[Federal Register Volume 83, Number 12 (Thursday, January 18, 2018)]
[Notices]
[Pages 2700-2704]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-00723]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82489; File No. SR-NYSEAMER-2017-42]


Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Change To Modify the 
NYSE American Options Fee Schedule

January 11, 2018.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given 
that, on December 29, 2017, NYSE American LLC (``Exchange'' or ``NYSE 
American'') filed with the Securities and Exchange Commission 
(``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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

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

    The Exchange proposes to modify the NYSE American Options Fee 
Schedule. The proposed change is available on the Exchange's website 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 purpose of this filing is to modify portions of the Fee 
Schedule, as described below, effective January 1, 2018.
Market Maker Sliding Scale-Electronic (``Sliding Scale'')
    Section I.C. of the Fee Schedule sets forth the Sliding Scale of 
transaction fees charged to NYSE American Options Marker [sic] Makers 
(referred to as Market Makers herein), which fees decrease upon the 
Market Maker achieving higher monthly volumes.\4\ Currently, Market 
Makers that have monthly volume on the Exchange of 0.15% or less of 
total Industry Customer Equity and ETF Option Volume are charged a base 
rate of $0.25 per contract and, these same market participants, upon 
reaching certain volume thresholds, or Tiers, receive the same per 
contract reduction for volume in each respective tier, as set forth in 
the table below. In addition, the Exchange charges a lower per contract 
base rate (of $0.23) to Market Makers that participate in a Prepayment 
Program, with lower marginal rates applied to volumes in successive 
tiers.
---------------------------------------------------------------------------

    \4\ See Fee Schedule, Section I.C., available here, https://www.nyse.com/publicdocs/nyse/markets/american-options/NYSE_American_Options_Fee_Schedule.pdf (excluding any volumes 
attributable to Mini Options, QCC trades, CUBE Auctions, and 
Strategy Execution Fee Caps, as these transactions are subject to 
separate pricing described in Fee Schedule Sections I.B., I.F., 
I.G., and I.J, respectively). The volume thresholds are based on a 
Market Makers' volume transacted Electronically as a percentage of 
total industry Customer equity and Exchange Traded Fund (``ETF'') 
options volumes (``ADV'') as reported by the Options Clearing 
Corporation (the ``OCC''). See OCC Monthly Statistics Reports, 
available here, http://www.theocc.com/webapps/monthly-volume-reports.

----------------------------------------------------------------------------------------------------------------
                                Market Maker
                             Electronic Monthly                       Rate per contract if Monthly Volume from
                              Volume as a % of                        Posted Volume is more than .85% of Total
           Tier               Industry Customer       Rate per        Industry Customer Equity and ETF Option
                             Equity and Exchange      contract      Volume or for any NYSE American Market Maker
                            Traded Fund (``ETF'')                      participating in a Prepayment Program
                                Option Volume                                 pursuant to Section I.D.
----------------------------------------------------------------------------------------------------------------
1........................  0.00% to 0.15%........           $0.25  $0.23
2........................  >0.15% to 0.60%.......            0.22  0.18
3........................  >0.60% to 1.10%.......            0.14  0.08
4........................  >1.10% to 1.45%.......            0.10  0.05
5........................  >1.45% to 1.80%.......            0.07  0.04
6........................  >1.80%................            0.05  0.02
----------------------------------------------------------------------------------------------------------------


[[Page 2701]]

* * * * *
    The Exchange proposes to replace the current table that describes 
the Sliding Scale with the table below, which modifies qualification 
thresholds and associated transaction fees for all Electronic Marker 
[sic] Maker volume:

----------------------------------------------------------------------------------------------------------------
                                                                                  Prepayment Program Participant
                                                                                               Rates
                                Market Maker         Rate per        Rate per    -------------------------------
           Tier            Electronic ADV as a %   contract for    contract for      Rate per
                                  of TCADV           Non-Take       Take Volume    contract for      Rate per
                                                    Volume \1\                       Non-Take      contract for
                                                                                    Volume \1\      Take Volume
----------------------------------------------------------------------------------------------------------------
1........................  0.00% to 0.20%.......           $0.25           $0.25           $0.22           $0.24
2........................  >0.20% to 0.65%......            0.22            0.24            0.17            0.20
3........................  >0.65% to 1.40%......            0.12            0.17            0.08            0.11
4........................  >1.40% to 2.00%......            0.09            0.14            0.05            0.08
5........................  >2.00%...............            0.06            0.09            0.03            0.06
----------------------------------------------------------------------------------------------------------------

