Document ID: SEC-2019-0353-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: MIAX Emerald, LLC
Posted Date: 2019-03-27T04:00Z

[Federal Register Volume 84, Number 59 (Wednesday, March 27, 2019)]
[Notices]
[Pages 11599-11622]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-05816]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85393; File No. SR-EMERALD-2019-15]

Self-Regulatory Organizations; MIAX Emerald, LLC; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To 
Establish the MIAX Emerald Fee Schedule

March 21, 2019.
    Pursuant to the provisions of Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice 
is hereby given that on March 15, 2019, MIAX Emerald, LLC (``MIAX 
Emerald'' or ``Exchange''), filed with the Securities and Exchange 
Commission (``Commission'') a proposed rule change as described in 
Items I, II, and III below, which Items have been prepared by the 
Exchange. 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\ 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

    The Exchange is filing a proposal to amend the MIAX Emerald Fee 
Schedule (the ``Fee Schedule'') by adopting rebates and fees applicable 
to participants trading options on and/or using services provided by 
MIAX Emerald.
    MIAX Emerald plans to commence operations as a national securities 
exchange registered under Section 6 of the Act \3\ on March 1, 2019.\4\
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    \3\ 15 U.S.C. 78f.
    \4\ See Securities Exchange Act Release No. 84891 (December 20, 
2018), 83 FR 67421 (December 28, 2018) (File No. 10-233) (order 
approving application of MIAX Emerald, LLC for registration as a 
national securities exchange).
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    The text of the proposed rule change is available on the Exchange's 
website at http://www.miaxoptions.com/rule-filings/emerald, at MIAX's 
principal office, 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 Exchange 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 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 aspects of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to establish transaction 
rebates and fees, regulatory fees, and certain non-transaction fees 
applicable to market participants trading options on and/or using 
services provided by the Exchange. These rebates and fees will apply to 
all market participants trading options on and/or using services 
provided by MIAX Emerald.
Definitions
    The Exchange has included a Definitions section at the beginning of 
the Fee Schedule. The purpose of the Definitions section is to 
streamline the Fee Schedule by placing many of the defined terms used 
in the Fee Schedule in one location at the beginning of the Fee 
Schedule. Many of the defined terms are also defined in the Exchange 
Rules, particularly in Exchange Rule 100. Any defined terms that are 
also defined or otherwise explained in the Exchange Rules contain a 
cross reference to the relevant Exchange Rule. The Exchange notes that 
other exchanges have Definitions sections in their respective fee 
schedule,\5\ and the Exchange believes that including a Definitions 
section in the front of the Exchange's Fee Schedule makes the Fee 
Schedule more user-friendly.
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    \5\ See Exchange Act Release Nos. 70200 (August 14, 2013), 78 FR 
51242 (August 20, 2013) (SR-Topaz-2013-10); 76453 (November 17, 
2015), 80 FR 72999 (November 23, 2015) (SR-EDGX-2015-56); 80061 
(February 17, 2017), 82 FR 11676 (February 24, 2017) (SR-PEARL-2017-
10).
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Exchange Rebates/Fees
    The proposed Fee Schedule sets forth transaction rebates and fees 
for all options traded on the Exchange in amounts that vary depending 
upon certain factors, including the type of

[[Page 11600]]

market participant (``Origin'') for whom the transaction is executed, 
the contra party to a transaction, whether in a Penny class or a non-
Penny class, and whether the transaction is in simple, complex, or 
PRIME \6\ or cPRIME,\7\ and the amount of volume executed by the 
Member, as described more fully below.
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    \6\ Price Improvement Mechanism (``PRIME'') is a process by 
which a Member may electronically submit for execution (``Auction'') 
an order it represents as agent (``Agency Order'') against principal 
interest, and/or an Agency Order against solicited interest. See 
Exchange Rule 515A(a).
    \7\ A Complex PRIME or ``cPRIME'' Order is a complex order (as 
defined in Rule 518(a)(5)) that is submitted for participation in a 
cPRIME Auction. Trading of cPRIME Orders is governed by Rule 515A, 
Interpretation and Policy .12. See Exchange Rule 518(b)(7).
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Transaction Fees
Tiers and their application are defined in Tier section (1)(a)(ii)

                                        Members and Their Affiliates In Penny Classes Simple/Complex/PRIME/cPRIME
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                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier      Taker                    Origins ex       Priority
                                             [supcaret]     Maker        Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Market Maker.....................        1      ($0.35)        $0.50           $0.10           $0.47        $0.50        $0.05        $0.05        $0.05
                                         2       (0.35)         0.50            0.10            0.47         0.50         0.05         0.05         0.05
                                         3       (0.35)         0.50            0.10            0.47         0.50         0.05         0.05         0.05
                                         4       (0.45)         0.48            0.10            0.47         0.50         0.05         0.05         0.05
Non-MIAX Emerald Market Maker....        1       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.48            0.20            0.50         0.50         0.05         0.05         0.05
Firm Proprietary/Broker-Dealer...        1       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.49            0.20            0.50         0.50         0.05         0.05         0.05
Non-Priority Customer............        1       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.49            0.20            0.50         0.50         0.05         0.05         0.05
Priority Customer *..............        1       (0.48)         0.47          (0.25)          (0.25)       (0.25)         0.00         0.05         0.05
                                         2       (0.48)         0.47          (0.40)          (0.40)       (0.40)         0.00         0.05         0.05
                                         3       (0.48)         0.47          (0.45)          (0.45)       (0.45)         0.00         0.05         0.05
                                         4       (0.53)         0.45          (0.50)          (0.50)       (0.50)         0.00         0.05         0.05
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                                      Members and Their Affiliates In Non-Penny Classes Simple/Complex/PRIME/cPRIME
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                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer       Taker ~       Agency       Contra     Responder
                                                                         Customer)        Origin)
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Market Maker.....................        1      ($0.45)        $0.99           $0.20           $0.86        $0.88        $0.05        $0.05        $0.05
                                         2       (0.45)         0.99            0.20            0.86         0.88         0.05         0.05         0.05
                                         3       (0.45)         0.99            0.20            0.86         0.86         0.05         0.05         0.05
                                         4       (0.75)         0.94            0.20            0.86         0.86         0.05         0.05         0.05
Non-MIAX Emerald Market Maker....        1       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
Firm Proprietary/Broker-Dealer...        1       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
Non-Priority Customer............        1       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
Priority Customer *..............        1       (0.85)         0.85          (0.40)          (0.40)       (0.40)         0.00         0.05         0.05
                                         2       (0.85)         0.85          (0.60)          (0.60)       (0.60)         0.00         0.05         0.05
                                         3       (0.85)         0.85          (0.70)          (0.70)       (0.75)         0.00         0.05         0.05
                                         4       (1.05)         0.82          (0.87)          (0.87)       (0.85)         0.00         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
* Priority Customer Complex Orders contra to Priority Customer Complex Orders are neither charged nor rebated. Priority Customer Complex Orders that leg
  into the Simple book are neither charged nor rebated.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.
Notes Accompanying Tables Above
During the Opening Rotation and the ABBO uncrossing, the per contract rebate or fee will be waived for all Origins.

[[Page 11601]]

    In general, the Exchange proposes that Add/Remove Tiered Rebates/
Fees applicable to all market participants will be based upon a 
threshold tier structure (``Tier'') that is applicable to transaction 
fees, as set forth in the Fee Schedule. Tiers are determined on a 
monthly basis and are based on three alternative calculation methods 
(as defined below). The calculation method that results in the highest 
Tier achieved by the Member shall apply to all Origin types by the 
Member. The monthly volume thresholds for each method, associated with 
each Tier, are calculated as the total monthly volume executed by the 
Member \8\ in all options classes on MIAX Emerald in the relevant 
Origins and/or applicable liquidity, not including Excluded 
Contracts,\9\ (as the numerator) expressed as a percentage of (divided 
by) Customer Total Consolidated Volume (``CTCV'') (as the denominator). 
CTCV, which is defined in the Definitions section of the Fee Schedule, 
means Customer Total Consolidated Volume calculated as the total 
national volume cleared at The Options Clearing Corporation (``OCC'') 
in the Customer range in those classes listed on MIAX Emerald for the 
month for which fees apply, excluding volume cleared at the OCC in the 
Customer range executed during the period of time in which the Exchange 
experiences an ``Exchange System Disruption'' (solely in the option 
classes of the affected Matching Engine).\10\ The term Exchange System 
Disruption, which is defined in the Definitions section of the Fee 
Schedule, means an outage of a Matching Engine or collective Matching 
Engines for a period of two consecutive hours or more, during trading 
hours. The term Matching Engine, which is also defined in the 
Definitions section of the Fee Schedule, is a part of the MIAX Emerald 
electronic system that processes options orders and trades on a symbol-
by-symbol basis. Some Matching Engines will process option classes with 
multiple root symbols, and other Matching Engines may be dedicated to 
one single option root symbol (for example, options on SPY may be 
processed by one single Matching Engine that is dedicated only to SPY). 
A particular root symbol may only be assigned to a single designated 
Matching Engine. A particular root symbol may not be assigned to 
multiple Matching Engines. The Exchange believes that it is reasonable 
and appropriate to select two consecutive hours as the amount of time 
necessary to constitute an Exchange System Disruption, as two hours 
equates to approximately 1.4% of available trading time per month. The 
Exchange notes that the term ``Exchange System Disruption'' and its 
meaning have no applicability outside of the Fee Schedule, as it is 
used solely for purposes of calculating volume for the threshold tiers 
in the Fee Schedule.
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    \8\ ``Member'' means an individual or organization approved to 
exercise the trading rights associated with a Trading Permit. 
Members are deemed ``members'' under the Exchange Act. See the 
Definitions Section of the Fee Schedule and Exchange Rule 100.
    \9\ ``Excluded Contracts'' means any contracts routed to an away 
market for execution.
    \10\ A ``Matching Engine'' is a part of the MIAX Emerald 
electronic system that processes options orders and trades on a 
symbol-by-symbol basis. Some Matching Engines will process option 
classes with multiple root symbols, and other Matching Engines may 
be dedicated to one single option root symbol (for example, options 
on SPY may be processed by one single Matching Engine that is 
dedicated only to SPY). A particular root symbol may only be 
assigned to a single designated Matching Engine. A particular root 
symbol may not be assigned to multiple Matching Engines. See the 
Definitions Section of the Fee Schedule.
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    In addition, the per contract transaction rebates and fees shall be 
applied retroactively to all eligible volume once the Tier has been 
reached by the Member. The Exchange additionally proposes to aggregate 
the volume of Members and their Affiliates.\11\ Members that place 
resting liquidity, i.e., orders on the MIAX Emerald System, will be 
assessed the specified ``maker'' rebate or fee (each a ``Maker'') and 
Members that execute against resting liquidity will be assessed the 
specified ``taker'' fee or rebate (each a ``Taker'').\12\ Finally, 
Members shall be assessed lower transaction fees and smaller rebates 
for order executions in standard option classes in the Penny Pilot 
Program \13\ (``Penny classes'') than for order executions in standard 
option classes which are not in the Penny Pilot Program (``Non-Penny 
classes''), for which Members will be assessed a higher transaction 
fees and larger rebates.
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    \11\ ``Affiliate'' means an affiliate of a Member of at least 
75% common ownership between the firms as reflected on each firm's 
Form BD, Schedule A. See the Definitions Section of the Fee 
Schedule.
    \12\ For a Priority Customer complex order taking liquidity in 
both a Penny class and non-Penny class against Origins other than 
Priority Customer, the Priority Customer order will receive a rebate 
based on the Tier achieved.
    \13\ See Securities Exchange Act Release No. 85225 (March 1, 
2019), 84 FR 68353 (March 7, 2019)(SR-EMERALD-2019-06).
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    The Add/Remove Tiered Rebates/Fees proposed by the Exchange are 
similar in structure to and in the range of the transaction rebates and 
fees charged by Cboe BZX Options Exchange (``Cboe BZX'') to its market 
participants.\14\ The Exchange notes the proposed transaction rebate 
and fee structure is similar to that of Cboe BZX, in that the Exchange 
proposes to use CTCV as the denominator in determining the volume for 
each Tier and Cboe BZX uses OCC Clearing Volume (``OCV'') as its 
denominator in the volume for each of its tiers. OCV is the total 
equity and ETF options volume that clears in the Customer range at the 
OCC for the month for which the fees apply, excluding volume on any day 
that the Exchange experiences an exchange system disruption and on any 
day with a scheduled early market close. CTCV similarly encompasses 
volume from all Customer clearing types. However, the Exchange's 
proposed transaction rebate and fee structure is not identical to that 
of Cboe BZX. A distinction is the fact that the Exchange proposes to 
use a Member's actual, total monthly volume as the numerator in 
determining the volume for each Tier and Cboe BZX instead uses an 
average of daily volume (``ADV'') as its numerator in the volume for 
each of its tiers. Additionally, Cboe BZX includes in the volume 
calculations for certain of its tiers applicable to its market 
participants the volume by such Member on Cboe BZX equities market. 
Unlike Cboe BZX, the Exchange does not presently offer any such 
comparable arrangement.\15\ The Exchange notes that these are high 
level similarities and differences regarding the method of using volume 
cleared in the Customer range at the OCC as the measuring unit 
(denominator), and specific fees are discussed below.
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    \14\ See Cboe BZX Options Fee Schedule, Transaction Fees.
    \15\ Id.
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    The Exchange's transaction rebates and fees structure is also 
similar to that of Nasdaq GEMX, LLC (``GEMX'').\16\ GEMX has adopted a 
maker-taker tiered fee structure based upon volume that is also further 
delineated by whether the transaction is in Penny and SPY classes or 
Non-Penny classes (Cboe BZX has also adopted this type of maker-taker 
tiered fee structure).\17\ The Exchange also proposes to delineate 
based on whether the transaction is in Penny or Non-Penny classes, and 
further delineate within the tables based on whether the order is 
simple, complex, or PRIME/cPRIME. Similar to the structure proposed by 
the Exchange, the highest tier threshold attained by a GEMX member 
applies retroactively in a given month to all eligible traded contracts 
and applies to all eligible market participants. All eligible volume 
from affiliated members is aggregated in determining applicable tiers, 
provided

[[Page 11602]]

there is at least 75% common ownership between the members as reflected 
on each member's Form BD, Schedule A.
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    \16\ See Nasdaq GEMX, Options 7 Pricing Schedule, Section 3 
Regular Order Fees and Rebates.
    \17\ See Cboe BZX Options Fee Schedule.
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Tiers and Their Application
    The Exchange proposes that its maker-taker tiered fee structure 
based on volume be determined based on three alternative calculation 
methods. Specifically, the Exchange proposes to add a section to its 
Fee Schedule titled ``Tiers and their Application,'' which sets forth 
volume thresholds based on different types of volume that can be 
achieved by Members. The proposed section will be included in the Fee 
Schedule as follows:
(ii) Tiers and their Application
    Tiers are determined on a monthly basis. Tiers are determined based 
on three (3) alternative calculation methods. The calculation method 
that results in the highest Tier achieved by the Member shall apply to 
all Origin types by the Member. Following are the three (3) alternative 
calculation methods:
    1. Total Member sides volume, based on % of CTCV (``Method 1'');
    2. Total Emerald Market Maker sides volume, based on % of CTCV 
(``Method 2'');
    3. Total Priority Customer Maker sides volume, based on % of CTCV 
(``Method 3'').

----------------------------------------------------------------------------------------------------------------
                 Tier                          Method 1                 Method 2                 Method 3
----------------------------------------------------------------------------------------------------------------
1....................................  0.00%-0.40%............  0.00%-0.10%............  0.00%-0.10%.
2....................................  Above 0.40%-0.80%......  Above 0.10%-0.50%......  Above 0.10%-0.35%.
3....................................  Above 0.80%-1.20%......  Above 0.50%-0.75%......  Above 0.35%-0.60%.
4....................................  Above 1.20%............  Above 0.75%............  Above 0.60%.
----------------------------------------------------------------------------------------------------------------
Each method is calculated based on the total monthly sides executed by the Member in all options classes on MIAX
  Emerald in the relevant Origin(s) and/or applicable liquidity (i.e., Priority Customer Maker), not including
  Excluded Contracts, (as the numerator) expressed as a percentage of (divided by) CTCV (as the denominator).
  The per contract transaction rebates and fees shall be applied retroactively to all eligible volume once the
  Tier has been reached by the Member. The Exchange aggregates the volume of Members and their Affiliates in the
  Tiers.

