Document ID: SEC-2020-2003-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Cboe EDGX Exchange, Inc.
Posted Date: 2020-12-17T05:00Z

[Federal Register Volume 85, Number 243 (Thursday, December 17, 2020)]
[Notices]
[Pages 81966-81971]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-27724]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-90643; File No. SR-CboeEDGX-2020-061]

Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change 
Relating To Amend Its Fee Schedule With Respect to Qualified Contingent 
Cross (``QCC'') and Solicitation Auction Mechanism (``SAM'') Orders

December 11, 2020.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on December 3, 2020, Cboe EDGX Exchange, Inc. (the ``Exchange'' or 
``EDGX'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the 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

    Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX Options'') 
proposes to amend its Fee Schedule with respect to Qualified Contingent 
Cross (``QCC'') and Solicitation Auction Mechanism (``SAM'') orders. 
The text of the proposed rule change is provided in Exhibit 5.
    The text of the proposed rule change is also available on the 
Exchange's website (http://markets.cboe.com/us/options/regulation/rule_filings/edgx/), at the Exchange's Office of the Secretary, and at 
the Commission's Public Reference Room.

[[Page 81967]]

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 Exchange proposes to modify the Fee Schedule relating to 
Qualified Contingent Cross (``QCC'') and Solicitation Auction Mechanism 
(``SAM'') \3\ orders.\4\
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    \3\ SAM is the Exchange's solicited order mechanism for larger-
sized orders.
    \4\ The Exchange initially filed the proposed fee changes on 
December 1, 2020 (SR-CboeEDGX-2020-058). On December 3, 2020, the 
Exchange withdrew that filing and submitted this proposal.
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    The Exchange first notes that it operates in a highly competitive 
market in which market participants can readily direct order flow to 
competing venues if they deem fee levels at a particular venue to be 
excessive or incentives to be insufficient. More specifically, the 
Exchange is only one of 16 options venues to which market participants 
may direct their order flow. Based on publicly available information, 
no single options exchange has more than 15% of the market share.\5\ 
Thus, in such a low-concentrated and highly competitive market, no 
single options exchange possesses significant pricing power in the 
execution of option order flow. The Exchange believes that the ever-
shifting market share among the exchanges from month to month 
demonstrates that market participants can shift order flow, or 
discontinue use of certain categories of products, in response to fee 
changes. Accordingly, competitive forces constrain the Exchange's 
transaction fees, and market participants can readily trade on 
competing venues if they deem pricing levels at those other venues to 
be more favorable. In response to the competitive environment, the 
Exchange offers specific rates and credits in its fees schedule, like 
that of other options exchanges' fees schedules, which the Exchange 
believes provide incentive to Members to increase order flow of certain 
qualifying orders.
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    \5\ See Cboe Global Markets U.S. Options Market Monthly Volume 
Summary (November 25, 2020), available at https://markets.cboe.com/us/options/market_statistics/.
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QCC Transaction Fees
    By way of background, a QCC order 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 and that for 
complex QCC transactions, the 1,000 contracts minimum is applied per 
leg. Currently, the Exchange assesses a fee of $0.08 per contract for 
Non-Customer Agency and Contra QCC orders and $0.00 for Customer QCC 
Agency and Contra orders. The Exchange proposes to amend its fees for 
orders executed in QCC transactions. First, the Exchange proposes to 
eliminate transaction fees for Professional Agency and Contra QCC 
orders. The purpose of the proposed change to waive fees for 
Professional QCC orders is to incentivize the sending of QCC orders to 
the Exchange by these market participants and compete with other 
