Document ID: SEC-2017-1749-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Options Price Reporting Authority
Posted Date: 2017-10-25T04:00Z

[Federal Register Volume 82, Number 205 (Wednesday, October 25, 2017)]
[Notices]
[Pages 49428-49429]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-23115]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81900; File No. SR-OPRA-2017-02]

Options Price Reporting Authority; Notice of Filing and Immediate 
Effectiveness of Proposed Amendment To Modify the OPRA Fee Schedule To 
Eliminate the Enterprise Rate Non-Professional Subscriber Fee and Amend 
the Non-Professional Subscriber Fee

October 19, 2017.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 608 thereunder,\2\ notice is hereby given that 
on September 27, 2017, the Options Price Reporting Authority (``OPRA'') 
submitted to the Securities and Exchange Commission (``Commission'') an 
amendment to the Plan for Reporting of Consolidated Options Last Sale 
Reports and Quotation Information (``OPRA Plan'').\3\ The OPRA Plan 
amendment would implement changes to the Non-Professional Subscriber 
Fee and Eliminate the Enterprise Rate Non-Professional Subscriber Fee 
effective January 1, 2018. The Commission is publishing this notice to 
provide interested persons an opportunity to submit written comments on 
the OPRA Plan amendment.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ The OPRA Plan is a national market system plan approved by 
the Commission pursuant to Section 11A of the Act and Rule 608 
thereunder. See Securities Exchange Act Release No. 17638 (March 18, 
1981), 22 S.E.C. Docket 484 (March 31, 1981). The full text of the 
OPRA Plan and a list of its fifteen participants are available at 
http://www.opradata.com. The OPRA Plan provides for the collection 
and dissemination of last sale and quotation information on options 
that are traded on the participant exchanges.
---------------------------------------------------------------------------

I. Description and Purpose of the Plan Amendment

(a) Fee Schedule Amendments

    The purpose of the amendment is to eliminate OPRA's Enterprise Rate 
Nonprofessional Subscriber Fee (``Enterprise Rate Nonpro Fee'') and to 
revise its Nonprofessional Subscriber Fee so that, instead of being a 
flat fee of $1.25 per month per Nonprofessional Subscriber, the 
Nonprofessional Subscriber Fee will have five tiers, with the tier for 
a Vendor's first 75,000 Nonprofessional Subscribers subject to the 
current rate of $1.25 per month and each of the successive higher tiers 
subject to a lower rate.
    OPRA's Fee Schedule provides that a Vendor \4\ may determine the 
fee that it pays with respect to its distribution of current OPRA data 
to a Nonprofessional Subscriber \5\ in one of two ways: Either the 
Vendor may pay OPRA's monthly Nonprofessional Subscriber Fee (currently 
$1.25/month), or the Vendor may count the Nonprofessional Subscriber's 
queries for OPRA data and pay Usage-based Vendor Fees based on the 
actual usage of OPRA data by the Nonprofessional Subscriber, subject to 
a cap that OPRA has always set at the amount of the Nonprofessional 
Subscriber Fee.\6\
---------------------------------------------------------------------------

    \4\ OPRA defines a ``Vendor,'' in general, as an entity that 
receives OPRA data and redistributes it externally, that is, to 
persons other than its own employees and employees of its wholly-
owned subsidiaries.
    \5\ OPRA defines a ``Subscriber,'' in general, as an entity or 
person that receives OPRA data but does not redistribute it to third 
parties, and defines a ``Nonprofessional Subscriber'' as a 
Subscriber who is a ``Nonprofessional.'' OPRA's definition of the 
term ``Nonprofessional'' is stated in its forms of ``Electronic 
Subscriber Agreement'' and ``Hardcopy Subscriber Agreement.'' These 
forms are available on OPRA's Web site, www.opradata.com. With a 
limited exception for certain personal trusts that is described in 
the Electronic Subscriber Agreement and Hardcopy Subscriber 
Agreement, a Nonprofessional Subscriber must be a natural person.
    \6\ Many Vendors prefer to pay the flat Nonprofessional 
Subscriber Fee, even though their aggregate fees on the basis of 
Usage-based Vendor Fees might be lower and could not be greater, due 
to the administrative simplicity of doing so and the fact that the 
cost on a per Subscriber basis of doing so is very small.
---------------------------------------------------------------------------

    OPRA introduced the Enterprise Rate Nonpro Fee in 2012.\7\ The 
purpose of the Fee was to limit the maximum aggregate amount of 
Nonprofessional Subscriber Fees and Usage-based Vendor Fees with 
respect to Nonprofessional Subscribers that any Vendor would be 
required to pay with respect to its Nonprofessional Subscribers. OPRA's 
Enterprise Rate Nonpro Fee was established at $375,000 per month. When 
the Enterprise Rate Nonpro Fee was introduced, the fee provided a 
benefit to one OPRA Vendor, but OPRA's expectation was that the fee 
would provide an incentive for other Vendors to increase the number of 
Nonprofessional Subscribers to whom they distribute OPRA data.
---------------------------------------------------------------------------

