Document ID: SEC-2021-1572-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Investors Exchange, LLC
Posted Date: 2021-11-08T05:00Z

[Federal Register Volume 86, Number 213 (Monday, November 8, 2021)]
[Notices]
[Pages 61798-61801]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-24324]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-93505; File No. SR-IEX-2021-13]

Self-Regulatory Organizations; Investors Exchange LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Amend IEX 
Rule 11.330 To Retire the IEX Data Platform Data Product

November 2, 2021.
    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 October 25, 2021, 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 
and II 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 Substance 
of the Proposed Rule Change

    Pursuant to the provisions of Section 19(b)(1) under the Act,\4\ 
and Rule 19b-4 thereunder,\5\ IEX is filing with the Commission 
proposed changes to IEX Rule 11.330 to retire the IEX Data Platform 
data product. The Exchange has designated this rule change as ``non-
controversial'' under Section 19(b)(3)(A)

[[Page 61799]]

of the Act \6\ and provided the Commission with the notice required by 
Rule 19b-4(f)(6) thereunder.\7\
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    \4\ 15 U.S.C. 78s(b)(1).
    \5\ 17 CFR 240.19b-4.
    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4.
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    The text of the proposed rule change is available at the Exchange's 
website 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 the 
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 statement 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 is proposing to modify IEX Rule 11.330(a)(2) to retire 
the IEX Data Platform data product (``Data Platform''). As discussed 
below, IEX is proposing to retire the Data Platform because IEX has 
determined that because IEX offers the same data in the Data Platform 
through other data products, the costs associated with maintaining and 
updating the Data Platform outweigh the benefits of offering the Data 
Platform.
    IEX's Data Platform is both a human readable data feed available 
through IEX's website that offers aggregated top of book quotations for 
all displayed orders resting on IEX's Order Book \8\ and last sale data 
(``TOPS Viewer''), and an application programming interface (the 
``API'') \9\ that offers aggregated top of book and depth of book 
quotations for all displayed orders resting on the Order Book at each 
price level as well as last sale data, each in near real time.\10\ IEX 
understands that while both TOPS Viewer and the API provide potentially 
useful market data, because they are internet based they are subject to 
the concomitant latency associated therewith and are thus not generally 
utilized for time-sensitive trading decisions but for informational and 
research purposes. For example, by the time market data is viewed or 
obtained by query or update it will typically be stale and not usable 
for determining IEX's current protected quote, midpoint or available 
depth of book liquidity.
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    \8\ See IEX Rule 1.160(p).
    \9\ The IEX API enables a market participant to query IEX market 
data through a computer to computer based protocol. Through such 
queries, a market participant can obtain a series of static views of 
the IEX order book, or, can receive periodic updates to the top of 
book for a particular security.
    \10\ See IEX Rule 11.330(a)(2). The Data Platform would also 
include auction information (see IEX Rule 11.330(a)(2)) if there 
were any IEX-listed securities.
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    IEX provides all of the data available in TOPS Viewer and the API 
through other market data products. Specifically, IEX's ``TOPS'' \11\ 
feed contains all the data visible in the TOPS Viewer, and IEX's 
``DEEP'' \12\ feed contains all the data accessible via the API. 
Additionally, IEX's ``HIST'' \13\ offers TOPS and DEEP data on a T+1 
basis for download from the Exchange's public website.\14\
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    \11\ See IEX Rule 11.330(a)(1).
    \12\ See IEX Rule 11.330(a)(3).
