Federal Register / Vol. 82, No. 182 / Thursday, September 21, 2017 / Notices 44235 

11See Securities Exchange Act Release No. 80234 

(March 14, 2017), 82 FR 14401 (March 20, 2017) 

(SR–FICC–2017–002). 12 17 CFR 200.30–3(a)(57). 

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

2 17 CFR 240.19b–4. 

submit additional comments at this 

time, they need not re-submit earlier 

comments. In addition, the Commission 

seeks comment on the following: 

1. The Proposed Rule Change would 

require each Netting Member to attest 

that its Individual Total Amount has 

been incorporated into its liquidity 

plans (‘‘Attestation Requirement’’).11

The Commission requests comment on 

the means by which the various types of 

Netting Members anticipate complying 

with the Proposed Rule Change, 

including the Attestation Requirement, 

and the expected cost (monetary or 

otherwise) of such compliance. To the 

extent possible, please provide specific 

data, analyses, or studies for support. 

2. The Proposed Rule Change would 

require FICC to provide each Netting 

Member with a daily ‘‘liquidity funding 

report’’ to help the Netting Member 

monitor and manage the liquidity risk it 

presents to FICC. The Commission 

requests comment on the value of such 

daily reporting to Netting Members and 

the extent to which and, if so, how 

Netting Members anticipate adjusting 

their trading behavior or otherwise 

managing the liquidity risk they present 

to FICC, whether in reliance on the 

daily liquidity funding report or 

otherwise. Please explain and, to the 

extent possible, provide specific data, 

analyses, or studies on potential 

changes to trading behavior or other 

adjustments to manage liquidity 

obligations to FICC for support. 

a. If such adjustments would include 

changes in market participation, 

participation in certain market 

segments, or the quantity or price of 

services offered to clients, please 

provide information of such changes, in 

addition to any supporting data, 

analyses, or studies. 

b. If such adjustments would include 

deciding to clear repo transactions 

bilaterally, instead of centrally through 

FICC, please provide the rationale and 

factors considered in making that 

decision, in addition to any supporting 

data, analyses, or studies. 

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– 

FICC–2017–002 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–FICC–2017–002. 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 

filings also will be available for 

inspection and copying at the principal 

office of FICC and on DTCC’s Web site 

(http://dtcc.com/legal/sec-rulefilings.aspx). 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–FICC– 

2017–002 and should be submitted on 

or before October 6, 2017. Any person 

who wishes to file a rebuttal to any 

other person’s submission must file that 

rebuttal on or before October 12, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Eduardo Aleman, 

Assistant Secretary. 

[FR Doc. 2017–20090 Filed 9–20–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81632; File No. SR–GEMX– 

2017–42] 

Self-Regulatory Organizations; Nasdaq 

GEMX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend Its Schedule of 

Fees To Offer Monthly Subscriptions 

for Open and Close Trade Profile 

Information 

September 15, 2017. 

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 

September 1, 2017, Nasdaq GEMX, LLC 

(‘‘GEMX’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I and 

II, 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 proposes to amend its 

Schedule of Fees to offer monthly 

subscriptions for Open and Close Trade 

Profile Information. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at www.ise.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 aspects 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 its 

Schedule of Fees to offer monthly 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
44236 Federal Register / Vol. 82, No. 182 / Thursday, September 21, 2017 / Notices 

3The Exchange initially filed this proposal as a 

fee filing on August 25, 2017 (SR–GEMX–2017–41). 

The proposal was rejected on August 31, 2017, and 

is being resubmitted as a proposal that (i) does not 

significantly affect the protection of investors or the 

public interest, and (ii) does not impose any 

significant burden on competition under Exchange 

Act Rule 19b–4(f)(6)(iii). 

4 ‘‘Origin Code’’ categories include Customer, 

Professional Customer, Firm and Market Maker. 

‘‘Customer’’ applies to any transaction identified by 

a member or a member organization for clearing in 

the Customer range at the Options Clearing 

Corporation which is not for the account of a broker 

or dealer or a Professional. A ‘‘Professional 

Customer’’ is a high-activity customer that enters 

into more than 390 orders per day over the course 

of a one-month period. A ‘‘Firm’’ is a broker-dealer 

trading in its own proprietary account or on behalf 

of another broker-dealer. A ‘‘Market Maker’’ is a 

broker-dealer that assumes the risk of holding a 

position in a series to facilitate trading. 