    First, the Exchange proposes to restate the volume thresholds in 
terms of a Market Maker's average daily volume or ADV as a percent of 
the TCADV, a defined term,\5\ which is mathematically equivalent to a 
Market Maker's monthly total volume as a percent of the Industry 
Customer equity and ETF Total Volume. This proposed change would add 
clarity and internal consistency to the Fee Schedule.\6\
---------------------------------------------------------------------------

    \5\ See Fee Schedule, supra note 4, Key Terms and Definitions 
(defining TCADV as ``Total Industry Customer equity and ETF option 
average daily volume. TCADV includes OCC calculated Customer volume 
of all types, including Complex Order transactions and QCC 
transactions, in equity and ETF options'').
    \6\ See, e.g., Fee Schedule, supra note 4, Section I.A. and I.E. 
(similarly expressing qualification thresholds in terms of 
percentage of TCADV).
---------------------------------------------------------------------------

    Second, as shown in the table above, the Exchange proposes to:
     Increase the minimum volume necessary to achieve each 
successive Tier;
     Differentiate the type of volume that qualifies for 
specific rates by applying different rates depending on whether the 
Market Maker volume is take or non-take volume; \7\ \8\ and
---------------------------------------------------------------------------

    \7\ For purposes of the Sliding Scale, ``all eligible volume 
that does not remove liquidity'' would be considered non-take 
volume; whereas any volume that removes liquidity would be 
considered take volume. '' See proposed Fee Schedule, Section I.C., 
note 1. For example, any Market Maker transaction that interacts 
with resting liquidity is take volume.
    \8\ The Exchange notes that other options exchanges similarly 
differentiate fees based on maker-taker activity. See, e.g., MIAX 
Options fee schedule, at p.1, available here, https://www.miaxoptions.com/sites/default/files/fee_schedule-files/MIAX_Options_Fee_Schedule_12012017B.pdf (``Market Maker Sliding 
Scale''); Cboe Exchange, Inc. fee schedule, at p. 3 available here, 
http://www.cboe.com/publish/feeschedule/CBOEFeeSchedule.pdf 
(``Liquidity Provider Sliding Scale'').
---------------------------------------------------------------------------

     Reduce the number of Tiers from 6 to 5.
    Third, because the Exchange will be offering different rates 
depending on whether volume is make or take, the Exchange proposes to 
eliminate as unnecessary the minimum volume threshold for posted volume 
(of 0.85% of TCADV) to qualify for a reduced per contract rate. The 
Exchange proposes to continue to provide reduced rates to Market Makers 
that participate in the Prepayment Program.
    The proposed changes are designed to incent Market Makers to 
transact more business on the Exchange, including by posting a more 
meaningful percentage of TCADV, executing more take volume, and 
committing to transact a certain amount of business on the Exchange by 
enrolling in the Prepayment Program.\9\
---------------------------------------------------------------------------

    \9\ See proposed Fee Schedule, Section I.C. See also Fee 
Schedule, supra note 4, Section I.D. (Prepayment Program) 
(describing the 1- and 3-Year Prepayment Programs, including 
requisite timelines for committing and prepaying as well as various 
conditions to opt out of the 3-Year Prepayment Program).
---------------------------------------------------------------------------

