
[Federal Register Volume 80, Number 115 (Tuesday, June 16, 2015)]
[Notices]
[Pages 34475-34480]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-14668]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-75139; File No. SR-NYSE-2015-28]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Amending the Price List To Revise Fees and Credits for Mid-Point 
Passive Liquidity Orders and Non Displayed Reserve Orders and To Revise 
Credits Applicable to Certain Transactions at the Open, Certain 
Designated Market Maker Transactions, and Certain Supplemental 
Liquidity Provider Transactions

 June 10, 2015.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on May 27, 2015, New York Stock Exchange LLC (``NYSE'' 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 self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Price List to revise (i) fees 
and credits for Mid-Point Passive Liquidity Orders and Non-Displayed 
Reserve Orders; (ii) credits applicable to certain transactions at the 
open; (iii) credits applicable to certain Designated Market Maker 
transactions; and (iv) credits applicable to Supplemental Liquidity 
Providers. The Exchange proposes to implement the fee change effective 
June 1, 2015. The text of the proposed rule change is available on the 
Exchange's Web site at www.nyse.com, at the principal office of the 
Exchange, and at the Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposes to amend its Price List to revise (i) fees 
and credits for Mid-Point Passive Liquidity (``MPL'') Orders and Non-
Displayed Reserve Orders; (ii) credits applicable to certain 
transactions at the open; (iii) credits applicable to certain 
Designated Market Maker (``DMM'') transactions; and (iv) credits 
applicable to Supplemental Liquidity Providers (``SLPs'').
MPL Orders and Non-Displayed Reserve Orders
    An MPL Order is an undisplayed limit order that trades at the mid-
point of the best protected bid (``PBB'') and best protected offer 
(``PBO''), as such terms are defined in Regulation NMS Rule 600(b)(57) 
(together, ``PBBO'').
    The Exchange currently charges $0.0025 per share for all MPL 
Orders, not designated as ``retail'' under Rule 13, for securities 
priced $1.00 or more that remove liquidity from the

[[Page 34476]]