    The Exchange believes that its proposed methodology for calculating 
its tiers is reasonable, as this methodology is similar to how another 
exchange calculates its tiers. The Exchange's methodology, which 
analyzes three alternative calculation methods and then selects the 
method that is the highest tier reached to the Member, is similar to 
how GEMX calculates its tiers.\18\ For example, GEMX has four 
qualifying tiers, the same number that the Exchange is proposing. GEMX 
calculates its tiers using CTCV (Customer Total Consolidated Volume) at 
the OCC, which is fundamentally the same denominator method that the 
Exchange is proposing. GEMX aggregates volume of affiliated members, as 
the Exchange is also proposing. GEMX has two alternative calculation 
methods, however the Exchange is proposing three alternative 
calculation methods, which the Exchange believes provides greater 
benefit to Members, as there is an additional method to enable 
qualification for a higher tier. GEMX, for certain of its tiers, offers 
a calculation that looks at absolute ADV volume (i.e. 20,000 ADV), in 
addition to, or in lieu of, percentages of CTCV, whereas the Exchange 
is proposing to only look at monthly percentages of CTCV.
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    \18\ See Nasdaq GEMX, Options 7 Pricing Schedule.
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Priority Customers
    Transaction rebates/fees applicable to all orders submitted by a 
Member for the account of a Priority Customer \19\ will be assessed 
according to the following sections of the tables:
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    \19\ ``Priority Customer'' means a person or entity that (i) is 
not a broker or dealer in securities, and (ii) does not place more 
than 390 orders in listed options per day on average during a 
calendar month for its own beneficial accounts(s). See the 
Definitions Section of the Fee Schedule and Exchange Rule 100, 
including Interpretations and Policies .01.

                                        Members and Their Affiliates in Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Priority Customer *..............        1      ($0.48)        $0.47         ($0.25)         ($0.25)      ($0.25)        $0.00        $0.05        $0.05
                                         2       (0.48)         0.47          (0.40)          (0.40)       (0.40)         0.00         0.05         0.05
                                         3       (0.48)         0.47          (0.45)          (0.45)       (0.45)         0.00         0.05         0.05
                                         4       (0.53)         0.45          (0.50)          (0.50)       (0.50)         0.00         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                      Members and Their Affiliates in Non-Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer       Taker ~       Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Priority Customer *..............        1      ($0.85)        $0.85         ($0.40)         ($0.40)      ($0.40)        $0.00        $0.05        $0.05
                                         2       (0.85)         0.85          (0.60)          (0.60)       (0.60)         0.00         0.05         0.05
                                         3       (0.85)         0.85          (0.70)          (0.70)       (0.75)         0.00         0.05         0.05

[[Page 11603]]

 
                                         4       (1.05)         0.82          (0.87)          (0.87)       (0.85)         0.00         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
* Priority Customer Complex Orders contra to Priority Customer Complex Orders are neither charged nor rebated. Priority Customer Complex Orders that leg
  into the Simple book are neither charged nor rebated.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.

    The rebates and fees proposed by the Exchange for Priority Customer 
transactions are similar to those assessed in select tiers by GEMX for 
transactions on behalf of its Priority Customers for simple orders. 
Transactions on behalf of a GEMX ``Priority Customer'' are also similar 
to transactions by a Member on behalf of the Exchange's Origin type 
``Priority Customer.'' \20\ For example, for a GEMX member adding 
liquidity in a Penny Pilot class on behalf of the account of a Priority 
Customer, GEMX pays a rebate of (i) $0.25 in Tier 1; (ii) $0.40 in Tier 
2; (iii) $0.48 in Tier 3; and (iv) $0.53 in Tier 4.
---------------------------------------------------------------------------

    \20\ See supra note 16.
---------------------------------------------------------------------------

    Additionally, for a GEMX member taking liquidity in a Penny Pilot 
class on behalf of the account of a Priority Customer, GEMX assesses a 
fee of $0.48 in Tier 1; (ii) $0.47 in Tier 2; (iii) $0.47 in Tier 3; 
and (iv) $0.45 in Tier 4.\21\
---------------------------------------------------------------------------

    \21\ See id.
---------------------------------------------------------------------------

    The rebates proposed by the Exchange for Priority Customer complex 
transactions in Penny classes are also similar to those rebates paid by 
Nasdaq ISE, LLC (``Nasdaq ISE'') to its ``Priority Customers'' for 
``Priority Customer Complex Tier'' transactions in Nasdaq ISE ``Select 
Symbols.'' \22\ For example, for Priority Customer complex orders in 
Select Symbols, Nasdaq ISE will pay a rebate of (i) $0.25 in Tier 1; 
(ii) $0.30 in Tier 2; (iii) $0.35 in Tier 3; (iv) $0.40 in Tier 4; (v) 
$0.45 in Tier 5; (vi) $0.46 in Tier 6; (vii) $0.48 in Tier 7; and 
(viii) $0.50 in Tiers 8 and 9.\23\
---------------------------------------------------------------------------

    \22\ See Nasdaq ISE, Options 7 Pricing Schedule, Section 4 
Complex Order Fees and Rebates.
    \23\ See id.
---------------------------------------------------------------------------

    Additionally, for Priority Customer complex orders in Non-Select 
Symbols, Nasdaq ISE will pay a rebate of (i) $0.40 in Tier 1; (ii) 
$0.55 in Tier 2; (iii) $0.70 in Tier 3; (iv) $0.75 in Tier 4; (v) $0.80 
in Tiers 5, 6 and 7; and (vi) $0.85 in Tiers 8 and 9.\24\
---------------------------------------------------------------------------

    \24\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Priority Customer 
transactions in a PRIME/cPRIME auction are also similar to those 
assessed by GEMX for transactions on behalf of its Priority Customers 
for orders executed using GEMX's ``Price Improvement Mechanism'' 
(``PIM'') in both Penny and Non-Penny classes. For example, in both 
Penny and Non-Penny classes, GEMX members will be assessed a fee of (i) 
$0.00 for Priority Customer orders on the agency side; (ii) $0.05 per 
contract for Priority Customer orders on the contra-side; and (iii) 
$0.05 per contract for all Responses. The Exchange's fee structure for 
PRIME/cPRIME is similar to GEMX in that both of these structures do not 
have breakup credits and higher response fees for price improvement 
auctions.
MIAX Emerald Market Makers
    Transaction rebates/fees applicable to all Market Makers \25\ will 
be assessed according to the following sections of the tables:
---------------------------------------------------------------------------

    \25\ ``Market Maker'' means a Member registered with the 
Exchange for the purpose of making markets in options contracts 
traded on the Exchange. See the Definitions Section of the Fee 
Schedule and Exchange Rule 100.

                                        Members and Their Affiliates in Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Market Maker.....................        1      ($0.35)        $0.50           $0.10           $0.47        $0.50        $0.05        $0.05        $0.05
                                         2       (0.35)         0.50            0.10            0.47         0.50         0.05         0.05         0.05
                                         3       (0.35)         0.50            0.10            0.47         0.50         0.05         0.05         0.05
                                         4       (0.45)         0.48            0.10            0.47         0.50         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 11604]]

                                      Members and Their Affiliates in Non-Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer       Taker ~       Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Market Maker.....................        1      ($0.45)        $0.99           $0.20           $0.86        $0.88        $0.05        $0.05        $0.05
                                         2       (0.45)         0.99            0.20            0.86         0.88         0.05         0.05         0.05
                                         3       (0.45)         0.99            0.20            0.86         0.86         0.05         0.05         0.05
                                         4       (0.75)         0.94            0.20            0.86         0.86         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.

    The tiered Market Maker rebates/fees proposed by the Exchange are 
similar in structure to the transaction rebates and fees charged by 
GEMX to its market makers for simple orders and quotes. For example, 
for a market maker adding liquidity in a Penny Pilot class, GEMX pays a 
rebate of (i) $0.28 in Tier 1; (ii) $0.30 in Tier 2; (iii) $0.35 in 
Tier 3; and (iv) $0.45 in Tier 4.\26\
---------------------------------------------------------------------------

    \26\ See supra note 16.
---------------------------------------------------------------------------

    For a market maker adding liquidity in a Non-Penny Pilot class, 
GEMX pays a rebate of (i) $0.40 in Tier 1; (ii) $0.42 in Tier 2; (iii) 
$0.45 in Tier 3; and (iv) $0.75 in Tier 4.\27\
---------------------------------------------------------------------------

    \27\ See id.
---------------------------------------------------------------------------

    Additionally, for a market maker taking liquidity in a Penny Pilot 
class, GEMX assesses a fee of (i) $0.50 in Tier 1; (ii) $0.50 in Tier 
2; (iii) $0.50 in Tier 3; and (iv) $0.48 in Tier 4.\28\
---------------------------------------------------------------------------

    \28\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Market Maker complex 
transactions in Penny classes are also similar to those fees charged by 
Nasdaq ISE to its ``Market Makers'' for complex transactions in Nasdaq 
ISE Select Symbols. For example, for a Market Maker adding liquidity in 
a Select Symbol, Nasdaq ISE assesses a fee of (i) $0.10 when trading 
against Origins not Priority Customer; and (ii) a base $0.47 when 
trading against Priority Customers. Additionally, for a Market Maker 
taking liquidity in a Select Symbol, Nasdaq ISE assesses a base fee of 
$0.50.\29\
---------------------------------------------------------------------------

    \29\ See supra note 22.
---------------------------------------------------------------------------

    For a Market Maker adding liquidity in a Non-Select Symbol, Nasdaq 
ISE assesses a fee of (i) $0.20 when trading against Origins not 
Priority Customer; and (ii) $0.86 when trading against Priority 
Customers. Additionally, for a Market Maker taking liquidity in a Non-
Select Symbol, Nasdaq ISE assesses a fee of $0.86.\30\
---------------------------------------------------------------------------

    \30\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Market Maker transactions in 
a PRIME/cPRIME auction are also similar to those assessed by GEMX for 
transactions on behalf of its Market Makers for orders executed in a 
GEMX PIM auction in both Penny and Non-Penny classes. For example, in 
both Penny and Non-Penny classes, GEMX members will be assessed a fee 
of (i) $0.05 for Market Maker orders on the agency side; (ii) $0.05 per 
contract for Market Maker orders on the contra-side; and (iii) $0.05 
per contract for all Responses. The Exchange's fee structure for PRIME/
cPRIME is similar to GEMX in that both of these structures do not have 
breakup credits and higher responses for price improvement auctions.
Non-MIAX Emerald Market Makers
    Transaction rebates/fees applicable to all orders submitted by a 
Member for the account of a non-MIAX Emerald Market Maker will be 
assessed according to the following sections of the tables:

                                        Members and Their Affiliates in Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Non-MIAX Emerald Market Maker....        1      ($0.25)        $0.50           $0.20           $0.50        $0.50        $0.05        $0.05        $0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.48            0.20            0.50         0.50         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 11605]]

                                      Members and Their Affiliates in Non-Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer       Taker ~       Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Non-MIAX Emerald Market Maker....        1      ($0.25)        $0.99           $0.20           $0.88        $0.88        $0.05        $0.05        $0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.

    The tiered rebates/fees assessable to Non-MIAX Emerald Market 
Makers proposed by the Exchange for simple orders are also similar in 
structure to and in the range of the transaction rebates and fees 
charged by GEMX for transactions for the accounts of ``Non-Nasdaq GEMX 
Market Makers (FarMM).'' For example, for transactions on behalf of 
Non-Nasdaq GEMX Market Makers (FarMM) adding liquidity in a Penny Pilot 
class, GEMX pays a rebate of $0.25 in Tier 1.\31\
---------------------------------------------------------------------------

    \31\ See supra note 16.
---------------------------------------------------------------------------

    Additionally, for transactions on behalf of Non-Nasdaq GEMX Market 
Makers (FarMM) taking liquidity in a Penny Pilot class, GEMX assesses a 
fee of (i) $0.50 in Tier 1; (ii) $0.50 in Tier 2; (iii) $0.50 in Tier 
3; and (iv) $0.48 in Tier 4.\32\
---------------------------------------------------------------------------

    \32\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Non-MIAX Emerald Market Maker 
complex transactions in Penny classes are also similar to those fees 
charged by Nasdaq ISE to a ``Non-Nasdaq ISE Market Maker (FarMM)'' for 
complex transactions in Nasdaq ISE Select Symbols. For example, for a 
Non-Nasdaq ISE Market Maker (FarMM) adding liquidity in a Select 
Symbol, Nasdaq ISE assesses a fee of (i) $0.20 when trading against 
Origin not Priority Customer; and (ii) $0.48 when trading against 
Priority Customers.\33\ Additionally, for a Non-Nasdaq ISE Market Maker 
(FarMM) taking liquidity in a Select Symbol, Nasdaq ISE assesses a fee 
of $0.50.\34\
---------------------------------------------------------------------------

    \33\ See supra note 22.
    \34\ See id.
---------------------------------------------------------------------------

    For a Non-Nasdaq ISE Market Maker (FarMM) adding liquidity in a 
Non-Select Symbol, Nasdaq ISE assesses a fee of (i) $0.20 when trading 
against Origin not Priority Customer; and (ii) $0.88 when trading 
against Priority Customers.\35\ Additionally, for a Non-Nasdaq ISE 
Market Makers (FarMM) taking liquidity in a Non-Select Symbol, Nasdaq 
ISE assesses a fee of $0.88.\36\
---------------------------------------------------------------------------

    \35\ See id.
    \36\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Non-MIAX Emerald Market Maker 
transactions in a PRIME/cPRIME auction are also similar to those 
assessed by GEMX for transactions on behalf of its Non-Nasdaq GEMX 
Market Makers (FarMM) for orders executed in a GEMX PIM auction in both 
Penny and Non-Penny classes. For example, in both Penny and Non-Penny 
classes, GEMX members will be assessed a fee of (i) $0.05 for Non-
Nasdaq GEMX Market Maker (FarMM) orders on the agency side; (ii) $0.05 
per contract for Non-Nasdaq GEMX Market Maker (FarMM) orders on the 
contra-side; and (iii) $0.05 per contract for all Responses.\37\ The 
Exchange's fee structure for PRIME/cPRIME is similar to GEMX in that 
both of these structures do not have a breakup credits and higher 
responses for price improvement auction.
---------------------------------------------------------------------------

    \37\ See supra note 16.
---------------------------------------------------------------------------

Firm Proprietary/Broker-Dealer
    Transaction rebates/fees applicable to all orders submitted by a 
Member for the account of a Firm Proprietary or Broker-Dealer will be 
assessed according to the following sections of the tables:

                                        Members and Their Affiliates in Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Firm Proprietary/Broker-Dealer...        1      ($0.25)        $0.50           $0.20           $0.50        $0.50        $0.05        $0.05        $0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.49            0.20            0.50         0.50         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 11606]]

                                      Members and Their Affiliates in Non-Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker~       Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Firm Proprietary/Broker-Dealer...        1      ($0.25)        $0.99           $0.20           $0.88        $0.88        $0.05        $0.05        $0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.

    The tiered rebates/fees assessable to Firm Proprietary/Broker-
Dealers proposed by the Exchange for simple orders are also similar in 
structure to and in the range of the transaction rebates and fees 
charged by GEMX for transactions for the accounts of ``Firm 
Proprietary/Broker-Dealer.'' For example, for transactions on behalf of 
Firm Proprietary/Broker-Dealer adding liquidity in a Penny Pilot class, 
GEMX pays a rebate of $0.25 in Tier 1.\38\
---------------------------------------------------------------------------

    \38\ See supra note 16.
---------------------------------------------------------------------------

    Additionally, for transactions on behalf of Firm Proprietary/
Broker-Dealer taking liquidity in a Penny Pilot class, GEMX assesses a 
fee of (i) $0.50 in Tier 1; (ii) $0.50 in Tier 2; (iii) $0.50 in Tier 
3; and (iv) $0.49 in Tier 4.\39\
---------------------------------------------------------------------------

    \39\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Firm Proprietary/Broker-
Dealer complex transactions in Penny classes are also similar to those 
fees charged by Nasdaq ISE to ``Firm Proprietary/Broker-Dealer'' order 
for complex transactions in Nasdaq ISE Select Symbols. For example, for 
a Firm Proprietary/Broker-Dealer adding liquidity in a Select Symbol, 
Nasdaq ISE assesses a fee of (i) $0.10 when trading against Origin not 
Priority Customer; and (ii) $0.48 when trading against Priority 
Customers.\40\ Additionally, for a Firm Proprietary/Broker-Dealer 
taking liquidity in a Select Symbol, Nasdaq ISE assesses a fee of 
$0.50.\41\
---------------------------------------------------------------------------

    \40\ See supra note 22.
    \41\ See id.
---------------------------------------------------------------------------

    For a Firm Proprietary/Broker-Dealer adding liquidity in a Non-
Select Symbol, Nasdaq ISE assesses a fee of (i) $0.20 when trading 
against Origin not Priority Customer; and (ii) $0.88 when trading 
against Priority Customers.\42\ Additionally, for a Firm Proprietary/
Broker-Dealer taking liquidity in a Non-Select Symbol, Nasdaq ISE 
assesses a fee of $0.88.\43\
---------------------------------------------------------------------------

    \42\ See id.
    \43\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Firm Proprietary/Broker-
Dealer transactions in a PRIME/cPRIME auction are also similar to those 
assessed by GEMX for transactions on behalf of its Firm Proprietary/
Broker-Dealer orders executed in a GEMX PIM auction in both Penny and 
Non-Penny classes. For example, in both Penny and Non-Penny classes, 
GEMX members will be assessed a fee of (i) $0.05 for Firm Proprietary/
Broker-Dealer orders on the agency side; (ii) $0.05 per contract for 
Firm Proprietary/Broker-Dealer orders on the contra-side; and (iii) 
$0.05 per contract for all Responses. The Exchange's fee structure for 
PRIME/cPRIME is similar to GEMX in that both of these structures do not 
have a breakup credit or higher response fees for price improvement 
auctions.
Non-Priority Customers
    Transaction rebates/fees applicable to all orders submitted by a 
Member for the account of a non-Priority Customers will be assessed 
according to the following sections of the tables:

