Document ID: SEC-2019-1358-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: New York Stock Exchange, LLC
Posted Date: 2019-09-24T04:00Z

[Federal Register Volume 84, Number 185 (Tuesday, September 24, 2019)]
[Notices]
[Pages 50089-50094]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20574]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-86999; File No. SR-NYSE-2019-50]

Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Its Price List To Aggregate Rates and Requirements Across Tapes 
A, B and C Securities for Midpoint Passive Liquidity Orders

September 18, 2019.
    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 September 3, 2019, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') 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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[[Page 50090]]

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

    The Exchange proposes to amend its Price List to (1) aggregate 
rates and requirements across Tapes A, B and C securities for Midpoint 
Passive Liquidity (``MPL'') Orders, including revising the requirements 
for the two existing MPL tiers that provide liquidity to the Exchange, 
and (2) add a new tier for MPL Orders across Tapes A, B and C 
securities. The Exchange proposes to implement the fee changes 
effective September 3, 2019. The proposed rule change is available on 
the Exchange's website 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 amend its Price List to revise pricing 
available for MPL that provide liquidity to the Exchange as follows:
    (1) Revise all MPL tiers so that the respective credits are 
available for MPL Orders that add liquidity in Tapes A, B and C 
securities;
    (2) Add a new MPL tier with lower requirements for MPL Orders that 
add liquidity in Tapes A, B and C securities. Under the proposed tier, 
member organizations that have an average daily volume (``ADV'') of MPL 
Orders executed on the Exchange that add liquidity (``Adding ADV'') 
that is at least 0.0075% of consolidated average daily volume 
(``CADV'') \4\ in Tapes A, B and C combined (``US CADV''), excluding 
any liquidity added by a Designated Market Maker (``DMM''), would 
qualify for a $0.0020 credit;
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    \4\ The terms ``ADV'' and ``CADV'' are defined in footnote * of 
the Price List.
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    (3) For the two existing MPL tiers for which qualification is based 
on the member organization having Adding ADV in MPL Orders in Tape A 
securities that represents a specified percentage of NYSE CADV, 
lowering the specified percentages and replacing the requirement of 
NYSE CADV with Tapes A, B and C combined; and
    (4) Conform the rates for adding liquidity in Tapes B and C 
securities in MPL Orders by eliminating the separate credits for adding 
liquidity in Tapes B and C securities in MPL Orders.
    The proposed changes respond to the current competitive environment 
where order flow providers have a choice of where to direct liquidity-
providing orders by offering further incentives for member 
organizations to send additional liquidity to the Exchange.
    The Exchange proposes to implement the fee changes effective 
September 3, 2019.
Competitive Environment
    The Commission has repeatedly expressed its preference for 
competition over regulatory intervention in determining prices, 
products, and services in the securities markets. In Regulation NMS, 
the Commission highlighted the importance of market forces in 
determining prices and SRO revenues and, also, recognized that current 
regulation of the market system ``has been remarkably successful in 
promoting market competition in its broader forms that are most 
important to investors and listed companies.'' \5\