Exchange. The Exchange proposes to amend its Price List to increase the 
charge for such MPL Orders from $0.0025 per share to $0.0027 per share.
    The proposed change would not affect transaction fees for MPL 
Orders that remove liquidity from the Exchange and that are designated 
with a ``retail modifier'' as defined in Rule 13.\4\
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    \4\ MPL Orders that remove liquidity from the Exchange and that 
are designated with a ``retail'' modifier as defined in Rule 13 
would continue not to be charged transaction fees.
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    The Exchange currently provides a credit of $0.0020 per share for 
executions of MPL Orders that provide liquidity for securities priced 
$1.00 or more. With respect to market participants, including floor 
brokers and SLPs, but not DMMs, the Exchange proposes to amend its 
Price List to replace the credit of $0.0020 per share for MPL Orders 
that provide liquidity for securities priced $1.00 or more with the 
following credits:
     A $0.0030 per share transaction credit for MPL Orders that 
provide liquidity from a member organization that has Adding ADV in MPL 
Orders that is at least 1.5 million shares, excluding any liquidity 
added by a Designated Market Maker (``MPL Order Tier'').\5\
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    \5\ Footnote 2 to the Price List defines ADV as ``average daily 
volume'' and ``Adding ADV'' as ADV that adds liquidity to the 
Exchange during the billing month. The Exchange is not proposing to 
change these definitions.
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     A $0.0015 per share transaction credit for MPL Orders that 
provide liquidity from a member organization that does not meet the 
above Adding ADV threshold.
    Because the credits for MPL Orders that add liquidity would be as 
specified above, the Exchange also proposes to add, to each of the 
descriptions of the Non-Tier Adding Credit, Tier 1 Adding Credit, Tier 
2 Adding Credit, Tier 3 Adding Credit, the Equity per Share Credit for 
retail orders, and the Credit per Share for execution of orders sent to 
floor brokers, language that excludes MPL orders from the applicable 
credit. For SLP Tier 1, SLP Tier 2, and SLP Tier 3 (as defined below in 
``SLPs''), the Exchange also proposes to add language that excludes MPL 
Orders from the applicable credit.
    In addition, the Exchange proposes to amend its Price List to 
increase the transaction credit for DMMs in securities with a per share 
price of $1.00 or more of $0.0020 per share for MPL Orders that provide 
liquidity to the Exchange to $0.0030 per share for MPL Orders that 
provide liquidity to the Exchange. For clarity, the Exchange is 
proposing to specify this credit for liquidity by adding MPL Orders 
separately in the Price List under the section entitled ``Fees and 
Credits applicable to Designated Market Makers (``DMMs'').'' Further, 
the Exchange is proposing to include language that excludes MPL orders 
from the other DMM per share rebates for adding liquidity.
    Finally, the Exchange currently provides a credit of $0.0010 per 
share for executions of Non-Displayed Reserve Orders for market 
participants, other than SLPs, that provide liquidity. The Exchange 
proposes to eliminate that credit. Accordingly, the Exchange is 
proposing to add to each of the descriptions of the Non-Tier Adding 
Credit, Tier 1 Adding Credit, Tier 2 Adding Credit, Tier 3 Adding 
Credit, and the Equity per Share Credit for retail orders language that 
excludes Non-Displayed Reserve Orders from the applicable credit.
Credits for Execution of Certain Orders at the Opening
    The Exchange proposes to amend its Price List for certain 
executions at the opening.
    For securities priced $1.00 or more, the Exchange currently charges 