                                        Members and Their Affiliates in Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker        Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Non-Priority Customer............        1      ($0.25)        $0.50           $0.20           $0.50        $0.50        $0.05        $0.05        $0.05
                                         2       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         3       (0.25)         0.50            0.20            0.50         0.50         0.05         0.05         0.05
                                         4       (0.25)         0.49            0.20            0.50         0.50         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------

                                      Members and Their Affiliates in Non-Penny Classes Simple/Complex/PRIME/cPRIME
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     Simple                            Complex #                             PRIME/cPRIME[loz]
                                           -------------------------------------------------------------------------------------------------------------
                                                                       Maker (Contra   Maker (Contra
              Origin                 Tier                   Taker       Origins ex       Priority
                                               Maker      [supcaret]     Priority        Customer        Taker~       Agency       Contra     Responder
                                                                         Customer)        Origin)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Non-Priority Customer............        1      ($0.25)        $0.99           $0.20           $0.88        $0.88        $0.05        $0.05        $0.05
                                         2       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05
                                         3       (0.25)         0.99            0.20            0.88         0.88         0.05         0.05         0.05

[[Page 11607]]

 
                                         4       (0.25)         0.94            0.20            0.88         0.88         0.05         0.05         0.05
--------------------------------------------------------------------------------------------------------------------------------------------------------
[supcaret] Contra to Priority Customer Simple Orders, Origins ex Priority Customer Simple Orders will be charged $0.50 and Priority Customer Simple
  Orders will be charged $0.49 in Penny classes, and Origins ex Priority Customer Simple Orders will be charged $1.10 and Priority Customer Simple
  Orders will be charged $0.85 in Non-Penny classes.
~ A $0.05 Complex surcharge for Origins ex Priority Customer for Complex Orders that take liquidity from the Complex Order Book in Non-Penny classes.
# For orders in a Complex Auction, Priority Customer Complex Orders will receive the Complex Taker rebate based on the tier achieved when contra to an
  Origin that is not a Priority Customer. Origins that are not a Priority Customer will be charged the applicable Maker fee depending on the contra,
  based on the tier achieved.
[loz] For PRIME and cPRIME, the per contract rebate or fee for the preexisting contra-side interest that trades with the Agency side will be waived.
  PRIME/cPRIME Responder side interest that trades with unrelated Agency side interest trades as Taker will be subject to Simple or Complex rates, as
  applicable.

    The tiered rebates/fees assessable to Non-Priority Customers 
proposed by the Exchange are also similar in structure to and in the 
range of the transaction rebates and fees for simple orders charged by 
GEMX for transactions for the accounts of ``Professional Customers.''
    For example, for transactions on behalf of Professional Customers 
adding liquidity in a Penny Pilot class, GEMX pays a rebate of $0.25 in 
Tier 1.\44\
---------------------------------------------------------------------------

    \44\ See supra note 16.
---------------------------------------------------------------------------

    Additionally, for transactions on behalf of Professional Customers 
taking liquidity in a Penny Pilot class, GEMX assesses a fee of (i) 
$0.50 in Tier 1; (ii) $0.50 in Tier 2; (iii) $0.50 in Tier 3; and (iv) 
$0.49 in Tier 4.\45\
---------------------------------------------------------------------------

    \45\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Non-Priority Customer complex 
transactions in Penny classes are also similar to those fees charged by 
Nasdaq ISE for ``Professional Customers'' for complex transactions in 
Nasdaq ISE Select Symbols. For example, for a Professional Customer 
adding liquidity in a Select Symbol, Nasdaq ISE assesses a fee of (i) 
$0.10 when trading against non-Priority Customers; and (ii) $0.48 when 
trading against Priority Customers.\46\ Additionally, for a 
Professional Customer taking liquidity in a Select Symbol, Nasdaq ISE 
assesses a fee of $0.50.\47\
---------------------------------------------------------------------------

    \46\ See supra note 22.
    \47\ See id.
---------------------------------------------------------------------------

    For a Professional Customer adding liquidity in a Non-Select 
Symbol, Nasdaq ISE assesses a fee of (i) $0.20 when trading against 
non-Priority Customers; and (ii) $0.88 when trading against Priority 
Customers.\48\ Additionally, for a Professional Customer taking 
liquidity in a Non-Select Symbol, Nasdaq ISE assesses a fee of 
$0.88.\49\
---------------------------------------------------------------------------

    \48\ See id.
    \49\ See id.
---------------------------------------------------------------------------

    The fees proposed by the Exchange for Non-Priority Customer 
transactions in a PRIME/cPRIME auction are also similar to those 
assessed by GEMX for transactions on behalf of its Professional 
Customer orders executed in a GEMX PIM auction in both Penny and Non-
Penny classes. For example, in both Penny and Non-Penny classes, GEMX 
members will be assessed a fee of (i) $0.05 for Professional Customer 
orders on the agency side; (ii) $0.05 per contract for Professional 
Customer orders on the contra-side; and (iii) $0.05 per contract for 
all Responses. The Exchange's fee structure for PRIME/cPRIME is similar 
to GEMX in that both of these structures do not have a breakup credit 
and higher responses fees for price improvement auctions.
QCC Fees
    The Exchange proposes to adopt new Section (1)(a)iii of the Fee 
Schedule to establish transaction fees and rebates for QCC Orders:

----------------------------------------------------------------------------------------------------------------
                                                                                     QCC Order
                                                                 -----------------------------------------------
                  Types of market participants                     Per contract    Per contract    Per contract
                                                                      fee for         fee for       rebate for
                                                                     initiator      contraside       initiator
----------------------------------------------------------------------------------------------------------------
Priority Customer...............................................           $0.00           $0.00         ($0.10)
Public Customer that is Not a Priority Customer.................            0.15            0.15          (0.10)
MIAX Emerald Market Maker.......................................            0.15            0.15          (0.10)
Non-MIAX Emerald Market Maker...................................            0.15            0.15          (0.10)
Non-Member Broker-Dealer........................................            0.15            0.15          (0.10)
Firm............................................................            0.15            0.15          (0.10)
----------------------------------------------------------------------------------------------------------------
Rebates will be delivered to the Member that enters the order into the MIAX Emerald system, but will only be
  paid on the initiating side of the QCC transaction. However, no rebates will be paid for QCC transactions for
  which both the initiator and contra-side orders are Priority Customers. A QCC transaction is comprised of an
  `initiating order' to buy (sell) at least 1,000 contracts coupled with a contra-side order to sell (buy) an
  equal number of contracts.

    A QCC Order is comprised of an order to buy or sell at least 1,000 
contracts that is identified as being part of a qualified contingent 
trade, coupled with a contra side order to buy or sell an equal number 
of contracts.\50\ The Exchange proposes to establish a transaction fee 
for all Origins other than Priority Customer QCC Orders of $0.15 per 
contract side (Priority Customer orders will not be assessed a charge). 
In addition, the Exchange proposes to adopt a $0.10 per contract rebate 
for the initiating order side, regardless of Origin code. The Exchange 
proposes to explicitly provide in the Fee Schedule that the rebate will 
be assessed to the Member that enters the order into the

[[Page 11608]]

System, but will only be assessed on the initiating side of the QCC 
transaction. However, no rebates will be assessed for QCC transactions 
in which both the initiator and contra-side are Priority Customers.
---------------------------------------------------------------------------

    \50\ A Qualified Contingent Cross Order is comprised of an 
originating order to buy or sell at least 1,000 contracts, or 10,000 
mini-option contracts, that is identified as being part of a 
qualified contingent trade, as that term is defined in 
Interpretation and Policy .01 to Rule 516, coupled with a contra-
side order or orders totaling an equal number of contracts. See 
Exchange Rule 516(j).
---------------------------------------------------------------------------

    Additionally, the Exchange proposes to state explicitly in the Fee 
Schedule that a QCC transaction is comprised of an `initiating order' 
to buy (sell) at least 1,000 contracts, coupled with a contra-side 
order to sell (buy) an equal number of contracts. The Exchange notes 
that with regard to order entry, the first order submitted into the 
system is marked as the initiating side and the second order is marked 
as the contra side. The purpose of this proposed fee is to incentivize 
the sending of QCC Orders to the Exchange. The Exchange notes that 
other competing exchanges similarly provide rebates on QCC initiating 
orders.\51\
---------------------------------------------------------------------------

    \51\ See Cboe Exchange, Inc. Fees, Pg. 5, QCC Rate Table, Nasdaq 
ISE, Options 7 Pricing Schedule, Section 6, Other Options Fees and 
Rebates.
---------------------------------------------------------------------------

cQCC Fees
    The Exchange proposes to adopt new Section (1)(a)iv of the Fee 
Schedule to establish transaction fees and rebates for cQCC \52\ 
Orders, which are identical to transaction fees and rebates that the 
Exchange proposes to charge for simple QCC Orders:
---------------------------------------------------------------------------

    \52\ A Complex Qualified Contingent Cross or ``cQCC'' Order is 
comprised of an originating complex order to buy or sell where each 
component is at least 1,000 contracts that is identified as being 
part of a qualified contingent trade, as defined in Rule 516, 
Interpretation and Policy .01, coupled with a contra-side complex 
order or orders totaling an equal number of contracts. Trading of 
cQCC Orders is governed by Rule 515(h)(4). See Exchange Rule 
518(b)(6).

----------------------------------------------------------------------------------------------------------------
                                                                                     QCC Order
                                                                 -----------------------------------------------
                  Types of market participants                     Per contract    Per contract    Per contract
                                                                      fee for     fee for contra-   rebate for
                                                                     initiator         side          initiator
----------------------------------------------------------------------------------------------------------------
Priority Customer...............................................           $0.00           $0.00         ($0.10)
Public Customer that is Not a Priority Customer.................            0.15            0.15          (0.10)
MIAX Emerald Market Maker.......................................            0.15            0.15          (0.10)
Non-MIAX Emerald Market Maker...................................            0.15            0.15          (0.10)
Non-Member Broker-Dealer........................................            0.15            0.15          (0.10)
Firm............................................................            0.15            0.15          (0.10)
----------------------------------------------------------------------------------------------------------------
All fees and rebates are per contract per leg. Rebates will be delivered to the Member that enters the order
  into the MIAX Emerald system, but will only be paid on the initiating side of the cQCC transaction. However,
  no rebates will be paid for cQCC transactions for which both the initiator and contra-side orders are Priority
  Customers. A cQCC transaction is comprised of an `initiating complex order' to buy (sell) where each component
  is at least 1,000 contracts that is identified as being part of a qualified contingent trade, coupled with a
  contra-side complex order or orders to sell (buy) an equal number of contracts.

    This cQCC Fee table (including the amounts therein) is identical to 
the QCC Fee table (including the amounts therein), which is contained 
in Section (1)(a)(iii) of the Fee Schedule.
    The Exchange also proposes to adopt certain explanatory text 
relating to the cQCC Fee table, just as the Exchange currently has 
relating to the simple QCC Fee table. The text provides that all fees 
and rebates are per contract per leg. Also, rebates will be delivered 
to the Member that enters the order into the MIAX Emerald system, but 
will only be assessed on the initiating side of the cQCC transaction. 
However, no rebates will be assessed for cQCC transactions for which 
both the initiator and contra-side are Priority Customers. A cQCC 
transaction is comprised of an `initiating complex order' to buy (sell) 
where each component is at least 1,000 contracts that is identified as 
being part of a qualified contingent trade, coupled with a contra-side 
complex order or orders to sell (buy) an equal number of contracts.
C2C and cC2C Fees
    The Exchange proposes to adopt new Section (1)(a)(v), C2C \53\ and 
cC2C \54\ Fees, to the Fee Schedule to clarify and establish 
transaction fees and rebates for C2C Orders and cC2C Orders.
---------------------------------------------------------------------------

    \53\ A C2C Order is comprised of a Priority Customer Order to 
buy and a Priority Customer Order to sell at the same price and for 
the same quantity. See the Transaction Fees Section of the Fee 
Schedule.
    \54\ A Complex Customer Cross or ``cC2C'' Order is comprised of 
one Priority Customer complex order to buy and one Priority Customer 
complex order to sell at the same price and for the same quantity. 
Trading of cC2C Orders is governed by Rule 515(h)(3). See Exchange 
Rule 518(b)(5).

------------------------------------------------------------------------
                                                           C2C and cC2C
                                                            Order per
              Types of market participants                contract fee/
                                                              rebate
------------------------------------------------------------------------
Priority Customer......................................           $0.00
------------------------------------------------------------------------

    The Exchange notes that it proposes to offer trading in C2C 
Orders.\55\ Because C2C Orders are comprised entirely of Priority 
Customer orders, the Exchange proposes to assess a $0.00 per contract 
transaction fee and a $0.00 rebate to such orders. However, the 
Exchange desires to clarify and make explicit that C2C Orders will be 
assessed a $0.00 per contract transaction fee and assessed a $0.00 per 
contract rebate. The Exchange is also proposing to assess cC2C Orders a 
$0.00 per contract transaction fee and to pay a $0.00 per contract 
rebate.
---------------------------------------------------------------------------

    \55\ See Exchange Rule 516(i).
---------------------------------------------------------------------------

    The Exchange also proposes to adopt certain explanatory text 
relating to the C2C and cC2C Fee table. The text provides that all fees 
and rebates are per contract per leg. Also, a C2C Order is comprised of 
a Priority Customer Order to buy and a Priority Customer Order to sell 
at the same price and for the same quantity. A cC2C Order is comprised 
of one Priority Customer complex order to buy and one Priority Customer 
complex order to sell at the same price and for the same quantity.
Routing Fees
    MIAX Emerald proposes to assess Routing Fees in order to recoup 
costs incurred by MIAX Emerald when routing orders to various away 
markets. The amount of the applicable fee, is based upon (i) the Origin 
type of the order, (ii) whether or not it is an order for an option in 
a Penny or Non-Penny class (or other explicitly identified classes) and 
(iii) to which away market it is being routed, according to the 
following table: \56\
---------------------------------------------------------------------------

    \56\ This is similar to the methodologies utilized by the 
Exchange's affiliates, MIAX and MIAX PEARL, and by Cboe BZX Options 
in assessing Routing Fees. See MIAX Fee Schedule, Section (1)(c), 
Fees for Customer Orders Routed to Another Options Exchange, MIAX 
PEARL Fee Schedule, Section (1)(b), Fees for Customer Orders Routed 
to Another Options Exchange, and Cboe BZX Fee Schedule under ``Fee 
Codes and Associated Fees''.

