Document ID: SEC-2018-0823-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Nasdaq ISE, LLC
Posted Date: 2018-05-29T04:00Z

[Federal Register Volume 83, Number 103 (Tuesday, May 29, 2018)]
[Notices]
[Pages 24543-24547]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-11456]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83306; File No. SR-ISE-2018-46]

Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change To Amend the 
Schedule of Fees Related to Complex Orders

May 23, 2018.
    Pursuant to 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 May 10, 2018, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I and II 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to amend the Schedule of Fees related to 
Complex Orders traded on the Exchange.
    The text of the proposed rule change is available on the Exchange's 
website at http://ise.cchwallstreet.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 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 amend the Schedule of 
Fees related to Complex Orders traded on the Exchange, including: (1) 
Priority Customer \3\ Complex Order rebates, (2) Market Maker \4\ fees, 
(3) the non-Priority Customer Complex Order taker surcharge, and (4) 
formatting and other non-substantive changes to the tables. Each of the 
proposed changes is described in more detail below.
---------------------------------------------------------------------------

    \3\ A ``Priority Customer'' is a person or entity that is not a 
broker/dealer in securities, and does not place more than 390 orders 
in listed options per day on average during a calendar month for its 
own beneficial account(s), as defined in Nasdaq ISE Rule 
100(a)(37A).
    \4\ ``Market Maker'' refers to ``Competitive Market Makers'' and 
``Primary Market Makers'' collectively. See ISE Rule 100(a)(28).
---------------------------------------------------------------------------

I. Priority Customer Complex Order Rebates
    Currently, the Exchange has a fee structure in place for Complex 
Orders that provides rebates to Priority Customer Complex Orders in 
order to encourage Members to bring that order flow to the Exchange. 
Specifically, Priority Customer Complex Orders are provided rebates in 
Select Symbols \5\ and Non-Select Symbols \6\ (other than NDX and MNX) 
based on Priority Customer average daily volume (``ADV'') in eight 
tiers as shown in the table below:\7\
---------------------------------------------------------------------------

    \5\ ``Select Symbols'' are options overlying all symbols listed 
on the Nasdaq ISE that are in the Penny Pilot Program.
    \6\ ``Non-Select Symbols'' are options overlying all symbols 
excluding Select Symbols.
    \7\ The Priority Customer Complex Order rebates are provided per 
contract per leg if the order trades with non-Priority Customer 
orders in the Complex Order Book or trades with quotes and orders on 
the regular order book.
    The rebate for the highest tier volume achieved is applied 
retroactively to all eligible Priority Customer Complex volume once 
the threshold has been reached.
    Members will not receive rebates for net zero complex orders. 
For purposes of determining which complex orders qualify as ``net 
zero'' the Exchange will count all complex orders that leg in to the 
regular order book and are executed at a net price per contract that 
is within a range of $0.01 credit and $0.01 debit.

[[Page 24544]]

------------------------------------------------------------------------
                                            Rebate for    Rebate for non-
                                          select symbols  select symbols
------------------------------------------------------------------------
Priority Customer Complex ADV 0-14,999..         ($0.26)         ($0.40)
Priority Customer Complex ADV 15,000-             (0.30)          (0.60)
 44,999.................................
Priority Customer Complex ADV 45,000-             (0.36)          (0.70)
 59,999.................................
Priority Customer Complex ADV 60,000-             (0.41)          (0.75)
 74,999.................................
Priority Customer Complex ADV 75,000-             (0.42)          (0.75)
 99,999.................................
Priority Customer Complex ADV 100,000-            (0.45)          (0.80)
 124,999................................
Priority Customer Complex ADV 125,000-            (0.46)          (0.81)
 224,999................................
Priority Customer Complex ADV 225,000+..          (0.50)          (0.85)
------------------------------------------------------------------------