Prepayment Program
    The Exchange also proposes to update the Prepayment Programs that 
it will offer beginning in 2018. In January 2015, the Exchange 
introduced two Prepayment Programs--for a 1- or 3- year term--to allow 
Market Makers to prepay a portion of the charges incurred for 
transactions executed on the Exchange.\10\ In 2016, the Exchange 
introduced a ``Balance of the Year'' program that allowed Market Makers 
to commit to prepay a portion of their transaction charges for some 
portion of the calendar year, for a maximum of three-quarters of the 
year.\11\ The terms of the current 3-Year, and the subsequently 
modified 1-Year, Prepayment Programs terminate at the end of 2017.\12\ 
The Exchange is proposing to modify the Prepayment Programs that it 
offers beginning in 2018 to encourage broader participation by Market 
Maker firms. Specifically, the Exchange proposes to eliminate reference 
to the 3 Year Prepayment Program, which has expired, and to maintain 
the 1 Year and Balance of the Year Prepayment Programs, as described 
below.\13\
---------------------------------------------------------------------------

    \10\ See Securities Exchange Act Release No. 74086 (January 16, 
2015), 80 FR 3701 (January 23, 2015) (SR-NYSEMKT-2015-4) 
(introducing the prepayment programs).
    \11\ See Securities Exchange Act Release No. 79737 (January 4, 
2016), 82 FR 3052 (January 10, 2017) (modifying the description of 
the Prepayment Programs and introducing the Balance of the Year 
program).
    \12\ See Fee Schedule, Section I.D (Prepayment Programs), supra 
note 4.
    \13\ See proposed Fee Schedule, Section I.D (Prepayment 
Programs) (deleting all references to the 3 Year Prepayment Program, 
including reference to early termination and the ability to opt out; 
and updating references to 1-Year and Balance of the Year Prepayment 
Programs to reflect 2018 calendar year and other program updates as 
described herein).
---------------------------------------------------------------------------

    The Exchange proposes to continue to offer the 1 Year Prepayment 
Program, without altering any aspects of the Program, including 
offering the same $3 million prepayment amount as was offered for 
2017.\14\ Participants in the 1 Year Prepayment Program would continue 
to qualify its Affiliated (or Appointed) OFP to be eligible to receive 
the enhanced credit(s) under the American Customer Engagement (``ACE'') 
Program, including revised credits as proposed herein (and discussed 
further below).\15\ To enroll in the proposed 1 Year Prepayment 
Program, a Market Maker would have to notify the Exchange by the last 
business day before the start of the new (following) year and remit 
payment to the Exchange by the last business day of January the 
following year (i.e., the year in which the prepayments would be 
applied). Thus, any Market Maker that would like to participate in the 
1 Year Prepayment Program for 2018 should notify the Exchange of its 
intent by December 29, 2017and remit the $3 million prepayment by 
January 31, 2018.\16\
---------------------------------------------------------------------------

    \14\ See proposed Fee Schedule, Section I.D.
    \15\ See Fee Schedule, Section I.E. (American Customer 
Engagement (``ACE'') Program--Standard Options), supra note 4.
    \16\ See proposed Fee Schedule, Section I.D (Prepayment 
Programs) (modifying the description of the 1Year Prepayment 
Programs to remove reference to a specific calendar year and instead 
maintain requirement [sic] that Market Makers would [sic] the 
Exchange of their commitment to the Program by sending an email the 
Exchange at [email protected]).

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

[[Page 2702]]

    Next, the Exchange is proposing to continue to offer a ``Balance of 
the Year'' Prepayment Program, without altering any material aspects of 
the Program. The Exchange would continue to require the following 
prepayments based on the quarter in which a Market Maker joined:

----------------------------------------------------------------------------------------------------------------
                                                                    2nd Quarter     3rd Quarter     4th Quarter
----------------------------------------------------------------------------------------------------------------
Prepayment Amount and Payment Schedule..........................      $2,475,000      $1,800,000        $975,000
----------------------------------------------------------------------------------------------------------------