[[Page 11609]]

------------------------------------------------------------------------
                       Description                             Fees
------------------------------------------------------------------------
Routed, Priority Customer, Penny Pilot, to: NYSE                   $0.15
 American, BOX, Cboe, Cboe EDGX Options, MIAX Options,
 Nasdaq MRX, Nasdaq PHLX (except SPY), Nasdaq BX Options
Routed, Priority Customer, Penny Pilot, to: NYSE Arca               0.65
 Options, Cboe BZX Options, Cboe C2, Nasdaq GEMX, Nasdaq
 ISE, NOM, Nasdaq PHLX (SPY only), MIAX PEARL...........
Routed, Priority Customer, Non-Penny Pilot, to: NYSE                0.15
 American, BOX, Cboe, Cboe EDGX Options, MIAX Options,
 Nasdaq ISE, Nasdaq MRX, Nasdaq PHLX, Nasdaq BX Options.
Routed, Priority Customer, Non-Penny Pilot, to: NYSE                1.00
 Arca Options, Cboe BZX Options, Cboe C2, MIAX PEARL,
 Nasdaq GEMX, NOM.......................................
Routed, Public Customer that is not a Priority Customer,            0.65
 Penny Pilot, to: NYSE American, NYSE Arca Options, Cboe
 BZX Options, BOX, Cboe, Cboe C2, Cboe EDGX Options,
 Nasdaq GEMX, Nasdaq ISE, Nasdaq MRX, MIAX Options, MIAX
 PEARL, NOM, Nasdaq PHLX, Nasdaq BX Options.............
Routed, Public Customer that is not a Priority Customer,            1.00
 Non-Penny Pilot, to: MIAX Options, NYSE American, Cboe,
 Nasdaq PHLX, Nasdaq ISE, Cboe EDGX Options.............
Routed, Public Customer that is not a Priority Customer,            1.15
 Non-Penny Pilot, to: Cboe C2, BOX, Nasdaq MRX, Nasdaq
 BX Options, NOM, MIAX PEARL............................
Routed, Public Customer that is not a Priority Customer,            1.25
 Non-Penny Pilot, to: Cboe BZX Options, NYSE Arca
 Options, Nasdaq GEMX...................................
------------------------------------------------------------------------

    In determining its proposed Routing Fees, the Exchange took into 
account transaction fees and rebates assessed by the away markets to 
which the Exchange routes orders, as well as the Exchange's clearing 
costs,\57\ administrative, regulatory, and technical costs associated 
with routing orders to an away market. The Exchange uses unaffiliated 
routing brokers to route orders to the away markets; the costs 
associated with the use of these services are included in the Routing 
Fees specified in the Fee Schedule. This Routing Fees structure is not 
only similar to the Exchange's affiliates, Miami International 
Securities Exchange LLC (``MIAX'') and MIAX PEARL, LLC (``MIAX 
PEARL''), but is also comparable to the structures in place at other 
exchanges, such as Cboe BZX Options.\58\ The Cboe BZX fee schedule has 
exchange groupings, whereby several exchanges are grouped into the same 
category, dependent on the order's Origin type and whether it is a 
Penny or Non-Penny Pilot class. For example, Cboe BZX fee code RQ 
covers routed customer orders in Penny classes to NYSE Arca Options, 
Cboe C2, Nasdaq ISE, Nasdaq GEMX, MIAX PEARL or NOM, with a single fee 
of $0.85 per contract. The Exchange is proposing a similar structure, 
however its structure is more granular and thus contains more exchange 
groupings. The Exchange is proposing to have 8 different exchange 
groupings, based on the exchange, order type, and option class. The 
Exchange believes that having more groupings will offer the Exchange to 
better approximate its costs associated with routing orders to away 
markets. The per-contract transaction fee amount associated with each 
grouping closely approximates the Exchange's all-in cost (plus an 
additional, non-material amount) to execute that corresponding contract 
at that corresponding exchange. For example, to execute a Priority 
Customer order in a Penny Pilot symbol at NYSE American costs the 
Exchange approximately $0.15 a contract. Since this is also the 
approximate cost to execute that same order at BOX, the Exchange is 
able to group NYSE American and BOX together in the same grouping. The 
Exchange notes that in determining the appropriate groupings, the 
Exchange considered the transaction fees and rebates assessed by away 
markets, and grouped exchanges together that assess transaction fees 
for routed orders within a similar range. This same logic and structure 
applies to all of the groupings in the proposed Routing Fees table. By 
utilizing the same structure that is utilized by the Exchange's 
affiliates, MIAX and MIAX PEARL, those Members which are Members of the 
Exchange, MIAX, and MIAX PEARL, will be assessed Routing Fees in the 
same manner, which the Exchange believes will minimize any confusion as 
to the method of assessing Routing Fees between the three exchanges for 
those Members. This proposal is identical to the structure of the 
routing fee tables of the Exchange's affiliates, MIAX and MIAX 
PEARL.\59\
---------------------------------------------------------------------------

    \57\ The OCC amended its clearing fee from $0.01 per contract 
side to $0.02 per contract side. See Securities Exchange Act Release 
No. 71769 (March 21, 2014), 79 FR 17214 (March 27, 2014) (SR-OCC-
2014-05).
    \58\ See supra note 56.
    \59\ See SR-MIAX-2019-08 and SR-PEARL-2019-06 filed on February 
28, 2019 to conform the routing fee structures of MIAX and MIAX 
PEARL.
---------------------------------------------------------------------------

Regulatory Fees
Sales Value Fee
    The Sales Value Fee \60\ is proposed to be assessed by the Exchange 
to each Member for sales on the Exchange with respect to which the 
Exchange is obligated to pay a fee to the United States Securities and 
Exchange Commission (``Commission'') pursuant to Section 31 of the 
Exchange Act. The Sales Value Fee is equal to the Section 31 fee rate 
multiplied by the Member's aggregate dollar amount of covered sales 
resulting from options transactions occurring on the Exchange during 
any computational period. The Section 31 fee rate is set annually by 
the Commission. To the extent there may be any excess monies collected 
under this rule, the Exchange may retain those monies to help fund 
general operating expenses. The sales transactions to which the fee 
applies are sales of options (other than options on a security index) 
and the sales of securities resulting from the exercise of physical-
delivery options. The fee is collected indirectly from Members through 
their clearing firms by the OCC on behalf of MIAX Emerald with respect 
to option sales and options exercises. The Sales Value fee proposed by 
the Exchange is identical to the fee assessed by other exchanges, 
including the Exchange's affiliates MIAX and MIAX PEARL.\61\
---------------------------------------------------------------------------

    \60\ See Exchange Rule 1207.
    \61\ See MIAX Fee Schedule, Section (2)(a), Sales Value Fee and 
MIAX PEARL Fee Schedule, Section (2)(a), Sales Value Fee.
---------------------------------------------------------------------------

Web CRD \62\ Fees
---------------------------------------------------------------------------

    \62\ FINRA operates the Web Central Registration Depository 
(CRD[supreg]), the central licensing and registration system for the 
U.S. securities industry and its regulators. It contains the 
registration records of more than 6,800 registered broker-dealers 
and the qualification, employment, and disclosure histories of more 
than 660,000 active registered individuals.
---------------------------------------------------------------------------

    Financial Industry Regulatory Authority (``FINRA''), through the 
Web CRD\SM\ registration system for the registration of associated 
persons of Electronic Exchange Member and Market Maker organizations 
that are not also FINRA members, collects from those MIAX Emerald 
Members general

[[Page 11610]]

registration fees and fingerprint processing fees. The Fee Schedule 
sets forth the Web CRD Fees FINRA is currently charging. The Web CRD 
fees proposed by the Exchange are similar to those assessed by other 
exchanges and identical to the same fees assessed by MIAX and MIAX 
PEARL.\63\
---------------------------------------------------------------------------

    \63\ See MIAX Fee Schedule, Section (2)(c), Web CRD Fees and 
MIAX PEARL Fee Schedule, Section (2)(c), Web CRD Fees.
---------------------------------------------------------------------------

Non-Transaction Fees
    The Exchange proposes to establish certain non-transaction fees, 
including membership, testing, system connectivity and market data 
fees, applicable to Members and non-Members using services provided by 
MIAX Emerald.
Membership Fees
    MIAX Emerald proposes to assess Membership fees for Applications 
and Trading Permits.
Application for MIAX Emerald Membership
    A one-time application fee based upon the applicant's status as 
either an Electronic Exchange Member (``EEM'') or as a Market Maker 
will be assessed by MIAX Emerald. The Exchange proposes to assess the 
one-time application fee on the earlier of (i) the date the applicant 
is certified in the Exchange's membership system or (ii) once an 
application for MIAX Emerald membership is finally denied. MIAX Emerald 
proposes that the one-time application fee for membership will be 
waived for a period of time, which the Exchange has defined in the Fee 
Schedule as the Waiver Period,\64\ for both EEMs and Market Makers. 
MIAX Emerald believes that this will provide incentive for potential 
applicants to submit early applications, which should result in 
increasing potential order flow and liquidity as MIAX Emerald begins 
trading. The Exchange will submit a rule filing to the Commission to 
establish the fee amount and any related requirements, and provide 
notice to expire the applicable Waiver Period. Even though the Exchange 
is proposing to waive this particular fee during the Waiver Period, the 
Exchange believes that is appropriate to provide market participants 
with the overall structure of the fee by outlining the structure on the 
Fee Schedule without setting forth a specific fee amount, so that there 
is general awareness that the Exchange intends to assess such a fee in 
the future, should the Waiver Period terminate and the Exchange 
establish an applicable fee. The Exchange believes that its proposal to 
waive this fee under this waiver structure is reasonable because this 
waiver structure is identical to the waiver structure that is currently 
in place at the Exchange's affiliate, MIAX PEARL.\65\
---------------------------------------------------------------------------

    \64\ ``Waiver Period'' means, for each applicable fee, the 
period of time from the initial effective date of the MIAX Emerald 
Fee Schedule until such time that the Exchange has an effective fee 
filing establishing the applicable fee. The Exchange will issue a 
Regulatory Circular announcing the establishment of an applicable 
fee that was subject to a Waiver Period at least fifteen (15) days 
prior to the termination of the Waiver Period and effective date of 
any such applicable fee. See the Definitions Section of the Fee 
Schedule.
    \65\ See Securities Exchange Act Release No. 80061(February 17, 
2017), 82 FR 11676 (February 24, 2017) (SR-PEARL-2017-10) (Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To 
Establish the MIAX PEARL Fee Schedule). MIAX PEARL introduced the 
structure of certain non-transaction rebates and fees (without 
proposing actual fee amounts), but also explicitly waived the 
assessment of any such fees for the period of time which MIAX PEARL 
defined as the ``Waiver Period''.
---------------------------------------------------------------------------

Trading Permits
    MIAX Emerald proposes to issue Trading Permits that confer the 
ability to transact on MIAX Emerald. Trading Permits will be issued to 
EEMs and Market Makers. Members receiving Trading Permits during a 
particular calendar month will be assessed monthly Trading Permit Fees 
as shall be set forth in the Fee Schedule. The Exchange notes that the 
Exchange's affiliates, MIAX and MIAX PEARL, charge trading permit fees 
as well, and the Exchange's proposed structure for its Trading Permit 
fees is based on the structure of MIAX, particularly as it relates to 
EEMs.\66\ For the calculation of the monthly Trading Permit Fee as it 
relates to EEMs, Monthly Trading Fees will be assessed with respect to 
EEMs (other than Clearing Firms) in any month the EEM is certified in 
the membership system and the EEM is credentialed to use one or more 
FIX Ports in the production environment. Further, the Exchange proposes 
that Monthly Trading Permit Fees will be assessed with respect to EEM 
Clearing Firms in any month the Clearing Firm is certified in the 
membership system to clear transactions on the Exchange. The Exchange 
proposes that Monthly Trading Permit Fees will be assessed with respect 
to Market Makers in any month the Market Maker is certified in the 
membership system, is credentialed to use one or more MIAX Emerald 
Express Interface (``MEI'') Ports in the production environment and is 
assigned to quote in one or more classes.
---------------------------------------------------------------------------

    \66\ See MIAX Fee Schedule, Section (3) (b), Monthly Trading 
Permit Fee and MIAX PEARL Fee Schedule, Section (3) (b), Monthly 
Trading Permit Fee.
---------------------------------------------------------------------------

    For the calculation of the monthly Trading Permit Fees that apply 
to Market Makers, the number of classes is defined as the greatest 
number of classes the Market Maker was assigned to quote in on any 
given day within the calendar month and the class volume percentage is 
based on the total national average daily volume in classes listed on 
MIAX Emerald in the prior calendar quarter. Newly listed option classes 
are excluded from the calculation of the monthly Market Maker Trading 
Permit Fee until the calendar quarter following their listing, at which 
time the newly listed option classes will be included in both the per 
class count and the percentage of total national average daily volume. 
The Exchange will assess Market Makers the monthly Trading Permit Fee 
based on the greatest number of classes listed on MIAX Emerald that the 
Market Maker was assigned to quote in on any given day within a 
calendar month and the applicable fee rate that is the lesser of either 
the per class basis or percentage of total national average daily 
volume measurement. The calculation of the Trading Permit Fee for the 
first month in which the Trading Permit is issued will be pro-rated 
based on the number of trading days on which the Trading Permit was in 
effect divided by the total number of trading days in that month 
multiplied by the monthly rate.
    The monthly Trading Permit Fees assessable to EEMs and Market 
Makers are being waived by the Exchange for the Waiver Period. The 
Exchange will submit a rule filing to the Commission to establish the 
fee amount and any related requirements, and provide notice to 
terminate the applicable Waiver Period. Even though the Exchange is 
proposing to waive this particular fee during the Waiver Period, the 
Exchange believes that is appropriate to provide market participants 
with the overall structure of the fee by outlining the structure on the 
Fee Schedule without setting forth a specific fee amount, so that there 
is general awareness that the Exchange intends to assess such a fee in 
the future, should the Waiver Period terminate and the Exchange 
establish an applicable fee. The Exchange believes that its proposal to 
waive this fee under this waiver structure is reasonable because this 
waiver structure is identical to the waiver structure that was 
previously in place at the Exchange's affiliate, MIAX PEARL.\67\
---------------------------------------------------------------------------

    \67\ See supra note 65.
---------------------------------------------------------------------------

    Testing and Certification Fees
    API Testing and Certification Fee for Members

[[Page 11611]]

    MIAX Emerald proposes to assess an Application Programming 
Interface (``API'') testing and certification fee on all Members 
depending upon the type of interface being tested. An API makes it 
possible for Member software to communicate with MIAX Emerald software 
applications, and is subject to Member testing with, and certification 
by, MIAX Emerald. The Exchange proposes to offer four types of 
interfaces: (i) The Financial Information Exchange (``FIX'') Port,\68\ 
which allows Members to electronically send orders in all products 
traded on the Exchange; (ii) the MEI Port, which allows Market Makers 
to submit electronic orders and quotes to the Exchange; (iii) the 
Clearing Trade Drop (``CTD'') Port,\69\ which provides real-time trade 
clearing information to the participants to a trade on MIAX Emerald and 
to the participants' respective clearing firms; and (iv) FIX Drop Copy 
(``FXD'') Port \70\, which provides a copy of real-time trade 
execution, correction and cancellation information through a FIX Port 
to any number of FIX Ports designated by an EEM to receive such 
messages.
---------------------------------------------------------------------------

    \68\ ``FIX Port'' means an interface with MIAX Emerald systems 
that enables the Port user to submit simple and complex orders 
electronically to MIAX Emerald. See the Definitions Section of the 
Fee Schedule.
    \69\ ``CTD Port'' or ``Clearing Trade Drop Port'' provides an 
Exchange Member with a real-time clearing trade updates. The updates 
include the Member's clearing trade messages on a low latency, real-
time basis. The trade messages are routed to a Member's connection 
containing certain information. The information includes, among 
other things, the following: (i) Trade date and time; (ii) symbol 
information; (iii) trade price/size information; (iv) Member type 
(for example, and without limitation, Market Maker, Electronic 
Exchange Member, Broker-Dealer); and (v) Exchange MPID for each side 
of the transaction, including Clearing Member MPID. See the 
Definitions Section of the Fee Schedule.
    \70\ ``FXD Port'' or ``FIX Drop Copy Port'' means a messaging 
interface that provides a copy of real-time trade execution, trade 
correction and trade cancellation information to FIX Drop Copy Port 
users who subscribe to the service. FXD Port users are those users 
who are designated by an EEM to receive the information and the 
information is restricted for use by the EEM.
---------------------------------------------------------------------------

    API Testing and Certification Fees will be assessed (i) initially 
per API for FIX, FXD and CTD in the month the EEM has been credentialed 
to use one or more ports in the production environment for the tested 
API, and (ii) each time an EEM initiates a change to its system that 
requires testing and certification. API Testing and Certification Fees 
will not be assessed in situations where the Exchange initiates a 
mandatory change to the Exchange's system that requires testing and 
certification. The fees represent costs incurred by the Exchange as it 
works with each Member for testing and certifying that the Member's 
software systems communicate properly with MIAX Emerald's interfaces. 
MIAX Emerald has set a one-time fee so that MIAX Emerald Members will 
know the full cost for the service prior to beginning to use such 
services and thereby be more cost effective to the Members.
    API Testing and Certification Fees for EEM Clearing Firms will be 
assessed (i) initially per API in the month the EEM Clearing Firm has 
been credentialed to use one or more CTD Ports in the production 
environment, and (ii) each time an EEM Clearing Firm initiates a change 
to its system that requires testing and certification.
    API Testing and Certification Fees for Market Makers will be 
assessed (i) initially per API for CTD and MEI in the month the Market 
Maker has been credentialed to use one or more ports in the production 
environment for the tested API and the Market Maker has been assigned 
to quote in one or more classes, and (ii) each time a Market Maker 
initiates a change to its system that requires testing and 
certification.
    In order to provide an incentive to prospective Members to apply 
early for membership and to engage in API testing and certification 
such that they will be able to trade options on MIAX Emerald as soon as 
possible, API Testing and Certification fees assessable to Members will 
be waived by the Exchange for all interfaces for the Waiver Period. The 
Exchange will submit a rule filing to the Commission to establish the 
fee amount and any related requirements, and provide notice to 
terminate the applicable Waiver Period. Even though the Exchange is 
proposing to waive this particular fee during the Waiver Period, the 
Exchange believes that is appropriate to provide market participants 
with the overall structure of the fee by outlining the structure on the 
Fee Schedule without setting forth a specific fee amount, so that there 
is general awareness that the Exchange intends to assess such a fee in 
the future, should the Waiver Period terminate and the Exchange 
establish an applicable fee. The Exchange believes that its proposal to 
waive this fee under this waiver structure is reasonable because this 
waiver structure is identical to the waiver structure that is currently 
in place at the Exchange's affiliate, MIAX PEARL.\71\
---------------------------------------------------------------------------

    \71\ See supra note 65.
---------------------------------------------------------------------------