a fee of $0.0010 per share for executions at the opening or at the 
opening only orders, subject to a monthly fee cap of $20,000 per member 
organization for such executions. The Exchange proposes to raise the 
monthly fee cap for transaction fees for at the opening or at the 
opening only orders to $30,000 per member organization for securities 
priced $1.00 or greater.\6\ The $0.0010 per share fee for executions at 
the opening or at the opening only orders would not be changed. DMMs 
currently are not charged for executions at the opening and would 
continue to not be charged.
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    \6\ The existing pricing for executions at the opening in 
securities priced below $1.00 would also remain unchanged (i.e., 
0.3% of the total dollar value of the transaction).
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DMMs
    The section of the Exchange's Price List entitled ``Fees and 
Credits applicable to Designated Market Makers (``DMMs'')'' sets out 
different monthly rebate amounts to DMMs depending on the average daily 
consolidated volume of the security and the DMM quoting percentage in 
any month in which the DMM meets the Less Active Securities Quoting 
Requirement. The DMM meets the ``Less Active Securities Quoting 
Requirement'' when a security has a consolidated ADV of less than 
1,000,000 shares per month in the previous month and a stock price of 
$1.00 or more, and the DMM quotes at the National Best Bid or Offer 
(``NBBO'') in the applicable security at least 15% of the time in the 
applicable month.
    The term ``ADV'' in this section currently is defined as ``average 
daily consolidated volume.'' The Exchange proposes to change the name 
of the term to ``Security CADV'' to clarify that the term refers to 
consolidated volume for the applicable security, and to remove any 
confusion with the term ``ADV'' as defined and used elsewhere in the 
Price List. The Exchange proposes to make conforming changes to use the 
term ``Security CADV'' in place of ``ADV'' throughout this section of 
the Price List.
    The Exchange also proposes to change the monthly rebate amounts to 
DMMs depending on the Security CADV and the DMM quoting percentage. The 
monthly rebate payable to DMMs for securities with a Security CADV of 
100,000 up to 250,000 shares in the previous month is currently $250 
when the DMM quotes at the NBBO 20% of the time or more in an 
applicable security and $200 if the DMM quotes at the NBBO at least 15% 
and up to 20% of the time in an applicable month in an applicable 
security. For these securities, the Exchange proposes monthly rebates 
as follows:
     $450 rebate if the DMM quotes at the NBBO 50% of the time 
or more in an applicable security.
     $375 rebate if the DMM quotes at the NBBO at least 40% and 
up to 50% of the time in an applicable month in an applicable security.
     $300 rebate if the DMM quotes at the NBBO at least 30% and 
up to 40% of the time in an applicable month in an applicable security.
     $225 rebate if the DMM quotes at the NBBO at least 20% and 
up to 30% of the time in an applicable month in an applicable security.
     $150 rebate if the DMM quotes at the NBBO at least 15% and 
up to 20% of the time in an applicable month in an applicable security.
    The current monthly rebate payable to DMMs for securities with a 
Security CADV of less than 100,000 shares in the previous month is $175 
when the DMM quotes at the NBBO 20% of the time or more in an 
applicable security and $125 if the DMM quotes at the NBBO at least 15% 
and up to 20% of the time in an applicable month in an applicable 
security. For these securities, the Exchange proposes monthly rebates 
as follows:
     $400 rebate if the DMM quotes at the NBBO 50% of the time 
or more in an applicable security.
     $325 rebate if the DMM quotes at the NBBO at least 40% and 
up to 50%