    The Exchange now proposes to modify this rebate structure such that 
Priority Customer Complex Order rebates will be paid a rebate based on 
a percentage of industry volume rather than straight volume thresholds. 
In addition, the Exchange proposes to move away from a tier calculation 
based solely on Priority Customer Complex ADV to one that includes 
Complex Orders entered for other market participant types, and orders 
entered by affiliates of the Member. Specifically, the Exchange 
proposes to adopt Priority Customer Complex Tiers that are based on 
Total Affiliated Member Complex Order Volume (Excluding Crossing Orders 
and Responses to Crossing Orders) Calculated as a Percentage of 
Customer Total Consolidated Volume. All Complex Order volume executed 
on the Exchange, including volume executed by Affiliated Members, will 
be included in the volume calculation, except for volume executed as 
Crossing Orders and Responses to Crossing Orders. An ``Affiliated 
Member'' is a Member that shares at least 75% common ownership with a 
particular Member as reflected on the Member's Form BD, Schedule A. 
Furthermore, ``Customer Total Consolidated Volume'' means the total 
national volume cleared at The Options Clearing Corporation in the 
Customer range in equity and ETF options in that month.
    As proposed, there will be nine Priority Customer Complex Order 
Tiers based on the percentage of industry volume calculation: 0.000%-
0.200% (Tier 1); above 0.200%-0.400% (Tier 2); above 0.400%-0.600% 
(Tier 3), above 0.600%-0.800% (Tier 4), above 0.800%-1.000% (Tier 5), 
above 1.000%-1.600% (Tier 6), above 1.600%-2.000% (Tier 7), above 
2.000%-3.500% (Tier 8), above 3.500% (Tier 9). Furthermore, the 
associated rebates will be modified such that in Select Symbols the 
proposed rebate will be $0.25 per contract for Tier 1, $0.30 per 
contract for Tier 2, $0.35 per contract for Tier 3, $0.40 per contract 
for Tier 4, $0.45 per contract for Tier 5, $0.46 per contract for Tier 
6, $0.48 per contract for Tier 7, and $0.50 per contract for Tiers 8 
and 9. Furthermore, in Non-Select Symbols the proposed rebate will be 
$0.40 per contract for Tier 1, $0.55 per contract for Tier 2, $0.70 per 
contract for Tier 3, $0.75 per contract for Tier 4, $0.80 per contract 
for Tiers 5-7, and $0.85 per contract for Tiers 8 and 9.
II. Market Maker Fees
    Market Maker Complex Orders in Select Symbols are charged a maker 
fee of $0.47 per contract when trading against Priority Customer 
Complex Orders, and a $0.50 per contract taker fee regardless of the 
counterparty. Currently, each of these fees is reduced to $0.44 per 
contract for Market Makers with total affiliated Priority Customer 
Complex ADV of 150,000 or more contracts.\8\ The Exchange proposes to 
base this fee discount on the proposed Priority Customer Complex Tiers, 
and introduce a second tier of reduced fee for Market Makers that 
achieve a higher Priority Customer Complex Tier. Specifically, the 
Exchange proposes to keep the current $0.44 per contract fee for Market 
Makers Market Makers that achieve Priority Customer Complex Tier 9, and 
charge a fee of $0.47 per contract for Market Makers that achieve 
Priority Customer Complex Tier 8.
---------------------------------------------------------------------------

    \8\ All eligible volume from affiliated Members is aggregated in 
determining total affiliated Priority Customer Complex ADV, provided 
there is at least 75% common ownership between the Members as 
reflected on each Member's Form BD, Schedule A.
---------------------------------------------------------------------------