Exchanges that similarly do not assess fees on Professional QCC 
orders.\6\ In connection with this proposed change, the Exchange 
proposes to adopt new fee codes QO and QP to apply specifically to QCC 
Agency and Contra Professional orders, respectively, and amend the 
description of current fee codes QM and QN to provide it applies to 
Non-Customer, Non-Professionals. The Exchange next proposes to increase 
the fees for QCC Agency and Contra Non-Customer, Non-Professional 
orders from $0.08 per contract to $0.20 per contract. The proposed Non-
Customer, Non-Professional QCC fee change is also in line with amounts 
assessed by other exchanges for similar transactions.\7\
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    \6\ See e.g., BOX Options Fee Schedule, Section 1(D), Qualified 
Contingent Cross (``QCC'') Transactions, which provides that no fees 
are assessed for Customer and Professional Customer QCC 
transactions. See also NYSE American Options Fee Schedule, Section 
1(F), QCC Fees and Credits, which also provides that no fees are 
assessed for Customer and Professional Customer QCC transactions.
    \7\ See e.g., Nasdaq ISE LLC Pricing Schedule, Options 7 Pricing 
Schedule, Section 1, ``Crossing Orders'', which provides that non-
customer, non-professional QCC orders are assessed $0.20 per 
contract.
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Agency Orders and Designated Give Up
    Footnote 5 of the Fee Schedule currently specifies that when an 
order is submitted with a Designated Give Up, as defined in Rule 
21.12(b)(1), the applicable rebates for such orders when executed on 
the Exchange (orders yielding fee code BC, NC, PC, SC, QA, QM, ZA and 
ZB) are provided to the Member who routed the order to the Exchange. 
Pursuant to Rule 21.12, which specifies the process to submit an order 
with a Designated Give Up, a Member acting as an options routing firm 
on behalf of one or more other Exchange Members (a ``Routing Firm'') is 
able to route orders to the Exchange and to immediately give up the 
party (a party other than the Routing Firm itself or the Routing Firm's 
own clearing firm) who accepts and clears any resulting transaction. 
Because the Routing Firm is responsible for the decision to route the 
order to the Exchange, the Exchange currently provides such Member with 
the rebate when orders that yield fee code BC,\8\ NC,\9\ PC,\10\ 
SC,\11\ QA,\12\ QM,\13\ ZA \14\ and ZB \15\ are executed. In connection 
with the adoption of a new fee code for QCC Professional orders, the 
Exchange proposes to add new fee code QO (QCC Professional Agency 
Order) to the lead-in sentence of footnote 5 and to append footnote 5 
to fee code QO in the Fee Codes and Associated Fees table of the Fee 
Schedule. The Exchange notes that Professional QCC Agency orders are 
currently included under Footnote 5, albeit represented by fee code QM, 
which will no longer be appended to Professional QCC Agency orders.
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    \8\ Fee Code ``BC'' is appended to AIM Agency Customer orders.
    \9\ Fee Code ``NC'' is appended to Customer Non-Penny orders.
    \10\ Fee Code ``PC'' is appended to Customer Penny orders.
    \11\ Fee Code ``SC'' is appended to SAM Agency Customer orders.
    \12\ Fee Code ``QA'' is appended to QCC Agency Customer orders.
    \13\ Fee Code ``QM'' is appended to QCC Agency Non-Customer 
orders.
    \14\ Fee Code ``ZA'' is appended to Complex Customer (contra 
Non-Customer), Penny orders.
    \15\ Fee Code ``ZB'' is appended to Complex Customer (contra 
Non-Customer), Non-Penny orders.
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QCC Initiator/Solicitation Rebate Tiers
    As noted above, the Exchange operates in a highly-competitive 
market by which competitive forces constrain the Exchange's transaction 
fees and market participants can readily trade on competing venues if 
they deem pricing levels at those other venues to be more favorable. In 
response to the competitive environment, the Exchange offers, among 
other things, tiered pricing which provides Members opportunities to 
qualify for higher rebates or reduced fees where certain volume 
criteria and thresholds are met. Tiered pricing provides an incremental 
incentive for Members to strive for higher tier levels, which provides 
increasingly higher

[[Page 81968]]