[[Page 34477]]

of the time in an applicable month in an applicable security.
     $250 rebate if the DMM quotes at the NBBO at least 30% and 
up to 40% of the time in an applicable month in an applicable security.
     $175 rebate if the DMM quotes at the NBBO at least 20% and 
up to 30% of the time in an applicable month in an applicable security.
     $100 rebate if the DMM quotes at the NBBO at least 15% and 
up to 20% of the time in an applicable month in an applicable security.
    In addition, the Exchange proposes to add monthly rebates to the 
Price List for securities with a Security CADV of 250,000 up to 
1,500,000 shares in the previous month, which would apply, as with the 
other two categories of rebates, in any month in which the DMM meets 
the Less Active Securities Quoting Requirement in an applicable 
security, and as follows:
     $500 rebate if the DMM quotes at the NBBO 50% of the time 
or more in an applicable security.
     $425 rebate if the DMM quotes at the NBBO at least 40% and 
up to 50% of the time in an applicable month in an applicable security.
     $350 rebate if the DMM quotes at the NBBO at least 30% and 
up to 40% of the time in an applicable month in an applicable security.
     $275 rebate if the DMM quotes at the NBBO at least 20% and 
up to 30% of the time in an applicable month in an applicable security.
     $200 rebate if the DMM quotes at the NBBO at least 15% and 
up to 20% of the time in an applicable month in an applicable security.
    Finally, as noted above, because the Exchange is proposing to list 
separately the credit to DMMs for liquidity adding MPL Orders, the 
Exchange is proposing to exclude MPL orders from the other DMM per 
share rebates for adding liquidity listed in this section.
SLPs
    SLPs are eligible for certain credits when adding liquidity to the 
Exchange. The amount of the credit is currently determined by the 
``tier'' for which the SLP qualifies, which is generally based on the 
SLP's level of quoting and the ADV of liquidity added by the SLP in 
assigned securities.
    Currently, when adding liquidity to the NYSE in securities with a 
share price of $1.00 or more, an SLP is eligible for a credit of 
$0.0023 per share traded if the SLP (1) meets the 10% average or more 
quoting requirement in assigned securities pursuant to Rule 107B and 
(2) adds liquidity for assigned SLP securities in the aggregate \7\ of 
an ADV \8\ of more than 0.20% of NYSE CADV,\9\ or an SLP that is also a 
DMM and subject to Rule 107B(i)(2)(a),\10\ more than 0.15% of NYSE CADV 
(``SLP Tier 3''). In the case of Non-Displayed Reserve Orders, the SLP 
credit is $0.0018 and in the case of MPL Orders, the credit is $0.0020. 
For less active SLP securities (i.e. securities with an ADV in the 
previous month of 500,000 share or less per month (``Less Active SLP 
Securities'')), the SLP is eligible for a per share credit of $0.0028; 
$0.0023 if a Non-Displayed Reserve Order; or $0.0020 if an MPL Order.
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    \7\ Under Rule 107B, an SLP can be either a proprietary trading 
unit of a member organization (``SLP-Prop'') or a registered market 
maker at the Exchange (``SLMM''). For purposes of the 10% average or 
more quoting requirement in assigned securities pursuant to Rule 
107B, quotes of an SLP-Prop and an SLMM of the same member 
organization are not aggregated. However, for purposes of adding 
liquidity for assigned SLP securities in the aggregate, shares of 
both an SLP-Prop and an SLMM of the same member organization are 
included.
    \8\ The defined term, ``ADV,'' used here as defined in footnote 
2 to the Price List. See supra note 5.
    \9\ NYSE CADV is defined in the Price List as the consolidated 
average daily volume of NYSE-listed securities.
    \10\ Rule 107B(i)(2)(A) prohibits a DMM from acting as a SLP in 
the same securities in which it is a DMM.
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    Similarly, an SLP adding liquidity in securities with a per share 
