Document ID: SEC-2011-0052-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2011-01-12T05:00Z

[Federal Register Volume 76, Number 8 (Wednesday, January 12, 2011)]
[Notices]
[Pages 2176-2177]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-437]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63649; File No. SR-NYSEArca-2010-122]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Equities Schedule of Fees and Charges for Exchange Services

January 5, 2011.
    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 December 28, 2010, NYSE Arca, Inc. (``NYSE Arca'' or the 
``Exchange'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the self-regulatory 
organization. NYSE Arca filed the proposal pursuant to Section 
19(b)(3)(A) \4\ of the Act and Rule 19b-4(f)(2) \5\ thereunder. 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.
    \4\ 15 U.S.C. 78s(b)(3)(A).
    \5\ 17 CFR 240.19b-4(f)(2).
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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 the NYSE Arca Equities Schedule of 
Fees and Charges for Exchange Services (the ``Schedule'') to modify the 
fees that it charges for routing orders to the New York Stock Exchange 
LLC and NYSE Amex LLC for execution on those markets. The text of the 
proposed rule change is available at the Exchange, the Commission's 
Public Reference Room, and http://www.nyse.com.

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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Effective January 1, 2011, the Exchange proposes to amend the 
Schedule to modify the fees that it charges for routing orders to the 
New York Stock Exchange LLC (``NYSE'') and NYSE Amex LLC (``NYSE 
Amex'') for execution on those markets. In two recent rule filings,\6\ 
both NYSE and NYSE Amex have modified their fee structures for equities 
transactions, including changes to the rates for taking liquidity and 
adding liquidity, to become effective at the beginning of January 2011. 
The Exchange's current fees for routing orders to those exchanges are 
closely related to those exchanges' fees for taking and adding 
liquidity, and the Exchange is proposing an adjustment to its routing 
fees to maintain the existing relationship to the new fees in place at 
the NYSE and NYSE Amex.
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    \6\ See SR-NYSE-2010-87 (the ``NYSE Fee Filing'') and SR-
NYSEAmex-2010-125 (the ``NYSE Amex Fee Filing'').
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    The NYSE Fee Filing increased the NYSE's charge for execution of 
customer orders that take liquidity from the NYSE from $0.0021 per 
share to $0.0023 per share, and increased the rebate for execution of 
customer orders that add liquidity to the NYSE from $0.0013 per share 
to $0.0015 per share. Currently, for NYSE Arca Tier 1 and Tier 2 
customers, the fee for routing orders in Tape A securities to the NYSE 
outside the book is equal to the NYSE ``take'' rate of $0.0021 per 
share, and the fee for routing such orders to the NYSE for non-tier 
customers is slightly higher at $0.0023 per share. Consequently, the 
Exchange is proposing to increase each of those fees by $0.0002 to 
$0.0023 per share and $0.0025 per share, respectively, in line with the 
$0.0002 increase in the NYSE ``take'' rate.
    In addition, the Exchange currently charges $0.0019 per share for 
Primary Sweep Orders in Tape A securities that are routed outside the 
book to the NYSE for execution. This charge applies to Tier 1, Tier 2 
and non-tier customers. In order to maintain the existing relationship 
to the other Exchange

[[Page 2177]]

routing fees that are being adjusted upward, the Exchange is also 
proposing to increase this fee by $0.0002 to both tier and non-tier 
customers, to a level of $0.0021 per share.
    Finally, for Primary Only Plus (``PO+'') orders, the current 
Exchange fee for orders routed to the NYSE that remove liquidity from 
the NYSE is $0.0021 per share, which is equal to the current NYSE 
``take'' rate, and the Exchange credit for such orders routed to the 
NYSE that provide liquidity to the NYSE is $0.0013 per share, which is 
equal to the current NYSE rebate for execution of customer orders that 
add liquidity to the NYSE. Consequently, the Exchange is proposing to 
increase its fees (credits) for routing PO+ orders to the NYSE by the 
same amount ($0.0002) as the increase in the corresponding NYSE fees 
(credits). The proposed new fee for PO+ orders routed to the NYSE that 
remove liquidity is $0.0023 per share, and the proposed new credit for 
such orders routed to the NYSE that provide liquidity is $0.0015 per 
share. These changes would maintain the current relationship with NYSE 
rates.
    The NYSE Amex Fee Filing increased NYSE Amex's charge for execution 
of customer orders that take liquidity from NYSE Amex from $0.0025 per 
share to $0.0028 per share, and increased the rebate for execution of 
customer orders that add liquidity to NYSE Amex from $0.0015 per share 
to $0.0016 per share. Currently, the Exchange fee is $0.0025 per share 
for PO and PO+ orders routed to NYSE Amex that remove liquidity from 
NYSE Amex, which is equal to the current NYSE Amex ``take'' rate, and 
the Exchange credit for such orders routed to NYSE Amex that provide 
liquidity to NYSE Amex is $0.0015, which is equal to the current NYSE 
Amex rebate for execution of customer orders that add liquidity to NYSE 
Amex. Consequently, the Exchange is proposing to increase its fees 
(credits) for routing PO and PO+ orders to NYSE Amex by the same 
amounts as the increase in the corresponding NYSE fees (credits). The 
proposed new fee for PO and PO+ orders routed to NYSE Amex that remove 
liquidity is $0.0028 per share, and the proposed new credit for such 
orders routed to NYSE Amex that provide liquidity is $0.0016 per share. 
These changes would maintain the current relationship with NYSE Amex 
rates.
    Finally, the Exchange is adding a sentence in the introduction of 
the Tier 1 and Tier 2 volume levels to clarify that the calculation of 
U.S. Average Daily Consolidated Share Volume does not include trades on 
days when the market closes early.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Securities Exchange Act of 1934 
(the ``Act''),\7\ in general, and Section 6(b)(4) of the Act,\8\ 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 believes 
that the proposal does not constitute an inequitable allocation of 
fees, as all similarly situated member organizations and other market 
participants will be subject to the same fee structure, and access to 
the Exchange's market is offered on fair and non-discriminatory terms.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
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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 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

    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 NYSE Arca.
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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 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.

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-NYSEArca-2010-122 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-NYSEArca-2010-122. 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 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 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.\11\ 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-2010-122 and should be submitted on or before February 2, 
2011.
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    \11\ The text of the proposed rule change is available on the 
Commission's Web site at http://www.sec.gov.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-437 Filed 1-11-11; 8:45 am]
BILLING CODE 8011-01-P