    \13\ See IEX Rule 11.330(a)(5).
    \14\ HIST data is available for download at https://iextrading.com/trading/market-data/#hist-download.
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    The TOPS and DEEP feeds also include additional information that is 
not included in the TOPS Viewer or API. Specifically, IEX recently 
introduced TOPS and DEEP ``snapshots'' that allow subscribers of those 
feeds to download point-in-time snapshots of TOPS or DEEP in order to 
enable them to accelerate late start recovery (i.e., if a data 
subscriber's connection to the data feed is delayed or interrupted, the 
snapshot will provide the subscriber with point-in-time data that it 
can use to sync up its trading operations going forward).\15\ In 
addition, IEX recently began disseminating a ``Retail Liquidity 
Indicator'' through both the TOPS and DEEP feeds, which is also 
distributed to the SIPs, but not to TOPS Viewer or the API.\16\
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    \15\ See Trading Alert No. 2021-003, available at https://iextrading.com/alerts/#/135 and Trading Alert No. 2021-031, 
available at https://iextrading.com/alerts/#/163.
    \16\ See Trading Alert 2021-036, https://iextrading.com/alerts/#/169; see also, Securities Exchange Act Release No. 92398 (July 13, 
2021), 86 FR 38166 (July 19, 2021) (SR-IEX-2021-06).
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    In view of the significant overlap in the data available in the 
Data Platform and in the TOPS and DEEP feeds, IEX has determined that 
the costs to maintain and update TOPS Viewer and the API are not 
warranted. IEX does not charge any fees to access either TOPS Viewer or 
the API, and thus has borne all costs for developing and supporting 
both data products. As with all businesses, IEX does not have unlimited 
resources and has determined that it is no longer in its commercial 
interests to incur costs to maintain and update TOPS Viewer and the 
API. Accordingly, IEX proposes to retire TOPS Viewer and the API, 
delete the current IEX Rule 11.330(a)(2), and renumber subparagraphs 
(a)(3)-(a)(5) to (a)(2)-(a)(4).
    IEX also believes this proposed rule change will eliminate any 
possible confusion that may arise from a market participant trying to 
access data elements in TOPS Viewer and the API that can only be found 
in the TOPS and DEEP data products. Along those lines, in advance of 
issuing a formal trading alert as discussed below, IEX has been 
advising users of TOPS Viewer and the API that pending the filing and 
effectiveness of this rule change, IEX intends to retire both data 
products after November 18, 2021.\17\
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    \17\ Notification is being provided via website headers on the 
TOPS Viewer and API pages of IEX's website, with a comparable header 
returned with any API queries, in order to notify API users that 
might not visit the website. The notifications also inform any users 
of the API that IEX's market data will continue to be available via 
the TOPS and DEEP feeds, as well as through third party vendors of 
IEX market data.
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Implementation
    This proposed rule change is effective on filing, and the Exchange 
expects to implement it on November 19, 2021 (meaning November 18, 2021 
will be the last day that TOPS Viewer and the API will be available to 
users), following the expiration of the 30-day operative delay. IEX 
will provide at least ten (10) days' notice to Members \18\ and market 
participants of the implementation timeline.
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    \18\ See IEX Rule 1.160(s).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act, in general, and furthers the objectives 
of Section 6(b)(5), in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, to foster cooperation and coordination 
with persons engaged in facilitating transactions in securities, and 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. Specifically, the Exchange believes 
that the proposed rule change is consistent with the protection of 
investors and the public interest because it will continue to provide 
all market data currently available in TOPS Viewer and the API