    In addition, Market Makers that qualify for the Market Maker Plus 
program are currently charged a fee $0.10 per contract instead of the 
applicable Market Maker Plus rebate when trading against Priority 
Customer Complex Orders that leg into the regular order book. 
Regardless of the counterparty, a $0.10 per contract maker fee also 
applies to Market Makers that do not qualify for Market Maker Plus and 
Non-Nasdaq ISE Market Makers. With the proposed Priority Customer 
Complex Order Tiers described above, which in some cases may result in 
higher rebates being provided to Priority Customer Complex Orders, 
including Complex Orders that leg into the regular order book, the 
Exchange proposes to increase the fee for trading against Priority 
Customer Complex Orders that leg into the regular order book. 
Specifically, the Exchange proposes to increase this fee to $0.15 per 
contract and apply it to all Market Maker Orders and Non-Nasdaq ISE 
Market Maker Orders. Furthermore, there is currently no fee charged or 
rebate provided to Market Maker Orders submitted by Market Makers that 
qualify for Market Maker Plus when trading against non-Priority 
Customer Complex Orders that leg into the regular order book. As 
proposed, this treatment will be afforded to all Market Maker Orders 
when trading against non-Priority Customer Complex Orders that leg into 
the regular order book. The fees for Non-Nasdaq ISE Market Makers for 
trading against non-Priority Customer Complex Orders that leg into the 
regular order book will remain unchanged.
III. Non-Priority Customer Complex Order Taker Surcharge
    Currently, the Exchange assesses a $0.03 per contract surcharge to 
non-Priority Customer Complex Orders in Non-Select Symbols that take 
liquidity from the Complex Order Book, excluding Complex Orders 
executed in the Facilitation Mechanism, Solicited Order Mechanism, 
Price Improvement Mechanism (``PIM'') and ``exposure'' auctions 
pursuant to Rule 722(b)(3)(iii). The Exchange proposes to increase this 
taker surcharge to $0.05 per contract.
IV. Formatting and Other Non-Substantive Changes to the Tables
    With the changes described above, which add additional content to 
the Schedule of Fees, the Exchange proposes to make certain non-
substantive formatting changes that are designed to make the flow of 
the Schedule of Fees easier for Members to understand. None of these 
changes affect the fees charged or rebates provided to members. With 
the proposed changes, the Exchange will

[[Page 24545]]

have three tables located under Section II of the Schedule of Fees 
(Complex Order Fees and Rebates): (1) ``Priority Customer Rebates,'' 
(2) ``Maker and Taker Fees,'' and (3) ``Crossing Order Fees and 
Rebates.''
    The first table, i.e., Priority Customer Rebates, will contain the 
Priority Customer Complex Tiers described above rather than all rebates 
as is currently the case. As such, the Exchange proposes to move the 
column on Facilitation and Solicitation Break-up Rebate for Select 
Symbols to the third table on Crossing Order Fees and Rebates. These 
rebates will continue to be applied in exactly the same manner as 
today. Furthermore, the Exchange proposes to delete references in this 
table to other market participant types, which are not eligible for 
rebates in Complex Orders other than the Facilitation and Solicitation 
Break-up Rebate in Select Symbols described above. The second table, 
i.e., Maker and Taker Fees, will include both the maker fees described 
there today as well as the taker fees that are currently included in 
the following table. As such, the Exchange proposes to move the columns 
that describe the taker fee for Select Symbols and the taker fee for 
Non-Select Symbols to this table. No changes to these taker fees are 
proposed. Finally, the third table, i.e., Crossing Order Fees and 
Rebates, will include only fees and rebates that relate to the 
Exchange's various crossing mechanisms. The fees and rebates moved to 
and from this table are described above.
    Finally, the footnote referenced in the column on Facilitation and 
Solicitation Break-up Rebates for Select Symbols contains an outdated 
reference to the PIM. Specifically, the footnote provides that rebates 
are provided per contract per leg for contracts that are submitted to 
PIM, Facilitation and Solicitation Mechanisms . . .'' As indicated in 
the header to the column, these break-up rebates apply to the 
Facilitation and Solicitation Mechanisms only. The language related to 
the PIM was included in the Schedule of Fees when the Exchange offered 
a break-up rebate for the PIM. When the Exchange eliminated PIM break-
up rebates, the Exchange deleted the column that included those rebates 
but did not remove the related reference in this footnote.\9\ The 
Exchange therefore proposes to update this footnote now by deleting the 
PIM reference, which is no longer applicable.
---------------------------------------------------------------------------

