Document ID: SEC-2017-1078-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: Bats EDGA Exchange, Inc.
Posted Date: 2017-06-26T04:00Z

[Federal Register Volume 82, Number 121 (Monday, June 26, 2017)]
[Notices]
[Pages 28920-28924]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-13228]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80976; File No. SR-BatsEDGA-2017-18]

Self-Regulatory Organizations; Bats EDGA Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change Related 
To Amend Its Fee Schedule To Replace Current Inverted Pricing Model 
With Low Fee Model

June 20, 2017.
    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 June 12, 2017, Bats EDGA Exchange, Inc. (the ``Exchange'' or 
``EDGA'') 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 Exchange 
has designated the proposed rule change as one establishing or changing 
a member due, fee, or other charge imposed by the Exchange under 
Section 19(b)(3)(A)(ii) of the Act \3\ and Rule 19b-4(f)(2) 
thereunder,\4\ which renders the proposed rule change effective upon 
filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange filed a proposal to amend its fee schedule to replace 
its current inverted pricing model with a simple, low fee model.
    The text of the proposed rule change is available at the Exchange's 
Web site at www.bats.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 parts of such 
statements.

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

1. Purpose
    Most exchanges today utilize maker-taker pricing under which they 
provide a rebate to orders that add liquidity and charge a fee to 
orders that remove liquidity. The Exchange currently incorporates an 
inverse of that pricing model under which it charges a fee to add 
liquidity and provides a rebate to remove liquidity. As described 
below, the Exchange proposes to amend its fee schedule to replace its 
current inverted

[[Page 28921]]

