Document ID: SEC-2013-0660-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE MKT LLC
Posted Date: 2013-04-08T04:00Z

[Federal Register Volume 78, Number 67 (Monday, April 8, 2013)]
[Notices]
[Pages 20969-20971]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-08095]

[[Page 20969]]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69273; File No. SR-NYSEMKT-2013-30]

Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change Proposing To Establish 
the NYSE MKT Trades Digital Media Data Feed and a Schedule of the NYSE 
MKT Equities Proprietary Market Data Fees

April 2, 2013.
    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 March 21, 2013, NYSE MKT LLC (the ``Exchange'' or ``NYSE 
MKT'') 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to establish the NYSE MKT Trades Digital 
Media data feed and a schedule of the NYSE MKT Equities Proprietary 
Market Data Fees. The text of 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to establish the NYSE MKT Trades Digital 
Media data feed and a Market Data Fee Schedule.
Background
    In 2010, the Securities and Exchange Commission (``SEC'' or the 
``Commission'') approved the NYSE MKT Trades data feed and certain fees 
for it.\4\ NYSE MKT Trades is a NYSE MKT-only market data feed that 
allows a vendor to redistribute on a real-time basis the same last sale 
information that the Exchange reports under the Consolidated Tape 
Association (``CTA'') Plan for inclusion in the CTA Plan's consolidated 
data streams and certain other related data elements. Specifically, 
NYSE MKT Trades includes the real-time last sale price, time, size, and 
bid/ask quotations for each security traded on the Exchange and a stock 
summary message. The stock summary message updates every minute and 
includes NYSE MKT's opening price, high price, low price, closing 
price, and cumulative volume for the security.
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 62187 (May 27, 
2010), 75 FR 31500 (June 3, 2010) (SR-NYSEAmex-2010-35).
---------------------------------------------------------------------------

    The Exchange currently charges NYSE MKT Trades data feed recipients 
an access fee of $750 per month, and a subscriber fee for professional 
subscribers of $10 per month per device, which may be counted, at the 
election of the vendor based on the number of ``Subscriber 
Entitlements'' \5\ (collectively, these fees are referred to in this 
filing as ``NYSE MKT Trades basic fees''). In July 2012, the Exchange 
added a fee for distribution by television broadcasters (``Broadcast 
Fee''), which is $5,000 per month.\6\ The television broadcast 
distribution method differs from the other distribution methods in that 
the data is available in a temporary, view-only mode on television 
screens. NYSE MKT Trades is not offered in a manner to facilitate its 
distribution via Web sites or mobile devices.
---------------------------------------------------------------------------

    \5\ See id. at 31501.
    \6\ See Securities Exchange Act Release No. 67438 (July 13, 
2012), 77 FR 42535 (July 19, 2012) (SR-NYSEMKT-2012-19).
---------------------------------------------------------------------------

Proposed Change
    The Exchange proposes to offer a new version of NYSE MKT Trades 
called ``NYSE MKT Trades Digital Media,'' which will include, as with 
NYSE MKT Trades as currently offered, access to the real-time last sale 
price, time, and size for each security traded on the Exchange as well 
as the stock summary message. NYSE MKT Trades Digital Media will not, 
however, include access to the bid/ask quotation that is included with 
the current NYSE MKT Trades product under the NYSE MKT Trades basic 
fees and Broadcast Fee. NYSE MKT Trades will be offered in a new manner 
that will permit market data vendors, television broadcasters, Web site 
and mobile device service providers, and others to distribute this data 
product to their customers for viewing via television, Web site, and 
mobile devices. Vendors will not be permitted to provide NYSE MKT 
Trades Digital Media in a context in which a trading or order routing 
decision can be implemented unless CTA data is available in an 
equivalent manner, must label the products as NYSE MKT-only data, and 
must provide a hyperlinked notice similar to the one provided for CTA 
delayed data.\7\
---------------------------------------------------------------------------

    \7\ These are requirements that currently apply to NYSE MKT 
Realtime Reference Prices (``NYSE MKT RRP''), a separate last sale 
product that also is offered for use in a non-trading environment. 
See Securities Exchange Act Release Nos. 61144 (Dec. 10, 2009), 74 
FR 67275, 67276-77 (Dec. 18, 2009) (SR-NYSEAmex-2009-85); 61403 
(Jan. 22, 2010), 75 FR 4598 (Jan. 28, 2010) (SR-NYSEAmex-2009-85). 
The Exchange also intends to offer NYSE MKT RRP in the future as 
NYSE MKT RRP Digital Media, but there will be no substantive change 
to the NYSE MKT RRP product elements, only the permitted 
distribution channels. The Exchange will propose pricing for NYSE 
MKT Trades Digital Media and NYSE MKT RRP Digital Media in a 
separate filing.
---------------------------------------------------------------------------

    The Exchange also proposes to establish a Market Data Fee Schedule. 
The market data fees on the proposed Market Data Fee Schedule for NYSE 
MKT BBO,\8\ NYSE MKT Trades,\9\ NYSE MKT RRP,\10\ and NYSE MKT Order 
Imbalances \11\ have been previously filed with the Commission. The 
Exchange is proposing the Market Data Fee Schedule in order to provide 
greater transparency to its customers.
---------------------------------------------------------------------------

    \8\ See supra note 4.
    \9\ See supra notes 4, 6.
    \10\ See Securities Exchange Act Release No. 61403 (Jan. 22, 
2010), 75 FR 4598 (Jan. 28, 2010) (SR-NYSEAmex-2009-85).
    \11\ See Securities Exchange Act Release No. 60385 (July 24, 
2009), 74 FR 38249 (July 31, 2009) (NYSEAmex-2009-26).
---------------------------------------------------------------------------

