Document ID: SEC-2023-1424-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: MEMX, LLC
Posted Date: 2023-12-12T05:00Z

[Federal Register Volume 88, Number 237 (Tuesday, December 12, 2023)]
[Notices]
[Pages 86171-86172]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-27158]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-99100; File No. SR-MEMX-2023-32]

Self-Regulatory Organizations; MEMX LLC; Notice of Filing and 
Immediate Effectiveness of a Proposed Rule Change To Amend the 
Exchange's Fee Schedule

December 6, 2023.
    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 November 30, 2023, MEMX LLC (``MEMX'' or the ``Exchange'') 
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

    The Exchange is filing with the Commission a proposed rule change 
to amend the Exchange's fee schedule applicable to Members \3\ (the 
``Fee Schedule'') pursuant to Exchange Rules 15.1(a) and (c). The 
Exchange proposes to implement the changes to the Fee Schedule pursuant 
to this proposal on December 1, 2023. The text of the proposed rule 
change is provided in Exhibit 5.
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    \3\ See Exchange Rule 1.5(p).
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II. Self-Regulatory Organization's Statement of the Purpose of, and the 
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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The purpose of the proposed rule change is to amend the Fee 
Schedule to remove an expired criteria under Liquidity Provision Tier 
5.
    The Exchange currently provides a base rebate of $0.0015 per share 
for executions of orders in securities priced at or above $1.00 per 
share that add displayed liquidity to the Exchange (such orders, 
``Added Displayed Volume'').\4\ The Exchange also currently offers 
Liquidity Provision Tiers 1-5 under which a Member may receive an 
enhanced rebate for executions of Added Displayed Volume by achieving 
the corresponding required volume criteria for each such tier. With 
respect to Liquidity Provision Tier 5, the Exchange currently provides 
an enhanced rebate of $0.0025 per share for executions of Added 
Displayed Volume for Members that qualify for such tier by achieving: 
(1) an ADAV \5\ that is equal to or greater than 0.06% of the TCV; \6\ 
or (2) a Displayed ADAV that is equal to or greater than 0.007% of the 
TCV and a Step-Up Displayed ADAV \7\ from May 2023 that is equal to or 
greater than 50% of the Member's May 2023 Displayed ADAV of the TCV.\8\ 
Additionally, the Fee Schedule indicates that criteria (2) of Liquidity 
Provision Tier 5 will expire no later than November 30, 2023. Now, 
given the expiration of criteria (2) of Liquidity Provision Tier 5, it 
is necessary to modify the Fee Schedule to delete this criteria (2) as 
well as the note under the Liquidity Provision Tiers pricing table that 
indicates its expiration, as both are no longer applicable and 
otherwise obsolete. The Exchange is not proposing to make any changes 
to this or any other Liquidity Provision Tier, and as such, Liquidity 
Provision Tier 5 will now consist solely of the previously existing 
criteria (1).
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    \4\ The base rebate for executions of Added Displayed Volume is 
referred to by the Exchange on the Fee Schedule under the existing 
description ``Added displayed volume'' with a Fee Code of ``B'', 
``D'' or ``J'', as applicable, on execution reports.
    \5\ As set forth on the Fee Schedule, ``ADAV'' means the average 
daily added volume calculated as the number of shares added per day, 
which is calculated on a monthly basis.
    \6\ As set forth on the Fee Schedule, ``TCV'' means total 
consolidated volume calculated as the volume reported by all 
exchanges and trade reporting facilities to a consolidated 
transaction reporting plan for the month for which the fees apply.
    \7\ As set forth on the Fee Schedule, ``Step Up Displayed ADAV'' 
means Displayed ADAV in the relevant baseline month subtracted from 
current Displayed ADAV.
    \8\ The proposed pricing for Liquidity Provision Tier 5 is 
referred to by the Exchange on the Fee Schedule under the existing 
description ``Added displayed volume, Liquidity Provision Tier 5'' 
with a Fee Code of ``B5'', ``D5'' or ``J5'', as applicable, to be 
provided by the Exchange on the monthly invoices provided to 
Members.
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2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the provisions of Section 6 of the Act,\9\ in general, and with 
Sections 6(b)(4) and 6(b)(5) of the Act,\10\ in particular, in that it 
provides for the equitable allocation of reasonable dues, fees and 
other charges among its Members and other persons using its facilities 
and is not designed to permit unfair discrimination between customers, 
issuers, brokers, or dealers.
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    \9\ 15 U.S.C. 78f.
    \10\ 15 U.S.C. 78f(b)(4) and (5).
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    The Exchange believes that the proposed change to modify Liquidity 
Provision Tier 5 to remove the expired criteria (2) criteria [sic] is 
reasonable because there was an expiration date associated with this 
criteria that has now passed. As such, this criteria is no longer 
available under this tier, and should not remain on the Fee Schedule. 
The Exchange believes that the enhanced rebate for executions of Added 
Displayed Volume provided under Liquidity Provision Tier 5, which the 
Exchange is not proposing to change with this proposal, remains 
commensurate with the required criteria under such tier, as modified, 
and is reasonably related to the market quality benefits that such tier 
is designed to achieve. The Exchange also believes the enhanced rebate 
for executions of Added Displayed Volume provided under Liquidity 
Provision Tier 5 remains equitable and not unfairly discriminatory, as 
such enhanced rebate will continue to apply equally to all qualifying 
Members.
    For the reasons discussed above, the Exchange submits that the 
proposal

[[Page 86172]]

satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of the Act 
\11\ in that it provides for the equitable allocation of reasonable 
dues, fees and other charges among its Members and other persons using 
its facilities and is not designed to unfairly discriminate between 
customers, issuers, brokers, or dealers.
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    \11\ 15 U.S.C. 78f(b)(4) and (5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\12\ the Exchange 
believes that the proposed rule change will not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act.
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    \12\ 15 U.S.C. 78f(b)(8).
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    The Exchange believes that the proposed rule change would not place 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. The proposed rule change is not 
designed to address any competitive issues but rather is designed to 
enhance the clarity of the Fee Schedule and alleviate possible Member 
confusion that may arise from the inclusion of obsolete language.

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)(ii) of the Act \13\ and Rule 19b-4(f)(2) \14\ thereunder.
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    \13\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \14\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.

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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-MEMX-2023-32 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-MEMX-2023-32. 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 (https://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 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the Exchange. Do not 
include personal identifiable information in submissions; you should 
submit only information that you wish to make available publicly. We 
may redact in part or withhold entirely from publication submitted 
material that is obscene or subject to copyright protection. All 
submissions should refer to file number SR-MEMX-2023-32 and should be 
submitted on or before January 2, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-27158 Filed 12-11-23; 8:45 am]
BILLING CODE 8011-01-P