pricing model with a simple, low fee model.
    The Exchange submits this proposal in response to the industry 
feedback and the debate regarding exchange fee structures. Rule 610 of 
Regulation NMS limits the fees that a Trading Center \5\ may charge for 
accessing its Protected Quotation at $0.0030 per share.\6\ This fee cap 
has served to create a cap on rebates with exchange's charging at or 
near the access fee cap to remove liquidity and providing a rebate to 
orders that add liquidity. Recent industry discourse has focused on fee 
structures and their purported effect on liquidity provision, liquidity 
taking, potential conflicts and order routing in the U.S. equity 
market. In addition, the Commission's Equity Market Structure Advisory 
Committee (``EMSAC'') recommended that the Commission propose a pilot 
program to adjust the access fee cap under Rule 610 of Regulation NMS 
to better understand these dynamics.\7\ In addition, some exchanges 
have experimented with solutions, such as the recent pilot implemented 
by the Nasdaq Stock Market LLC (``Nasdaq''), with limited success. 
Other exchanges have proposed to not offer rebates and implemented a 
low fee model \8\ as the Exchange proposes herein. The Exchange now 
proposes to amend its fee schedule to no longer provide rebates and to 
modify or eliminate other types of incentive pricing under its current 
taker-maker pricing model. As amended, the Exchange would adopt a new 
low fee pricing model under which it would charge a low fee or provide 
the execution free of charge. The proposed low fee model is described 
below.
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    \5\ See 17 CR 242.600(b)(78).
    \6\ See 17 CFR 242.610(c).
    \7\ See EMSAC's Regulation NMS Subcommittee, Recommendation for 
an Access Fee Pilot, June 10, 2016, available at https://www.sec.gov/spotlight/emsac/emsac-regulation-nms-recommendation-61016.pdf.
    \8\ See the Investors Exchange, Inc. fee schedule available at 
https://iextrading.com/trading/ (dated August 19, 2016).
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Displayed Order Fee Change
    In securities priced at or above $1.00, the Exchange currently 
charges a fee of $0.0005 per share for Displayed orders that add 
liquidity and provides a rebate $0.0002 per share for Displayed orders 
that remove liquidity. Receipt of this removal rebate is contingent on 
the attributed Market Participant Identifier (``MPID'') adding 
(including Non-Displayed \9\) and/or routing an ADV \10\ of at least 
50,000 shares. Any attributed MPID not meeting this criteria is charged 
$0.0030 per share for removing liquidity for securities priced $1.00 
and over and 0.20% of dollar value for securities priced less than 
$1.00. The Exchange now proposes to charge a fee of $0.00030 per share 
to all Displayed \11\ orders in securities priced above $1.00, 
regardless of whether they add or remove liquidity. The Exchange does 
not propose any contingency requirements or conditions that Members 
must satisfy to receive the proposed rates. Therefore, the Exchange 
proposes to delete footnote 1 \12\ of the fee schedule as receipt of 
the proposed fee would not be contingent on the MPID adding (including 
Non-Displayed) and/or routing an ADV of at least 50,000 shares. All 
Displayed orders in securities priced below $1.00 would continue to be 
free and not be contingent to any minimum volume requirements.
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    \9\ See Exchange Rule 11.6(e)(2).
    \10\ ADV means average daily volume calculated as the number of 
shares added to, removed from, or routed by, the Exchange, or any 
combination or subset thereof, per day. See the Exchange's fee 
schedule available at http://www.bats.com/us/equities/membership/fee_schedule/edga/.
    \11\ See Exchange Rule 11.6(e)(1).
    \12\ Due to the deletion of footnote 1, as well as the proposed 
deletion of other footnotes described herein, the Exchange proposes 
to renumber the remaining footnotes and corresponding reference to 