    Consistent with the current Balance of the Year Prepayment Program, 
a Market Maker that participates in the Balance of the Year Program 
would receive a credit equal to its prepayment amount (i.e., 
$2,475,000; $1,800,000; or $975,000, respectively) toward certain fees 
it incurs on the Exchange.\17\ As proposed, Marker [sic] Makers that 
enroll in the Balance of the Year Program would be required to notify 
the Exchange by the last business day before the start of the new 
(following) quarter (e.g., to participate for three-quarters of the 
year, notice must be given by the last business day of the first 
quarter of that year, etc.).\18\ In addition, consistent with 2017, 
participants must remit payment by the last business day in the first 
month of the respective quarter (i.e., the quarter in which prepayments 
will begin to apply). However, the Exchange proposes to remove 
reference to specific dates, which were tied to prior calendar years, 
to avoid having to revise the Fee Schedule on an annual basis. Thus, as 
proposed, the deadlines to participate in the Balance of the Year 
Prepayment Program for each quarter would be the last business day in 
April, July and October, for the second, third and fourth quarter, 
respectively.
---------------------------------------------------------------------------

    \17\ See id. Similarly, just as with the 1-Year Prepayment 
Program, the Exchange would apply the prepayment as a credit against 
certain charges incurred on the Exchange. Once the prepayment credit 
has been exhausted, the Exchange would invoice the Market Maker at 
the appropriate rates. In the event that a Market Maker does not 
conduct sufficient activity to exhaust the entirety of their 
prepayment credit within the calendar year, there would be no 
refunds issued for any unused portion of their prepayment credit. 
See id.
    \18\ See id. (providing that Market Makers would be required to 
notify the Exchange of their commitment to the Program by sending an 
email the Exchange at [email protected]).
---------------------------------------------------------------------------

    Finally, the Exchange proposes to make clear that any prepayments 
made pursuant to the 1 Year Prepayment Program 1 or the Balance of the 
Year Prepayment Program would apply to transactions effected using the 
BOLD Mechanism, pursuant to Section I.M. of the Fee Schedule.\19\
---------------------------------------------------------------------------

    \19\ See id. The Exchange notes that after introducing fees 
associated with BOLD transactions in 2017, it modified various 
aspects of the Fee Schedule to account for these fees. However, the 
Exchange failed to make clear that payments under any of the 
Prepayment Programs would count towards BOLD transactions and seeks 
to correct this oversight with this proposed change. See id.
---------------------------------------------------------------------------

American Customer Engagement (``ACE'') Program
    Section I. E. of the Fee Schedule describes the Exchange's ACE 
Program. The ACE Program features a base tier and five higher tiers 
expressed as a percentage of TCADV \20\ and provides two alternative 
methods by which Order Flow Providers (each an ``OFP'') may receive per 
contract credits for Electronic Customer volume that the OFP, as agent, 
submits to the Exchange.\21\ The Exchange is proposing to modify 
certain credits offered in the ACE Program.
---------------------------------------------------------------------------

    \20\ See Fee Schedule, Section I.E., supra note 4. The Exchange 
also proposes to make a grammatical change to the second sentence of 
the introductory paragraph by changing the word ``is'' to ``are,'' 
which should add clarity to the fee schedule. See proposed Fee 
Schedule, Section I.E.
    \21\ The volume thresholds are based on an OFP's Customer volume 
transacted Electronically as a percentage of TCADV as reported by 
the OCC. See OCC Monthly Statistics Reports, available here, http://www.theocc.com/webapps/monthly-volume-reports.
---------------------------------------------------------------------------

    First, the Exchange proposes to delete the ACE credits for 3 Year 
Enhanced Customer Volume Credits, and any references thereto, to 
reflect that the 3 Year Prepayment Program has expired, as noted 
above.\22\ The Exchange believes these changes would add clarity, 
transparency and internal consistency to the Fee Schedule.
---------------------------------------------------------------------------

    \22\ See proposed Fee Schedule, Section I. E.
---------------------------------------------------------------------------