5An opening buy is a transaction that creates or 

increases a long position and an opening sell is a 

transaction that creates or increases a short 

position. A closing buy is a transaction made to 

close out an existing position. A closing sell is a 

transaction to reduce or eliminate a long position. 

6Trading volume is the number of contracts 

traded; the number of trades is the number of 

transactions. 

7The degree to which a series is ‘‘in’’ or ‘‘out’’ 

of the ‘‘money’’ is identified according to the 

following five levels of ‘‘moneyness’’: (i) ‘‘Deep in 

the Money’’ means that the strike price of this 

option is more than 12% lower than the price of 

the underlying security if it is a call or more than 

12% higher if it is a put; (ii) ‘‘In the Money’’ means 

that the strike price of this option is within the 

range of 5%–12% lower than the price of the 

underlying security if it is a call or within the range 

of 5%–12% higher if it is a put; (iii) ‘‘At the 

Money’’ means that the strike price of this option 

is within the range of 5% higher or lower than the 

price of the underlying security; (iv) ‘‘Out of the 

Money’’ means that the strike price of this option 

is within the range of 5%–12% higher than the 

price of the underlying security if it is a call or 5%– 

12% lower if it is a put; and (v) ‘‘Deep out of the 

Money’’ means that the strike price of this option 

is more than 12% higher than the price of the 

underlying security if it is a call or more than 12% 

lower if it is a put. 

8 ‘‘Open Interest’’ is the total number of 

outstanding contracts for each series across all 

options exchanges for the trade date of the file. 

9Nasdaq ISE Rulebook, Fee Schedule, Chapter 

VIII (Market Data), A (offering an annual 

subscription to Nasdaq ISE Open/Close Trade 

Profile End of Day for $759 per month) and B 

(offering a monthly subscription to the Nasdaq ISE 

Open/Close Trade Profile Intraday for $2,000 per 

month). 

10 15 U.S.C. 78f(b). 

11 15 U.S.C. 78f(b)(5). 

12Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(‘‘Regulation NMS Adopting Release’’). 

13NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 

2010). 

14See NetCoalition, at 534—535. 

15 Id. at 537. 

16 Id. at 539 (quoting Securities Exchange Act 

Release No. 59039 (December 2, 2008), 73 FR 

74770, 74782–83 (December 9, 2008) (SR– 

NYSEArca–2006–21)). 

subscriptions for Open and Close Trade 

Profile Information; subscriptions will 

be available for both end-of-day and 

intraday updates.3

The Open/Close Trade Profile 

provides over 80 fields of trading and 

volume data for GEMX-listed options 

that can be used to create and test 

trading models and analytical strategies. 

Trade Profile data includes: ‘‘Origin 

Code’’ (the type of trader participating 

in the transaction); 4 opening and 

closing buys and sells; 5 trading volume 

and number of trades categorized by day 

and series; 6 the degree to which a series 

is ‘‘in’’ or ‘‘out’’ of the ‘‘money’’ ; 7 the 

number of days to expiration; an 

indication of the degree to which there 

is ‘‘Open Interest’’ 8 for each series; and 

a comparison of the volume of trading 

at GEMX relative to the industry as a 

whole. 

The GEMX Open/Close Trade Profile 

is currently available as an historical 

database available upon request, and the 

Exchange proposes to offer intraday and 

end-of-day subscriptions to Trade 

Profile information as well. Such 

subscriptions will be available to both 

members and non-members, similar to 

the ISE Open/Close Trade Profile.9 The 

end-of-day file is updated overnight and 

available for download the following 

morning. The intraday file is updated at 

10 minute intervals to provide a 

cumulative record of transactions that 

take place over the course of the trading 

day. The end-of-day subscription will be 

available for $500 per month; the 

intraday subscription will be available 

for $1,000 per month. 

The proposed rule change will 

increase transparency in the market by 

increasing the amount of information 

available to market participants to assist 

them in making investment decisions 

related to GEMX-listed options. 