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    \5\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37495, 37499 (June 29, 2005) (S7-10-04) (Final Rule) 
(``Regulation NMS'').
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    As the Commission itself recognized, the market for trading 
services in NMS stocks has become ``more fragmented and competitive.'' 
\6\ Indeed, equity trading is currently dispersed across 13 
exchanges,\7\ 31 alternative trading systems,\8\ and numerous broker-
dealer internalizers and wholesalers, all competing for order flow. 
Based on publicly-available information, no single exchange has more 
than 18% market share (whether including or excluding auction 
volume).\9\ Therefore, no exchange possesses significant pricing power 
in the execution of equity order flow. More specifically, the 
Exchange's market share of intraday trading (i.e., excluding auctions) 
in Tape A, B and C combined declined from 9.9% in March 2019 to 9.1% in 
July 2019.\10\
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    \6\ See Securities Exchange Act Release No. 51808, 84 FR 5202, 
5253 (February 20, 2019) (File No. S7-05-18) (Transaction Fee Pilot 
for NMS Stocks Final Rule) (``Transaction Fee Pilot'').
    \7\ See Cboe Global Markets, U.S. Equities Market Volume 
Summary, available at http://markets.cboe.com/us/equities/market_share/. See generally https://www.sec.gov/fast-answers/divisionsmarketregmrexchangesshtml.html.
    \8\ See FINRA ATS Transparency Data, available at https://otctransparency.finra.org/otctransparency/AtsIssueData. A list of 
alternative trading systems registered with the Commission is 
available at https://www.sec.gov/foia/docs/atslist.htm.
    \9\ See Cboe Global Markets U.S. Equities Market Volume Summary, 
available at http://markets.cboe.com/us/equities/market_share/.
    \10\ See id.
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    The Exchange believes that the ever-shifting market share among the 
exchanges from month to month demonstrates that market participants can 
move order flow, or discontinue or reduce use of certain categories of 
products, in response to fee changes. With respect to non-marketable 
order flow that would provide displayed liquidity on an Exchange, 
member organizations can choose from any one of the 13 currently 
operating registered exchanges to route such order flow. Accordingly, 
competitive forces constrain exchange transaction fees that relate to 
orders that would provide liquidity on an exchange.
Proposed Rule Change
    To respond to this competitive environment, the Exchange has 
established incentives for its member organizations who submit MPL 
Orders that provide liquidity on the Exchange, including cross-tape 
incentives for member organizations based on submission of orders that 
provide displayed and non-displayed liquidity in Tapes B and C 
securities.
    For Tape A securities at or above $1.00, the Exchange currently 
offers a base rate for MPL Orders that provide liquidity to the 
Exchange, excluding MPL Orders from DMMs, and two related MPL tiers for 
member organizations that have a minimum amount of Adding ADV of NYSE 
CADV in MPL orders. The MPL credits are $0.0010 (base rate), $0.00250 
(first Adding ADV tier) and $0.00275 (second tier). Member 
organizations that do not meet the Adding ADV thresholds in the two 
existing tiers would receive the base rate credit.
    The proposed fee change is designed to attract additional MPL Order 
flow to the Exchange by aggregating rates and requirements for MPL 
Orders across Tapes A, B and C securities, introducing a new tier rate 
for MPL Orders that provide liquidity to the Exchange, and lowering the 
Adding ADV requirements for the two existing tiers that would apply 
across all three tapes rather than solely Tape A, as described below.