    \7\ See Securities Exchange Act Release No. 66564 (March 9, 
2012) (File No. SR-OPRA-2012-02).
---------------------------------------------------------------------------

    OPRA's expectation for the Enterprise Rate Nonpro Fee has not been 
fulfilled. The fee continues to provide a benefit to only one OPRA 
Vendor, and it now appears to OPRA that this is likely to remain the 
case indefinitely.
    Accordingly, OPRA is proposing to eliminate the Enterprise Rate 
Nonpro Fee and, at the same time, revise OPRA's Nonprofessional 
Subscriber Fee so that the fee has five tiers: $1.25/month for a 
Vendor's first 75,000 Nonprofessional Subscribers, $1.15/month for the 
Vendor's next 75,000 Nonprofessional Subscribers, $1.00/month for the 
Vendor's next 100,000 Nonprofessional Subscribers, $0.75/month for the 
Vendor's next 250,000 Nonprofessional Subscribers, and $0.60/month for 
the Vendor's Nonprofessional Subscribers in excess of 500,000 
Nonprofessional Subscribers.\8\
---------------------------------------------------------------------------

    \8\ For example, a hypothetical Vendor that reports 310,000 
Nonprofessional Subscribers in a month would pay total 
Nonprofessional Subscriber Fees of $337,500 for the month: The sum 
of (75,000 x $1.25) + (75,000 x $1.15) + (150,000 x $1.00) + (10,000 
x $0.75).
---------------------------------------------------------------------------

    If all Vendors were to continue to distribute OPRA data to 
Nonprofessional Subscribers at their current rates, these changes would 
result in an increase in OPRA's annual revenues of approximately 
$135,000. However, OPRA anticipates that, in fact,

[[Page 49429]]

in the short term the Vendor that has had the benefit of the Enterprise 
Rate Nonpro Fee may reduce its distribution of OPRA data to 
Nonprofessional Subscribers and that these changes may therefore result 
in a decrease in OPRA's annual revenues. In the longer term, OPRA 
anticipates that it is possible that the tiered Nonprofessional 
Subscriber fees may accomplish OPRA's original expectation for the 
Enterprise Rate Nonpro Fee by providing an incentive for Vendors to 
increase the number of Nonprofessional Subscribers to whom they 
distribute OPRA data in view of the reduced fees in the higher tiers.
    The text of the amendment to the OPRA Plan is available at OPRA, 
the Commission's Public Reference Room, the OPRA Web site at http://opradata.com, and on the Commission's Web site at www.sec.gov.

(b) Implementation of the OPRA Plan Amendment

    Pursuant to paragraph (b)(3)(i) of Rule 608 of Regulation NMS under 
the Act, OPRA designated this amendment as establishing or changing 
fees or other charges collected on behalf of all of the OPRA 
participant exchanges in connection with access to or use of OPRA 
facilities. In order to give persons subject to these fees advance 
notice of the changes, OPRA proposes that they go into effect on 
January 1, 2018.

(c) Phases of Development and Implementation

    Not applicable.

(d) Impact on Competition

    OPRA believes that the proposed amendment will impose no burdens on 
competition that are not justified in light of the purposes of the Act.

(e) Written Understandings or Agreements Among the Plan Participants

    Not applicable.

(f) Approval of the Proposed Amendment

    OPRA represents that the proposed amendments to the OPRA Fee 
Schedule were approved in accordance with the provisions of the OPRA 
Plan.
    The Commission may summarily abrogate the amendment within sixty 
days of its filing and require refiling and approval of the amendment 
by Commission order pursuant to Rule 608(b)(2) under the Act \9\ if it 
appears to the Commission that such action is necessary or appropriate 
in the public interest, for the protection of investors, or the 
maintenance of fair and orderly markets, to remove impediments to, and 
perfect the mechanisms of, a national market system, or otherwise in 
furtherance of the purposes of the Act.\10\
---------------------------------------------------------------------------

    \9\ See 17 CFR 242.608(b)(2).
    \10\ See 17 CFR 242.608(b)(3)(iii).
---------------------------------------------------------------------------

II. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the OPRA Plan 
amendment 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 [email protected]. Please include 
File No. SR-OPRA-2017-02 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-OPRA-2017-02. 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 OPRA Plan amendment that are 
filed with the Commission, and all written communications relating to 
the OPRA Plan amendment 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 OPRA. 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-OPRA-2017-02 and should be 
submitted on or before November 15, 2017.

    By the Commission.
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-23115 Filed 10-24-17; 8:45 am]
 BILLING CODE 8011-01-P