The proposed fees are optional in that 

they apply only to firms that elect to 

purchase these products. The changes 

do not impact the cost of any other 

GEMX product. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,10 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,11

in particular, in that it 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. The 

proposal is to make open and close 

trade profile information, currently 

available only on an historical basis, 

available at 10 minute intervals over the 

course of the trading day and in 

summary form at the end of the trading 

day, thereby increasing the flow of 

information and removing impediments 

to a free and open market. 

The Commission and the courts have 

repeatedly expressed their preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, while 

adopting a series of steps to improve the 

current market model, the Commission 

highlighted the importance of market 

forces in determining prices and SRO 

revenues and, also, recognized that 

current regulation of the market system 

‘‘has been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 12

Likewise, in NetCoalition v. Securities 

and Exchange Commission 13

(‘‘NetCoalition’’) the D.C. Circuit upheld 

the Commission’s use of a market-based 

approach in evaluating the fairness of 

market data fees against a challenge 

claiming that Congress mandated a costbased approach.14 As the court 

emphasized, the Commission ‘‘intended 

in Regulation NMS that ‘market forces, 

rather than regulatory requirements’ 

play a role in determining the market 

data . . . to be made available to 

investors and at what cost.’’ 15

Further, ‘‘[n]o one disputes that 

competition for order flow is ‘fierce.’ 

. . . As the SEC explained, ‘[i]n the U.S. 

national market system, buyers and 

sellers of securities, and the brokerdealers that act as their order-routing 

agents, have a wide range of choices of 

where to route orders for execution’; 

[and] ‘no exchange can afford to take its 

market share percentages for granted’ 

because ‘no exchange possesses a 

monopoly, regulatory or otherwise, in 

the execution of order flow from broker 

dealers’ . . .’’ 16 Although the court and 

the SEC were discussing the cash 

equities markets, the Exchange believes 

that these views apply with equal force 

to the options markets. 

The Exchange believes that adding the 

proposed subscriptions to the 

Exchange’s Open/Close Trade Profile is 

reasonable and equitable in accordance 

with Section 6(b)(4) of the Act, and not 

unreasonably discriminatory in 

accordance with Section 6(b)(5) of the 

Act. The proposed changes will increase 

transparency by providing information 

about options activity throughout and at 

the end of the trading day. The 

proposed fees, like all proprietary data 

fees, are constrained by the Exchange’s 

need to compete for order flow, and are 

subject to competition from other 

options exchanges. As explained in 


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Federal Register / Vol. 82, No. 182 / Thursday, September 21, 2017 / Notices 44237 

17Nasdaq ISE Rulebook, Fee Schedule, Chapter 

VIII (Market Data), A (offering an annual 

subscription to Nasdaq ISE Open/Close Trade 

Profile End of Day for $759 per month) and B 

(offering a monthly subscription to the Nasdaq ISE 

Open/Close Trade Profile Intraday for $2,000 per 

month). 

18 15 U.S.C. 78s(b)(3)(A)(iii). 

19 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 

20 17 CFR 240.19b–4(f)(6). 

21 17 CFR 240.19b–4(f)(6)(iii). 

further detail below, the proposal will 

impose no burden on competition 

because GEMX transaction information 

is disseminated by the Options Price 

Reporting Authority, LLC (‘‘OPRA’’), 

and customers would not pay a 

premium for GEMX information when 

similar transaction information is 

available at a lower cost from OPRA, 

and because the price of GEMX 

proprietary data is constrained by the 

need for GEMX to compete for order 

flow. The Exchange further notes that 

GEMX Open/Close Trade Profile 

information is an optional service that 

only applies to firms that elect to 

purchase the product. Moreover, the 

proposed service is similar to services 

already provided by other exchanges, 

such as the ISE Open/Close Trade 

Profile.17

The proposed changes are an 

equitable allocation of reasonable dues, 

fees, and other charges because fees will 

be the same for all of the purchasers of 

each product and it is equitable to 

charge more for the intraday product— 

which provides updates at 10 minute 

intervals over the course of the trading 

day—than the end-of-day product, 

which provides updates once per day. 

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. The 

proposed changes will allow the 

Exchange to offer intraday and end-ofday subscriptions to options trading 

data. If the price of the proposed 

subscriptions were to be set above a 

competitive price, the Exchange may 

lose revenue as a result. 