[[Page 50091]]

MPL Orders
    An MPL Order is defined in Rule 7.31 as a Limit Order that is not 
displayed and does not route, with a working price at the midpoint of 
the PBBO.\11\
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    \11\ See Rule 7.31(d)(3). Limit Order is defined in Rule 
7.31(a)(2).
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MPL Orders That Provide Liquidity
    Currently, for securities at or above $1.00 in Tape A securities, 
the Exchange provides a credit of $0.00100 \12\ for all MPL Orders 
(other than MPL Orders from DMMs) that add liquidity to the NYSE, 
unless one of the higher credits set forth in two tiers that follow in 
the Price List apply.
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    \12\ For the sake of consistency, the Exchange proposes to 
delete the extra zero in the current Price List.
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    The Exchange proposes to retain this base rate credit but extend 
its applicability to all MPL Orders in Tapes A, B and C securities, 
other than MPL Orders from DMMs.
    The Exchange further proposes to introduce a new, higher fee of 
$0.0020 per share for member organizations that have an Adding ADV in 
MPL Orders that is at least 0.0075% of Tapes A, B and C CADV combined, 
excluding any liquidity added by DMMs. The proposed tier would be 
inserted between the base rate and the two existing tiers, discussed 
below.
    For example, in a month where US CADV is 6.1 billion shares, a 
member organization has an Adding ADV in MPL Orders that add liquidity 
of 500,000 shares in Tapes A, B and C securities. That member 
organization's Adding ADV as a percentage of US CADV would accordingly 
be 0.0081%, which would qualify for the proposed MPL Adding Tier 3 
credit of $0.0020 per share. Prior to proposed change, such a member 
organization would have received the non-tier credit of $0.0012 per 
share.
    Further, currently a member organization that has Adding ADV in MPL 
Orders that is at least 0.030% of NYSE CADV, excluding any liquidity 
added by a DMM, would be eligible for a $0.00250 credit.
    The Exchange proposes to retain this credit and revise the 
qualifying requirement to having an Adding ADV in MPL Orders that is at 
least 0.015% of Tapes A, B and C CADV combined, once again excluding 
any liquidity added by a DMM.
    Similarly, under the other current tier, a member organization that 
has Adding ADV in MPL Orders that is at least 0.140% of NYSE CADV, 
excluding any liquidity added by a DMM, would be eligible for a 
$0.00275 credit.
    The Exchange proposes to retain this credit as well and revise the 
requirement for qualifying to having an Adding ADV in MPL Orders that 
is at least 0.075% of Tapes A, B and C CADV combined, excluding any 
liquidity added by a DMM.
    The Exchange notes that the reduction in the percentage of CADV 
levels for MPL Adding Tiers 1 and 2 are in line with the Tape A 
percentage of all US CADV insofar as the proposed requirement utilizes 
a denominator (US CADV) that is almost double the previous denominator 
limited to Tape A securities. In July 2019, Tape A CADV was 3.141 
billion shares, 51.2% of total US CADV, which was 6.127 billion shares.
MPL Orders That Provide Liquidity in Tapes B and C Securities
    Currently, for securities priced at or above $1.00, the Exchange 
offers a credit of $0.0010 per share for executions in each of Tape B 
and C securities for MPL Orders that provide liquidity to the Exchange, 
unless a specific credit applies.
    Under the Adding Tier 1, the Exchange offers a per tape credit of 
$0.0025 per share for an MPL Order on a per tape basis for transactions 
in stocks with a per share price of $1.00 or more when adding liquidity 
to the Exchange if the member organization has at least 0.10% of Adding 
