to 

modify its Fee Schedule, pursuant to 

IEX Rule 15.110(a) to adopt pricing for 

orders that execute pursuant to Rule 

11.231 (Regular Market Session Opening 

Process for Non-IEX-Listed Securities). 

Changes to the Fee Schedule pursuant 

to this proposal are effective upon filing, 

and will be operative once the Exchange 

begins conducting the Regular Market 

Session Opening Process for Non-IEXListed Securities (the ‘‘Opening 

Process’’).6 The text of the proposed rule 

change is available at the Exchange’s 

Web site at www.iextrading.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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B, and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange Exchange recently filed 

and the Commission approved a 

proposed rule change to Rule 11.231, 

which modified the Opening Process for 

non-IEX-listed securities.7 The 

Exchange proposes to update its Fee 

Schedule, pursuant to IEX Rule 

15.110(a) and (c), to add a new Fee Code 

‘‘X’’ to identify the fee applicable to 

certain orders that execute in the 

Opening Process. More specifically, 

orders that execute in the Opening 

Process will receive the new Fee Code 

X on execution reports as follows: 

• Execution reports for non-displayed 

orders resting on the Continuous Order 

Book that execute in the Opening 

Process will receive new Fee Code X 

rather than Fee Code I.8

• Execution reports for displayed 

orders resting on the Continuous Order 

Book that execute in the Opening 

Process will continue to receive Fee 

Code L and will also receive new Fee 

Code X. 

• Execution reports for all orders on 

the Cross Book 9 that execute in the 

Opening Process will receive new Fee 

Code X. 

The Exchange is proposing to charge 

fees that are analogous to existing fees 

for orders that execute in the Opening 

Process. Accordingly, non-displayed 

orders on the Continuous Order Book 

and orders on the Cross Book that are 

executed in the Opening Process will 

receive Fee Code X on their execution 

reports and will be subject to a fee of 

$0.0009 per share (or 0.30% of total 

dollar value of the transaction 

calculated as the execution price 

multiplied by the number of shares 

executed in the transaction for shares 

executed below $1.00). Further, orders 

that were displayed on the Continuous 

Order Book during the Pre-Market 

Session 10 that are executed in the 

Opening Process will receive new Fee 

Code X and existing Fee Code L, and 

will not be charged a fee because, 

pursuant to the IEX Fee Schedule, to the 

extent a Member receives multiple Fee 

Codes on an execution, the lower fee 

shall apply.11

The Exchange notes that the 

Internalization Fee, Displayed Match 

Fee for non-displayed orders that 

remove displayed liquidity, and the 

exception to the Non-Displayed Match 

Fee for displayable orders that remove 

non-displayed resting interest upon 

entry are not applicable to the Opening 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
42142 Federal Register / Vol. 82, No. 171 / Wednesday, September 6, 2017 / Notices 

12 15 U.S.C. 78f. 

13 15 U.S.C. 78f(b)(4). 

14See Securities Exchange Act Release No. 78550 

(August 11, 2016), 81 FR 54873 (August 17, 2016) 

(SR–IEX–2016–09). 

15The Exchange notes that to the extent such 

orders are unexecuted after the Opening Process, 

the Exchange would display such orders consistent 

with their display instructions. 

16The Exchange notes that it is possible for a 

displayed order to remove non-displayed liquidity 

in the Pre-Market Session; however, such execution 

would not be part of the Opening Process, and 

would be subject to the exchanges existing fee 

schedule. 

17See Rule 11.231(a). 

18For example, the Nasdaq Stock Market charges 

fees ranging from $0.0015–$0.00085 for orders 

executed in the Nasdaq Opening Cross, including 

capping such fees at $35,000 per month for certain 

members, which includes crosses for listed and 

non-listed securities (see, https://

www.nasdaqtrader.com/ 

Trader.aspx?id=PriceListTrading2). Similarly, Bats 

EDGX Exchange charges $0.0010 for orders 

executed in the EDGX opening or re-opening 

process for non-listed securities priced above $1.00 

(see, http://www.bats.com/us/equities/membership/ 

fee_schedule/edgx/). 

19 Id. 

Process. As discussed below in the 

Statutory Basis section, the Opening 

Process is a bulk execution without 

explicit counterparties. 

2. Statutory Basis 

IEX believes that the proposed rule 

change is consistent with the provisions 

of Section 6(b) 12 of the Act in general, 

and furthers the objectives of Sections 

6(b)(4) 13 of the Act, in particular, in that 

it is designed to provide for the 

equitable allocation of reasonable dues, 

fees and other charges among its 

Members and other persons using its 

facilities. 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. 