price of $1.00 or more is eligible for a per share credit of $0.0026 if 
the SLP: (1) Meets the 10% average or more quoting requirement in an 
assigned security pursuant to Rule 107B; and (2) adds liquidity for all 
assigned SLP securities in the aggregate of an ADV of more than 0.35% 
of NYSE CADV, or for an SLP that is also a DMM and subject to Rule 
107B(i)(2)(a), more than 0.30% of NYSE CADV \11\ (``SLP Tier 2''). In 
the case of Non-Displayed Reserve Orders, the SLP credit is $0.0021 and 
in the case of MPL Orders, the credit is $0.0020. For Less Active SLP 
Securities, the SLP is eligible for a per share credit of $0.0031; 
0.0026 if a Non-Displayed Reserve Order; or $0.0020 if an MPL Order.
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    \11\ In determining whether an SLP meets the requirement to add 
liquidity in the aggregate of an ADV of more than 0.35% or 0.30% 
depending on whether the SLP is also a DMM, the SLP may include 
shares of both an SLP-Prop and an SLMM of the same member 
organization.
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    An SLP adding liquidity in securities with a per share price of 
$1.00 or more is eligible for a per share credit of $0.0029 if the SLP: 
(1) Meets the 10% average or more quoting requirement in an assigned 
security pursuant to Rule 107B; and (2) adds liquidity for all for 
assigned SLP securities in the aggregate of an ADV of more than 0.55% 
of NYSE CADV, or for an SLP that is also a DMM and subject to Rule 
107B(i)(2)(a), more than 0.50% of NYSE CADV, the SLP is eligible for a 
per share credit of $.0029 (``SLP Tier 1''). In the case of Non-
Displayed Reserve Orders, the credit is $0.0024 and in the case of MPL 
Orders, the credit is $0.0020. For Less Active SLP Securities, the SLP 
is eligible for a per share credit of $0.0034; $0.0029 if a Non-
Displayed Reserve Order; or $0.0020 if an MPL Order.
    Finally, an SLP adding liquidity in securities with a per share 
price of $1.00 or more that does not qualify for the credits described 
above is eligible for the applicable rate for the base SLP tier, which 
would be the rate that applies to the non-SLP activity of the member 
organization, i.e. the non-Tier Adding Credit, Tier 3 Adding Credit, 
Tier 2 Adding Credit or Tier 1 Adding Credit (``SLP Non-Tier''). In the 
case of Non-Displayed Reserve Orders, the credit is $0.0010 and in the 
case of MPL Orders, the credit is $0.0020.
    The Exchange proposes to add defined terms identifying each of 
tiers for SLP credits, as defined above, in the Price List, as SLP Tier 
1, SLP Tier 2, SLP Tier 3 and SLP Non-Tier.
    The Exchange proposes to increase for SLP Tier 1 and SLP Tier 2 the 
ADV percentage requirement for SLPs and for SLPs that are also DMMs and 
subject to Rule 107B(i)(2)(A). The ADV percentage requirement for SLPs 
for SLP Tier 1 and SLP Tier 2 would increase from 0.55% to 0.90% and 
0.35% to 0.45%, respectively. The ADV percentage requirement for SLPs 
that are also DMMs and subject to Rule 107B(i)(2)(A) for SLP Tier 1 and 
SLP Tier 2 would increase from 0.50% to 0.85% and 0.30% to 0.40%, 
respectively. The Exchange does not propose to change the ADV 
percentage requirement for SLP Tier 3.
    The Exchange proposes, for each SLP tier, to decrease the credit 
for a Non-Displayed Reserve Order by $0.0010. Specifically, for Non-
Displayed Reserve Orders the SLP Tier 1 credit would decrease from 
$0.0024 to $0.0014; the SLP Tier 2 credit would decrease from $0.0021 
to $0.0011; the SLP Tier 3 credit would decrease from $0.0018 to 
$0.0008; and the SLP Non-Tier credit would decrease from $0.0010 to no 
credit.
    The Exchange proposes to decrease the credit for a Non-Displayed 
Reserve Order for Less Active SLP Securities by $0.0010 for each SLP 
tier: specifically, for SLP Tier 1, from $0.0029 to $0.0019; for SLP 
Tier 2, from $0.0026 to $0.0016; and for SLP Tier 3, from $0.0023 to 
$0.0013.
    The proposed changes to the credits applicable to MPL Orders are as 
set