2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) \12\ of 
the Act, in general, and furthers the objectives of Section 6(b)(5) 
\13\ of the Act, in particular, in that it is designed to prevent 
fraudulent and manipulative acts and practices, to promote just and

[[Page 20970]]

equitable principles of trade, to foster cooperation and coordination 
with persons engaged in facilitating transactions in securities, 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, and it is not designed to permit 
unfair discrimination among customers, brokers, or dealers.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange is offering the NYSE MKT Trades Digital Media data 
product in recognition of the demand for a more seamless and easier-to-
administer data distribution model that takes into account the expanded 
variety of media and communication devices that investors utilize 
today. For example, a television broadcaster could display the NYSE MKT 
Trades Digital Media data during market-related television programming 
and on its Web site and allow its viewers to view the data via their 
mobile devices, creating a more seamless distribution model that will 
allow investors more choice in how they receive and view market data. 
Because the product is intended for use in a non-trading environment, 
the Exchange will not include a bid/ask quotation as a product element. 
Market participants that still wish to obtain bid/ask quotations can do 
so by paying the NYSE MKT Trades basic fees. The Exchange believes that 
establishing the Market Data Fee Schedule will provide greater 
transparency for the Exchange's customers.
    In adopting Regulation NMS, the Commission granted self-regulatory 
organizations and broker-dealers increased authority and flexibility to 
offer new and unique market data to consumers of such data. It was 
believed that this authority would expand the amount of data available 
to users and consumers of such data and also spur innovation and 
competition for the provision of market data. The Exchange believes 
that the data products proposed herein are precisely the sort of market 
data products that the Commission envisioned when it adopted Regulation 
NMS. The Commission concluded that Regulation NMS--by lessening 
regulation of the market in proprietary data--would itself further the 
Act's goals of facilitating efficiency and competition:

    [E]fficiency is promoted when broker-dealers who do not need the 
data beyond the prices, sizes, market center identifications of the 
NBBO and consolidated last sale information are not required to 
receive (and pay for) such data. The Commission also believes that 
efficiency is promoted when broker-dealers may choose to receive 
(and pay for) additional market data based on their own internal 
analysis of the need for such data.\14\
---------------------------------------------------------------------------

    \14\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496 (June 29, 2005).

    By removing ``unnecessary regulatory restrictions'' on the ability 
of exchanges to sell their own data, Regulation NMS advanced the goals 
of the Act and the principles reflected in its legislative history.
    The Exchange further notes that the existence of alternatives to 
the Exchange's products, including real-time consolidated data, free 
delayed consolidated data, and proprietary data from other sources, 
ensures that the Exchange is not unreasonably discriminatory because 
vendors and subscribers can elect these alternatives.
    The proposed data product will remove impediments to and help 
perfect a free and open market by permitting the Exchange's last sale 
data to be more widely distributed, thereby benefiting users of the 
data. In addition, the proposal would not permit unfair discrimination 
because the product will be available to all of the Exchange's vendors 
and customers on an equivalent basis.

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. The market for proprietary 
data products is currently competitive and inherently contestable 
because there is fierce competition for the inputs necessary to the 
creation of proprietary data. Numerous exchanges compete with each 
other for listings, trades, and market data itself, providing virtually 
limitless opportunities for entrepreneurs who wish to produce and 
distribute their own market data. This proprietary data is produced by 
each individual exchange, as well as other entities (such as 
internalizing broker-dealers and various forms of alternative trading 
systems, including dark pools and electronic communication networks), 
in a vigorously competitive market. It is common for market 
participants to further and exploit this competition by sending their 
order flow and transaction reports to multiple markets, rather than 
providing them all to a single market.

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

    Because the foregoing proposed rule change: (1) Does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
and (3) by its terms does not become operative for 30 days after the 
date of this filing, or such shorter time as the Commission may 
designate if consistent with the protection of investors and the public 
interest, the proposed rule change has become effective pursuant to 
Section 19(b)(3)(A) \15\ of the Act and Rule 19b-4(f)(6) 
thereunder.\16\
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78s(b)(3)(A).
    \16\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under 19b-4(f)(6) normally may not 
become operative prior to 30 days after the date of filing.\17\ 
However, Rule 19b-4(f)(6)(iii) \18\ permits the Commission to designate 
a shorter time if such action is consistent with the protection of 
investors and the public interest. The Exchange has requested that the 
Commission waive the 30-day operative delay. The Exchange believes that 
the proposed rule change will make the Exchange's last sale data more 
widely available through more distribution channels, which will enable 
investors to better monitor trading activity on the Exchange, and 
thereby serve the public interest. The Exchange also notes that other 
exchanges already offer similar products, and thus believes that the 
Exchange's proposed products will enhance competition. The Exchange 
believes that expanding distribution channels and offering a new 
version of the product for use in a non-trading environment will 
benefit investors. The Commission believes that permitting the Exchange 
to offer this product without delay is consistent with the protection 
of investors and the public interest. Accordingly, the Commission

[[Page 20971]]

designates the proposed rule change to be operative upon filing.\19\
---------------------------------------------------------------------------

    \17\ 17 CFR 240.19b-4(f)(6)(iii). 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.
    \18\ Id.
    \19\ For the purposes only of waiving the 30-day operative 
delay, the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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.

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-NYSEMKT-2013-30 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-NYSEMKT-2013-30. 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 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-NYSEMKT-2013-30 and should 
be submitted on or before April 29, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\20\
---------------------------------------------------------------------------

    \20\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-08095 Filed 4-5-13; 8:45 am]
BILLING CODE 8011-01-P