    \9\ See Securities Exchange Act Release No. 80684 (May 16, 
2017), 82 FR 23435 (May 22, 2017) (SR-ISE-2017-39).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\10\ in general, and furthers the objectives of 
Sections 6(b)(4) and 6(b)(5) of the Act,\11\ in particular, in that it 
provides for the equitable allocation of reasonable dues, fees, and 
other charges among members and issuers and other persons using any 
facility, and is not designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

I. Priority Customer Complex Order Rebates
    The Exchange believes that the proposed changes to the Priority 
Customer Complex Order Tiers are reasonable and equitable as these 
changes are designed to incentivize Members to trade Complex Orders, 
and, in particular Priority Customer Complex Orders, on the Exchange. 
The Exchange is proposing to base Priority Customer Complex Order Tiers 
on a percentage of industry volume in recognition of the fact that the 
volume executed by a Member may rise or fall with industry volume. A 
percentage of industry volume calculation allows the Exchange's tiers 
to be calibrated to current market volumes rather than requiring the 
same amount of volume regardless of market conditions. While the amount 
of volume required by the proposed tiers may change in any given month 
due to increases or decreases in industry volume, the Exchange believes 
that the proposed tier requirements are set at a level that roughly 
corresponds to the current ADV requirements for Priority Customer 
Complex Tiers. The Exchange is also proposing to include additional 
types of Complex Order volume in the tier calculation. Although the 
current tier structure counts solely Priority Customer Complex ADV, the 
proposed structure would allow Members to qualify for higher tier based 
on all Complex Order volume except for Crossing Orders and Responses to 
Crossing Orders. The Exchange believes that increasing the volume 
counted for purposes of calculating tiers will encourage Members to 
bring different types of Complex Order volume to the Exchange (i.e., to 
qualify for a higher tier), while continuing to incentivize Members to 
bring Priority Customer Complex Orders specifically to earn the 
associated rebates. Crossing Orders and Responses to Crossing Orders 
will be excluded from the proposed tier calculation as this type of 
order flow is subject to separate pricing, with various incentives for 
Members that trade in the Exchange's crossing mechanisms.
    In addition, the Exchange believes that the proposed changes are 
equitable and not unfairly discriminatory as these changes are designed 
to bring more order flow, and in particular, Priority Customer Complex 
Orders, to the Exchange. The Exchange does not believe that it is 
unfairly discriminatory provide rebates only to Priority Customer 
Complex Orders as this is the order flow that the Exchange is seeking 
to incentivize. A Priority Customer is by definition not a broker or 
dealer in securities, and does not place more than 390 orders in listed 
options per day on average during a calendar month for its own 
beneficial account(s). This limitation does not apply to participants 
whose behavior is substantially similar to that of market 
professionals, including Professional Customers, who will generally 
submit a higher number of orders than Priority Customers. The Exchange 
currently has Priority Customer Complex Order Tiers in place to 
incentivize that order flow, and is simply modifying those tiers in a 
way that the Exchange believes will increase participation in Complex 
Orders. The Exchange believes that the proposed changes to the Priority 
Customer Complex Tiers will benefit all market participants that trade 
on the Exchange by increasing their opportunities to trade.
    Furthermore, the Exchange believes that its proposed definitions of 
``Affiliated Member'' and ``Customer Total Consolidated Volume'' are 
reasonable, equitable, and not unfairly discriminatory as these 
definitions clarify terms that the Exchange is using to describe its 
Priority Customer Complex Tiers. The proposed definitions are 
consistent with definitions adopted for these concepts on the 
Exchange's affiliated exchanges, Nasdaq MRX, LLC (``MRX'') and Nasdaq 
GEMX, LLC (``GEMX'') respectively.\12\ Furthermore, with respect to the 
definition of ``Affiliated Member'' in particular the Exchange is 
adopting a definition that is consistent with the Exchange's current 
practice of aggregating volume from Members that share at least 75% 
common ownership.
---------------------------------------------------------------------------

    \12\ See MRX Schedule of Fees, Preface; GEMX Schedule of Fees, 
I. Regular Order Fees and Rebates, Qualifying Tier Thresholds.
---------------------------------------------------------------------------