CADV in Tape B or C. For purposes of qualifying for this tier, the 
0.10% of Adding CADV could include shares of both an SLP-Prop and an 
SLMM \13\ of the same or an affiliated member organization.
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    \13\ Under Rule 107B, a Supplemental Liquidity Provider 
(``SLP'') can be either a proprietary trading unit of a member 
organization (``SLP-Prop'') or a registered market maker at the 
Exchange (``SLMM''). For purposes of the 10% average or more quoting 
requirement in assigned securities pursuant to Rule 107B, quotes of 
an SLP-Prop and an SLMM of the same member organization are not 
aggregated. However, for purposes of adding liquidity for assigned 
SLP securities in the aggregate, shares of both an SLP-Prop and an 
SLMM of the same member organization are included.
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    The Exchange proposes to delete the reference to the $0.0010 credit 
per share for executions in each of Tape B and C securities for MPL 
Orders and refer to the portion of the Price List following the 
``Executions at the Close Equity Per Share Charge'' section that would 
set forth the proposed aggregation of rates for MPL Orders across tapes 
described above.
    Similarly, the Exchange proposes to delete the reference to the per 
tape credit of $0.0025 per share for an MPL Order on a per tape basis 
in Adding Tier 1.
Application and Impact of Transition Period Pricing
    The purpose of these proposed changes are to incentivize member 
organizations to trade on the Exchange in MPL Orders in Tapes A, B and 
C securities. The proposed new tier for member organizations with 
Adding ADV in MPL Orders that is at least 0.0075% of Tapes A, B and C 
CADV combined would incentivize member organizations with lower trading 
volumes who qualified for the lower base rate the opportunity to 
qualify for a higher credit of $0.0020, thereby increasing the number 
of orders adding liquidity that are executed on the Exchange and 
improving overall liquidity on a public exchange. In addition, the new 
proposed tier would encourage member organizations with lower trading 
volumes to increase mid-point liquidity, thereby improving overall 
market quality and offering price improvement.
    The proposed changes to the two existing MPL tiers to lower the 
Adding ADV requirement while expanding it to all three tapes would 
increase liquidity-providing MPL Orders in Tapes A, B and C securities, 
which would support the quality of price discovery on the Exchange and 
provide additional price improvement opportunities for incoming orders. 
The Exchange believes that by correlating the amount of credits to the 
level of MPL Orders sent by a member organization that add liquidity, 
the Exchange's fee structure would incentivize member organizations to 
submit more MPL Orders that add liquidity to the Exchange, thereby 
increasing the potential for price improvement and execution 
opportunities to incoming marketable orders submitted to the Exchange.
    As noted above, the Exchange operates in a competitive and 
fragmented market environment, particularly as it relates to attracting 
non-marketable orders, which add liquidity to the Exchange. Without 
having a view of a member organization's activity on other markets and 
off-exchange venues, the Exchange believes the proposed new MPL tier 
with a higher rate and lowered amount of Adding ADV requirement spread 
across three tapes would provide an incentive for member organizations 
to add additional MPL liquidity to the Exchange. Currently, 8 firms 
(out of a total 146 member firms) can qualify for the MPL tiers. Based 
on the profile of liquidity-adding firms generally, the Exchange 
believes that at least 5 additional member organizations could qualify 
for the new tiered rate under if