API Testing and Certification Fee for Non-Members
    MIAX Emerald proposes to assess a one-time API Testing and 
Certification fee per interface on third-party vendors, Service Bureaus 
and other non-Members whose software interfaces with MIAX Emerald 
software. As with Members, an API makes it possible for the software of 
third-party vendors, Service Bureaus and other non-Members to 
communicate with MIAX Emerald software applications, and is subject to 
testing with, and certification by, MIAX Emerald. API Testing and 
Certification Fees will be assessed (i) initially per API for FIX, FXD, 
CTD and MEI in the month the non-Member has been credentialed to use 
one or more ports in the production environment for the tested API, and 
(ii) each time a Third Party Vendor, Service Bureau or other non-Member 
initiates a mandatory change to its system that requires testing and 
certification. API Testing and Certification Fees will not be assessed 
in situations where the Exchange initiates a mandatory change to the 
Exchange's system that requires testing and certification.
    Other exchanges, including Nasdaq PHLX, LLC and The Nasdaq Stock 
Market LLC, charge a fee for similar services to Members and non-
Members.\72\ In order to provide an incentive to non-Members to engage 
in early API testing and certification such that they will be able to 
utilize the services of MIAX Emerald as soon as possible, API Testing 
and Certification fees assessable to non-Members will be waived by the 
Exchange for all interfaces for the Waiver Period. The Exchange will 
submit a rule filing to the Commission to establish the fee amount and 
any related requirements, and provide notice to terminate the 
applicable Waiver Period. Even though the Exchange is proposing to 
waive this particular fee during the Waiver Period, the Exchange 
believes that is appropriate to provide market participants with the 
overall structure of the fee by outlining the structure on the Fee 
Schedule without setting forth a specific fee amount, so that there is 
general awareness that the Exchange intends to assess such a fee in the 
future, should the Waiver Period terminate and the Exchange establish 
an applicable fee. The Exchange believes that its proposal to waive 
this fee under this waiver structure is reasonable because this waiver 
structure is identical to the waiver structure that is

[[Page 11612]]

currently in place at the Exchange's affiliate, MIAX PEARL.\73\
---------------------------------------------------------------------------

    \72\ See Nasdaq PHLX Options 7 Pricing Schedule, Section 9, 
Other Member Fees, E. Testing Facilities.
    \73\ See supra note 65.
---------------------------------------------------------------------------

Member Network Testing and Certification Fee
    MIAX Emerald will establish electronic communication connections 
with Individual Firms and proposes to assess Individual Firms a Testing 
and Certification Fee for network connectivity. Member Network 
Connectivity Testing and Certification Fees will be assessed (i) 
initially per connection in the month the Individual Firm has been 
credentialed to use any API or Market Data feeds in the production 
environment utilizing the tested network connection, and (ii) each time 
an Individual Firm initiates a change to its system that requires 
network connectivity testing and certification. Network Connectivity 
Testing and Certification Fees will not be assessed in situations where 
the Exchange initiates a mandatory change to the Exchange's system that 
requires testing and certification. Member Network Connectivity Testing 
and Certification Fees will not be assessed for testing and 
certification of connectivity to the Exchange's Disaster Recovery 
Facility.
    The Exchange notes that the Emerald Express Network Interconnect 
(``EENI'') \74\ is a network infrastructure which provides Members and 
non-Members network connectivity to the trading platforms, market data 
systems, test systems, and disaster recovery facility of the Exchange. 
When utilizing a Shared \75\ cross-connect, the EENI can also be 
configured to offer network connectivity to the trading platforms, 
market data systems, test systems, and disaster recovery facilities of 
MIAX and MIAX PEARL. When utilizing a Dedicated \76\ cross-connect, the 
EENI can only be configured to offer network connectivity to the 
trading platforms, market data systems, and test systems of the 
Exchange. The EENI consists of the low latency and ultra-low latency 
(``ULL'') connectivity options set forth in the Exchange's Fee 
Schedule. Accordingly, Members utilizing Shared cross-connects to 
connect to the trading platforms, market data systems, test systems, 
and disaster recovery facilities of the Exchange and its affiliates, 
MIAX and MIAX PEARL will only be assessed one Network Connectivity 
Testing and Certification Fee per connection tested, regardless of the 
trading platforms, market data systems, test systems, and disaster 
recovery facilities accessed via such connection. The Exchange notes 
that it has submitted a separate rule filing to the Commission to 
establish the fee amounts and related requirements related to 
connectivity for Members to the Exchange's primary/secondary 
facility.\77\
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    \74\ ``EENI'' means the Emerald Express Network Interconnect, 
which is a network infrastructure which provides Members and non-
Members network connectivity to the trading platforms, market data 
systems, test systems, and disaster recovery facilities of MIAX 
Emerald. When utilizing a Shared cross-connect, the EENI can also be 
configured to offer network connectivity to the trading platforms, 
market data systems, test systems, and disaster recovery facilities 
of MIAX and MIAX PEARL. When utilizing a Dedicated cross-connect, 
the EENI can only be configured to offer network connectivity to the 
trading platforms, market data systems, and test systems of MIAX 
Emerald. The EENI consists of the low latency and ultra-low latency 
(``ULL'') connectivity options set forth in the Exchange's Fee 
Schedule. See the Definitions Section of the Fee Schedule.
    \75\ ``Shared'' (cross-connect) means cross-connect that 
provides network connectivity to the trading platforms, market data 
systems, test systems, and/or disaster recovery facilities of MIAX 
Emerald, MIAX and MIAX PEARL via a single, shared connection. The 
following connections can be Shared across MIAX Emerald, MIAX and 
MIAX PEARL: 1 Gigabit, 1 Gigabit Disaster Recovery, and 10 Gigabit 
Disaster Recovery. See the Definitions Section of the Fee Schedule.
    \76\ ``Dedicated'' (cross-connect) means cross-connect that 
provides network connectivity solely to the trading platforms, 
market data systems, and test systems of MIAX Emerald. The following 
connection is Dedicated to MIAX Emerald: 10 Gigabit ULL. See the 
Definitions Section of the Fee Schedule.
    \77\ See Securities Exchange Act Release No. 85316 (March 14, 
2019), SR-EMERALD-2019-11 (Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change to Adopt System Connectivity 
Fees).
---------------------------------------------------------------------------

    In order to provide an incentive to Individual Firms to engage in 
early network connectivity testing and certification, such that they 
will be able to utilize the services of MIAX Emerald as soon as 
possible, Network Connectivity Testing and Certification fees 
assessable to Individual Firms will be waived by the Exchange for the 
Waiver Period. The Exchange will submit a rule filing to the Commission 
to establish the fee amount and any related requirements, and provide 
notice to terminate the applicable Waiver Period. Even though the 
Exchange is proposing to waive this particular fee during the Waiver 
Period, the Exchange believes that is appropriate to provide market 
participants with the overall structure of the fee by outlining the 
structure on the Fee Schedule without setting forth a specific fee 
amount, so that there is general awareness that the Exchange intends to 
assess such a fee in the future, should the Waiver Period terminate and 
the Exchange establish an applicable fee. The Exchange believes that 
its proposal to waive this fee under this waiver structure is 
reasonable because this waiver structure is identical to the waiver 
structure that was previously in place at the Exchange's affiliate, 
MIAX PEARL.\78\
---------------------------------------------------------------------------

    \78\ See supra note 65.
---------------------------------------------------------------------------

Non-Member Network Testing and Certification Fee
    MIAX Emerald will establish electronic connections with and 
proposes to assess Service Bureaus, Extranet Providers and other non-
Members a Testing and Certification Fee for network connectivity.
    Non-Member Network Connectivity Testing and Certification Fees will 
be assessed (i) initially per connection in the month the Service 
Bureau, Extranet Provider or other non-Member has been credentialed to 
use any API or Market Data feeds in the production environment using 
the tested network connection, and (ii) each time Service Bureau, 
Extranet Provider or other non-Member initiates a change to its system 
that requires network connectivity testing and certification.
    Network Connectivity Testing and Certification Fees will not be 
assessed in situations where the Exchange initiates a mandatory change 
to the Exchange's system that requires testing and certification. Non-
Member Network Connectivity Testing and Certification Fees will not be 
assessed for testing and certification of connectivity to the 
Exchange's Disaster Recovery Facility.
    The EENI is also available to non-Member subscribers. For non-
Member subscribers, when utilizing a Shared cross-connect, the EENI can 
also be configured to offer network connectivity to the trading 
platforms, market data systems, test systems, and disaster recovery 
facilities of MIAX and MIAX PEARL. When utilizing a Dedicated cross-
connect, the EENI can only be configured to offer network connectivity 
to the trading platforms, market data systems, and test systems of the 
Exchange. The EENI consists of the low latency and ULL connectivity 
options set forth in the Exchange's Fee Schedule. Accordingly, non-
Members utilizing Shared cross-connects to connect to the trading 
platforms, market data systems, test systems, and disaster recovery 
facilities of the Exchange and its affiliates, MIAX and MIAX PEARL will 
only be assessed one Network Connectivity Testing and Certification Fee 
per connection tested, regardless of the trading platforms, market data 
systems, test systems, and disaster recovery facilities accessed via 
such connection. The Exchange notes that it has submitted a separate 
rule filing to the Commission to establish the fee amounts and related 
requirements

[[Page 11613]]

related to connectivity for Members to the Exchange's primary/secondary 
facility.\79\
---------------------------------------------------------------------------

    \79\ See supra note 77.
---------------------------------------------------------------------------

    The Member and non-Member Network Testing and Certification fees 
represent installation and support costs incurred by the Exchange as it 
works with each Member and non-Member to make sure there are 
appropriate electronic connections with MIAX Emerald.
    In order to provide an incentive to Service Bureau, Extranet 
Provider or other non-Members to engage in early network connectivity 
testing and certification such that they will be able to utilize the 
services of MIAX Emerald as soon as possible, Network Connectivity 
Testing and Certification fees assessable to Service Bureau, Extranet 
Provider or other non-Members will be waived by the Exchange for the 
Waiver Period. The Exchange will submit a rule filing to the Commission 
to establish the fee amount and any related requirements, and provide 
notice to terminate the applicable Waiver Period. Even though the 
Exchange is proposing to waive this particular fee during the Waiver 
Period, the Exchange believes that is appropriate to provide market 
participants with the overall structure of the fee by outlining the 
structure on the Fee Schedule without setting forth a specific fee 
amount, so that there is general awareness that the Exchange intends to 
assess such a fee in the future, should the Waiver Period terminate and 
the Exchange establish an applicable fee. The Exchange believes that 
its proposal to waive this fee under this waiver structure is 
reasonable because this waiver structure is identical to the waiver 
structure that was previously in place at the Exchange's affiliate, 
MIAX PEARL.\80\
---------------------------------------------------------------------------

    \80\ See supra note 65.
---------------------------------------------------------------------------

Pass-Through of External Connectivity Fees
    MIAX Emerald proposes to assess External Connectivity fees to 
Members and non-Members that establish connections with MIAX Emerald 
through a third-party. Fees charged to MIAX Emerald by third-party 
external vendors on behalf of a Member or non-Member connecting to MIAX 
Emerald (including cross-connects), will be passed through to the 
Member or non-Member. External Connectivity fees include one-time set-
up fees, monthly charges, and other fees charged to MIAX Emerald by a 
third-party for the benefit of a Member or non-Member.
    The purpose of the External Connectivity fee is to recoup costs 
incurred by MIAX Emerald in establishing connectivity with external 
vendors acting on behalf of a Member or non-Member. MIAX Emerald will 
only pass-through the actual costs it is charged by the third-party 
external vendors. Other exchanges, including MIAX, charge a fee for 
similar services to Members and non-Members.\81\
---------------------------------------------------------------------------

    \81\ See MIAX Fee Schedule, Section (5)(c), Pass-Through of 
External Connectivity Fees.
---------------------------------------------------------------------------

Port Fees
    Once network connectivity is established, MIAX Emerald proposes to 
assess fees for access and services used by Members and non-Members via 
connections known as ``Port.'' These proposed fees are similar to the 
fees charged by other exchanges, including MIAX.\82\ MIAX Emerald 
provides four (4) Port types, including (i) the FIX Port, which allows 
Members to electronically send orders in all products traded on the 
Exchange; (ii) the MEI Port, which allows Market Makers to submit 
electronic orders and quotes to the Exchange; (iii) the CTD Port, which 
provides real-time trade clearing information to the participants to a 
trade on MIAX Emerald and to the participants' respective clearing 
firms; and (iv) the FXD Port, which provides a copy of real-time trade 
execution, correction and cancellation information through a FIX Port 
to any number of FIX Ports designated by an EEM to receive such 
messages.
---------------------------------------------------------------------------

    \82\ See MIAX Fee Schedule, Section (5)(d), Port Fees.
---------------------------------------------------------------------------

    MIAX Emerald will assess monthly Port Fees on Members and non-
Members in each month the market participant is credentialed to use a 
Port in the production environment and based upon the number of 
credentialed Ports that a user is entitled to use. MIAX Emerald has 
Primary and Secondary Facilities and a Disaster Recovery Facility. Each 
type of Port provides access to all three facilities for a single fee. 
The Exchange notes that, unless otherwise specifically set forth in the 
Fee Schedule, the Port Fees include the information communicated 
through the Port. That is, unless otherwise specifically set forth in 
the Fee Schedule, there is no additional charge for the information 
that is communicated through the Port apart from what the user is 
assessed for each Port.
    In order to provide an incentive to Members and non-Members to 
connect to MIAX Emerald through the Ports such that they will be able 
to utilize the services of MIAX Emerald as soon as possible, all Port 
Fees (except for one) assessable to Port users will be waived by the 
Exchange for the Waiver Period for such fees. The one Port Fee that the 
Exchange does not propose to waive is the Limited Service MEI Ports 
beyond the two (2) Limited Service MEI Ports per Matching Engine to 
which they connect, allocated to MEI Port users (the ``Additional 
Limited Service MEI Port Fee''). Specifically, the Exchange notes that 
the MIAX Emerald Market Makers may request Additional Limited Service 
MEI Ports for which MIAX Emerald will assess MIAX Emerald Market Makers 
$50 per month per Additional Limited Service MEI Port for each Matching 
Engine, as discussed below. Market Makers are limited to six Additional 
Limited Service MEI Ports per Matching Engine, for a total of eight per 
Matching Engine. For all other waived Port Fees, the Exchange will 
submit a rule filing to the Commission to establish the fee amount and 
any related requirements, and provide notice to terminate the 
applicable Waiver Period. Even though the Exchange is proposing to 
waive most of these fees during the Waiver Period, the Exchange 
believes that is appropriate to provide market participants with the 
overall structure of the fee by outlining the structure on the Fee 
Schedule without setting forth a specific fee amount, so that there is 
general awareness that the Exchange intends to assess such a fee in the 
future, should the Waiver Period terminate and the Exchange establish 
an applicable fee. The Exchange believes that its proposal to waive 
most of these fee under this waiver structure is reasonable because 
this waiver structure is identical to the waiver structure that was 
previously in place at the Exchange's affiliate, MIAX PEARL.\83\
---------------------------------------------------------------------------

    \83\ See supra note 65.
---------------------------------------------------------------------------

FIX Port Fees
    The Exchange is proposing to structure its FIX Port as a monthly 
fixed amount based on the number of credentialed FIX Ports, not tied to 
transacted volume of the Member. Although one FIX Port gives access to 
all products traded on MIAX Emerald, some Members may choose to use 
more than one FIX Port. A FIX Port is an interface with MIAX Emerald 
systems that enables the Port user to submit orders electronically to 
MIAX Emerald. MIAX Emerald will assess monthly FIX Port on Members in 
each month the Member is credentialed to use a FIX Port in the 
production environment and based upon the number of credentialed FIX 
Ports.