those footnote throughout the fee schedule accordingly.
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    As a result of the proposed change, the Exchange proposes to make 
corresponding changes to the following fee codes for securities priced 
at or above $1.00:
     Fee code 3, which is appended to orders that add liquidity 
on the Exchange in Tape A and C securities outside of Regular Trading 
Hours,\13\ are currently charged a fee of $0.00050 per share. Orders 
that yield fee code B would now be charged the proposed standard fee of 
$0.00030 per share.
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    \13\ Regular Trading Hours is defined as ``the time between 9:30 
a.m. and 4:00 p.m. Eastern Time.'' See Exchange Rule 1.5(y).
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     Fee code 4, which is appended to orders that add liquidity 
on the Exchange in Tape B securities outside of Regular Trading Hours, 
are currently charged a fee of $0.00050 per share. Orders that yield 
fee code 4 would now be charged the proposed standard fee of $0.00030 
per share.
     Fee code 6, which is appended to orders that remove 
liquidity from the Exchange in all securities outside of Regular 
Trading Hours, are currently provided a rebate of $0.00020 per share. 
Orders that yield fee code 6 would now be charged the proposed standard 
fee of $0.00030 per share.
     Fee code B, which is appended to orders that add liquidity 
on the Exchange in Tape B securities during Regular Trading Hours, are 
currently charged a fee of $0.00050 per share. Orders that yield fee 
code B would now be charged the proposed standard fee of $0.00030 per 
share.
     Fee code BB, which is appended to orders that remove 
liquidity from the Exchange in Tape B securities during of Regular 
Trading Hours, are currently provided a rebate of $0.00020 per share. 
Orders that yield fee code BB would now be charged the proposed 
standard fee of $0.00030 per share.
     Fee code CR, which is appended to orders that remove 
liquidity from the Exchange using an eligible routing strategy, are 
currently provided a rebate of $0.00020 per share. Under footnote 12, 
the eligible routing strategies for fee code CR are ROUT, RDOT, ROUE, 
ROUC, and ROCO. The Exchange proposes to delete fee code CR and 
footnote 12 as orders that remove liquidity from the Exchange, 
regardless of whether any portion of that order is routed away would 
now be charged the proposed standard fee of $0.00030 per share as set 
forth under the Standard Rates table. The Exchange also proposes to 
delete fee code CR from the Standard Rate table.
     Fee code N, which is appended to orders that remove 
liquidity from the Exchange in Tape C securities during of Regular 
Trading Hours, are currently provided a rebate of $0.00020 per share. 
Orders that yield fee code N would now be charged the proposed standard 
fee of $0.00030 per share.
     Fee code PR, which is appended to orders that remove 
liquidity from the Exchange using an eligible routing strategy, are 
currently provided a rebate of $0.00020 per share. Under footnote 6, 
the eligible routing strategies for fee code PR are ROUZ, ROUD, and 
ROUQ. The Exchange proposes to delete fee code PR and footnote 6 as 
orders that remove liquidity from the Exchange, regardless of whether 
any portion of that order is routed away would now be charged the 
proposed standard fee of $0.00030 per share as set forth under the 
Standard Rates table. The Exchange also proposes to delete fee code PR 
from the Standard Rate table.
     Fee code V, which is appended to orders that add liquidity 
on the Exchange in Tape A securities during Regular Trading Hours, are 
currently charged a fee of $0.00050 per share. Orders that yield fee 
code V would now be charged the proposed standard fee of $0.00030 per 
share.
     Fee code W, which is appended to orders that remove 
liquidity from the Exchange in Tape A securities during of Regular 
Trading Hours, are currently provided a rebate of $0.00020 per share.