    Next, the Exchange proposes to modify the enhanced per contract 
credit applicable to Customer Complex Orders for 1 Year and Balance of 
the Year Prepayment Participants. Specially, the Exchange proposes to 
reduce the credit for Tier 1 from $0.20 to $0.19 per contract, while 
increasing the per contract credit for Tier 4 and 5, from $0.21 and 
$0.23, respectively, to $0.22 and $0.24, respectively.
    The Exchange also proposes to modify the per contract credit 
applicable to Simple Orders on Customer volume for Tiers 3, 4 and 5. 
Specifically, the Exchange proposes to reduce the credit for Tier 3, 4, 
and 5 from $0.19, $0.20, and $0.22, respectively, to $0.17, $0.19, and 
$0.21, respectively. And, the Exchange proposes to increase the 
enhanced per contract credit applied to Simple Orders on Customer 
volume for Prepayment participants that qualify for Tier 5 from $0.23 
to $0.24.
    The proposed changes to credits payable on Customer volume are 
intended to encourage ATP Holders and their Affiliates and/or Appointed 
parties to participate in the Prepayment Programs, while still 
rewarding OFPs that direct significant amounts of Customer volume to 
the Exchange with credits on transactions.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\23\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\24\ 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.
---------------------------------------------------------------------------

    \23\ 15 U.S.C. 78f(b).
    \24\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

Sliding Scale
    The Exchange believes that the proposed modifications to the 
Sliding Scale are reasonable, equitable and not unfairly discriminatory 
for a number of reasons. First, the Sliding Scale is available to all 
Market Makers and is based on the amount of business transacted on--and 
is designed to attract greater volume to--the Exchange. In addition, 
the elimination of the alternative basis to qualify for a reduced rate 
by posting monthly volume of at least 0.85% TCADV (if not participating 
in a Prepayment Program) is not unfairly discriminatory because Market 
Makers that would like to receive a more favorable per contract rate 
under the Sliding Scale have the option to commit to one of the 
Prepayment Programs, which commitment increases liquidity on the 
Exchange to the benefit of all market participants. Moreover, all 
Market Makers will be subject to the proposal to impose differing rates

[[Page 2703]]

depending on whether volume is make or take volume. The proposed 
adjustments are designed to encourage Market Makers to commit to 
directing their order flow to the Exchange, which would increase volume 
and liquidity, to the benefit of all market participants by providing 
more trading opportunities and tighter spreads. Further, the proposed 
Sliding Scale thresholds and rates are competitive with fees charged by 
other exchanges and are designed to attract (and compete for) order 
flow to the Exchange, which provides a greater opportunity for trading 
by all market participants.\25\ In addition, the proposed changes, 
which are designed to incent market participants to increase the orders 
sent directly to the Exchange, should provide liquidity that supports 
the quality of price discovery and promotes market transparency to the 
benefit of all market participants. Finally, the Exchange notes that 
other exchanges have established transaction fees for Market Makers 
based on maker and taker activity.\26\
---------------------------------------------------------------------------

    \25\ See MIAX and Cboe fee schedules, supra note 8.
    \26\ See id.
---------------------------------------------------------------------------

Prepayment Program
    The Exchange believes that the proposed modifications to the 
Prepayment Programs are reasonable, equitable and not unfairly 
discriminatory for a number of reasons. First, all of the Prepayment 
Programs offered on the Exchange are optional and Market Makers can 
elect to participate (or elect not to participate). Given the 
expiration of the 3 Year Prepayment Program, the Exchange believes that 
the goals of the Prepayment Program continue to be served by continuing 
to offer the 1 Year and Prepayment Program as well as the Balance of 
the Year Program. The Exchange believes that continuing to offer these 
Programs would provide Market Makers with the flexibility to join 
annually or at various points in the year, which may encourage broader 
participation in the Prepayment Programs. The Exchange anticipates that 
the potential greater capital commitment and resulting liquidity on the 
Exchange would benefit all market participants (including non-Market 
Makers). Moreover, the Exchange notes that other options exchanges 
likewise offer Prepayment Programs to market makers that may be joined 
after the start of the year.\27\ The Exchange also notes that, similar 
to the Sliding Scale, the Prepayment Program is designed to incent 
Market Makers to commit to directing their order flow to the Exchange, 
which would benefit all market participants by expanding liquidity, 
providing more trading opportunities and tighter spreads, even to those 
market participants that are not eligible for the Programs. Thus, the 
Exchange believes the Prepayment Program, as modified, is reasonable, 
equitable and not unfairly discriminatory to others.
---------------------------------------------------------------------------