[[Page 61800]]

through the TOPS and DEEP feeds. IEX appreciates that retail investors 
and other non-professional market participants may not be able to 
utilize TOPS or DEEP in lieu of TOPS Viewer or the API. However, IEX 
understands that the market data available in TOPS Viewer and through 
the API is also available to retail investors and other non-
professional market participants through brokerage accounts that must 
be maintained to enter orders on IEX.\19\ Thus, the retirement of TOPS 
Viewer and the API will not adversely impact the ability of retail 
investors to access IEX market data when making investing decisions. 
Additionally, as discussed in the Purpose section, IEX's HIST data 
product allows anyone to download TOPS and DEEP data from IEX's public 
website on a T+1 basis, so the retirement of TOPS Viewer and the API 
will not adversely impact the ability of academics or other non-market 
participants to access historical IEX market data.
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    \19\ Only a Member may enter an order directly on IEX. Thus, 
retail investors and other market participants that are not Members 
must maintain an account with a Member of IEX in order to do so.
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    Additionally, IEX believes that retiring TOPS Viewer and the API 
will allow it to dedicate more resources to the maintenance of and 
enhancements to the TOPS and DEEP feeds. This reallocation of IEX's 
limited resources should serve to help remove impediments to a free and 
open market, in furtherance of the protection of investors and the 
public interest.
    Finally, IEX notes that nothing in the Act requires IEX to provide 
a near real-time online version of its market data or any API with near 
real-time access to IEX's depth of book data product. No other exchange 
offers an online version or API that provides depth of book data 
analogous to the IEX API. One other exchange family, the Cboe 
exchanges, offers a similar, human readable, top of book viewer on its 
website free of charge.\20\ The only other human readable top of book 
viewer offered by an exchange is offered by Nasdaq, which charges $76/
month per professional subscriber and $15/month per non-professional 
subscriber to access the human readable top of book viewer.\21\
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    \20\ See https://www.cboe.com/us/equities/market_statistics/book_viewer/.
    \21\ See https://www.nasdaq.com/solutions/nasdaq-bookviewer#pricing.
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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. To the contrary, 
the proposal is designed to enhance IEX's competitiveness with other 
markets by enabling IEX to focus its limited resources on the continued 
maintenance and enhancement of its TOPS and DEEP feeds. Nothing in this 
rule change will impact the ability of any other exchange to offer or 
not offer comparable market data products. Further, elimination of TOPS 
Viewer and the API will not adversely impact any equities exchanges or 
other competing venues of IEX since IEX will continue to provide its 
market data through the TOPS and DEEP feeds. In this regard, IEX does 
not believe that such exchanges and venues utilize either for other 
than informational purposes since their non-continuous nature is not 
well suited for operating a trading market. For example, by the time 
market data is viewed or obtained by query or update it will typically 
be stale and not usable for determining IEX's protected quote.
    The Exchange also 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. All market 
participants will continue to be able to obtain IEX's market data 
through the TOPS and DEEP feeds, and as discussed in the Purpose 
section, there is more data available in the TOPS and DEEP feeds than 
in the TOPS Viewer and the API. Thus, this proposal will impact all 
market participants equally, any of which can obtain IEX market data 
through the TOPS and DEEP feeds, or through a third-party vendor.

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

    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 after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to Section 19(b)(3)(A) of the Act \22\ and Rule 19b-4(f)(6) 
\23\ thereunder.
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    \22\ 15 U.S.C. 78s(b)(3)(A).
    \23\ 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.
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    The Exchange has asked the Commission to waive the 30-day operative 
delay in order to discontinue the optional internet-based TOPS Viewer 
and API by November 18, 2021 because doing so: (1) Will allow 
developers to make code changes in advance of any year-end ``code 
freezes,'' and (2) would not adversely impact the ability of persons to 
access the same IEX market data.\24\ The Commission finds that waiving 
the 30-day operative delay is consistent with the protection of 
investors and the public interest. Specifically, waiver of the 
operative delay will allow the Exchange to retire these optional market 
data products in a timely fashion well in advance of year-end code 
freezes and better focus its resources on its core market data feeds. 
In addition, according to the Exchange, the same and more IEX market 
data is available to market participants and others, through the 
Exchange's TOPS, DEEP and HIST data products. The proposal does not, 
therefore, present any novel issues and, accordingly, the Commission 
designates the proposal operative upon filing.\25\
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    \24\ 17 CFR 240.19b-4(f)(6)(iii).
    \25\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule change's impact on 
efficiency, competition, and capital formation. 15 U.S.C. 78c(f).
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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. 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:

[[Page 61801]]

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-IEX-2021-13 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-2021-13. This file 
number should be included in 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 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 Section, 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 IEX's principal office and on its internet website 
at www.iextrading.com. All comments received will be posted without 
change. Persons submitting comments are cautioned that we do not redact 
or edit personal identifying information from comment submissions. You 
should submit only information that you wish to make available 
publicly. All submissions should refer to File Number SR-IEX-2021-13 
and should be submitted on or before November 29, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\26\
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    \26\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-24324 Filed 11-5-21; 8:45 am]
BILLING CODE 8011-01-P