
[Federal Register Volume 80, Number 67 (Wednesday, April 8, 2015)]
[Notices]
[Pages 18892-18894]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-07960]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74632; File No. SR-MIAX-2015-24]


Self-Regulatory Organizations; Miami International Securities 
Exchange LLC; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Amend Its Fee Schedule

April 2, 2015.
    Pursuant to the provisions of 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 March 31, 2015, Miami International Securities 
Exchange LLC (``MIAX'' or ``Exchange'') filed with the Securities and 
Exchange Commission (``Commission'') a 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 the 
Substance of the Proposed Rule Change

    The Exchange is filing a proposal to modify the Market Maker 
Trading Permit Fee.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at 
MIAX's principal office, 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 Exchange proposes to modify its Trading Permit fees to increase 
the monthly Trading Permit fees that apply

[[Page 18893]]

to Market Makers (``MMs''). Specifically, the Exchange proposes to: (i) 
Increase the monthly Trading Permit fee that applies to MMs for MM 
Assignments in up to 250 options classes from $5,500 to $15,000; (ii) 
increase the monthly Trading Permit fee that applies to MMs for MM 
Assignments in all classes from $7,000 to $22,000; (iii) eliminate the 
Trading Permit fee that applies to MMs for MM Assignments in up to 100 
options classes; and (iv) add some clarifying language to the Fee 
Schedule regarding the fee applicable to MM Assignments above 250.
    The Exchange issues Trading Permits that confer the ability to 
transact on the Exchange.\3\ Currently, all MMs, whether they are a 
RMM, LMM or PLMM, are assessed $4,000 per month for a Trading Permit 
for an assignment in up to 100 option classes, $5,500 per month for a 
Trading Permit for an assignment in up to 250 option classes, or $7,000 
per month for a Trading Permit for an assignment in all option classes 
listed on the Exchange.\4\ The Exchange notes that the current monthly 
Trading Permit fees are in some instances substantially lower than 
monthly trading permit fees in place at other competing options 
exchanges.\5\ The Exchange established these lower rates in order to 
encourage additional market participants to become Members of the 
Exchange and register as MIAX Market Makers. Now that the Exchange has 
grown its market share and membership base, the Exchange proposes to 
modify its Trading Permit fee for MMs so that it is more aligned with 
the rates charged by competing options exchanges.
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    \3\ There is no limit on the number of Trading Permits that may 
be issued by the Exchange; however the Exchange has the authority to 
limit or decrease the number of Trading Permits it has determined to 
issue provided it complies with the provisions set forth in Rule 
200(a) and Section 6(c)(4) of the Exchange Act. See 15 U.S.C. 
78(f)(c)(4). For a complete description of MIAX Trading Permits, see 
MIAX Rule 200.
    \4\ The monthly Trading Permit Fee is in addition to the one-
time application fee for MIAX Membership. The Exchange charges a 
one-time application fee based upon the applicant's status as either 
an Electronic Exchange Member (``EEM'') or as a Market Maker. 
Applicants for MIAX Membership as an EEM are assessed a one-time 
Application Fee of $2,500.00. Applicants for MIAX Membership as a 
Market Maker are assessed a one-time Application Fee of $3,000.00. 
The difference in the fee charged to EEMs and Market Makers reflects 
the additional review and processing effort needed for Market Maker 
applications.
    \5\ See e.g., NYSE Arca Options Fees and Charges, p.1 (assessing 
market makers $6,000 for up to 100 option issues, an additional 
$5,000 for up to 250 option issues, an additional $4,000 for up to 
750 option issues, and an additional $3,000 for all option issues on 
the exchange); NYSE Amex Options Fee Schedule, p. 19 (assessing 
market makers $8,000 for up to 60 plus the bottom 45%, an additional 
$6,000 for up to 150 plus the bottom 45%, an additional $5,000 for 
up to 500 plus the bottom 45%, and additional $4,000 for up to 1,000 
[sic] plus the bottom 45%, and an additional $3,000 for all issues 
traded on the exchange).
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    The Exchange proposes to modify its MM Trading Permit fee to 
increase the monthly Trading Permit fee that applies to MMs. 
Specifically, the Exchange proposes to: (i) Increase the monthly 
Trading Permit fee that applies to MMs for MM Assignments in up to 250 
options classes from $5,500 to $15,000; (ii) increase the monthly 