[[Page 11614]]

MEI Port Fees
    MIAX Emerald will offer different options of MEI Ports depending on 
the services required by Market Makers. MIAX Emerald will assess 
monthly MEI Port Fees on Market Makers based upon the number of classes 
or class volume accessed by the Market Maker. Market Makers are 
allocated two (2) Full Service MEI Ports \84\ and two (2) Limited 
Service MEI Ports \85\ per Matching Engine to which they connect. The 
Full Service MEI Ports, Limited Service MEI Ports and the additional 
Limited Service MEI Ports all include access to the Exchange's Primary 
and Secondary data centers and its Disaster Recovery center.
---------------------------------------------------------------------------

    \84\ Full Service MEI Ports means a port which provides Market 
Makers with the ability to send Market Maker simple and complex 
quotes, eQuotes, and quote purge messages to the MIAX Emerald 
System. Full Service MEI Ports are also capable of receiving 
administrative information. Market Makers are limited to two Full 
Service MEI Ports per Matching Engine. See the Definitions Section 
of the Fee Schedule.
    \85\ Limited Service MEI Ports means a port which provides 
Market Makers with the ability to send simple and complex eQuotes 
and quote purge messages only, but not Market Maker Quotes, to the 
MIAX Emerald System. Limited Service MEI Ports are also capable of 
receiving administrative information. Market Makers initially 
receive two Limited Service MEI Ports per Matching Engine. See the 
Definitions Section of the Fee Schedule.
---------------------------------------------------------------------------

    For the calculation of the monthly MEI Port Fees that apply to 
Market Makers, the number of classes is defined as the greatest number 
of classes the Market Maker was assigned to quote in on any given day 
within the calendar month and the class volume percentage is based on 
the total national average daily volume in classes listed on MIAX 
Emerald in the prior calendar quarter.\86\ Newly listed option classes 
are excluded from the calculation of the monthly MEI Port Fee until the 
calendar quarter following their listing, at which time the newly 
listed option classes will be included in both the per class count and 
the percentage of total national average daily volume.
---------------------------------------------------------------------------

    \86\ The Exchange will use the following formula to calculate 
the percentage of total national average daily volume that the 
Market Maker assignment is for purposes of the MEI Port Fee for a 
given month:
    Market Maker assignment percentage of national average daily 
volume = [total volume during the prior calendar quarter in a class 
in which the Market Maker was assigned]/[total national volume in 
classes listed on MIAX in the prior calendar quarter].
---------------------------------------------------------------------------

    The Exchange proposes to assess Market Makers the monthly MEI Port 
Fees based on the greatest number of classes listed on MIAX Emerald 
that the Market Maker was assigned to quote in on any given day within 
a calendar month and the applicable fee rate that is the lesser of 
either the per class basis or percentage of total national average 
daily volume measurement.
    MEI Port users will be allocated two (2) Full Service MEI Ports and 
two (2) Limited Service MEI Ports per Matching Engine to which they 
connect. MEI Port Fees include MEI Ports at the Primary, Secondary and 
Disaster Recovery data centers. MIAX Emerald Market Makers may request 
additional Limited Service MEI Ports for which MIAX Emerald will assess 
MIAX Emerald Market Makers $50 per month per additional Limited Service 
MEI Port for each Matching Engine. Market Makers are limited to six 
additional Limited Service MEI Ports per Matching Engine, for a total 
of eight per Matching Engine.
    A MIAX Emerald Market Maker may request and be allocated two (2) 
Purge Ports per Matching Engine to which it connects. For each month in 
which the MIAX Emerald Market Maker has been credentialed to use Purge 
Ports in the production environment and has been assigned to quote in 
at least one class, the Exchange will assess the MIAX Emerald Market 
Maker a flat fee which will be waived for the Waiver Period, regardless 
of the number of Purge Ports allocated to the MIAX Emerald Market 
Maker.
Clearing Trade Drop Port Fee
    The Exchange is proposing to structure its CTD Port as a monthly 
fixed amount, not tied to transacted volume of the Member. This fixed 
fee structure is the same structure in place at Nasdaq PHLX with 
respect to the proposed CTD Port Fees.\87\ CTD provides Exchange 
members with real-time clearing trade updates. The updates include the 
Member's clearing trade messages on a low latency, real-time basis. The 
trade messages are routed to a Member's connection containing certain 
information. The information includes, among other things, the 
following: (i) Trade date and time; (ii) symbol information; (iii) 
trade price/size information; (iv) Member type (for example, and 
without limitation, Market Maker, Electronic Exchange Member, Broker-
Dealer); (v) Exchange Member Participant Identifier (``MPID'') for each 
side of the transaction, including Clearing Member MPID; and (vi) 
strategy specific information for complex transactions. CTD Port will 
be assessed in any month the Member is credentialed to use the CTD Port 
in the production environment.
---------------------------------------------------------------------------

    \87\ See Nasdaq PHLX Pricing Schedule, Options 7, Section 9, 
Other Member Fees, B. Port Fees.
---------------------------------------------------------------------------

FIX Drop Copy Port Fees
    The Exchange is proposing to structure its FXD Port Fee as a 
monthly fixed amount, not tied to transacted volume of the Member. This 
fixed fee structure is the same structure in place at Nasdaq PHLX with 
respect to FXD Port Fees.\88\ FXD is a messaging interface that will 
provide a copy of real-time trade execution, trade correction and trade 
cancellation information to FXD Port users who subscribe to the 
service. FXD Port users are those users who are designated by an EEM to 
receive the information and the information is restricted for use by 
the EEM. FXD Port Fees will be assessed in any month the Member is 
credentialed to use the FXD Port in the production environment.
---------------------------------------------------------------------------

    \88\ Id.
---------------------------------------------------------------------------

MPID Fees
    MIAX Emerald proposes to assess monthly MPID fees on EEMs based 
upon the number of MPIDs assigned to a particular EEM in a given month 
in each month the Member is credentialed to use such MPIDs in the 
production environment. MIAX Emerald intends to assess MPID fees in 
order to cover the administrative costs it incurs in assigning and 
managing these identifiers for each EEM.
    In order to provide an incentive to Members to start trading on 
MIAX Emerald as soon as possible, all MPID fees assessable to EEMs will 
be waived by the Exchange for the Waiver Period for such fees. The 
Exchange will submit a rule filing to the Commission to establish the 
fee amount and any related requirements, and provide notice to 
terminate the applicable Waiver Period. Even though the Exchange is 
proposing to waive this particular fee during the Waiver Period, the 
Exchange believes that is appropriate to provide market participants 
with the overall structure of the fee by outlining the structure on the 
Fee Schedule without setting forth a specific fee amount, so that there 
is general awareness that the Exchange intends to assess such a fee in 
the future, should the Waiver Period terminate and the Exchange 
establish an applicable fee. The Exchange believes that its proposal to 
waive this fee under this waiver structure is reasonable because this 
waiver structure is identical to the waiver structure that is currently 
in place at the Exchange's affiliate, MIAX PEARL.\89\
---------------------------------------------------------------------------

    \89\ See supra note 65.
---------------------------------------------------------------------------

Technical Support Request Fee
    MIAX Emerald proposes to assess a technical support request fee to 
both Members and non-Members that request MIAX Emerald technical 
support at any of the MIAX Emerald data centers. MIAX Emerald proposes 
that such fee

[[Page 11615]]

will be $200 per hour for such technical support. The purpose of the 
proposed fee is to permit users to request the use of Exchange's on-
site data center personnel as technical support as a convenience to the 
users to test or otherwise assess the user's connectivity to the 
Exchange. Other exchanges, including MIAX and MIAX PEARL, charge a fee 
for similar services to Members and non-Members.\90\
---------------------------------------------------------------------------

    \90\ See MIAX Fee Schedule, Section 5) f), Member and non-Member 
Technical Support Request Fee and MIAX PEARL Fee Schedule, Section 
5) f), Member and non-Member Technical Support Request Fee.
---------------------------------------------------------------------------

Market Data Fees
    The Exchange proposes to assess fees for its market data products, 
MIAX Emerald Top of Market (``ToM'') \91\ and Complex Top of Market 
(``cToM'') \92\; Administrative Information Subscriber (``AIS'') \93\; 
and MIAX Order Feed (``MOR'').\94\ The Exchange notes that it has 
separately filed with the Commission a proposed rule change to 
establish the ToM, cToM, AIS, and MOR products (the ``Market Data 
Product Filing'').\95\ More information about the ToM, cToM, AIS, and 
MOR products can be found in the Market Data Product Filing.
---------------------------------------------------------------------------

    \91\ See Securities Exchange Act Release No. 69007 (February 28, 
2013), 78 FR 14617 (March 6, 2013) (SR-MIAX-2013-05).
    \92\ See Securities Exchange Act Release No. 79146 (October 24, 
2016), 81 FR 75171(October 28, 2016)(SR-MIAX-2016-36)
    \93\ See Securities Exchange Act Release Nos. 69320 (April 5, 
2013), 78 FR 21661 (April 11, 2013) (SR-MIAX-2013-13); 82740 
(February 20, 2018), 83 FR 8304 (February 26, 2018) (SR-MIAX-2018-
04).
    \94\ See Securities Exchange Act Release No. 74759 (April 17, 
2015), 80 FR 22749 (April 23, 2015) (SR-MIAX-2015-28).
    \95\ See Securities Exchange Act Release No. 85207 (February 27, 
2019, 84 FR 7963 (March 5, 2019)) (SR-Emerald-2019-09) (Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change to 
Establish MIAX Emerald Top of Market (``ToM'') Data Feed, MIAX 
Emerald Complex Top of Market (``cToM'') Data Feed, MIAX Emerald 
Administrative Information Subscriber (``AIS'') Data Feed, and MIAX 
Emerald Order Feed (``MOR'').
---------------------------------------------------------------------------

    To summarize, ToM provides market participants with a direct data 
feed that includes the Exchange's best bid and offer, with aggregate 
size, and last sale information, based on displayable order and quoting 
interest on the Exchange. The ToM data feed includes data that is 
identical to the data sent to the processor for the Options Price 
Reporting Authority (``OPRA''). ToM will also contain a feature that 
provides the number of Priority Customer contracts that are included in 
the size associated with the Exchange's best bid and offer.
    cToM will provide subscribers with the same information as the ToM 
market data product as it relates to the strategy book, i.e., the 
Exchange's best bid and offer for a complex strategy, with aggregate 
size, based on displayable order and quoting interest in the complex 
strategy on the Exchange. cToM will also provide subscribers with the 
identification of the complex strategies currently trading on MIAX 
Emerald; complex strategy last sale information; and the status of 
securities underlying the complex strategy (e.g., halted, open, or 
resumed). cToM is distinct from ToM, and anyone wishing to receive cToM 
data must subscribe to cToM regardless of whether they are a current 
ToM subscriber. ToM subscribers are not required to subscribe to cToM, 
and cToM subscribers are not required to subscribe to ToM.
    AIS provides market participants with a direct data feed that 
allows subscribers to receive real-time updates of products traded on 
MIAX Emerald, trading status for MIAX Emerald and products traded on 
MIAX Emerald, and liquidity seeking event notifications. The AIS market 
data feed includes opening imbalance condition information, opening 
routing information, expanded quote range information, post-halt 
notifications, and liquidity refresh condition information. AIS real-
time messages are disseminated over multicast to achieve a fair 
delivery mechanism. AIS notifications provide current electronic system 
status allowing subscribers to take necessary actions immediately.
    MOR provides market participants with a direct data feed that 
allows subscribers to receive real-time updates of options orders, 
products traded on MIAX Emerald, MIAX Emerald Options System status, 
and MIAX Emerald Options Underlying trading status. Subscribers to the 
data feed will get a list of all options symbols and strategies that 
will be traded and sourced on that feed at the start of every session.
    The Exchange proposes to charge monthly fees to Distributors of the 
ToM, cToM, AIS, and MOR market data products. MIAX Emerald will assess 
market data fees applicable to the market data products on Internal and 
External Distributors in each month the Distributor is credentialed to 
use the applicable market data product in the production environment. A 
``Distributor'' of MIAX Emerald data is any entity that receives a feed 
or file of data either directly from MIAX Emerald or indirectly through 
another entity and then distributes it either internally (within that 
entity) or externally (outside that entity). All Distributors are 
required to execute a MIAX Emerald Distributor Agreement. Market data 
fees for ToM, cToM, AIS, and MOR will be reduced for new Distributors 
for the first month during which they subscribe to the applicable 
market data product, based on the number of trading days that have been 
held during the month prior to the date on which they have been 
credentialed to use the applicable market data product in the 
production environment. Such new Distributors will be assessed a pro-
rata percentage of the fees described above, which is the percentage of 
the number of trading days remaining in the affected calendar month as 
of the date on which they have been credentialed to use the applicable 
market data product in the production environment, divided by the total 
number of trading days in the affected calendar month.
    Other exchanges, including MIAX and MIAX PEARL, charge fees for 
market data products to Members and non-Members. In order to provide an 
incentive to Members and non-Members to receive the market data feeds 
as soon as possible, all market data fees assessable to Distributors 
for ToM, cToM, AIS, and MOR will be waived by the Exchange for the 
Waiver Period for such fees. The Exchange will submit a rule filing to 
the Commission to establish the fee amount and any related 
requirements, and provide notice to terminate the applicable Waiver 
Period. Even though the Exchange is proposing to waive this particular 
fee during the Waiver Period, the Exchange believes that is appropriate 
to provide market participants with the overall structure of the fee by 
outlining the structure on the Fee Schedule without setting forth a 
specific fee amount, so that there is general awareness that the 
Exchange intends to assess such a fee in the future, should the Waiver 
Period terminate and the Exchange establish an applicable fee. The 
Exchange believes that its proposal to waive this fee under this waiver 
structure is reasonable because this waiver structure is identical to 
the waiver structure that is currently in place at the Exchange's 
affiliate, MIAX PEARL.\96\
---------------------------------------------------------------------------

    \96\ See supra note 65.
---------------------------------------------------------------------------

    The Exchange does not propose to adopt any other fees at this time. 
The Exchange expects to adopt additional fees after the terminations of 
applicable Waiver Periods as determined by the Exchange, which shall be 
at a later date. The Exchange will submit rule filings with the 
Commission prior to any such fees becoming effective.
2. Statutory Basis
    The Exchange believes that its proposal to amend its Fee Schedule 
is

[[Page 11616]]

consistent with Section 6(b) of the Act \97\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act \98\ in particular, in 
that it is an equitable allocation of reasonable fees and other charges 
among its members and issuers and other persons using its facilities. 
The Exchange also believes the proposal furthers the objectives of 
Section 6(b)(5) of the Act in that it is designed to promote just and 
equitable principles of trade, 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 is not 
designed to permit unfair discrimination between customers, issuers, 
brokers and dealers.
---------------------------------------------------------------------------

    \97\ 15 U.S.C. 78f(b).
    \98\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

Transaction Fees
Add/Remove Tiered Exchange Rebates/Fees
    The Exchange believes the rebates and fees proposed for 
transactions on MIAX Emerald are reasonable, equitable and not unfairly 
discriminatory. MIAX Emerald operates within a highly competitive 
market in which market participants can readily send order flow to 
several other competing venues if, among other things, they deem fees 
at a particular venue to be unreasonable or excessive. The proposed fee 
structure is intended to attract order flow to MIAX Emerald by offering 
market participants incentives to submit their orders or quotes to MIAX 
Emerald.
Tiers and Their Application
    The Exchange believes that its proposed methodology for calculating 
its tiers is reasonable, equitable, and not unfairly discriminatory, as 
this methodology is similar to how another exchange calculates its 
tiers. The Exchange's methodology, which analyzes three alternative 
calculation methods and then selects the method that is the highest 
tier reached to the Member, is similar to how GEMX calculates its 
tiers.\99\ For example, GEMX has four qualifying tiers, the same number 
that the Exchange is proposing. GEMX calculates its tiers using CTCV 
(Customer Total Consolidated Volume) at the OCC, which is fundamentally 
the same denominator method that the Exchange is proposing. GEMX 
aggregates volume of affiliated members, as the Exchange is also 
proposing. GEMX has two alternative calculation methods, however the 
Exchange is proposing three alternative calculation methods, which the 
Exchange believes provides greater benefit to Members, as there is an 
additional method to enable qualification for a higher tier. For GEMX, 
for certain of its tiers, offers a calculation that looks at absolute 
ADV volume (i.e. 20,000 ADV), in addition to, or in lieu of, 
percentages of CTCV, whereas the Exchange is proposing to only look at 
monthly percentages of CTCV. The Exchange's proposed methodology for 
calculating its tiers is reasonable, equitable, and not unfairly 
discriminatory because it applies equally to all Members. Volume-based 
pricing models such as those proposed on the Exchange have been widely 
adopted by options exchanges and are equitable and not unfairly 
discriminatory because they are open to all Members and provide 
additional benefits or discounts that are reasonably related to the 
value of an exchange's market quality associated with higher levels of 
market activity, such as higher levels of liquidity provision and/or 
growth patterns, and introduction of higher volumes of orders into the 
price and volume discovery processes.
---------------------------------------------------------------------------

    \99\ See Nasdaq GEMX, Options 7 Pricing Schedule.
---------------------------------------------------------------------------

    The Exchange's proposal to offer a rebate or lower fee to Makers 
that provide liquidity in Penny and Non-Penny classes is also equitable 
and not unfairly discriminatory under the Act. The Exchange believes 
that the proposed maker-taker model is an important competitive tool 
for exchanges and directly or indirectly can provide better prices for 
investors. The proposed fee structure may incentivize the MIAX Emerald 
bid and offer because the rebate or lower fee assessable to Makers 
effectively subsidizes, and thus encourages, the posting of liquidity. 
The Exchange believes that the Maker rebate or lower Maker fee will 
also provide MIAX Emerald Market Makers with greater incentive to 
either match or improve upon the best price displayed on MIAX Emerald, 
all to the benefit of investors and the public in the form of improved 
execution prices.
Priority Customers
    The Exchange believes the proposed Tiered rebates and fees assessed 
on Priority Customers are reasonable, equitable, and not unfairly 
discriminatory because they are, as detailed in the Purpose section 
above, comparable to fees that Priority Customers are assessed at other 
competing exchanges.\100\ The Exchange believes charging lower fees and 
providing higher rebates to Priority Customer orders attracts that 
order flow to the Exchange and thereby creates liquidity to the benefit 
of all market participants who trade on the Exchange. Further, the 
Exchange believes that it is equitable and not unfairly discriminatory 
to assess lower fees to Priority Customer orders than for orders for 
Origins other than Priority Customer. The Exchange believes assesses 
Priority Customers lower or no transaction fees is equitable not 
unfairly discriminatory because market participants generally seek to 
trade with Priority Customer order flow, which in turn enhances 
liquidity on the Exchange for the benefit of all market participants. 
Priority Customer liquidity benefits all market participants by 
providing more trading opportunities, which attracts Market Makers. An 
increase in the activity of these market participants in turn 
facilitates tighter spreads, which may cause an additional 
corresponding increase in order flow from other market participants. 
This limitation does not apply to participants on the Exchange whose 
behavior is substantially similar to that of market professionals, 
including Non-Priority Customers, Non-MIAX Emerald Market Makers, Firm 
Proprietary, and Broker-Dealers, who will generally submit a higher 
number of orders than Priority Customers.
---------------------------------------------------------------------------