benefits or discounts for satisfying increasingly more stringent 
criteria. One such example is that the Exchange currently offers QCC 
Initiator/Solicitation Rebate Tiers under footnote 7, which provide 
enhanced rebates for qualifying QCC and SAM Agency orders where a 
Member meets incrementally increasing volume thresholds. Particularly, 
the Exchange will apply the QCC Initiator/Solicitation Rebate to the 
Member that submits QCC Agency Orders or Solicitation Agency Orders, 
including a Member who routed orders to the Exchange with a Designated 
Give Up, when at least one side of the transaction is of Non-Customer 
capacity. Currently fee codes QA, QM, SA \16\ and SC qualify for these 
rebates. Currently, Tier 1 provides no rebates for Members that submit 
qualifying orders (i.e., QA, QM, SA and SC) totaling 0 to 99,999 
contracts per month; Tier 2, provides a rebate of $0.05 per contract 
for Members that submit qualifying orders totaling 100,000 to 199,999 
contracts per month; Tier 3, provides a rebate of $0.07 per contract 
for Members that submit qualifying orders totaling 200,000 to 499,999 
contracts per month; Tier 4, provides a rebate of $0.09 per contract 
for Members that submit qualifying orders totaling 500,000 to 749,999 
contracts per month; Tier 5 provides a rebate of $0.10 per contract for 
Members that submit qualifying orders totaling 750,000 to 999,999 
contracts per month; and Tier 6, provides a rebate of $0.11 per 
contract for Members that submit qualifying orders totaling 1,000,000 
or more contracts per month.
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    \16\ Fee Code ``SA'' is appended to SAM Agency Non-Customer 
orders.
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    The Exchange proposes to amend the QCC Initiator/Solicitation 
Rebate Tier program by (1) amending the volume thresholds, (2) 
eliminating Tiers 5 and 6, (3) amending the current rebates and (4) 
clarifying that the program will apply to new fee code QO which will be 
appended to QCC Agency Professional orders. The Exchange first proposes 
to amend the volume thresholds as follows:
     To receive the rebate in Tier 1, a member must submit 
qualifying orders totaling 0-999,999 contracts per month.
     To receive the rebate in Tier 2, a member must submit 
qualifying orders totaling 1,000,000-1,999,999 contracts per month.
     To receive the rebate in Tier 3, a member must submit 
qualifying orders totaling 2,000,000-2,999,999 contracts per month.
     To receive the rebate in Tier 4, a member must submit 
qualifying orders totaling 3,000,000 or more contracts per month.

The Exchange also proposes to eliminate Tiers 5 and 6 and notes that no 
Members have historically hit such tiers. The Exchange also proposes to 
adopt a new rebate structure for Tiers 1 through 4. Particularly, the 
Exchange proposes to adopt two separate rebates that are available 
under each tier, depending on the market participants involved in a 
particular transaction. A qualifying order will receive the rebate 
under ``Rebate 1'' if one side of the transaction is of Non-Customer, 
Non-Professional capacity. A qualifying order will receive the rebate 
under ``Rebate 2'', if both sides of the transaction are of Non-
Customer, Non-Professional capacity. Transactions where both sides of 
the transaction are Customers or Professionals will not receive a 
rebate. The proposed rebates and corresponding tiers are as follows:

------------------------------------------------------------------------
                  Volume threshold  (per
      Tier                month)             Rebate 1        Rebate 2
------------------------------------------------------------------------
1..............  0 to 999,999 contracts.         ($0.14)         ($0.22)
2..............  1,000,000 to 1,999,999          ($0.15)         ($0.23)
                  contracts.
3..............  2,000,000 to 2,999,999          ($0.16)         ($0.24)
                  contracts.
4..............  3,000,000+ contracts...         ($0.16)         ($0.26)
------------------------------------------------------------------------