GEMX market data fees are 

constrained by competition among 

exchanges and other entities seeking to 

attract order flow, and the existence of 

substitutes that are offered, or may be 

offered, by other entities. Order flow is 

the ‘‘life blood’’ of the exchanges. For a 

variety of reasons, competition from 

new entrants, especially for order 

execution, has increased dramatically 

over the last decade, as demonstrated by 

the proliferation of new options 

exchanges such as EDGX Exchange and 

MIAX Options within the last four 

years. Each options exchange is 

permitted to produce proprietary data 

products. 

The markets for order flow and 

proprietary data are inextricably linked: 

A trading platform cannot generate 

market information unless it receives 

trade orders. As a result, the 

competition for order flow constrains 

the prices that platforms can charge for 

proprietary data products. Firms make 

decisions on how much and what types 

of data to consume based on the total 

cost of interacting with GEMX and other 

exchanges. Data fees are but one factor 

in a total platform analysis. If the cost 

of the product exceeds its expected 

value, the prospective customer will 

choose not to buy it. A supracompetitive 

increase in the fees charged for either 

transactions or proprietary data has the 

potential to impair revenues from both 

products. 

The price of options data is also 

constrained by the existence of multiple 

substitutes offered by a number of 

entities, and non-proprietary data 

disseminated by OPRA. OPRA is a 

securities information processor that 

disseminates last sale reports and 

quotations, as well as the number of 

options contracts traded, open interest 

and end-of-day summaries. Many 

customers that obtain information from 

OPRA do not also purchase proprietary 

data, but in cases in which customers 

buy both products, they may shift 

purchasing decisions based on price 

changes. OPRA constrains the price of 

proprietary data products on options 

exchanges because no customer would 

pay an excessive price for these 

products when they already have data 

from OPRA. Similarly, no customer 

would pay an excessive price for 

Exchange data when they have the 

ability to obtain similar proprietary data 

from other exchanges. It is not necessary 

that products be identical in order to be 

reasonable substitutes for each other. 

As such, the price of the GEMX Open/ 

Close Trade Profile product is 

constrained by other exchanges in the 

competition for order flow and the 

availability of similar data from OPRA. 

Customers choose exchanges based on 

the total cost of interacting with the 

exchange; if the GEMX Open/Close 

Trade Profile were set above market 

price, the total cost of interacting with 

GEMX would be above market price, 

and GEMX would lose market share as 

a result. In addition, the availability of 

trading information from OPRA will 

constrain the price of the GEMX Open/ 

Close Trade Profile because customers 

would not pay an excessive amount for 

proprietary data when similar 

information is available at a lower price; 

two products need not be identical for 

each product to act as a constraint on 

the price of the other. For these reasons, 

the Exchange does not believe that the 

proposed changes will impair the ability 

of members or competing order 

execution venues to maintain their 

competitive standing in the financial 

markets. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 18 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.19

A proposed rule change filed under 

Rule 19b–4(f)(6) 20 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),21 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The Exchange requests that the 

Commission waive the 30-day operative 

delay. The Exchange notes that a 

product similar to the proposed product 

is already being sold by another 

exchange. The Exchange also asserts 

that the addition of the proposed 

product can increase competition, and 

will not harm firms that do not purchase 

the product as the service is optional. 

The Commission believes that waiving 

the 30-day operative delay is consistent 

with the protection of investors and the 

public interest. Accordingly, the 

Commission hereby waives the 30-day 

operative delay and designates the 


asabaliauskas on DSKBBXCHB2PROD with NOTICES
44238 Federal Register / Vol. 82, No. 182 / Thursday, September 21, 2017 / Notices 

22For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

23 17 CFR 200.30–3(a)(12). 

1Exchange Act Release No. 77112 (Feb. 11, 2016), 

File No. SR–OCC–2015–02. 

2BATS Global Markets, Inc. (‘‘BATS’’) was 

initially a petitioner, but later withdrew. 

3The petitioners had also opposed OCC’s motion 

to lift the automatic stay in place pending the 

Commission’s review of the Capital Plan. The 

Commission found, however, that it was ‘‘in the 

public interest to the lift the stay during the 

pendency of the Commission’s review.’’ Exchange 

Act Release No. 75886 at 2 (Sept. 10, 2015), File No. 