[[Page 28922]]

Orders that yield fee code W would now be charged the proposed standard 
fee of $0.00030 per share.
     Fee code XR, which is appended to orders that remove 
liquidity from the Exchange using an eligible routing strategy, are 
currently provided a rebate of $0.00020 per share. Under footnote 7, 
the eligible routing strategies for fee code PR are DIRC, ROUX, RDOX, 
INET, ROBB, SWPA, and SWPB. The Exchange proposes to delete fee code XR 
and footnote 7 as orders that remove liquidity from the Exchange, 
regardless of whether any portion of that order is routed away would 
now be charged the proposed standard fee of $0.00030 per share as set 
forth under the Standard Rates table. The Exchange also proposes to 
delete fee code XR from the Standard Rate table.
     Fee code Y, which is appended to orders that add liquidity 
on the Exchange in Tape C securities during Regular Trading Hours, are 
currently charged a fee of $0.00050 per share. Orders that yield fee 
code Y would now be charged the proposed standard fee of $0.00030 per 
share.
    The Exchange determines the liquidity adding reduced fee that it 
will charge Members using a tiered pricing structure. Currently, the 
Exchange charges reduced fee of $0.00030 per share under three Volume 
Tiers and two Step-Up tiers described in footnote 4 of the Fee 
Schedule. The Exchange proposes to delete all tiers listed under 
footnote 4 as all Displayed orders would be charged a fee of $0.00030 
per share regardless of whether the Member or MPID achieves certain 
volume criteria. A description of each tier under footnote 4 that is to 
be deleted is below.
     Under Volume Tier 1, a Member must add an ADV equal to or 
greater than 1% of the TCV,\14\ including orders with a Non-Displayed 
instruction that add liquidity.
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    \14\ Id.
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     Under Volume Tier 2, a Members must add an ADV equal to or 
greater than 0.25% of the TCV, including orders with a Non-Displayed 
instruction that add liquidity; and removes an ADV of at least 0.25% of 
the TCV.
     Under Volume Tier 3, a Member must add an ADV equal to or 
greater than 0.15% of TCV, including Non-Displayed orders that add 
liquidity; and has an ``added liquidity'' as a percentage of ``added 
plus removed liquidity'' of at least 85%.
     Under Step-Up Tier 1, the MPID must add an ADV equal to or 
greater than 0.10% of the TCV more than the MPID's December 2012 added 
ADV as a percentage of TCV or September 2013 added ADV as a percentage 
of TCV, whichever is lower.
     Under Step-Up Tier 2, the MPID adds an ADV equal to or 
greater than 0.05% of the TCV more than the MPID's December 2012 added 
ADV as a percentage of TCV or September 2013 added ADV as a percentage 
of TCV, whichever is lower; and an ``added liquidity'' as a percentage 
of ``added plus removed liquidity'' equal to or greater than 85%.
Non-Displayed Order Fee Change
    In securities priced at or above $1.00, the Exchange currently 
charges a fee of $0.0010 per share for Non-Displayed orders that add or 
remove liquidity. The Exchange now proposes to charge a fee of $0.00050 
per share to Non-Displayed orders in securities priced above $1.00 that 
remove liquidity (other than for fee code DT, which will be charged no 
fee, as described below) and to charge no fee or rebate for Non-
Displayed orders that add liquidity. Unless noted below, the Exchange 
does not propose to amend the fees charged for Non-Displayed orders in 
securities priced below $1.00.
    As a result of the proposed change, the Exchange proposes to make 
corresponding changes to the following fee codes for securities priced 
at or above $1.00:
     Fee code DM is appended to Non-Displayed orders that add 
liquidity using MidPoint Discretionary Orders.\15\ Orders that yield 
fee code DM in securities priced at or above $1.00 are charged a fee of 
$0.00050 per share and orders in securities priced below $1.00 are 
charged a fee equal to 0.05% of the transaction's dollar value. Orders 
that yield fee code DM would now be free for all securities regardless 
of whether they are priced above or below $1.00.
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    \15\ The operation of MidPoint Discretionary Orders is described 
in Exchange Rule 11.8(e).
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     Fee code DT is appended to Non-Displayed orders that 
remove liquidity using MidPoint Discretionary Orders. Orders that yield 
fee code DT in securities priced at or above $1.00 are charged a fee of 
$0.00050 per share and orders in securities priced below $1.00 are 
charged a fee equal to 0.05% of the transaction's dollar value. Orders 
that yield fee code DT would now be free for all securities regardless 
of whether they are priced above or below $1.00.
     Fee code HA is appended to Non-Displayed orders that add 
liquidity Orders that yield fee code HA in securities priced at or 
above $1.00 are charged a fee of $0.00100 per share and orders in 
securities priced below $1.00 are charged a fee equal to 0.10% of the 
transaction's dollar value. Orders that yield fee code HA would now be 
free for all securities regardless of whether they are priced above or 
below $1.00.
     Fee code HR is appended to Non-Displayed orders that 
remove liquidity. Orders that yield fee code HR in securities priced at 
or above $1.00 are charged a standard fee of $0.0010 per share and 
orders in securities priced below $1.00 are charged a fee equal to 
0.10% of the transaction's dollar value. Orders in securities priced at 
or above $1.00 that yield fee code HR would now be charged the proposed 
standard fee of $0.00050 per share. Orders in securities priced below 
$1.00 would be charged 0.05% of the transaction's dollar value.
     Fee code RP, which is appended to Non-Displayed orders 
that add liquidity using Supplemental Peg Orders,\16\ are charged a fee 
of $0.00040 per share. Orders that yield fee code RP would now be free.
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    \16\ The operation of Supplemental Peg Orders is described in 
Exchange Rule 11.8(g).
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    In securities priced at or above $1.00, the Exchange currently 
charges a fee of $0.00080 per share for Non-Displayed orders that add 
or remove liquidity using MidPoint Peg Orders.\17\ The Exchange now 
proposes to charge a fee of $0.00050 per share to MidPoint Peg Orders 
in securities priced above $1.00 that remove liquidity and to charge no 
fee or rebate for MidPoint Peg Orders that add liquidity. The Exchange 
does not propose to amend the fees charged for MidPoint Peg Orders in 
securities priced below $1.00. As a result of the proposed change, the 
Exchange proposes to make corresponding changes to the following fee 
codes for securities priced at or above $1.00:
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    \17\ The operation of MidPoint Peg Orders is described in 
Exchange Rule 11.8(d).
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     Fee code MM is appended to Non-Displayed orders that add 
liquidity using MidPoint Peg Orders. Orders in securities priced at or 
above $1.00 that yield fee code MM are currently charged a fee of 
$0.00080 per share. Orders in securities below $1.00 that yield fee 
code MT are currently charged a fee equal to 0.08% of the transaction's 
dollar value. Orders that yield fee code MM would now be free for all 
securities regardless of whether they are priced above or below $1.00.
     Fee code MT is appended to Non-Displayed orders that 
remove liquidity using MidPoint Peg Orders. Orders in securities priced 
at or above $1.00 that yield fee code MT are currently charged a fee of 
$0.00080 per share. Orders in securities below $1.00 that yield fee 
code MT are currently charged a fee equal to 0.08% of the transaction's 
dollar value. Orders that yield fee code