II. Market Maker Fees
    The Exchange believes the proposed changes to the Market Maker 
Complex Order fees in Select Symbols are reasonable and equitable as 
the

[[Page 24546]]

proposed fees replace a fee that was previously tied to the Priority 
Customer Complex ADV with a new fees based on the proposed Priority 
Customer Complex Tiers. Furthermore, the Exchange believes that it is 
reasonable and equitable to provide a differentiated fee based on 
whether the Market Maker achieves Priority Customer Complex Tier 8 or 
9. With the proposed changes, Market Makers that achieve Priority 
Customer Complex Tier 9 will pay the same fee as would be applicable 
today based on achieving the required total affiliated Priority 
Customer ADV, while Market Makers that achieve Priority Customer 
Complex Tier 8 will pay a slightly higher fee that is nonetheless 
discounted compared to the fees applicable to Market Makers that do not 
achieve these tiers. The Exchange believes that this two tiered 
structure will encourage firms to reach for the highest tier of the 
under Priority Customer Complex Order rebate program, while nonetheless 
incentivizing firms that do not have sufficient volume to reach that 
tier to work towards the second highest tier introduced under that 
program.
    Furthermore, the Exchange believes that the proposed changes to 
Market Maker Complex Order fees are equitable and not unfairly 
discriminatory the changes apply equally to all Market Maker Complex 
Orders based on achieving the required Priority Customer Complex Tier. 
As is the case today, the Exchange will continue to charge lower fees 
to Market Makers that execute, through their affiliates, a significant 
volume of Priority Customer Complex Orders, as this will incentivize 
members to bring order flow to the Exchange, creating additional 
liquidity in Complex Orders to the benefit of all Members. The Exchange 
does not believe that it is unfairly discriminatory only to provide 
these lower fees to Market Maker Orders as Market Makers are subject to 
additional requirements and obligations (such as quoting requirements) 
that other market participants are not.
    The Exchange also believes that that it is reasonable and equitable 
to increase the maker fee charged to Market Makers and Non-Nasdaq ISE 
Market Makers that provide liquidity to Priority Customer Complex 
Orders that leg into the regular order book. Today, Market Makers that 
do not qualify for Market Maker Plus and Non-Nasdaq ISE Market Makers 
pay a small fee for providing liquidity in Select Symbols. In addition, 
Market Makers that qualify for Market Maker Plus and would typically be 
eligible for a maker rebate are instead charged a maker fee when 
trading against Priority Customer Complex Orders that leg into the 
regular order book. At the same time, the Exchange pays high rebates to 
Priority Customer Complex Orders, including when those Complex Orders 
leg into the regular order book. In some cases these rebates may be 
increased with the proposed changes described above to the Priority 
Customer Complex Order Tiers. The Exchange believes that it is 
reasonable and equitable to increase the fees charged for all Market 
Maker and Non-Nasdaq ISE Market Maker Orders that provide liquidity to 
Priority Customer Complex Orders that leg into the regular market as 
this will help offset potentially significant rebates paid on the other 
side of these trades. In this regard, the proposed fee increase would 
decrease but not completely eliminate the negative economics associated 
with these trades as the Exchange pays out significantly more in rebate 
opportunity for Priority Customer Complex Orders than it receives from 
other side of the trade when those orders leg into the regular order 
book. Furthermore, the Exchange believes that it is reasonable and 
equitable to reduce fees for all Market Maker Orders trading against 
non-Priority Customer Complex Orders that leg into the regular order 
book. Currently, this benefit is provided only to Market Makers that 
achieve Market Maker Plus status. The Exchange believes, however, that 
it is appropriate to extend this benefit to all Market Maker Orders as 
an additional incentive for Market Makers that have an obligation to 
maintain quotes and provide liquidity in the regular market rather than 
only those Market Makers that meet the heightened requirements of 
Market Maker Plus. Non-Nasdaq ISE Market Makers who have no obligations 
to provide liquidity will not be eligible for this incentive.
    Furthermore, the Exchange believes that the proposed changes to 
these fees for Market Maker and Non-Nasdaq ISE Market Maker Orders are 
equitable and not unfairly discriminatory as they are designed to 
reduce the negative economics associated with Priority Customer Complex 
Orders that leg into the regular order book. The proposed fees will 
apply equally to all Market Makers and Non-Nasdaq ISE Market Makers. 
The Exchange pays significant rebates to that Priority Customer Complex 
Orders, including when those orders leg into the regular order book 
where they may trade with Market Makers and Non-Nasdaq ISE Market 
Makers providing liquidity in the regular market. The Exchange does not 
believe it is unfairly discriminatory to charge increased maker fees 
only to Market Maker and Non-Nasdaq ISE Market Maker Orders as these 
market participants are typically the ones providing liquidity and 
trading with Priority Customer Complex Orders that leg into the regular 
order book.
III. Non-Priority Customer Complex Order Taker Surcharge
    The Exchange believes that the proposed increase the taker 
surcharge for non-Priority Customer Complex Orders in Non-Select 
Symbols that take liquidity from the complex order book is reasonable 
and equitable. The proposed fees are modestly increased and the 
Exchange believes that such fees will remain attractive to market 
participants, who will continue to be charged lower fees for adding 
liquidity to the complex order book than for removing liquidity, and 
who may be granted additional opportunities to trade by virtue of the 
incentives being granted to attract Priority Customer Complex Orders to 
the Exchange. Furthermore, the Exchange believes that the proposed 
change is equitable and not unfairly discriminatory as it applies to 
all non-Priority Customer Complex Orders that take liquidity in Non-
Select Symbols.
IV. Formatting and Other Non-Substantive Changes to the Tables
    The Exchange believes that the proposed formatting changes to the 
tables are reasonable, equitable, and not unfairly discriminatory. As 
explained in the purpose section of this filing, these changes are 
entirely cosmetic and merely move around columns in various tables so 
that these are grouped in a manner that the Exchange believes will be 
easier for Members to follow. The Exchange hopes that these changes 
will increase the readability of the Schedule of Fees by grouping fees 
and rebates for Complex Orders under three headings--i.e., Priority 
Customer Rebates, Maker and Taker Fees, and Crossing Order Fees and 
Rebates. None of the proposed formatting changes impact the fees 
charged or rebates provided to Members. Furthermore, the Exchange 
believes that it is reasonable, equitable, and not unfairly 
discriminatory to remove the outdated reference to the PIM in the 
Facilitation and Solicitation break-up rebate footnote. As explained in 
the purpose section of this proposed rule change, the Exchange does not 
have break-up rebates for the PIM. Although the column correctly refers 
to Facilitation and Solicitation break-up rebates, the PIM reference 
was inadvertently left in the footnote at the time the Exchange filed 
to remove those

