Document ID: SEC-2016-0229-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2016-02-11T05:00Z

[Federal Register Volume 81, Number 28 (Thursday, February 11, 2016)]
[Notices]
[Pages 7390-7391]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-02732]

[[Page 7390]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77067; File No. SR-NYSEARCA-2016-24]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Options Fee Schedule

February 5, 2016.
    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 February 1, 2016, 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 self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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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''). The Exchange proposes to implement the fee change 
effective February 1, 2016. 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 purpose of this filing is to clarify an aspect of the tiers for 
the Firm and Broker Dealer Monthly Firm Cap. The Exchange proposes to 
have the clarification effective February 1, 2016.
    Currently, for trade-related charges for standard options, the 
Exchange has a Firm and Broker Dealer Monthly Fee Cap (``Firm Cap'') 
that places a limit, or cap, of $100,000 per month on combined Firm 
Proprietary Fees and Broker Dealer Fees for transactions in standard 
options contracts cleared in the customer range for Manual (Open 
Outcry) Executions, and QCC Transactions executed by a Floor Broker 
from the Floor of the Exchange. The Firm Cap excludes Strategy 
Executions, Royalty Fees, and firm trades executed via a Joint Back 
Office agreement, and also excludes Mini option contracts.
    On August 1, 2015, the Exchange adopted Tiered Caps based on the 
Firm's achieving one of the higher Customer and Professional Customer 
Monthly Posting Credit Tiers.\4\ Firms receiving the base Posting 
Credit for Customer or Professional Customer Order executions in Penny 
Pilot issues would continue to be capped at a $100,000 per month Firm 
Cap. Firms that achieve a higher Customer and Professional Customer 
Monthly Posting Credit Tier would be capped at progressively lower 
totals, dependent on achieving higher tiers.
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    \4\ See Exchange Act Release No. 75704 (August 14, 2015) 80 FR 
50683(August 20, 2015) (SR-NYSEArca-2015-71).
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    At the time the Tiered Caps were adopted, there were six Customer 
and Professional Customer Monthly Posting Credit Tiers. Recently, on 
November 2, 2015, the Exchange adopted a seventh Customer and 
Professional Customer Monthly Posting Credit Tier.\5\ However, at the 
time that the additional Customer and Professional Customer Monthly 
Posting Credit Tier was added, there was no modification to the Firm 
and Broker Dealer Monthly Firm Cap Tiers, nor was there any intention 
to do so.
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    \5\ See Exchange Act Release No. 76438 (November 13, 2015) 80 FR 
72465 (November 19, 2015) (SR-NYSEArca-2015-108).
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    The Exchange has received a request for clarification, and in the 
interest of reducing any possible investor confusion, proposes to amend 
the Fee Schedule to provide that the Firm Cap currently applicable to 
Tier 6 is also applicable to Tier 7, as follows (proposed new text 
italicized):

              Firm and Broker Dealer Monthly Firm Cap Tiers
------------------------------------------------------------------------
   Customer and professional customer monthly posting
                  credit tier achieved                       Firm cap
------------------------------------------------------------------------
Base or Tier 1..........................................        $100,000
Tier 2..................................................          85,000
Tier 3..................................................          80,000
Tier 4..................................................          75,000
Tier 5..................................................          70,000
Tier 6 or 7.............................................          65,000
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\6\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\7\ 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.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes the proposed change clarifying Tiered Firm 
Caps is reasonable, equitable, and not unfairly discriminatory, because 
the proposed rule change does not change any fees, but rather clarifies 
that the Firm Cap level currently in place for the Customer and 
Professional Customer Monthly Posting Credit Tier 6 would also be 
applicable to the Customer and Professional Customer Monthly Posting 
Credit Tier 7. Accordingly, the proposed rule change is designed to 
promote transparency and reduce investor confusion by aligning all of 
the eligible Customer and Professional Monthly Posting Credit Tiers 
with the Firm Caps.
    For these reasons, the Exchange believes that the proposal is 
consistent with the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\8\ 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. Instead, the Exchange believes that the proposed 
change would continue to encourage competition, including by attracting 
a wider variety of business to the Exchange, which would continue to 
make the Exchange a more competitive venue for, among other things, 
order execution and price discovery.
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    \8\ 15 U.S.C. 78f(b)(8).
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    The Exchange notes that it operates in a highly competitive market 
in which

[[Page 7391]]

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) \9\ of the Act and subparagraph (f)(2) of Rule 19b-
4 \10\ thereunder, because it establishes a due, fee, or other charge 
imposed by the Exchange.
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(2).
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    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) \11\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \11\ 15 U.S.C. 78s(b)(2)(B).
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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-2016-24 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-2016-24. 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-2016-24, and should 
be submitted on or before March 3, 2016.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Brent J. Fields,
Secretary.
[FR Doc. 2016-02732 Filed 2-10-16; 8:45 am]
BILLING CODE 8011-01-P