    The Exchange is proposing to increase the volume thresholds under 
the tiers in light of the proposed new (and much higher) enhanced 
rebates. Particularly, the Exchange believes the proposed thresholds 
are more appropriate and commensurate with the new proposed rebates. 
The Exchange notes that it also wishes to provide a lower enhanced 
rebate where only one side of a transaction is a Non-Customer, Non-
Professional, as it receives less revenue as compared to when both 
sides of a transaction are Non-Customer, Non-Professionals. The 
Exchange believes the proposed rebates and rebate structure are 
competitive with rebates offered at another exchange for similar 
transactions.\17\ Additionally, the proposed changes to the QCC 
Initiator/Solicitation Rebate Tiers are designed to incentivize Members 
to grow their QCC Initiator and/or Solicitation order flow to receive 
the enhanced rebates. The Exchange believes that incentivizing greater 
QCC Initiator and/or Solicitation order flow would provide more 
opportunities for participation in QCC trades or in the SAM Auction 
which icreases [sic] opportunities for price improvement.
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    \17\ See Box Options Fee Schedule, Section 1(D), which provides 
a $0.14 per contract rebate to the Agency Order where at least one 
party to the QCC transaction is a Broker-Dealer or Market-Maker 
(i.e., a non-customer, non-professional) and a $0.22 per contract 
rebate where both parties to the QCC transaction are a Broker-Dealer 
or Market-Maker.
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    Lastly, in connection with the adoption of a new fee code for QCC 
Professional orders, the Exchange proposes to add new fee code QO (QCC 
Agency Professional Order) to the lead-in sentence of footnote 7 and to 
append footnote 7 to fee code QO in the Fee Codes and Associated Fees 
table of the Fee Schedule. The Exchange notes that Professional QCC 
Agency orders already are included under Footnote 7, albeit represented 
by fee code QM, which will no longer be appended to Professional QCC 
Agency orders.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6 of the Act,\18\ in general, and furthers the 
requirements of Section 6(b)(4),\19\ in particular, as it is designed 
to provide for the equitable allocation of reasonable dues, fees and 
other charges among its facilities and does not unfairly discriminate 
between customers, issuers, brokers or dealers.
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    \18\ 15 U.S.C. 78f.
    \19\ 15 U.S.C. 78f(b)(4).
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    As stated above, the Exchange operates in a highly-competitive 
market in which market participants can readily direct order flow to 
competing venues if they deem fee levels at a particular venue to be 
excessive or incentives to be insufficient. The Exchange is only one of 
several options venues to which market participants may direct their 
order flow, and it represents a small percentage of the overall market. 
The proposed fee

[[Page 81969]]