Trading Permit fee that applies to MMs for MM Assignments in all 
classes from $7,000 to $22,000; and (iii) eliminate the Trading Permit 
fee that applies to MMs for MM Assignments in up to 100 options 
classes.
    Members receiving Trading Permits during the month will be assessed 
Trading Permit Fees according to the above schedule, except that the 
calculation of the Trading Permit fee for the first month in which the 
Trading Permit is issued will be pro-rated based on the number of 
trading days occurring after the date on which the Trading Permit was 
in effect during that first month divided by the total number of 
trading days in such month multiplied by the monthly rate.
    Finally, the Exchange proposes to add some clarifying language to 
the Fee Schedule in order to specify that the $22,000 Trading Permit 
Fee applies to MMs Assignments over 250 up to all options classes 
listed on MIAX. The Exchange believes that the proposed change will 
help avoid the potential for confusion on behalf of MMs as to which fee 
level applies to MMs Assignments over 250 options classes.
    The Exchange proposes to implement the Trading Permit fees 
beginning April 1, 2015.
2. Statutory Basis
    The Exchange believes that its proposal to amend its fee schedule 
is consistent with Section 6(b) of the Act \6\ in general, and furthers 
the objectives of Section 6(b)(4) of the Act \7\ in particular, in that 
it is an equitable allocation of reasonable fees and other charges 
among Exchange members.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).
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    The Exchange believes that the proposed Trading Permit fee is 
reasonable, equitable and not unfairly discriminatory. The proposed 
Trading Permit fees are reasonable in that they are within the range of 
comparable fees at other competing options exchanges.\8\ As such, the 
proposal is reasonably designed to continue to compete with other 
options exchange by incentivizing market participants to register as 
Market Makers on the Exchange in a manner that enables the Exchange to 
improve its overall competitiveness and strengthen its market quality 
for all market participants. The proposed fee is fair and equitable and 
not unreasonably discriminatory because it applies equally to all 
Market Makers regardless of type. All similarly situated Market Makers, 
with the same number of assignments, will be subject to the same 
Trading Permit fee, and access to the Exchange is offered on terms that 
are not unfairly discriminatory.
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    \8\ See supra note 5. NYSE Arca Options charges $11,000 for up 
to 250 option issues and $18,000 for all options issues on the 
exchange. NYSE Amex Options charges $26,000 for all option issues on 
the exchange.
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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 
proposal increases both intermarket and intramarket competition by 
increasing Trading Permit fees for Market Makers on the Exchange in a 
manner that allows all Market Makers to be subject to the same fee 
based on the number of assignments regardless of type and yet still be 
in the range of comparable fees on other exchanges. The Exchange notes 
that it operates in a highly competitive market in which market 
participants can readily favor competing venues if they deem fee levels 
at a particular venue to be excessive. In such an environment, the 
Exchange must continually adjust its fees to remain competitive with 
other exchanges and to attract order flow to the Exchange. The Exchange 
believes that the proposal reflects this competitive environment 
because it increases the Exchange's fees in a manner that continues to 
encourage market participants to register as Market Makers on the 
Exchange, to provide liquidity, and to attract order flow. To the 
extent that this purpose is achieved, all the Exchange's market 
participants should benefit from the improved market liquidity.

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

    Written comments were neither solicited nor 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

[[Page 18894]]

19(b)(3)(A)(ii) of the Act.\9\ 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 should be 
approved or disapproved.
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    \9\ 15 U.S.C. 78s(b)(3)(A)(ii).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-MIAX-2015-24 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-MIAX-2015-24. 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 such 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 Number SR-MIAX-2015-24, and should be 
submitted on or before April 29, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-07960 Filed 4-7-15; 8:45 am]
 BILLING CODE 8011-01-P