[[Page 28923]]

MT in securities priced at or above $1.00 would now be charged the 
proposed standard fee of $0.00050 per share. Orders in securities 
priced below $1.00 would be charged 0.05% of the transaction's dollar 
value.
     Fee code PA, which is appended to orders that add 
liquidity using the RMPT or RMPL routing strategies,\18\ are charged a 
fee of $0.00080 per share. Orders that yield fee code PA would now be 
charged no fee.
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    \18\ The RMPL and RMPT routing strategies utilize a MidPoint Peg 
Order to check the System for available shares and any remaining 
shares are then sent to destinations on the System routing table 
that support midpoint eligible orders. If any shares remain 
unexecuted after routing, they are posted on the EDGA Book as a 
MidPoint Peg Order, unless otherwise instructed by the User. See 
Exchange Rule 11.11(g)(13).
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     Fee code PT, which is appended to orders that add 
liquidity using the RMPT or RMPL routing strategies, are charged a fee 
of $0.00100 per share. Orders that yield fee code PT would now be 
charged the proposed standard fee of $0.00050 per share.
    Currently footnote 2 of the fee schedule states that the rates for 
fee codes HA, HR, MM and MT are contingent upon Member adding or 
removing an ADV of at least 1,000,000 shares Non-Displayed (yields fee 
codes HA, HR, DM, DT, MM, MT and RP) or Member adding an ADV of at 
least 8,000,000 shares (Displayed and Non-Displayed). For securities 
priced at or above $1.00, Members not meeting either minimum are 
currently charged $0.0030 per share for fee codes HA, HR, MM and MT. 
For securities priced below $1.00, Members not meeting either minimum 
are currently charged 0.30% of the dollar value of the transaction. The 
Exchange does not propose any contingency requirements or conditions 
that Members must satisfy to receive the proposed rates for Non-
Displayed orders. Therefore, the Exchange proposes to delete footnote 2 
of the fee schedule as receipt of the proposed rates would not be 
contingent on the Member meeting any volume requirements. All Non-
Displayed orders in securities priced below $1.00 would not be 
contingent to any minimum volume requirements and subject to the 
current rates set forth in the applicable fee code.
    The Exchange also proposes to modify or delete tiers applicable to 
Non-Displayed Orders. The Exchange currently offers two tiers under 
footnote 3, the RMPT/RMPL Tiers, under which a Member receives a 
discounted fee of either $0.0006 or $0.0008 per share for orders 
yielding fee codes PT or PX where that Member satisfies certain 
criteria. Under Tier 1, a Member receives a reduced fee of $0.0008 per 
share where they add or remove an ADV greater than or equal to 
2,000,000 shares using the RMPT or RMPL routing strategy. Under Tier 2, 
a Member receives a reduced fee of $0.0006 per share where they add or 
remove an ADV greater than or equal to 4,000,000 shares using the RMPT 
or RMPL routing strategy. As described above, fee codes PT and PX are 
appended to orders that remove liquidity or are routed, respectively, 
using the RMPT or RMPL routing strategies. Orders that yield fee code 
PT would be charged a fee of $0.00050 as proposed herein. Orders that 
yield fee code PX would continue to be charged a fee of $0.00120 per 
share. Because the fee for orders that yield fee code PT would be lower 
than the reduced fee provided by the two RMPT/RMPL Tiers, the Exchange 
proposes to only apply the reduced fee for those tiers to orders that 
yield fee code PX as those orders would be charged a higher fee of 
$0.00120 per share if they do not achieve the RMPT/RMPL tier's 
criteria.
    The Exchange also offers two tiers under footnote 13, the Midpoint 
Add and Remove Tiers, under which a Member receives a reduced fee of 
$0.0006 or $0.0004 per share for orders that yield fee code MM or MT 
where that Member satisfies certain criteria. As described above, fee 
codes MM and MT are appended to Midpoint Peg Orders that add or remove 
liquidity, respectively. Under Tier 1, Members are charged a reduced 
fee of $0.0006 per share where the Member has an ADV equal to or 
greater than 1,200,000 shares in orders that yield fee codes MM or MT. 
Under Tier 2, Members are charged a reduced fee of $0.0004 per share 
where the Member has an ADV equal to or greater than 2,500,000 shares 
in orders that yield fee codes MM or MT. The Exchange proposes to 
delete all tiers listed under footnote 13 as all MidPoint Peg orders 
that remove liquidity would be charged the proposed standard rates 
regardless of whether the Member achieves certain volume criteria--a 
fee of $0.00050 per share and those orders that add liquidity would be 
charged no fee.
Implementation Date
    The Exchange proposes to implement the above changes to its fee 
schedule on immediately.\19\
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    \19\ The Exchange initially filed the proposal on June 1, 2017. 
(SR-BatsEDGA-2017-17). On June 12, 2017, the Exchange withdrew SR-
BatsEDGA-2017-17 and submitted this filing.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\20\ in general, and 
furthers the objectives of Section 6(b)(4),\21\ in particular, as it is 
designed to provide for the equitable allocation of reasonable dues, 
fees and other charges among its Members and other persons using its 
facilities. The Exchange also believes the proposed rule change is not 
unfairly discriminatory as it would apply to all Members.
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    \20\ 15 U.S.C. 78f.
    \21\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes its proposal to replace its current taker-
maker pricing model with a new low fee model where it would charge a 
fee or provide the execution free of charge is equitable and reasonable 
as it would serve to simply its fee schedule to provide low standard 
rates for Displayed and Non-Displayed orders while also eliminating 
rebates and other pricing incentives. The Exchange submits this 
proposal in response to the industry feedback and the debate regarding 
exchange fee structures. Recent industry discourse has focused on fee 
structures and their purported effect on liquidity provision, liquidity 
taking, potential conflicts and order routing in the U.S. equity 
market. In addition, the Commission's EMSAC recommended that the 
Commission propose a pilot program to adjust the access fee cap under 
Rule 610 of Regulation NMS to better understand these dynamics.\22\ 
Other exchanges have proposed to not offer rebates and implemented a 
low fee model \23\ as the Exchange proposes herein. The Exchange 
submits this proposal in response to the industry feedback and debate 
regarding exchange fee structures and to move the discussion closer to 
a market practice of reduced transaction costs.
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    \22\ See supra note 7.
    \23\ See the Investors Exchange, Inc. fee schedule available at 
https://iextrading.com/trading/ (dated August 19, 2016).
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    The proposed fee structure provides a simple, straight forward low 
cost model that seeks to treat both liquidity providers and removers 
equally. Adopting a low fee model under which Displayed orders are 
charged the same low fee regardless of whether they add or remove 
liquidity will serve to provide an equal economic incentive to Members 
that not only seek to remove liquidity, but also to add liquidity to 
the Exchange. The Exchange believes that reducing the standard fee for 
Displayed orders and charging no fee for Non-Displayed orders that add 
liquidity will