[[Page 50092]]

they choose to direct order flow to, and increase quoting on, the 
Exchange.
    The proposed changes are not otherwise intended to address other 
issues, and the Exchange is not aware of any significant problems that 
market participants would have in complying with the proposed changes.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\14\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\15\ 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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    \14\ 15 U.S.C. 78f(b).
    \15\ 15 U.S.C. 78f(b)(4) & (5).
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The Proposed Change Is Reasonable
    As discussed above, the Exchange operates in a highly fragmented 
and competitive market. The Exchange believes that the ever-shifting 
market share among the exchanges from month to month demonstrates that 
market participants can move order flow, or discontinue or reduce use 
of certain categories of products, in response to fee changes. With 
respect to non-marketable orders that provide liquidity on an Exchange, 
member organizations can choose from any one of the 13 currently 
operating registered exchanges to route such order flow. Accordingly, 
competitive forces constrain exchange transaction fees that relate to 
orders that would provide displayed liquidity on an exchange. Stated 
otherwise, changes to exchange transaction fees can have a direct 
effect on the ability of an exchange to compete for order flow.
    Given this competitive environment, the proposal represents a 
reasonable attempt to attract additional order flow to the Exchange. As 
noted, the Exchange's market share of intraday trading (i.e., excluding 
auctions) in Tape A, B and C combined declined between March and July 
2019.
    Specifically, the Exchange believes that aggregating rates and 
requirements across tapes for MPL Orders that provide liquidity to the 
Exchange is reasonable because it would streamline the Exchange's Price 
List in a manner consistent with the practice on other exchanges where 
adding rates are consistent across tapes for the same order types.\16\
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    \16\ For instance, the requirements for the Exchange's affiliate 
NYSE National, Inc.'s Adding Tiers 1, 2, and 3 utilize Adding ADV as 
a percentage of US CADV, and offer the same credits for adding 
displayed liquidity across Tapes A, B and C securities within the 
same tier. See https://www.nyse.com/publicdocs/nyse/regulation/nyse/NYSE_National_Schedule_of_Fees.pdf.
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    Further, the Exchange believes the proposed new tier for member 
organizations with Adding ADV in MPL orders that is at least 0.0075% of 
Tapes A, B and C CADV combined is reasonable because it would 
incentivize member organizations with lower trading volumes who receive 
the lower base rate if they do not qualify for the MPL adding tiers the 
opportunity to qualify for a higher credit of $0.0020, thereby 
increasing the number of orders adding liquidity that are executed on 
the Exchange and improving overall liquidity on a public exchange. In 
addition, the new proposed tier would encourage member organizations 
with lower trading volumes to increase mid-point liquidity, thereby 
improving overall market quality and offering price improvement.
    Without having a view of a member organization's activity on other 
markets and off-exchange venues, the Exchange believes the proposed new 
MPL tier with a higher rate and lowered amount of Adding ADV spread 
across three tapes would provide an incentive for member organizations 
to add additional liquidity from the Exchange in Tape B and C 
securities. As previously noted, a number of firms can qualify for the 
MPL tiers and additional member organizations could qualify for the new 
tiered rate under the proposed criteria if they choose to direct order 
flow to, and increase offering the opportunity for price improvement to 
incoming orders on, the Exchange.
    Finally, the Exchange believes that the proposed changes to the two 
existing MPL tiers to lower the Adding ADV requirement while expanding 
it to all three tapes is reasonable because it would increase 
liquidity-providing MPL orders in Tapes A, B and C securities, which 
would support the quality of price discovery on the Exchange and 
provide additional price improvement opportunities for incoming orders. 
The Exchange believes that by correlating the amount of credits to the 
level of MPL orders sent by a member organization that add liquidity, 
the Exchange's fee structure would incentivize member organizations to 
submit more MPL orders that add liquidity to the Exchange, thereby 
increasing the potential for price improvement and execution 
opportunities to incoming marketable orders submitted to the Exchange.
    The Exchange notes that the existing credits for the MPL orders in 
Tape A securities remain unchanged and the credits in Tape B and C 
securities are in line with the credits the Exchange currently credits 
member organizations for adding MPL orders in Tape A securities.
    Finally, the Exchange also believes the proposed non-substantive 
changes are reasonable and would not be inconsistent with the public 
interest and the protection of investors because investors will not be 
harmed and in fact would benefit from increased clarity and 
transparency on the Price List, thereby reducing potential confusion.
The Proposal is an Equitable Allocation of Fees
    The Exchange believes its proposal equitably allocates its fees 
among its market participants by fostering liquidity provision and 
stability in the marketplace. The Exchange believes that, for the 
reasons discussed above, the proposed aggregation of rates and 
requirements across tapes for MPL Orders would incentivize member 
organizations with lower trading volumes who qualified for the lower 
base rate the opportunity to qualify for a higher credit of $0.0020, 
thereby increasing the number of orders adding liquidity that are 
executed on the Exchange and improving overall liquidity on a public 
exchange. In addition, the new proposed tier would encourage member 
organizations with lower trading volumes to increase mid-point 
liquidity, thereby providing customers with a higher quality venue for 
price discovery, liquidity, competitive quotes and price improvement. 
The proposed change will thereby encourage the submission of additional 
liquidity to a national securities exchange, thus promoting price 
discovery and transparency and enhancing order execution opportunities 
for member organizations from the substantial amounts of liquidity 
present on the Exchange. All member organizations would benefit from 
the greater amounts of liquidity that will be present on the Exchange, 
which would provide greater execution opportunities.
    The Exchange also believes that the proposed new tier for member 
organizations with Adding ADV in MPL Orders that is at least 0.0075% of 
Tapes A, B and C CADV combined would encourage member organizations 
with lower trading volumes who qualified for the lower base rate the 
opportunity to qualify for a higher credit of $0.0020, thereby 
increasing the number of orders adding liquidity that are executed on