changes reflect a competitive pricing structure designed to incentivize 
market participants, including Professionals, to direct their QCC order 
flow, which the Exchange believes would enhance market quality to the 
benefit of all Members.
    Overall, the Exchange believes that its volume-based tiers for QCC 
and SAM Agency Orders is consistent with Section 6(b)(4) of the Act in 
that the proposed fees are reasonable, equitable and not unfairly 
discriminatory. The Exchange believes that the proposed fees and 
rebates are reasonable, equitable, and not unfairly discriminatory in 
that competing options exchanges offer substantially the same fees and 
credits in connection with QCC transactions as the Exchange now 
proposes.\20\
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    \20\ See e.g., BOX Options Fee Schedule, Section 1(D), Qualified 
Contingent Cross (``QCC'') Transactions. See also NYSE American 
Options Fee Schedule, Section 1(F), QCC Fees and Credits and Nasdaq 
ISE LLC Pricing Schedule, Options 7 Pricing Schedule, Section 1, 
``Crossing Orders''.
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QCC Transaction Fees
    In particular, the Exchange believes the proposal to not assess a 
fee for Professional QCC orders is reasonable because such market 
participants would not be subject to any fees for such transactions. 
The Exchange notes other Exchanges also waive fees for Professional QCC 
transactions.\21\ The Exchange believes the proposed change to increase 
the fee for Non-Customer, Non-Professional QCC orders is reasonable 
because it is in line with the amounts assessed for similar orders at 
other exchanges.\22\ Additionally, the proposed rate changes apply 
uniformly to similarly situated market participants.
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    \21\ See e.g., BOX Options Fee Schedule, Section 1(D), Qualified 
Contingent Cross (``QCC'') Transactions, which provides that no fees 
are assessed for Customer and Professional Customer QCC 
transactions. See also NYSE American Options Fee Schedule, Section 
1(F), QCC Fees and Credits, which also provides that no fees are 
assessed for Customer and Professional Customer QCC transactions.
    \22\ See e.g., Nasdaq ISE LLC Pricing Schedule, Options 7 
Pricing Schedule, Section 1, ``Crossing Orders'', which provides 
that non-customer, non-professional QCC orders are assessed $0.20 
per contract.
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Professional QCC Agency Orders and Designated Give Up
    The Exchange believes that the proposal to add new fee code QO to 
the lead-in sentence of footnote 5 and to append footnote 5 to fee code 
QO is a reasonable and equitable allocation of fees and dues and is not 
unreasonably discriminatory because, as is currently the case pursuant 
to footnote 5 and Rule 21.12(b)(1), the proposal simply makes clear 
that a firm acting as a Routing Firm that routes Professional QCC 
Agency Orders to the Exchange will be provided applicable rebates, 
based on the Routing Firm's decision to route the order to the 
Exchange. Particularly, as noted above, Professional QCC Agency orders 
were already subject to footnote 5 of the fee schedule, albeit 
represented by footnote QM.
QCC Initiator/Solicitation Rebate Tiers
    The Exchange believes the proposed changes to the existing QCC 
Initiator/Solicitation Rebate Tiers is reasonable because they continue 
to provide opportunities for Members to receive higher rebates by 
providing for incrementally increasing volume-based criteria they can 
reach for (albeit using more stringent criteria, but offering higher 
enhanced rebates). The Exchange believes the rebate tiers, as modified, 
continue to serve as a reasonable means to encourage Members to 
increase their liquidity on the Exchange, particularly in connection 
with additional QCC and/or Solicitation Agency Order flow to the 
Exchange in order to benefit from the proposed enhanced rebates. The 
Exchange believes that incentivizing greater QCC Initiator and/or 
Solicitation order flow would provide more opportunities for 
participation in QCC trades or in the SAM Auction which increases 
opportunities for price improvement. The Exchange also notes that any 
overall increased liquidity that may result from the proposed tier 
incentives benefits all investors by offering additional flexibility 
for all investors to enjoy cost savings, supporting the quality of 
price discovery, promoting market transparency and improving investor 
protection. The Exchange again notes that volume-based incentives and 
discounts have been widely adopted by other exchanges, and believes 
that the proposed tiers are reasonable, equitable and non-
discriminatory because they are open to all Members on an equal basis.
    The Exchange believes eliminating current Tiers 5 and 6 is 
reasonable because the Exchange is not required to maintain these tiers 
and Members still have the opportunity to receive enhanced rebates 
under the existing Tiers 1-4. Moreover, no Member has historically 
achieved these tiers. The Exchange believes the proposal to eliminate 
these tiers is also equitable and not unfairly discriminatory because 
it applies to all Members.
    The Exchange believes the proposed enhanced rebates are 
commensurate with the difficulty of the proposed criteria and that the 
tiers continue to provide an incremental incentive for Members to 
strive for higher tier levels, which provides increasingly higher 
rebates for satisfying increasingly more stringent criteria. As noted 
above, the Exchange also believes the proposal to adopt two alternative 
rebates depending on the capacity of the parties to the transaction is 
reasonable. As discussed, the Exchange wishes to provide a lower 
enhanced rebate where only one side of a transaction is a Non-Customer, 
Non-Professional, as these transactions generally generate less revenue 
as compared to when both sides of a transaction are Non-Customer, Non-
Professionals. The Exchange also believes the proposed rebates and 
rebate structure are competitive with rebates offered at another 
exchange for similar transactions.\23\
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    \23\ See Box Options Fee Schedule, Section 1(D), which provides 
a $0.14 per contract rebate to the Agency Order where at least one 
party to the QCC transaction is a Broker-Dealer or Market-Maker 
(i.e., a non-customer, non-professional) and a $0.22 per contract 
rebate where both parties to the QCC transaction are a Broker-Dealer 
or Market-Maker.
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    The Exchange believes that the proposed changes to Tiers 1-4 
represent an equitable allocation of fees and is not unfairly 
discriminatory because Members will be eligible for these tiers and the 
corresponding enhanced rebates will apply uniformly to all Members that 
reach the proposed tier criteria. The Exchange believes that a number 
of market participants have a reasonable opportunity to satisfy the 
tiers' criteria, even as modified. The Exchange notes that currently no 
Members satisfy any of the Tiers' current criteria. While the Exchange 
has no way of knowing whether this proposed rule change would 
definitively result in any particular Member qualifying for the 
proposed tiers, the Exchange anticipates at least one to three Members 
meeting, or being reasonably able to meet, the proposed criteria under 
the rebate tiers. Particularly, the Exchange anticipates at least one 
firm to satisfy the criteria under each of Tiers 1, 2 and 3; however, 
the proposed tiers are open to any Member that satisfies the tiers' 
criteria. The Exchange also notes that the proposed changes will not 
adversely impact any Member's pricing or their ability to qualify for 
other rebate tiers. Rather, should a Member not meet the proposed 
criteria, the Member will merely not receive the corresponding enhanced 
rebates.