[[Page 28924]]

seek to further incentives Members to add liquidity to the Exchange. 
The potential increase in posted liquidity would serve to improve price 
discovery, depth of liquidity, and overall execution quality on the 
Exchange. The Exchange further believes that it is equitable and 
reasonable to charge no fee for orders that yield fee code DT, which is 
appended to Non-Displayed orders that remove liquidity using MidPoint 
Discretionary Orders, as it is intended to incentives the use of 
MidPoint Discretionary Orders and improve liquidity at the midpoint of 
the NBBO. Charging no fee for orders that yield fee code DT is designed 
to encourage the posting of contra-side orders that add liquidity at 
the midpoint of the NBBO as such orders could receive increased 
execution opportunities thought the possible increase in entry of 
MidPoint Discretionary Orders.
    The modification and elimination of certain reduced fees via the 
current tiered pricing model as proposed herein is also equitable and 
reasonable because it would aid in simplifying the fee schedule and 
result in all Member's being charged the same rates for all 
transactions regardless of their monthly volumes. The Exchange 
generally believes that volume-based pricing provides benefits or 
discounts that are reasonably related to: (i) The value to an 
exchange's market quality; (ii) associated higher levels of market 
activity, such as higher levels of liquidity provision and/or growth 
patterns; and (iii) the introduction of higher volumes of orders into 
the price and volume discovery processes. However, the elimination of 
the Exchange's current tiered pricing is consistent with the proposed 
fee model which is designed to attract additional order flow though low 
fees for both adding and removing liquidity.

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

    This proposed rule change does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Act. The Exchange does not believe that this change represents a 
significant departure from previous pricing offered by the Exchange's 
competitors. The proposed rates would apply uniformly to all Members, 
and Members may opt to disfavor the Exchange's pricing if they believe 
that alternatives offer them better value. Accordingly, the Exchange 
does not believe that the proposed changes will impair the ability of 
Members or competing venues to maintain their competitive standing in 
the financial markets. Further, excessive fees would serve to impair an 
exchange's ability to compete for order flow and members rather than 
burdening competition. The Exchange believes that its proposal would 
not burden intramarket competition because the proposed rate would 
apply uniformly to all Members.

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

    The Exchange has not solicited, and does not intend to solicit, 
comments on this proposed rule change. The Exchange has not received 
any written comments from members or other interested parties.

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 \24\ and paragraph (f) of Rule 19b-4 
thereunder.\25\ 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.
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    \24\ 15 U.S.C. 78s(b)(3)(A).
    \25\ 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 No. SR-BatsEDGA-2017-18 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 No. SR-BatsEDGA-2017-18. 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 Web site (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 Web site 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; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File No. SR-BatsEDGA-2017-18, and should be 
submitted on or before July 17, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\26\
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    \26\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-13228 Filed 6-23-17; 8:45 am]
 BILLING CODE 8011-01-P