    \100\ See supra notes 16 and 22.
---------------------------------------------------------------------------

MIAX Emerald Market Makers
    The Exchange believes that its proposed Tiered transaction rebates 
and fees for MIAX Emerald Market Makers are reasonable, equitable, and 
not unfairly discriminatory because they are available to all MIAX 
Emerald Market Makers and are reasonably related to the value to the 
Exchange that comes with higher market quality and higher levels of 
liquidity in the price and volume discovery processes. Such increased 
liquidity at the Exchange should allow it to spread its administrative 
and infrastructure costs over a greater number of transactions leading 
to lower costs per transaction.
    The Exchange believes it is equitable and not unfairly 
discriminatory for MIAX Emerald Market Makers to be assessed generally 
lower fees or higher rebates than other professional market 
participants (such as non-Priority Customers, Broker-Dealers, Non-MIAX 
Emerald Market Makers and Firm Proprietary). MIAX Emerald Market Makers 
have obligations that other professional market participants do not. In 
particular, they must maintain continuous two-sided markets in the 
classes in which they are registered to trade, and must meet certain 
minimum quoting requirements. Therefore, the Exchange believes it is 
appropriate that MIAX Emerald Market Makers be assessed lower fees or 
higher rebates

[[Page 11617]]

since they have the potential to provide greater volumes of liquidity 
to the market.
Non-MIAX Emerald Market Makers
    The Exchange believes the proposed Tiered rebates and fees assessed 
on Non-MIAX Emerald Market Makers are reasonable, equitable, and not 
unfairly discriminatory because they are, as detailed in the Purpose 
section above, comparable to fees that non-market makers are assessed 
at other competing exchanges.\101\ The tiered rebates/fees assessable 
to Non-MIAX Emerald Market Makers proposed by the Exchange for simple 
orders are also similar in structure to and in the range of the 
transaction rebates and fees charged by GEMX for transactions for the 
accounts of ``Non-Nasdaq GEMX Market Makers (FarMM).'' The fees 
proposed by the Exchange for Non-MIAX Emerald Market Maker complex 
transactions in Penny classes are also similar to those fees charged by 
Nasdaq ISE to a ``Non-Nasdaq ISE Market Maker (FarMM)'' for complex 
transactions in Nasdaq ISE Select Symbols. The fees proposed by the 
Exchange for Non-MIAX Emerald Market Maker transactions in a PRIME/
cPRIME auction are also similar to those assessed by GEMX for 
transactions on behalf of its Non-Nasdaq GEMX Market Makers (FarMM) for 
orders executed in a GEMX PIM auction in both Penny and Non-Penny 
classes. Finally, the rebates and fees for Non-MIAX Emerald Market 
Makers are the same amounts as the rebates and fees assessed by the 
Exchange on other professional Origins (Firm Proprietary/Broker-Dealer, 
Non-Priority Customer), with only minor differences in the highest 
Tiers for certain simple Taker fees.
---------------------------------------------------------------------------

    \101\ See supra notes 16 and 22.
---------------------------------------------------------------------------

Firm Proprietary/Broker-Dealers
    The Exchange believes the proposed Tiered rebates and fees assessed 
on Firm Proprietary/Broker-Dealers are reasonable, equitable, and not 
unfairly discriminatory because they are, as detailed in the Purpose 
section above, comparable to fees that orders for Firm Proprietary/
Broker-Dealers are assessed at other competing exchanges. The tiered 
rebates/fees assessable to Firm Proprietary or Broker-Dealers, proposed 
by the Exchange for simple orders are also similar in structure to and 
in the range of the transaction rebates and fees charged by GEMX for 
transactions for the accounts of ``Firm Proprietary/Broker-Dealer.'' 
The fees proposed by the Exchange for Firm Proprietary/Broker-Dealer 
complex transactions in Penny classes are also similar to those fees 
charged by Nasdaq ISE to ``Firm Proprietary/Broker-Dealer'' order for 
complex transactions in Nasdaq ISE Select Symbols. The fees proposed by 
the Exchange for Firm Proprietary/Broker-Dealer transactions in a 
PRIME/cPRIME auction are also similar to those assessed by GEMX for 
transactions on behalf of its Firm Proprietary/Broker-Dealer orders 
executed in a GEMX PIM auction in both Penny and Non-Penny classes. 
Finally, the rebates and fees for Firm Proprietary/Broker-Dealers are 
the same amounts as the rebates and fees assessed by the Exchange on 
other professional Origins (Non-MIAX Emerald Market Makers, Non-
Priority Customer), with only minor differences in the highest Tiers 
for certain simple Taker fees.
Non-Priority Customers
    The Exchange believes the proposed Tiered rebates and fees assessed 
on Non-Priority Customers are reasonable, equitable, and not unfairly 
discriminatory because they are, as detailed in the Purpose section 
above, comparable to fees that Non-Priority Customers are assessed at 
other competing exchanges. The tiered rebates/fees assessable to Non-
Priority Customers proposed by the Exchange are also similar in 
structure to and in the range of the transaction rebates and fees for 
simple orders charged by GEMX for transactions for the accounts of 
``Professional Customers.'' The fees proposed by the Exchange for Non-
Priority Customer complex transactions in Penny classes are also 
similar to those fees charged by Nasdaq ISE for ``Professional 
Customers'' for complex transactions in Nasdaq ISE Select Symbols. The 
fees proposed by the Exchange for Non-Priority Customer transactions in 
a PRIME/cPRIME auction are also similar to those assessed by GEMX for 
transactions on behalf of its Professional Customer orders executed in 
a GEMX PIM auction in both Penny and Non-Penny classes. Finally, the 
rebates and fees for Non-Priority Customers are the same amounts as the 
rebates and fees assessed by the Exchange on other professional Origins 
(Non-MIAX Emerald Market Makers, Firm Proprietary/Broker-Dealer), with 
only minor differences in the highest Tiers for certain simple Taker 
fees.
Penny and Non-Penny Classes
    The Exchange believes that establishing different pricing for 
options in Penny classes and Non-Penny classes is reasonable, 
equitable, and not unfairly discriminatory because options in Penny 
classes are generally more liquid as compared to Non-Penny classes. 
Additionally, other competing options exchanges differentiate pricing 
in a similar manner.\102\
---------------------------------------------------------------------------

    \102\ See Nasdaq PHLX Options 7 Pricing Schedule, Section 4, 
Section II; NYSE American Options Fee Schedule, Section 1; Cboe 
Exchange, Inc., Fee Schedule, p. 1.
---------------------------------------------------------------------------

Complex Transactions
    The Exchange believes that the proposed rebates and fees for 
complex orders is reasonable, equitable and not unfairly discriminatory 
because all similarly situated market participants are subject to the 
same fee and rebate structure for complex order transactions, and 
access to the Exchange is offered on terms that are not unfairly 
discriminatory. With the exception of Priority Customer Origins which 
receive higher rebates and lower fees, all other professional Origins 
(Non-Emerald Market Maker, Firm Proprietary/Broker-Dealer, Non-Priority 
Customer) are assessed the same rebate and fee amounts. MIAX Emerald 
Market Makers are also assessed higher rebates and lower fees than 
those professionals in certain Tiers, however MIAX Emerald Market 
Makers have additional obligations discussed above that warrant such 
differences. The Exchange believes that the proposed tiered fee 
structure for maker rebates and fees and taker rebates and fees for 
complex orders, carving out orders that are contra to Priority Customer 
Origin is reasonable, equitable and not unfairly discriminatory because 
the structure is consistent with other options markets that also assess 
different transaction fees depending on the contra Origin.\103\ 
Additionally, the Exchange believes the structure is reasonable, 
equitable and not unfairly discriminatory because all similarly 
situated market participants in the same Origin type are subject to the 
same tiered rebates and fees and access to the Exchange is offered on 
terms that are not unfairly discriminatory.
---------------------------------------------------------------------------

    \103\ See supra note 22.
---------------------------------------------------------------------------

PRIME/cPRIME
    The Exchange believes that the proposed fee structure for PRIME/
cPRIME Auction transaction fees and rebates is reasonable, equitable, 
and not unfairly discriminatory. The proposed fee structure is 
reasonably designed because it is intended to incentivize market 
participants to send simple and complex order flow to the Exchange in 
order to participate in the price improvement mechanism in a manner 
that enables the Exchange to improve its overall competitiveness and 
strengthen its market quality for all market

[[Page 11618]]

participants. PRIME/cPRIME Auctions and the corresponding fees are also 
reasonably designed because they are within the range of fees and 
rebates assessed by other exchanges employing similar fee structures 
for complex orders submitted and executed in a price improvement 
mechanism. Other competing exchanges offer different fees and rebates 
for complex agency orders, contra-side orders, and responders to an 
auction in a manner similar to the proposal. Other competing exchanges 
also charge different rates for transactions in their price improvement 
mechanisms for Priority Customers versus Origins other than Priority 
Customer in a manner similar to the proposal.
    The PRIME and cPRIME fee and rebate structure is reasonable, 
equitable, and not unfairly discriminatory because it will apply 
equally to Priority Customer orders, Market Maker orders, Non-MIAX 
Emerald Market Maker orders, Broker-Dealer orders, Firm Proprietary 
orders, and Non-Priority Customers, in each respective category of 
PRIME and cPRIME orders. All similarly situated categories of 
participants are subject to the same transaction fee and rebate 
schedule, and access to the Exchange is offered on terms that are not 
unfairly discriminatory. The PRIME and cPRIME fee and rebate structure 
is reasonably designed because it is intended to incentivize market 
participants to send complex orders to the Exchange in order to 
participate in the price improvement mechanism in a manner that enables 
the Exchange to improve its overall competitiveness and strengthen its 
market quality for all market participants.
QCC Orders
    The Exchange believes the proposed transaction fees for QCC orders 
is reasonable because the proposed amount is in line with the amount 
assessed at other Exchanges for similar transactions.\104\ 
Additionally, the proposed fees would be charged to all Origins except 
Priority Customer. Assessing QCC rates to all market participants 
except Priority Customers is equitable and not unfairly discriminatory 
because Priority Customer order flow enhances liquidity on the Exchange 
for the benefit of all market participants. Specifically, Priority 
Customer liquidity benefits all market participants by providing more 
trading opportunities, which attracts Market-Makers. An increase in the 
activity of these market participants in turn facilitates tighter 
spreads, which may cause an additional corresponding increase in order 
flow from other market participants. By assessing a $0.00 fee for 
Priority Customer orders, the QCC transaction fees will not discourage 
the sending of Priority Customer orders.
---------------------------------------------------------------------------

    \104\ See supra note 51.
---------------------------------------------------------------------------

    The Exchange believes the proposed rebate for the initiating order 
side of a QCC transaction is reasonable because other competing 
exchanges also provide a rebate on the initiating order side. 
Additionally, the proposed rebate amount is within the range of the 
rebate amounts at the other competing exchanges.\105\ The Exchange 
believes the proposed rebate is equitable and not unfairly 
discriminatory because it applies to all Members that enter the 
initiating order (except for when both the initiator and contra-side 
orders are Priority Customers) and because it is intended to 
incentivize the sending of more QCC Orders to the Exchange. The 
Exchange believes it is reasonable, equitable and not unfairly 
discriminatory to not provide a rebate for the initiating order for QCC 
transactions for which both the initiator and the contra-side are 
Priority Customers since Priority Customers are already incentivized by 
a reduced fee for submitting QCC Orders.
---------------------------------------------------------------------------

    \105\ See id.
---------------------------------------------------------------------------

cQCC Fees
    The Exchange believes the proposed transaction fees for cQCC orders 
are reasonable because the proposed amounts are identical to the 
proposed fees for QCC transactions and are in line with the amounts 
assessed at other Exchanges for similar transactions.\106\ 
Additionally, the proposed fees would be assessed to all Origins except 
Priority Customer.
---------------------------------------------------------------------------

    \106\ See BOX Options Market LLC (``BOX'') Fee Schedule, Section 
I(D) (BOX does not charge Public Customers but charges Professional 
Customers, Broker-Dealers and Market Makers $0.17 per contract on 
both Agency and Contra Orders); see also Cboe Exchange, Inc. 
(``Cboe'') Fee Schedule, ``QCC Rate Table,'' Page 5 (Cboe charges 
non-Public Customers $0.17 per contract and does not charge Public 
Customers); see also NYSE American Options Fee Schedule, Section I.F 
(NYSE American charges Non-Customers $0.20 per contract, Specialists 
and e-Specialists $0.13 per contract, and does not charge Customer 
and Professional Customers).
---------------------------------------------------------------------------

    The Exchange believes the proposed rebate for the initiating order 
side of a cQCC transaction is reasonable because other competing 
exchanges also provide a rebate on the initiating order side.\107\ 
Additionally, the proposed rebate amount is within the range of the 
rebate amounts at the other competing exchanges.\108\ The Exchange 
believes the proposed rebate is equitable and not unfairly 
discriminatory because it applies to all Members that enter the 
initiating order (except for when both the initiator and contra-side 
orders are Priority Customers) and because it is intended to 
incentivize the sending of cQCC Orders to the Exchange. The Exchange 
believes it is reasonable, equitable, and not unfairly discriminatory 
to not provide a rebate for the initiating order for cQCC transactions 
for which both the initiator and the contra-side orders are Priority 
Customers since Priority Customers are already incentivized by a 
reduced fee for submitting cQCC Orders.
---------------------------------------------------------------------------

    \107\ See BOX Fee Schedule, Section I(D)(1); see also Cboe Fee 
Schedule, ``QCC Rate Table,'' Page 5; see also NYSE American Options 
Fee Schedule, Section I.F; see also Nasdaq ISE Pricing Schedule, 
Options 7, Section 6, Other Options Fees and Rebate, A. QCC and 
Solicitation Rebate.
    \108\ See BOX Fee Schedule, Section I(D)(1) (a $0.14 per 
contract rebate will be applied to the Agency Order where at least 
one party to the QCC transaction is a Non-Public Customer); see also 
Cboe Fee Schedule, ``QCC Rate Table,'' Page 5 (a $0.10 per contract 
credit will be delivered to the TPH Firm that enters the order into 
Cboe Command but will only be paid on the initiating side of the QCC 
transaction); see also NYSE American Options Fee Schedule, Section 
I.F (a $0.07 credit is applied to Floor Brokers executing 300,000 or 
fewer contracts in a month and a $0.10 credit is applied to Floor 
Brokers executing more than 300,000 contracts in a month); see also 
Nasdaq ISE Pricing Schedule, Options 7, Section 6, Other Options 
Fees and Rebate, A. QCC and Solicitation Rebate (rebates range from 
$0.00 to $0.11 per contract).
---------------------------------------------------------------------------

C2C and cC2C Fees
    The Exchange believes that adding the C2C fee to the Fee Schedule 
is reasonable, equitable, and not unfairly discriminatory because it 
clarifies that there is no fee applicable for these orders which are 
comprised solely of Priority Customer orders. The Exchange believes 
that it will make it more transparent as to how the Exchange assesses 
such fee and avoid any confusion as to how such fee is assessed for 
simple (C2C) and complex (cC2C) orders. The Exchange believes that the 
proposed transaction fee for cC2C Orders is reasonable because the 
proposed amount is identical to the fee assessed for C2C transactions, 
which is currently $0.00. The proposed fees would be charged to all 
Priority Customers alike and the Exchange believes that assessing a 
$0.00 fee to Priority Customers is equitable and not unfairly 
discriminatory. By assessing a $0.00 fee to Priority Customer orders, 
the C2C and cC2C transaction fees will not discourage the sending of 
Priority Customer orders.
Routing Fees
    The Exchange believes that the proposed Routing Fees are 
reasonable, equitable and not unfairly