[[Page 50093]]

the Exchange and improving overall liquidity on a public exchange. In 
addition, the new proposed tier would encourage member organizations 
with lower trading volumes to increase mid-point liquidity, thereby 
improving overall market quality and offering price improvement. As 
previously noted, a number of member organizations are qualifying for 
the MPL tiers. Based on the profile of liquidity-adding firms 
generally, the Exchange believes additional member organizations could 
qualify for the new tiered rate under the proposed criteria if they 
choose to direct order flow to, and increase quoting on, the Exchange. 
The proposed rate and lower Adding ADV requirement across all three 
tapes is also equitable because it would apply equally to all existing 
member organizations that add liquidity to the Exchange in MPL Orders.
    Further, the Exchange believes that proposed changes to the two 
existing MPL tiers to lower the Adding ADV requirement while expanding 
it to all three tapes would increase liquidity-providing MPL Orders in 
Tapes A, B and C securities, would support the quality of price 
discovery on the Exchange and provide additional price improvement 
opportunities for incoming orders, to benefit of all member 
organizations. The Exchange believes that the proposal would provide an 
equal incentive to all member organizations to send additional MPL 
Orders to the Exchange, and that the proposal constitutes an equitable 
allocation of fees because all similarly situated member organizations 
would be eligible for the same rebates.
The Proposal is Not Unfairly Discriminatory
    The Exchange believes that the proposal is not unfairly 
discriminatory. In the prevailing competitive environment, member 
organizations are free to disfavor the Exchange's pricing if they 
believe that alternatives offer them better value.
    The proposal does not permit unfair discrimination because the 
existing MPL rates as well as the rate for the proposed new tier would 
be applied to all similarly situated member organizations and other 
market participants, who would all be eligible for the same credit on 
an equal basis. Accordingly, no member organization already operating 
on the Exchange would be disadvantaged by this allocation of fees.
    The Exchange believes it is not unfairly discriminatory to provide 
a higher fee for member organizations under the proposed tier because 
the tier would be provided on an equal basis to all member 
organizations. Further, the Exchange believes the proposed lower Adding 
ADV requirements for the two existing tiers while expanding it to all 
three tapes would increase liquidity-providing MPL Orders in Tapes A, B 
and C securities, would provide an equal incentive to all member 
organizations to send additional MPL Orders to the Exchange, and that 
the proposal constitutes an equitable allocation of fees because all 
similarly situated member organizations would be eligible for the same 
rebates.
    The Exchange also believes that the proposed change is not unfairly 
discriminatory because it is reasonably related to the value to the 
Exchange's market quality associated with higher volume. Finally, the 
submission of orders to the Exchange is optional for member 
organizations in that they could choose whether to submit orders to the 
Exchange and, if they do, the extent of its activity in this regard.
    Finally, the Exchange believes that it is subject to significant 
competitive forces, as described below in the Exchange's statement 
regarding the burden on competition.
    For the foregoing reasons, the Exchange believes that the proposal 
is consistent with the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\17\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. Instead, as discussed above, the Exchange believes 
that the proposed changes would encourage the submission of additional 
liquidity to a public exchange, thereby promoting market depth, price 
discovery and transparency and enhancing order execution opportunities 
for member organizations. As a result, the Exchange believes that the 
proposed change furthers the Commission's goal in adopting Regulation 
NMS of fostering integrated competition among orders, which promotes 
``more efficient pricing of individual stocks for all types of orders, 
large and small.'' \18\
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    \17\ 15 U.S.C. 78f(b)(8).
    \18\ Regulation NMS, 70 FR at 37498-99.
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    Intramarket Competition. The proposed changes are designed to 
attract additional order flow to the Exchange. The Exchange believes 
that the proposed changes would continue to incentivize market 
participants to direct order flow to the Exchange. Greater liquidity 
benefits all market participants on the Exchange by providing more 
trading opportunities and encourages member organizations to send 
orders, thereby contributing to robust levels of liquidity, which 
benefits all market participants on the Exchange. The proposed credits 
would be available to all similarly-situated market participants, and, 
as such, the proposed change would not impose a disparate burden on 
competition among market participants on the Exchange.
    Intermarket Competition. The Exchange operates in a highly 
competitive market in which market participants can readily choose to 
send their orders to other exchange and off-exchange venues if they 
deem fee levels at those other venues to be more favorable. As noted, 
the Exchange's market share of intraday trading in Tape B and C 
securities (excluding auction volume) in Tape A, B and C combined 
declined between March and July 2019. In such an environment, the 
Exchange must continually adjust its fees and rebates to remain 
competitive with other exchanges and with off-exchange venues. Because 
competitors are free to modify their own fees and credits in response, 
and because market participants may readily adjust their order routing 
practices, the Exchange does not believe its proposed fee change can 
impose any burden on intermarket competition.
    The Exchange believes that the proposed change could promote 
competition between the Exchange and other execution venues, including 
those that currently offer similar order types and comparable 
transaction pricing, by encouraging additional orders to be sent to the 
Exchange for execution. The Exchange also believes that the proposed 
change is designed to provide the public and investors with a Price 
List that is clear and consistent, thereby reducing burdens on the 
marketplace and facilitating investor protection.

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) \19\ of the Act and

[[Page 50094]]

subparagraph (f)(2) of Rule 19b-4 \20\ thereunder, because it 
establishes a due, fee, or other charge imposed by the Exchange.
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    \19\ 15 U.S.C. 78s(b)(3)(A).
    \20\ 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) \21\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \21\ 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-NYSE-2019-50 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-NYSE-2019-50. 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 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 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. 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-NYSE-2019-50 and should be submitted on 
or before October 15, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\22\
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    \22\ 17 CFR 200.30-3(a)(12).
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Jill M. Petersen,
Assistant Secretary.
[FR Doc. 2019-20574 Filed 9-23-19; 8:45 am]
BILLING CODE 8011-01-P