SR–OCC–2015–02. The Commission noted that it 

‘‘believes that the concerns raised by Petitioners 

regarding potential monetary and competitive harm 

do not currently justify maintaining the stay during 

the pendency of the Commission’s review.’’ Id. 

4Susquehanna Int’l Grp., LLP v. SEC, 866 F.3d 

442, 443 (D.C. Cir. 2017). 

5 Id. at 446. 

6 Id. at 451. 

7 Id. 

8By separate order of today’s date, we are issuing 

a scheduling order governing the proceedings on 

remand. 

9Petitioner KCG has not joined the instant 

motion. 

proposed rule change operative upon 

filing.22

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) 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– 

GEMX–2017–42 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–GEMX–2017–42. 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–GEMX– 

2017–42 and should be submitted on or 

before October 12, 2017. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–20088 Filed 9–20–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[File No. SR–OCC–2015–02; Release No. 

81628] 

Before the Securities and Exchange 

Commission; Securities Exchange Act 

of 1934; In the Matter of the Options 

Clearing Corporation; Corrected Order 

Denying Motion for Stay 

September 14, 2017. 

On February 11, 2016, the 

Commission issued an order (‘‘Approval 

Order’’) approving the Options Clearing 

Corporation’s (‘‘OCC’’) plan for raising 

additional capital (‘‘Capital Plan’’ or 

‘‘Plan’’) to support its function as a 

systemically important financial market 

utility.1 BOX Options Exchange LLC, 

KCG Holdings, Inc. (‘‘KCG’’), Miami 

International Securities Exchange, LLC, 

and Susquehanna International Group, 

LLP (collectively ‘‘petitioners’’) 2 filed a 

petition for review of the Approval 

Order in the U.S. Court of Appeals for 

the District of Columbia Circuit (‘‘D.C. 

Circuit’’), challenging the Commission’s 

Approval Order as inconsistent with the 

Exchange Act and lacking in the 

reasoned decisionmaking required by 

the Administrative Procedure Act. 

After filing their petition for review, 

petitioners filed a motion for a stay in 

the D.C. Circuit asking the court to stay 

the Commission’s Approval Order 

pending the court’s review. The D.C. 

Circuit denied petitioners’ request for a 

stay.3

In ruling on the petition for review, 

the D.C. Circuit concluded that the 

Approval Order did not ‘‘represent the 

kind of reasoned decisionmaking 

required by either the Exchange Act or 

the Administrative Procedure Act,’’ and 

therefore remanded the case to the 

Commission for further proceedings.4 In 

so ruling, the court did not reach any of 

petitioners’ arguments that the Plan was 

inconsistent with the substantive 

requirements of the Exchange Act, 

finding instead that the Commission’s 

failure to make the required findings 

under the Act required a remand.5

The court also considered whether to 

vacate the Approval Order prior to 

remand, and decided not to vacate. As 

the court explained, ‘‘the SEC may be 

able to approve the Plan once again, 

after conducting a proper analysis on 

remand.’’ 6 Because both parties had 

assured the court that it would be 

possible to unwind the Capital Plan at 

a later time, and ‘‘no party contends that 

the task would be materially more 

difficult if done then rather than now,’’ 

the court declined to vacate the Capital 

Plan and instead remanded the case ‘‘to 

give the SEC an opportunity to properly 

evaluate the Plan.’’ 7 The D.C. Circuit’s 

mandate, which issued on August 18, 

2017, returned the matter to the 

Commission for further proceedings.8

Petitioners 9 now seek a partial stay of 

the Capital Plan—specifically, a stay of 

the dividend payments to be made to 

the shareholder exchanges under the 

Plan—while the Commission considers 

the Plan as directed by the D.C. Circuit. 

OCC opposes the motion. 

In determining whether to grant a stay 

motion, the Commission typically 

considers whether (i) there is a strong 

likelihood that the moving party will 

succeed on the merits of its appeal; (ii) 

the moving party will suffer irreparable 

harm without a stay; (iii) any person 

will suffer substantial harm as a result 

of a stay; and (iv) a stay is likely to serve 


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