IEX believes that its proposed pricing 

for the Opening Process is reasonable 

and equitable because the Exchange is 

proposing to charge fees analogous to 

those already in place for orders 

executed on the Exchange during 

continuous trading,14 while also 

accounting for orders on the Cross Book 

executed in the Opening Process. 

Specifically, non-displayed orders 

resting on the Continuous Order Book 

during the Pre-Market Session that are 

executed in the Opening Process, as 

well as orders on the Cross Book that are 

executed in the Opening Process, will 

be charged the Opening Match Fee 

(which is equal to the existing NonDisplayed Match Fee), while displayed 

orders on the Continuous Order Book in 

the Pre-Market Session executed in the 

Opening Process will be subject to the 

existing Displayed Match Fee. 

The Exchange believes that it is 

appropriate, reasonable, and consistent 

with the Act to charge the Opening 

Match Fee (which is equal to the 

existing Non-Displayed Match Fee) to 

orders on the Cross Book that are 

executed in the Opening Process, 

because such orders (regardless of 

display instruction) are queued and not 

displayed prior to or during the 

Opening Process.15 Furthermore, as 

noted above, such fee is consistent with 

the fee currently charged by the 

Exchange for taking and providing nondisplayed liquidity. 

While the Displayed Match Fee 

applicable to executions during 

continuous trading also applies to a 

non-displayed order that removes 

liquidity from a displayed resting order 

as counterparty, in the context of the 

Opening Process (which is a bulk 

execution of multiple buy and sell 

orders at a single price), the Exchange 

does not believe that it is appropriate to 

provide the Displayed Match Fee to 

non-displayed orders that execute in the 

Opening Process because there are no 

explicit counterparties in a bulk 

execution. Similarly, the Exchange does 

not believe that the exception to the 

Non-Displayed Match Fee for 

displayable orders that take resting 

interest upon entry is applicable in the 

context of the Opening Process since 

such orders are not able to remove 

resting interest on entry in the Opening 

Process, because they are either queued 

on the Cross Book and not displayed, or 

resting displayed on the Continuous 

Order Book.16 Furthermore, as noted 

above the Opening Process is a bulk 

execution of multiple buy and sell 

orders at a single price, and thus there 

are no counterparties to distinguish 

between liquidity provider and liquidity 

takers, or their respective display 

status.17

IEX also believes that it is 

appropriate, reasonable, and consistent 

with the Act not to charge a fee for the 

execution of an order that was displayed 

on the Continuous Order Book during 

the Pre-Market Session prior to the 

Opening Process. As with the existing 

fee structure for execution of 

transactions including displayed 

liquidity, this fee structure is designed 

to incentivize Members to send IEX 

aggressively priced displayable orders, 

thereby contributing to price discovery, 

and consistent with the overall goal of 

enhancing market quality. IEX believes 

that, as with the existing Displayed 

Match Fee, not charging a fee for such 

a previously displayed order is 

equitable and not unfairly 

discriminatory because it is designed to 

facilitate execution of, and enhance 

trading opportunities for, displayable 

orders, thereby further incentivizing 

entry of displayed orders. 

Further, the Exchange notes that the 

proposed fees are nondiscriminatory 

because they will apply uniformly to all 

Members and all Members have the 

opportunity to submit both displayed 

and non-displayed orders for execution 

in the Opening Process. In addition, the 

Exchange believes that the proposed 

fees for the Opening Process are 

appropriate, reasonable, and consistent 

with the Act, because such fees are 

within the range of transaction charged 

by other exchanges for the opening 

process for non-listed securities.18

Further, although orders that execute in 

the Opening Process may be subject to 

different fees, for the reasons discussed 

in the Purpose section, the Exchange 

notes that other exchanges also charge 

differential pricing for orders that 

execute in their opening process.19

Additionally, the Exchange believes 

that its proposed Fee Code X, to be 

provided on execution reports, will 

provide transparency and predictability 

to Members as to the applicable 

transaction fees, because Members can 

determine which Fee Code is applicable 

to the execution of a particular order in 

the Opening Process. 

In conclusion, the Exchange also 

submits that its proposed fee structure 

satisfies the requirements of Sections 

6(b)(4) and 6(b)(5) of the Act for the 

reasons discussed above in that it does 

not permit unfair discrimination 

between customers, issuers, brokers, or 

dealers, and is designed 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 in 

general to protect investors and the 

public interest. Further, IEX believes 

that its proposal does not raise any new 

or novel issues that have not previously 

been considered by the Commission in 

connection with the existing IEX fees or 

the fees of other national securities 

exchanges. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

IEX 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. The 

Exchange does not believe that the 

proposed rule change will impose any 

burden on intermarket competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
Federal Register / Vol. 82, No. 171 / Wednesday, September 6, 2017 / Notices 42143 

20 15 U.S.C. 78s(b)(3)(A)(ii). 

