Document ID: SEC-2013-0483-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2013-03-13T04:00Z

[Federal Register Volume 78, Number 49 (Wednesday, March 13, 2013)]
[Notices]
[Pages 16019-16020]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-05716]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69059; File No. SR-NYSEArca-2013-23]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change Amending the NYSE 
Arca Inc. Fee Schedule To Increase the Gross FOCUS Fee

March 7, 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 February 26, 2013, NYSE Arca, Inc. (the ``Exchange'' or 
``NYSE Arca'') filed with the Securities and Exchange Commission (the 
``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\ 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 the 
Substance of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's Fee Schedule to 
increase the gross FOCUS fee (``Gross FOCUS Fee''). 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Fee Schedule to increase the 
Gross FOCUS Fee. The Exchange proposes to immediately reflect the 
proposed change in its Fee Schedule, but not to implement the proposed 
rate change until April 1, 2013.\4\
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    \4\ The Exchange has proposed changes to the Fee Schedule, as 
reflected in the Exhibit 5 attached hereto, in a manner that would 
permit readers of the Fee Schedule to identify the proposed increase 
to the Gross FOCUS Fee that would be implemented on April 1, 2013.
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    The Exchange currently charges each ETP Holder a monthly Gross 
FOCUS Fee of $0.07 per $1,000 of gross revenue reported on its FOCUS 
Report.\5\ The Exchange proposes to increase the rate of the Gross 
FOCUS Fee from $0.07 per $1,000 of gross revenue to $0.075 per $1,000 
of gross revenue.\6\ The Exchange is proposing this increase in order 
to offset increased regulatory expenses. In this regard, the Exchange 
notes that it has not increased the Gross FOCUS Fee since June 2011.\7\
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    \5\ FOCUS is an acronym for Financial and Operational Combined 
Uniform Single Report. FOCUS Reports are filed periodically with the 
Securities and Exchange Commission (the ``Commission'' or ``SEC'') 
as SEC Form X-17A-5 pursuant to Rule 17a-5 under the Act.
    \6\ The Exchange is also proposing to specify, as is the case 
today, that the Gross FOCUS Fee is charged monthly.
    \7\ See Securities Exchange Act Release No. 64595 (June 3, 
2011), 76 FR 33795 (June 9, 2011) (SR-NYSEArca-2011-32).
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    The Exchange allocates the funds collected pursuant to the Gross 
FOCUS Fee to fund the performance of its regulatory activities with 
respect to ETP

[[Page 16020]]

Holders, including expenses associated with the regulatory functions 
performed both by NYSE Regulation, Inc. (``NYSE Regulation'') and by 
the Financial Industry Regulatory Authority, Inc. (``FINRA'') pursuant 
to a regulatory services agreement, for which FINRA is paid by NYSE 
Regulation.
    The Exchange will monitor the amount of revenue collected from the 
Gross FOCUS Fee to ensure that it, in combination with its other 
regulatory fees and fines, does not exceed regulatory costs. The 
Exchange expects to monitor regulatory costs and revenues on an annual 
basis, at a minimum. If the Exchange determines that regulatory 
revenues exceed regulatory costs, the Exchange would adjust the Gross 
FOCUS Fee downward by submitting a fee change filing to the Commission.
    The Exchange notes that the proposed change is not otherwise 
intended to address any other issues, and the Exchange is not aware of 
any problems that ETP Holders would have in complying with the proposed 
change.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\8\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\9\ in 
particular, because it provides for the equitable allocation of 
reasonable dues, fees, and other charges among its members, issuers and 
other persons using its facilities and does not unfairly discriminate 
between customers, issuers, brokers or dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes that the proposed change is reasonable 
because the increase in the Gross FOCUS Fee would permit the Exchange 
to offset increased regulatory expenses related to ETP Holders. In this 
regard, the Exchange notes that it has not increased the Gross FOCUS 
Fee since June 2011.\10\
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    \10\ See supra note 7.
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    The Exchange further believes that the level of the Gross FOCUS Fee 
is reasonable because it is expected to generate revenues that, when 
combined with the Exchange's other regulatory fees with respect to ETP 
Holders, will be less than or equal to the Exchange's regulatory costs. 
The Exchange believes that this is consistent with the Commission's 
previously stated view that regulatory fees be used for regulatory 
purposes and not to support the Exchange's business side.
    The Exchange further believes that the proposed change is equitable 
and not unfairly discriminatory because the Gross FOCUS Fee is assessed 
in an objective manner to all ETP Holders based on gross revenue 
reported on their FOCUS Reports.

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 proposed change is not 
designed to address any competitive issues. Rather, the proposed change 
is designed to permit the Exchange to adequately fund its regulatory 
activities in light of increased regulatory expenses related to ETP 
Holders.

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) \11\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \12\ thereunder, because it establishes a due, fee, or other 
charge imposed by NYSE Arca.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(2).
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    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. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \13\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \13\ 15 U.S.C. 78s(b)(2)(B).
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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 email to rule-comments@sec.gov. Please include 
File Number SR-NYSEArca-2013-23 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-2013-23. 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 such 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-NYSEArca-2013-23, and should 
be submitted on or before April 3, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-05716 Filed 3-12-13; 8:45 am]
BILLING CODE 8011-01-P