[[Page 34478]]

forth in ``MPL Orders and Non-Displayed Reserve Orders'' above.
    The above proposed changes are not otherwise intended to address 
any other issues, and the Exchange is not aware of any problems that 
members and member organizations would have in complying with the 
proposed change.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\12\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\13\ in 
particular, because it provides for the equitable allocation of 
reasonable dues, fees, and other charges among its members, issuers and 
other persons using its facilities and does not unfairly discriminate 
between customers, issuers, brokers or dealers.
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    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(4) and (5).
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MPL Orders and Non-Displayed Reserve Orders
    The Exchange believes that the proposed increase to the fee for 
executions of MPL Orders that remove liquidity and the proposed changes 
to the credits for MPL Orders that provide liquidity are reasonable. 
MPL Orders provide opportunities for market participants to interact 
with orders priced at the midpoint of the PBBO, thus providing price 
improving liquidity to market participants and increasing the quality 
of order execution on the Exchange's market, which benefits all market 
participants. These changes should encourage additional utilization of 
MPL Orders on the Exchange.
    Specifically, the Exchange believes that the proposed change for 
MPL Orders that remove liquidity from the Exchange if the security is 
priced $1.00 or more from $0.0025 per share to $0.0027 per share is 
reasonable because the charge would be the same as the $0.0027 fee 
proposed for other executions that remove liquidity. The resulting fee 
is also reasonable because would be lower than the rates on the NASDAQ 
Stock Market, LLC (``NASDAQ''). For example, NASDAQ charges $0.0030 per 
share to execute against resting midpoint liquidity, which is greater 
than both the existing $0.0025 per share rate and the proposed $0.0027 
per share rate that would apply to MPL Orders.\14\
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    \14\ See NASDAQ Rule 7018(a).
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    The Exchange believes that the proposed additional tier of credits 
for MPL Orders is reasonable because the proposed MPL Order Tier credit 
of $0.0030 per share that would apply if the member organization has 
Adding ADV in MPL Orders that is at least 1.5 million shares would 
relate to volume that provides liquidity, which would be identical to 
the type of volume to which the credit would apply.
    In addition, the Exchange believes the decrease in the non-tier MPL 
Order credit to $0.0015 is reasonable as it is greater than the non-
tier credit that is available on NASDAQ for midpoint liquidity, which 
is currently $0.0014 for Tape A and B securities and $0.0010 per share 
for Tape C securities.\15\
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    \15\ See supra note 14.
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    The Exchange also believes that the proposed changes are equitable 
and not unfairly discriminatory because all market participants--
customers, Floor brokers, DMMs, and SLPs--may use MPL Orders on the 
Exchange and because customers, Floor brokers and SLPs that use MPL 
Orders would be subject to the same fee or credit.
    Finally, the Exchange believes that the proposed change to the 
credit for DMMs for MPL Orders that provide liquidity to the Exchange 
to $0.0030 per share is reasonable because DMMs cannot trade in 
securities they are not a DMM in and therefore the minimum volume 
requirement of the MPL Order Tier should not apply. Moreover, the 
requirement is equitable and not unfairly discriminatory because it 
would apply equally to all DMM firms.
    The Exchange believes the proposed changes should incentivize 
additional utilization of MPL Orders on the Exchange. MPL Orders 
provide opportunities for market participants to interact with orders 
priced at the midpoint of the PBBO, thus providing price improving 
liquidity to market participants and increasing the quality of order 
execution on the Exchange's market, which benefits all market 
participants. The proposed change is equitable and not unfairly 
discriminatory because MPL Orders increase the quality of order 
execution on the Exchange's market, which benefits all market 
participants. The Exchange also believes that the proposed changes are 
equitable and not unfairly discriminatory because all market 
participants--customers, Floor brokers, DMMs, and SLPs--may use MPL 
Orders on the Exchange and because all market participants that use MPL 
Orders may receive credits for MPL Orders, as is currently the case.
    The Exchange believes that the proposed rule change to reduce the 
credit for Non-Displayed Reserve Orders that provide liquidity is 
reasonable, equitable and not unfairly discriminatory because it is 
intended to incentivize member organizations to submit additional 
amounts of displayed liquidity to the Exchange during the trading day. 
For example, the proposed higher credits applicable to member 
organization for executions other than Non-Displayed Reserve Orders 
would incentivize member organizations to instead provide displayed 
liquidity on the Exchange. The Exchange believes that the proposed 
lower credit is equitable and not unfairly discriminatory because it 
would apply equally to all member organizations.
Credits for Certain Executions at the Opening
    The Exchange believes that it is reasonable to increase the monthly 
fee cap for fees for executions at the opening or executions at the 
opening only orders to $30,000 because members and member organizations 
benefit from the substantial amounts of liquidity that are present on 
the Exchange during such time. In addition, the Exchange believes that 
the proposed cap is reasonable because the proposed cap and the current 
fee rate together are comparable to those for executions at the opening 
on other markets.\16\
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    \16\ For example, NASDAQ charges $0.0015 per share for certain 
orders executed in the NASDAQ Opening Corss [sic] and applies at 
$20,000 fee cap per month per firm for such executions. See Nasdaq 
Rule 7018(e).
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    The proposed increased fee cap is equitable and not unfairly 
discriminatory because, even at such an increased level, this pricing 
would continue to encourage robust levels of liquidity at the opening, 
which benefits all market participants. The proposed increase will 
encourage the submission of additional liquidity to a national 
securities exchange, thereby promoting price discovery and transparency 
and enhancing order execution opportunities for member organization 
from the substantial amounts of liquidity that are present on the 
Exchange during the opening. Moreover, the requirement is equitable and 
not unfairly discriminatory because it would apply equally to all 
similarly situated member organizations.
DMMs
    The Exchange believes that the proposed higher monthly credit of 
$300, $375, and $450 for each security that has a consolidated ADV of 
more than 100,000 and less than 250,000 shares during the month when 
the DMM quotes at the NBBO in the applicable security at least 30%, 
40%, and 50%, of the time, respectively, in the applicable month is 
reasonable because of the