21 15 U.S.C. 78s(b)(2)(B). 

22 17 CFR 200.30–3(a)(12). 

1New York Stock Exchange, LLC, NYSE Arca, 

Inc., NYSE MKT LLC, and Miami International 

Securities Exchange LLC filed their proposed rule 

changes on May 16, 2017. 

2Bats BYX Exchange, Inc., Bats BZX Exchange, 

Inc., Bats EDGA Exchange, Inc., Bats EDGX 

Exchange, Inc. and Chicago Board Options 

Exchange, Incorporated filed their proposed rule 

changes on May 23, 2017. 

3BOX Options Exchange LLC filed its proposed 

rule change on May 25, 2017. 

4 Investors Exchange LLC filed its proposed rule 

change on June 6, 2017. 

5The NASDAQ Stock Market LLC and NASDAQ 

PHLX LLC filed their proposed rule changes on 

June 8, 2017. 

6NASDAQ BX, Inc., Nasdaq GEMX, LLC, Nasdaq 

ISE, LLC, Nasdaq MRX, LLC filed their proposed 

rule changes on June 9, 2017. 

To the contrary, the Exchange believes 

that the proposed pricing structure will 

increase competition and hopefully 

draw additional volume to the Exchange 

for the Opening Process. The Exchange 

operates in a highly competitive market 

in which market participants can 

readily favor competing venues if fee 

schedules at other venues are viewed as 

more favorable. Consequently, the 

Exchange believes that the degree to 

which IEX fees could impose any 

burden on competition is extremely 

limited, and does not believe that such 

fees would burden competition of 

Members or competing venues in a 

manner that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on intramarket competition 

that is not necessary or appropriate in 

furtherance of the purposes of the Act 

because, while different fees are 

assessed in some circumstances, these 

different fees are not based on the type 

of Member entering the orders that 

execute in the Opening Process but on 

the type of order entered and all 

Members can submit any type of order. 

Further, the proposed fees are intended 

to encourage market participants to 

bring increased volume to the Exchange, 

which benefits all market participants. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) 20 of the Act. 

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 

under Section 19(b)(2)(B) 21 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– 

IEX–2017–28 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–IEX–2017–28. 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 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–IEX– 

2017–28, and should be submitted on or 

before September 27, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.22

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–18796 Filed 9–5–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81500; File Nos. SR– 

BatsBYX–2017–13; SR–BatsBZX–2017–39; 

SR–BatsEDGA–2017–14; SR–BatsEDGX– 

2017–24; SR–BOX–2017–19; SR–CBOE– 

2017–043; SR–IEX–2017–21; SR–ISE–2017– 

52; SR–MRX–2017–08; SR–MIAX–2017–24; 

SR–NASDAQ–2017–059; SR–BX–2017–029; 

SR–GEMX–2017–24; SR–PHLX–2017–47; 

SR–NYSE–2017–24; SR–NYSEArca–2017– 

60; SR–NYSEMKT–2017–31] 

Self-Regulatory Organizations; Bats 

BYX Exchange Inc.; Bats BZX 

Exchange, Inc.; Bats EDGA Exchange, 

Inc.; Bats EDGX Exchange, Inc.; BOX 

Options Exchange LLC; Chicago 

Board Options Exchange, 

Incorporated; Investors Exchange 

LLC; Nasdaq ISE, LLC; Nasdaq MRX, 

LLC; Miami International Securities 

Exchange, LLC; The NASDAQ Stock 

Market LLC; NASDAQ BX, Inc.; Nasdaq 

GEMX, LLC; NASDAQ PHLX LLC; New 

York Stock Exchange LLC; NYSE Arca, 

Inc.; NYSE MKT LLC; Order Approving 

Proposed Rule Changes, as Modified 

by Amendments, To Adopt a 

Consolidated Audit Trail Fee Dispute 

Resolution Process 

August 30, 2017. 

I. Introduction 

On May 16, 2017,1 May 23, 2017,2

May 25, 2017,3 June 6, 2017,4 June 8, 

2017 5 and June 9, 2017,6 Bats BYX 

Exchange, Inc. (‘‘Bats BYX’’), Bats BZX 

Exchange, Inc. (‘‘Bats BZX’’), Bats EDGA 

Exchange, Inc. (‘‘Bats EDGA’’), Bats 

EDGX Exchange, Inc. (‘‘Bats EDGX’’), 

BOX Options Exchange LLC (‘‘BOX’’), 


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