[[Page 24547]]

rebates. The proposed change corrects this reference.

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 not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange believes that the 
proposed changes will enhance both intermarket and intramarket 
competition by amending various fees and rebates related to the trading 
of Complex Orders on the Exchange. The Exchange believes that the 
proposed fees and rebates remain competitive with those on other 
options markets, and will continue to attract order flow to the 
Exchange, thereby encouraging additional volume and liquidity to the 
benefit of all market participants. The Exchange operates in a highly 
competitive market in which market participants can readily direct 
their order flow to competing venues. In such an environment, the 
Exchange must continually review, and consider adjusting, its fees and 
rebates to remain competitive with other exchanges. For the reasons 
described above, the Exchange believes that the proposed fee changes 
reflect this competitive environment.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or 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,\13\ and Rule 19b-4(f)(2) \14\ 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: (i) Necessary or 
appropriate in the public interest; (ii) for the protection of 
investors; or (iii) otherwise in furtherance of the purposes of the 
Act. If the Commission takes such action, the Commission shall 
institute proceedings to determine whether the proposed rule should be 
approved or disapproved.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \14\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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-ISE-2018-46 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-ISE-2018-46. 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-ISE-2018-46 and should be submitted on 
or before June 19, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-11456 Filed 5-25-18; 8:45 am]
 BILLING CODE 8011-01-P