[[Page 34479]]

proposed higher quoting requirement associated with this increase in 
the credit. The Exchange believes that the proposed lower monthly 
credit of $150 and $225 for each security that has a consolidated ADV 
of more than 100,000 and less than 250,000 shares during the month when 
the DMM quotes at the NBBO in the applicable security between 15% and 
20% and 20% to 30% of the time, respectively, in the applicable month 
is reasonable because of the proposed higher credit available based on 
higher quoting, which should encourage greater quoting. The Exchange 
believes that the proposal would increase the incentive to add 
liquidity across thinly-traded securities where there may be fewer 
liquidity providers. Moreover, the requirement is equitable and not 
unfairly discriminatory because it would apply equally to all DMM 
firms.
    The Exchange believes that the proposed higher monthly credit of 
$250, $325, and $400 for each security that has a consolidated ADV of 
less than 100,000 shares during the month when the DMM quotes at the 
NBBO in the applicable security at least 30%, 40%, and 50%, of the 
time, respectively, in the applicable month is reasonable because of 
the proposed higher quoting requirement associated with this increase 
in the credit. The Exchange believes that the proposed lower monthly 
credit of $100 each security that has a consolidated ADV of less than 
100,000 shares during the month when the DMM quotes at the NBBO in the 
applicable security between 15% and 20% of the time in the applicable 
month is reasonable because of higher credit available based on higher 
quoting, which should encourage greater quoting. The Exchange also 
believes that it is reasonable to retain a $175 credit for each 
security that has a consolidated ADV of less than 100,000 shares during 
the month when the DMM quotes at the NBBO in the applicable security at 
least 20% and up to 30% of the time in the applicable month as this is 
the rate currently charged and it would apply equally to all DMM firms. 
The Exchange believes that the proposal would increase the incentive to 
add liquidity across thinly-traded securities where there may be fewer 
liquidity providers. Moreover, the requirement is equitable and not 
unfairly discriminatory because it would apply equally to all DMM 
firms.
    The Exchange believes that the proposed monthly credit of $200, 
$275, $350, $425, and $500 for each security that has a consolidated 
ADV of more than 250,000 and less than 1,500,000 shares during the 
month when the DMM quotes at the NBBO in the applicable security at 
least 15%, 20%, 30%, 40%, and 50%, of the time, respectively, in the 
applicable month is reasonable because of the proposed higher quoting 
requirement associated with this credit. The Exchange also believes 
that the higher credits for each security that has a consolidated ADV 
of more than 250,000 and less than 1,500,000 shares during the month 
when the DMM quotes at the NBBO of the time in the applicable month is 
reasonable in light of higher trading volumes in the applicable 
securities relatively to those securities that have a consolidated ADV 
of less than 250,000 shares. The Exchange believes that the proposal 
would increase the incentive to add liquidity across thinly-traded 
securities where there may be fewer liquidity providers. Moreover, the 
requirement is equitable and not unfairly discriminatory because it 
would apply equally to all DMM firms.
SLPs
    The Exchange believes that the proposal to add defined terms for 
the SLP Tiers to the Price List is reasonable because the change will 
make the Price List clearer and easier to understand.
    The Exchange believes that proposal to increase the ADV percentage 
requirement for SLPs that are also DMMs and subject to Rule 
107B(i)(2)(A) is reasonable because the higher requirements would 
incentivize member organizations to provide additional amounts of 
liquidity on the Exchange. The Exchange believes that the higher 
requirements are reasonable given the higher credits--$0.0029 per share 
for SLP Tier 1 and $0.026 per share for SLP Tier 2--relative to the 
credit applicable to member organizations other than SLPs, and that the 
lower requirements for SLP Tier 3 and the SLP Non-Tier are, similarly, 
reasonable given the lower credits for those tiers The Exchange 
believes that the proposed higher ADV percentage requirements for SLP 
Tier 1 and SLP Tier 2 are equitable and not unfairly discriminatory 
because they would apply equally to all SLPs.
    Further, the Exchange believes that the proposed rule change to 
reduce the credit for Non-Displayed Reserve Orders that provide 
liquidity is reasonable, equitable and not unfairly discriminatory 
because it is intended to incentivize SLPs to submit additional amounts 
of displayed liquidity to the Exchange during the trading day. This 
decrease in the credits for Non-Displayed Reserve Orders for SLPs is 
the same decrease as proposed for the credits applicable to Non-
Displayed Reserve Orders for other member organizations. Once again, 
the Exchange believes that the proposed lower credit is equitable and 
not unfairly discriminatory because it would apply equally to all SLPs.
    The Exchange believes that it is subject to significant competitive 
forces, as described below in the Exchange's statement regarding the 
burden on competition. For the foregoing reasons, the Exchange believes 
that the proposal is consistent with the Act.

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

    In accordance with Section 6(b)(8) of the Act,\17\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. Instead, the Exchange believes that the proposed 
change would contribute to the Exchange's market quality by promoting 
price discovery and ultimately increased competition. For the same 
reasons, the proposed change also would not impose any burden on 
competition among market participants. Pricing for executions at the 
opening would remain at the same relatively low levels and would 
continue to reflect the benefit that market participants receive 
through the ability to have their orders interact with other liquidity 
at the opening.
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    \17\ 15 U.S.C. 78f(b)(8).
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    Finally, 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 or rebate opportunities available at other venues to be more 
favorable. In such an environment, the Exchange must continually adjust 
its fees and rebates to remain competitive with other exchanges and 
with alternative trading systems that have been exempted from 
compliance with the statutory standards applicable to exchanges. 
Because competitors are free to modify their own fees and credits in 
response, and because market participants may readily adjust their 
order routing practices, the Exchange believes that the degree to which 
fee changes in this market may impose any burden on competition is 
extremely limited. As a result of all of these considerations, the 
Exchange does not believe that the proposed changes will impair the 
ability of member organizations or competing order execution venues to 
maintain their competitive standing in the financial markets.

[[Page 34480]]

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

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

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

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \18\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \19\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \18\ 15 U.S.C. 78s(b)(3)(A).
    \19\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \20\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \20\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-NYSE-2015-28 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-NYSE-2015-28. 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 will also be available 
for inspection and copying at the NYSE's principal office and on its 
Internet Web site at www.nyse.com. 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- NYSE-2015-28 and should be submitted on or before July 
7, 2015.
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    \21\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-14668 Filed 6-15-15; 8:45 am]
 BILLING CODE 8011-01-P