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not

[[Page 81970]]

necessary or appropriate in furtherance of the purposes of the Act. 
Rather, as discussed above, the Exchange believes that the proposed 
change would encourage the submission of additional order flow to a 
public exchange, thereby promoting market depth, execution incentives 
and enhanced execution opportunities for all Members. As a result, the 
Exchange believes that the proposed change furthers the Commission's 
goal in adopting Regulation NMS of fostering competition among orders, 
which promotes ``more efficient pricing of individual stocks for all 
types of orders, large and small.''
    The Exchange believes that the proposed rule change does not impose 
any burden on intramarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. First, the 
Exchange notes that the proposed changes apply uniformly to similarly 
situated Members. The Exchange believes that the proposed changes 
related to QCC and SAM transactions would not impose any burden on 
intramarket competition, but rather, serves to increase intramarket 
competition by incentivizing members, including Professionals, to 
direct their QCC and SAM orders to the Exchange, in turn providing for 
more opportunities to compete at improved prices. Additionally, the 
proposed rule change benefits all market participants as any overall 
increased liquidity that may result from the proposed fee and tier 
incentives benefits all investors by offering additional flexibility 
for all investors to enjoy cost savings, supporting the quality of 
price discovery, promoting market transparency and improving investor 
protection.
    Next, the Exchange believes the proposed rule change does not 
impose any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. As previously 
discussed, the Exchange operates in a highly competitive market. 
Members have numerous alternative venues they may participate on and 
direct their order flow, including 15 other options exchanges. 
Additionally, the Exchange represents a small percentage of the overall 
market. Based on publicly available information, no single options 
exchange has more than 15% of the market share.\24\ Therefore, no 
exchange possesses significant pricing power in the execution of order 
flow. Indeed, participants can readily choose to send their orders to 
other exchanges and off-exchange venues if they deem fee levels at 
those other venues to be more favorable. As noted above, the Exchange 
believes that the proposed pricing rebates under the QCC Initiator/
Solicitation Rebate Tiers is comparable to that of other exchanges 
offering similar QCC functionality. Moreover, the Commission has 
repeatedly expressed its preference for competition over regulatory 
intervention in determining prices, products, and services in the 
securities markets. Specifically, in Regulation NMS, the Commission 
highlighted the importance of market forces in determining prices and 
SRO revenues and, also, recognized that current regulation of the 
market system ``has been remarkably successful in promoting market 
competition in its broader forms that are most important to investors 
and listed companies.'' The fact that this market is competitive has 
also long been recognized by the courts. In NetCoalition v. Securities 
and Exchange Commission, the D.C. Circuit stated as follows: ``[n]o one 
disputes that competition for order flow is `fierce.' . . . As the SEC 
explained, `[i]n the U.S. national market system, buyers and sellers of 
securities, and the broker-dealers that act as their order-routing 
agents, have a wide range of choices of where to route orders for 
execution'; [and] `no exchange can afford to take its market share 
percentages for granted' because `no exchange possesses a monopoly, 
regulatory or otherwise, in the execution of order flow from broker 
dealers'. . . .''. Accordingly, the Exchange does not believe its 
proposed fee change imposes any burden on competition that is not 
necessary or appropriate in furtherance of the purposes of the Act.
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    \24\ See supra note 1 [sic].
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C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the 
proposed rule change.

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) of the Act \25\ and paragraph (f) of Rule 19b-4 \26\ 
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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
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    \25\ 15 U.S.C. 78s(b)(3)(A).
    \26\ 17 CFR 240.19b-4(f).
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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-CboeEDGX-2020-061 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-CboeEDGX-2020-061. 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

[[Page 81971]]

submissions should refer to File Number SR-CboeEDGX-2020-061 and should 
be submitted on or before January 7, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\27\
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    \27\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-27724 Filed 12-16-20; 8:45 am]
BILLING CODE 8011-01-P