[[Page 11619]]

discriminatory because they seek to recoup costs incurred by MIAX 
Emerald when routing orders to various away markets. In determining its 
proposed Routing Fees, the Exchange took into account transaction fees 
and rebates assessed by the away markets to which the Exchange routes 
orders, as well as the Exchange's clearing costs,\109\ administrative, 
regulatory, and technical costs associated with routing orders to an 
away market. The Exchange uses unaffiliated routing brokers to route 
orders to the away markets; the costs associated with the use of these 
services are included in the Routing Fees specified in the Fee 
Schedule. This Routing Fees structure is not only similar to the 
Exchange's affiliates, MIAX and MIAX PEARL, but is also comparable to 
the structures in place at other exchanges, such as Cboe BZX 
Options.\110\ The Exchange believes that having 8 groupings for its 
proposed routing fees is reasonable, equitable and not unfairly 
discriminatory because the Exchange will be able to better approximate 
its costs associated with routing orders to away markets. The per-
contract transaction fee amount associated with each grouping closely 
approximates the Exchange's all-in cost (plus an additional, non-
material amount) to execute that corresponding contract at that 
corresponding exchange. The Exchange notes that in determining the 
appropriate groupings, the Exchange considered the transaction fees and 
rebates assessed by away markets, and grouped exchanges together that 
assess transaction fees for routed orders within a similar range. This 
same logic and structure applies to all of the groupings in the 
proposed Routing Fees table. By utilizing the same structure that is 
utilized by the Exchange's affiliates, MIAX and MIAX PEARL, those 
Members which are Members of the Exchange, MIAX, and MIAX PEARL, will 
be assessed Routing Fees in the same manner, which the Exchange 
believes will minimize any confusion as to the method of assessing 
Routing Fees between the three exchanges for those Members. This 
proposal is identical to the routing fee tables of the Exchange's 
affiliates, MIAX and MIAX PEARL.\111\
---------------------------------------------------------------------------

    \109\ See supra note 57.
    \110\ See supra note 56.
    \111\ See supra note 59.
---------------------------------------------------------------------------

Regulatory Fees
Sales Value Fee
    The assessment by the Exchange of the proposed Sales Value Fee is 
reasonable, equitable and not unfairly discriminatory since it allows 
the Exchange to offset the cost it incurs in payment to the Commission 
of a transaction fee that is designed to recover the costs related to 
the government's supervision and regulation of the securities markets 
and securities professionals. The amount of the fee is the same amount 
assessed to the Exchange pursuant to Section 31 of the Exchange Act. 
The Exchange believes it is reasonable to recover the actual costs 
associated with the payment of Section 31 fees and other exchanges, 
including MIAX, charge the same fee to their market participants.
Web CRD Fees
    The Exchange believes it is reasonable, equitable and not unfairly 
discriminatory for the proposed FINRA fees to be included on the Fee 
Schedule because these fees are not being assessed or set by MIAX 
Emerald, but by FINRA, and will be assessed to broker-dealers that 
register associated persons through FINRA's Web CRD system, and other 
exchanges, including MIAX, charge the same fees to their market 
participants.
Non-Transaction Fees
Membership Fees
    The Exchange believes that the assessment of one-time Membership 
Application fees is reasonable, equitable and not unfairly 
discriminatory. As described in the Purpose section, the one-time 
application fees are charged by other options exchanges, including MIAX 
and MIAX PEARL, and are designed to recover costs associated with the 
processing of such applications. MIAX Emerald believes it is reasonable 
and equitable to waive the fee to applicants who apply for membership 
during the Waiver Period since the waiver of such fees provides 
incentives to interested applicants to apply early for MIAX Emerald 
membership. This in turn provides MIAX Emerald with potential order 
flow and liquidity providers as it begins operations. The waiver will 
apply equally to all applicants during the Waiver Period for the 
membership application fee.
Trading Permit Fees
    The Exchange believes that the assessment of Trading Permit fees is 
reasonable, equitable and not unfairly discriminatory. The assessment 
of Trading Permit fees is done by the Exchange's affiliates, MIAX and 
MIAX PEARL, and is commonly done by other exchanges as described in the 
Purpose section above. MIAX Emerald believes it is reasonable and 
equitable to waive the fee to Members during the Waiver Period since 
the waiver of such fees provides incentives to interested Members to 
apply early for trading permits. This in turn provides MIAX Emerald 
with potential order flow and liquidity providers as it begins 
operations. The waiver of the Trading Permit fees will apply equally to 
all Members during the Waiver Period.
API and Network Testing and Certification Fees
    MIAX Emerald believes that the assessment of API and Network 
Testing and Certification fees is a reasonable allocation of its costs 
and expenses among its Members and other persons using its facilities 
since it is recovering the costs associated with providing such 
infrastructure testing and certification services. Other exchanges, 
including MIAX and MIAX PEARL, charge a fee for similar services to 
Members and non-Members.
    MIAX Emerald believes it is reasonable and equitable to waive the 
API Testing and Certification fee assessable to Members and non-Members 
during the Waiver Period since the waiver of such fees provides 
incentives to interested Members and non-Members to test their APIs 
early. Determining system operability with the Exchange's system early 
will in turn provide MIAX Emerald with potential order flow and 
liquidity providers as it begins operations. The waiver of API Testing 
and Certification fees will apply equally to all Members and non-
Members during the Waiver Period.
    Additionally, MIAX Emerald believes it is reasonable, equitable and 
not unfairly discriminatory to assess different Network Testing and 
Certification fees to Members and non-Members. The higher fee charged 
to non-Members reflects the greater amount of time spent by MIAX 
Emerald employees testing and certifying non-Members. It has been MIAX 
Emerald's experience that Member testing takes less time than non-
Member testing because Members have more experience testing these 
systems with exchanges; generally fewer questions and issues arise 
during the testing and certification process.
System Connectivity Fees
    The Exchange believes that the proposed pass-through of external 
connectivity fees and Port Fees constitute an equitable allocation of 
fees, and are not unfairly discriminatory, because they allow the 
Exchange to recover costs associated with offering access through the 
network connections and access and services through the Ports, 
responding to customer requests, configuring MIAX

[[Page 11620]]

Emerald systems, programming API user specifications and administering 
the various services. Access to the MIAX Emerald market is offered on 
fair and non-discriminatory terms.
    MIAX Emerald believes it is reasonable, equitable and not unfairly 
discriminatory to pass-through External Connectivity fees to Members 
and non-Members that establish connections with MIAX Emerald through a 
third-party. MIAX Emerald will only pass-through the actual costs it is 
charged by third-party external vendors. MIAX Emerald believes it is 
reasonable and equitable to recover costs charged it on behalf of a 
Member or non-Member that establishes connections with MIAX Emerald 
through a third party. Other exchanges, including MIAX, charge a fee 
for similar services to Members and non-Members.
    MIAX Emerald believes it is reasonable, equitable and not unfairly 
discriminatory to assess Port Fees on both Members and non-Members who 
use such services. In particular, the Exchange believes that it is 
reasonable, equitable and not unfairly discriminatory to assess Port 
Fees on Members since the Ports enable Members to submit orders and to 
receive information regarding transactions. Specifically, the FIX Port, 
MEI Port, CTD Port and FXD Port enable Members to submit orders 
electronically to the Exchange for processing. The Exchange believes 
that its proposed fees are reasonable in that other exchanges offer 
similar ports with similar services and charge fees for the use of such 
ports, including MIAX.
    MIAX Emerald believes it is reasonable and equitable to waive most 
of the Port Fees assessable to Members and non-Members during the 
Waiver Period since the waiver of such fees provides incentives to 
Members and non-Members to connect to the Ports early. Determining 
connectivity and system operability with the Exchange's system early 
will in turn provide MIAX Emerald with potential order flow and 
liquidity providers as it begins operations. The waiver of most of the 
Port Fees will apply equally to all Members and non-Members during the 
Waiver Period. The sole Port Fee that is not waived is the Additional 
Limited Service MEI Ports Fee. The Exchange believes it is reasonable 
to exclude this fee from the Waiver Period in order to ensure that 
Members and non-Members do not request an excessive number of 
Additional Limited Service MEI Ports, since there is no fee associated 
with such Ports.
    MIAX Emerald believes that its fees for MPIDs are reasonable, 
equitable and not unfairly discriminatory in that they apply to all 
EEMs equally and allow the Exchange to recover operational and 
administrative costs in assigning and maintaining such services based 
on the number of MPIDs assigned to the particular EEM in a given month 
in each month the Member is credentialed to use such MPIDs in the 
production environment. The Exchange believes that its proposed fees 
are reasonable in that other exchanges charge fees for similar 
services, including MIAX.
    MIAX Emerald believes it is reasonable and equitable to waive the 
MPID fee to EEMs during the Waiver Period since the waiver of such fees 
provides incentives to Members to apply early. This in turn provides 
MIAX Emerald with potential order flow and liquidity providers as it 
begins operations. The waiver of the MPID fees will apply equally to 
all Members during the Waiver Period.
    The Exchange believes that the proposed Technical Support fee is 
fair, equitable and not unreasonably discriminatory, because it is 
assessed equally to all Members and non-Members who request technical 
support. Furthermore, Members and non-Members are not required to use 
the service but instead it is offered as a convenience to all Members 
and non-Members. The proposed fee is reasonably designed because it 
will permit both Members and non-Members to request the use of the 
Exchange's on-site data center personnel as technical support and as a 
convenience in order to test or otherwise assess the User's 
connectivity to the Exchange and the fee is within the range of the fee 
charged by other exchanges for similar services and is identical to the 
same fee assessed by MIAX and MIAX PEARL.
Market Data Fees
    The Exchange believes that its proposal to assess market data fees 
is consistent with the provisions of Section 6(b)(4) of the Act in that 
it provides an equitable allocation of reasonable fees among 
distributors of ToM, cToM, AIS and MOR, because all Distributors in 
each of the respective category of Distributor (i.e., Internal and 
External) will be assessed the same fees as other Distributors in their 
category for the applicable market data product.
    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 the public. It was believed that 
this authority would expand the amount of data available to consumers, 
and also spur innovation and competition for the provision of market 
data:

    [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 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. \112\
---------------------------------------------------------------------------

    \112\ 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. If 
the free market should determine whether proprietary data is sold to 
broker-dealers at all, it follows that the price at which such data is 
sold should be set by the market as well.
    In July, 2010, Congress adopted H.R. 4173, the Dodd-Frank Wall 
Street Reform and Consumer Protection Act of 2010 (``Dodd-Frank Act''), 
which amended Section 19 of the Act. Among other things, Section 916 of 
the Dodd-Frank Act amended paragraph (A) of Section 19(b)(3) of the Act 
by inserting the phrase ``on any person, whether or not the person is a 
member of the self-regulatory organization'' after ``due, fee or other 
charge imposed by the self-regulatory organization.'' As a result, all 
SRO rule proposals establishing or changing dues, fees or other charges 
are immediately effective upon filing regardless of whether such dues, 
fees or other charges are imposed on members of the SRO, non-members, 
or both. Section 916 further amended paragraph (C) of Section 19(b)(3) 
of the Act to read, in pertinent part, ``At any time within the 60-day 
period beginning on the date of filing of such a proposed rule change 
in accordance with the provisions of paragraph (1) [of Section 19(b)], 
the Commission summarily may temporarily suspend the change in the 
rules of the self-regulatory organization made thereby, 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 this title. If the Commission takes such 
action, the Commission shall institute proceedings under paragraph 
(2)(B) [of Section 19(b)] to determine whether the proposed rule should 
be approved or disapproved.''
    The Exchange believes that these amendments to Section 19 of the 
Act reflect Congress's intent to allow the Commission to rely upon the 
forces of competition to ensure that fees for

[[Page 11621]]

market data are reasonable and equitably allocated. Although Section 
19(b) had formerly authorized immediate effectiveness for a ``due, fee 
or other charge imposed by the self-regulatory organization,'' the 
Commission adopted a policy and subsequently a rule stating that fees 
for data and other products available to persons that are not members 
of the self-regulatory organization must be approved by the Commission 
after first being published for comment. At the time, the Commission 
supported the adoption of the policy and the rule by pointing out that 
unlike members, whose representation in self-regulatory organization 
governance was mandated by the Act, non-members should be given the 
opportunity to comment on fees before being required to pay them, and 
that the Commission should specifically approve all such fees. MIAX 
Emerald believes that the amendment to Section 19 reflects Congress's 
conclusion that the evolution of self-regulatory organization 
governance and competitive market structure have rendered the 
Commission's prior policy on non-member fees obsolete. Specifically, 
many exchanges have evolved from member-owned, not-for-profit 
corporations into for-profit, investor-owned corporations (or 
subsidiaries of investor-owned corporations). Accordingly, exchanges no 
longer have narrow incentives to manage their affairs for the exclusive 
benefit of their members, but rather have incentives to maximize the 
appeal of their products to all customers, whether members or non-
members, so as to broaden distribution and grow revenues. Moreover, the 
Exchange believes that the change also reflects an endorsement of the 
Commission's determinations that reliance on competitive markets is an 
appropriate means to ensure equitable and reasonable prices. Simply 
put, the change reflects a presumption that all fee changes should be 
permitted to take effect immediately, since the level of all fees are 
constrained by competitive forces. The Exchange therefore believes that 
the assessment of fees for the use of ToM, cToM, AIS and MOR is proper 
for all Distributors.
    The decision of the United States Court of Appeals for the District 
of Columbia Circuit in NetCoaliton v. SEC, No. 09-1042 (D.C. Cir. 
2010), although reviewing a Commission decision made prior to the 
effective date of the Dodd-Frank Act, upheld the Commission's reliance 
upon competitive markets to set reasonable and equitably allocated fees 
for market data:

    In fact, the legislative history indicates that the Congress 
intended that the market system `evolve through the interplay of 
competitive forces as unnecessary regulatory restrictions are 
removed' and that the SEC wield its regulatory power `in those 
situations where competition may not be sufficient,' such as in the 
creation of a `consolidated transactional reporting system. \113\
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    \113\ NetCoaltion, at 15 (quoting H.R. Rep. No. 94-229, at 92 
(1975), as reprinted in 1975 U.S.C.C.A.N. 321, 323).

    The court's conclusions about Congressional intent are therefore 
reinforced by the Dodd-Frank Act amendments, which create a presumption 
that exchange fees, including market data fees, may take effect 
immediately, without prior Commission approval, and that the Commission 
should take action to suspend a fee change and institute a proceeding 
to determine whether the fee change should be approved or disapproved 
only where the Commission has concerns that the change may not be 
consistent with the Act.
    MIAX Emerald believes that the assessment of the proposed market 
data fees for ToM, cToM, AIS and MOR is fair and equitable in 
accordance with Section 6(b)(4) of the Act, and not unreasonably 
discriminatory in accordance with Section 6(b)(5) of the Act. As 
described above, market data fees are assessed by other exchanges, 
including MIAX.\114\
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    \114\ See Securities Exchange Act Release Nos.69323 (April 5, 
2013), 78 FR 21677(April 11, 2013)(SR-MIAX-2013-14); 73326 (October 
9, 2014), 79 FR 62233 (October 16, 2014)(SR-MIAX-2014-51); 74857 
(May 1, 2015), 88 FR 26306 (May 7, 2015)(SR-MIAX-2015-32).
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    Moreover, the decision as to whether or not to subscribe to ToM, 
cToM, AIS and MOR is entirely optional to all parties. Potential 
subscribers are not required to purchase the ToM, cToM, AIS or MOR 
market data feed, and MIAX Emerald is not required to make the ToM, 
cToM, AIS or MOR market data feed available. Subscribers can 
discontinue their use at any time and for any reason, including due to 
their assessment of the reasonableness of fees charged. The allocation 
of fees among subscribers is fair and reasonable because, if the market 
deems the proposed fees to be unfair or inequitable, firms can diminish 
or discontinue their use of this data.
    MIAX Emerald believes it is reasonable and equitable to waive the 
market data fees to Distributors during the Waiver Period since the 
waiver of such fees provides incentives to interested Distributors to 
receive the data feeds early. This in turn provides MIAX Emerald with 
potential order flow and liquidity providers as it begins operations. 
The waiver of the market data fees will apply equally to all 
Distributors during the Waiver Period.
    Finally, the Exchange notes that it operates in a highly 
competitive market in which market participants can readily favor 
competing venues. In such an environment, the Exchange must establish 
fees that are competitive with other exchanges. For the reasons 
described above, the Exchange believes that the proposed fees in the 
MIAX Emerald Fee Schedule appropriately reflect this competitive 
environment.

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

    MIAX Emerald does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. Unilateral action by MIAX 
Emerald in establishing rebates and fees for services provided to its 
Members and others using its facilities will not have an impact on 
competition. As a new entrant in the already highly competitive 
environment for equity options trading, MIAX Emerald does not have the 
market power necessary to set prices for services that are unreasonable 
or unfairly discriminatory in violation of the Act. MIAX Emerald's 
proposed rebates and fees, as described herein, are comparable to 
rebates and fees charged by other options exchanges for the same or 
similar services, including those rebates and fees assessed by its 
affiliates, MIAX and MIAX PEARL.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act,\115\ and Rule 19b-4(f)(2) \116\ thereunder. 
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

[[Page 11622]]

institute proceedings to determine whether the proposed rule should be 
approved or disapproved.
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    \115\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \116\ 17 CFR 240.19b-4(f)(2).
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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-EMERALD-2019-15 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-EMERALD-2019-15. 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-EMERALD-2019-15 and should be submitted 
on or before April 17, 2019.
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    \117\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\117\
Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-05816 Filed 3-26-19; 8:45 am]
 BILLING CODE 8011-01-P