Document ID: SEC-2018-1742-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE Arca, Inc.
Posted Date: 2018-11-15T05:00Z

[Federal Register Volume 83, Number 221 (Thursday, November 15, 2018)]
[Notices]
[Pages 57511-57513]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-24868]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84557; File No. SR-NYSEArca-2018-78]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the NYSE 
Arca Equities Fees and Charges To Remove Certain Obsolete Text That 
References Pillar Phase I Protocols

November 8, 2018.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on November 1, 2018, NYSE Arca, Inc. (``Exchange'' or ``NYSE 
Arca'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by the self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the NYSE Arca Equities Fees and 
Charges (``Fee Schedule'') to remove certain obsolete text that 
reference [sic] Pillar phase I protocols now that Pillar phase I 
protocols are no longer available for ETP Holders to communicate with 
the NYSE Arca Marketplace. The Exchange proposes to implement the fee 
changes effective November 1, 2018. The proposed rule change is 
available on the Exchange's website at www.nyse.com, at the principal 
office of the Exchange, and at the Commission's Public Reference Room.

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

    In its filing with the Commission, the self-regulatory organization 
included statements concerning the purpose of, and basis for, the 
proposed rule change and discussed any comments it received on the 
proposed rule change. The text of those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

[[Page 57512]]

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

1. Purpose
    The Exchange proposes to amend the Fee Schedule to remove certain 
obsolete text that reference Pillar phase I protocols now that Pillar 
phase I protocols are no longer available for ETP Holders to 
communicate with the NYSE Arca Marketplace. The Exchange proposes to 
implement the fee changes effective November 1, 2018.
    As a general matter, ETP Holders enter orders and order 
instructions by using communication protocols that map to the order 
types and modifiers described in Exchange rules. Prior to the 
implementation of Pillar, ETP Holders communicated with the NYSE Arca 
Marketplace using Pillar phase I protocols. When the Exchange 
introduced trading on its Pillar trading platform, the Exchange also 
introduced new technology to support how ETP Holders communicate with 
the NYSE Arca Marketplace, referred to in the Exchange's rules as 
Pillar phase II protocols. During the Pillar implementation, there was 
a period of time when both Pillar phase I protocols and Pillar phase II 
protocols were available to ETP Holders. Effective October 1, 2018, 
Pillar phase I protocols are no longer available to ETP Holders. All 
ETP Holders now use Pillar phase II protocols to communicate with the 
NYSE Arca Marketplace. As a result, there is no longer a need to 
distinguish between Pillar phase I protocols and Pillar phase II 
protocols in the Exchange's Fee Schedule.
    In April 2018, the Exchange filed a proposed rule change to adopt a 
new pricing tier--BBO Setter Tier.\4\ In the BBO Setter Tier Filing, 
the Exchange adopted the following rule text in the BBO Setter pricing 
tier: ``For purpose of the BBO Setter Tier, ETP ID means an ETP ID when 
using Pillar phase I protocols to communicate with the NYSE Arca 
Marketplace or an MPID when using Pillar phase II protocols to 
communicate with the NYSE Arca Marketplace.'' The Exchange proposes to 
remove this text from the Fee Schedule now that Pillar phase I 
protocols are no longer available and all ETP Holders now communicate 
with the NYSE Arca Marketplace using Pillar phase II protocols.
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    \4\ See Securities Exchange Act Release No. 83032 (April 11, 
2017 [sic]), 83 FR 16909 (April 17, 2017 [sic]) (SR-NYSEArca-2018-
20) (``BBO Setter Tier Filing'').
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    Additionally, in August 2017, in connection with the introduction 
of Pillar phase II protocols, the Exchange amended the Fee Schedule to 
adopt a cap, for August and September 2017, on monthly fees for the use 
of ports connecting to the NYSE Arca Marketplace.\5\ Given that the 
months during which the port fee cap was applicable have passed, the 
Exchange proposes to delete reference to the port fee cap from the Fee 
Schedule as that rule text is now obsolete.
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    \5\ See Securities Exchange Act Release No. 81573 (September 11, 
2017), 82 FR 43430 (September 15, 2017) (SR-NYSEArca-2017-97).
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    Finally, in October 2017, the Exchange amended the Fee Schedule to 
adopt a Decommission Extension Fee applicable to ETP Holders for the 
use of Pillar phase I protocols to connect with the NYSE Arca 
Marketplace for a three-month period from March 2018 through May 2018 
as an incentive for ETP Holders to fully transition to the use of 
Pillar phase II protocols to connect with the NYSE Arca Marketplace.\6\ 
In June 2018, the Exchange filed to extend the effectiveness of the 
Decommission Extension Fee for an additional four months, until 
September 2018.\7\ The Exchange proposes to remove rule text regarding 
the Decommission Extension Fee from the Fee Schedule as that rule text 
is now obsolete because the period of time during which the 
Decommission Extension Fee was applicable has passed.
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    \6\ See Securities Exchange Act Release No. 81901 (October 19, 
2017), 82 FR 49426 (October 25, 2017) (SR-NYSEArca-2017-121).
    \7\ See Securities Exchange Act Release No. 83410 (June 12, 
2018), 83 FR 28300 (June 18, 2018) (SR-NYSEArca-2018-42).
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\8\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\9\ in particular, 
because it provides for the equitable allocation of reasonable dues, 
fees, and other charges among its members, issuers and other persons 
using its facilities and does not unfairly discriminate between 
customers, issuers, brokers or dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes that it is reasonable, equitable and not 
unfairly discriminatory to delete reference to obsolete rule text and 
dates from the Fee Schedule. The Exchange believes that the proposed 
changes are reasonable because they would result in greater specificity 
and precision within the Fee Schedule, which would contribute to 
reasonably ensuring that the fees and credits described there are clear 
and accurate. Specifically, the proposed changes are reasonable because 
they would remove obsolete rule text and dates from the Fee Schedule 
related to the use of ports that are no longer available to connect to 
the NYSE Arca Marketplace and a Decommission Extension Fee that is no 
longer charged by the Exchange. The Exchange also believes that the 
proposed changes are equitable and not unfairly discriminatory because 
all readers of the Fee Schedule, including all ETP Holders, would 
benefit from the increased specificity and clarity that this proposed 
rule change would provide.
    For the foregoing reasons, the Exchange believes that the proposal 
is consistent with the Act.

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

    In accordance with Section 6(b)(8) of the Act,\10\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. The proposed changes are not designed to address 
any competitive issues. Rather, the proposed changes are designed to 
provide greater specificity and precision within the Fee Schedule, 
which would contribute to reasonably ensuring that the fees and credits 
described therein are clear and accurate. In addition, the removal of 
obsolete text from the Fee Schedule would not have any impact on inter- 
or intra-market competition because the proposed change would result in 
a streamlined Fee Schedule without any impact on pricing.
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    \10\ 15 U.S.C. 78f(b)(8).
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C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \11\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \12\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may

[[Page 57513]]

temporarily suspend such rule change if it appears to the Commission 
that such action is necessary or appropriate in the public interest, 
for the protection of investors, or otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings under Section 19(b)(2)(B) \13\ 
of the Act to determine whether the proposed rule change should be 
approved or disapproved.
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    \13\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEArca-2018-78 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-NYSEArca-2018-78. 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-NYSEArca-2018-78 and should be submitted 
on or before December 6, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-24868 Filed 11-14-18; 8:45 am]
 BILLING CODE 8011-01-P