Document ID: SEC-2011-1101-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: EDGX Exchange, Inc.
Posted Date: 2011-08-01T04:00Z

[Federal Register Volume 76, Number 147 (Monday, August 1, 2011)]
[Notices]
[Pages 45895-45896]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-19325]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64963; File No. SR-EDGX-2011-21]

Self-Regulatory Organizations; EDGX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change Relating to 
Amendments to the EDGX Exchange, Inc. Fee Schedule

July 26, 2011.
    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 July 21, 2011, the EDGX Exchange, Inc. (the ``Exchange'' or the 
``EDGX'') 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 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\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its fee schedule applicable to 
Members \3\ and non-members of the Exchange pursuant to EDGX Rule 
15.1(a) and (c). Pursuant to the proposed rule change, the Exchange 
will commence charging fees for Members and non-members for certain 
logical ports used to receive market data. The Exchange intends to 
implement this rule proposal effective August 1, 2011. The text of the 
proposed rule change is available on the Exchange's Internet website at 
http://www.directedge.com.
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    \3\ A Member is any registered broker or dealer, or any person 
associated with a registered broker or dealer, that has been 
admitted to membership in the Exchange.
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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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange is proposing to charge a monthly fee for logical ports 
used to receive market data. Currently, ports used to receive or re-
transmit market data are provided free of charge. The Exchange 
currently charges for logical ports (also commonly referred to as TCP/
IP ports) established by the Exchange within the Exchange's system that 
grant Members or non-members the ability to operate a specific 
application, such as FIX or High Performance API for order entry. The 
current monthly fee for these logical ports is $500 per month, where 
members and non-members receive the first ten (10) sessions free of 
charge for direct (``Direct'') Sessions only. The Exchange is proposing 
to include logical ports used to receive market data among those 
logical ports currently charged at $500 per month.\4\ Under the 
proposed change, the quantity of logical ports used to receive market 
data will be included among those ports used for order entry (FIX, HP-
API) or for drop copies (DROP). Exchange customers will continue to 
receive the first ten (10) sessions free of charge, regardless of the 
type of logical port used for Direct Sessions (FIX, HP-API, DROP, or 
data), and thereafter be charged a $500 fee per month per logical port. 
The charge will apply to Members and non-members. The Exchange notes 
that the proposed port fees are consistent with similar logical port 
fees charged by other exchanges.\5\
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    \4\ The Exchange notes that ports used to request a re-
transmission of market data from the Exchange will continue to be 
provided free of charge.
    \5\ See, e.g., Rule 7015(g) of The NASDAQ Stock Market LLC 
(``NASDAQ'') (setting forth, among other fees for access services, 
port fees charged to members and non-members used for market data 
delivery over the internet); Securities Exchange Act Release No. 
63197 (October 27, 2010), 75 FR 67791 (November 3, 2010) (SR-NASDAQ-
2010-136) (adopting Access Services fees, including fees for ports 
used to receive market data) 72 FR 13328 (March 21, 2007) (SR-
NASDAQ-2006-064) (increasing Internet port fee from $200 to $600 per 
Internet port that is used to deliver market data); Securities 
Exchange Act Release No. 60586 (August 28, 2009), 74 FR 46256 
(September 8, 2009) (SR-BATS-2009-026) (establishing fees for ports 
used by members and non-members to enter orders and receive market 
data).
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    The Exchange believes that the imposition of port fees for logical 
ports used to receive market data will promote efficient use of the 
ports by market participants, helping the Exchange to continue to 
maintain and improve its infrastructure, while also encouraging 
Exchange customers to request and enable only the ports that

[[Page 45896]]

are necessary for their operations related to the Exchange.
    The Exchange will implement the proposed rule change on August 1, 
2011.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\6\ in general, and 
furthers the objectives of Section 6(b)(4),\7\ in particular, as 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 believes that its proposed logical data port 
fees are reasonable in light of the benefits to members of market data 
access. In addition, the Exchange believes that its fees are equitably 
allocated among its constituents based upon the number of access ports 
that they require to receive data from the Exchange. Furthermore, the 
fees associated with logical data ports will be equitably allocated to 
all constituents as the fees will be uniform in application to all 
Members and non-members. Finally, the Exchange believes that the fees 
obtained will enable it to cover its infrastructure costs associated 
with allowing Members and non-members to establish logical ports to 
connect to the Exchange's systems and continue to maintain and improve 
its infrastructure, market technology, and services.
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    \6\ 15 U.S.C. 78f.
    \7\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act.

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 unsolicited 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) of the Act \8\ and Rule 19b-4(f)(2) \9\ thereunder. 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.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 19b-4(f)(2).
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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 e-mail to rule-comments@sec.gov. Please include 
File Number SR-EDGX-2011-21 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-EDGX-2011-21. This file 
number should be included on the subject line if e-mail 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 website (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 website 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 a.m. and 3 
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-EDGX-2011-21 and should be submitted on 
or before August 22, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-19325 Filed 7-29-11; 8:45 am]
BILLING CODE 8011-01-P