    \27\ See, e.g., Cboe fee schedule, supra note 8, at p. 18, 
footnote 10 (a market maker may be permitted to pay a pro-rated 
amount of the $2.4 million if, for example, they join the program 
mid-year).
---------------------------------------------------------------------------

    In addition, the Exchange believes that the proposal to replace 
specific dates with the term ``last business day'' removes impediments 
to and perfects the mechanism of a free and open market by eliminating 
redundant annual rule filings when the Exchange is not changing its 
fees. The Exchange further believes that the proposal removes 
impediments to and perfects the mechanism of a free and open market by 
reducing potential confusion among market participants and the 
investing public who may see a rule filing and mistake it for a fee 
change when in fact a fee is not changing. The proposed change is also 
reasonable, equitable and not unfairly discriminatory as it is designed 
to add clarity to the Fee Schedule to the benefit of all market 
participants.
    The Exchange believes that the proposed change to make clear that 
fees associated with BOLD transactions would be applied against 
prepayments made under the Balance of the Year Program would add 
clarity, transparency and internal consistency to the Fee Schedule.
ACE Program
    The Exchange believes the proposed changes to the ACE Program are 
reasonable, equitable and not unfairly discriminatory for a number of 
reasons. First, the proposed changes to increase three of the credits 
associated with participants in one of the Prepayment Programs are 
designed to incent market participants to increase the orders sent 
directly to the Exchange and therefore provide liquidity that supports 
the quality of price discovery and promotes market transparency to the 
benefit of all market participants. The Exchange believes that the 
proposed fee change would directly relate to the activity of a Market 
Maker and the activity of an affiliated ATP Holder on the Exchange, 
thereby encouraging increased trading activity. The Exchange believes 
that the proposal to amend the credits associated with various Tiers of 
the ACE Program is reasonable because it provides ATP Holders 
affiliated with an NYSE American Options Market Maker with additional 
incentives to participate in the Prepayment Program. The Exchange 
believes that the proposal to slightly reduce the credits for Simple 
Orders not associated with participants in one of the Prepayment 
Programs are likewise reasonable, equitable and not unfairly 
discriminatory because such credits are within the range offered by 
competing options exchanges.\28\
---------------------------------------------------------------------------

    \28\ See id., Volume Incentive Program, at p. 3 (offering per 
contracts credits ranging from $0.09-$0.14 for simple orders).
---------------------------------------------------------------------------

    The Exchange's proposed grammatical change (see supra note 19) is 
reasonable, equitable and not unfairly discriminatory as it is designed 
to add clarity to the Fee Schedule to the benefit of all market 
participants.

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

    In accordance with Section 6(b)(8) of the Act,\29\ the Exchange 
does not believe that the proposed rule change would impose any burden 
on competition that is not necessary or appropriate in furtherance of 
the purposes of the Act. The Exchange believes that the proposed 
changes relating to the Sliding Scale, the Prepayment Program, and the 
ACE Program may increase both intermarket and intramarket competition 
by incenting participants to direct their orders to the Exchange, which 
would enhance the quality of quoting and may increase the volume of 
contracts traded on the Exchange. To the extent that there is an 
additional competitive burden on non-NYSE American Market Makers, the 
Exchange believes that this is appropriate because Market Makers have 
heightened obligations that other market participants do not and the 
proposal should incent market participants to direct additional order 
flow to the Exchange, and thus provide additional liquidity that 
enhances the quality of its markets and increases the volume of 
contracts traded here. To the extent that this purpose is achieved, all 
of the Exchange's market participants should benefit from the improved 
market liquidity. Enhanced market quality and increased transaction 
volume that results from the anticipated increase in order flow 
directed to the Exchange will benefit all market participants and 
improve competition on the Exchange.
---------------------------------------------------------------------------

    \29\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    Given the robust competition for volume among options markets, many 
of which offer the same products, implementing programs to attract 
order flow similar to the ones being proposed in this filing, are 
consistent with the above-mentioned goals of the Act. The

[[Page 2704]]

Exchange notes that it operates in a highly competitive market in which 
market participants can readily favor competing venues. In such an 
environment, the Exchange must continually review, and consider 
adjusting, its fees and credits to remain competitive with other 
exchanges. For the reasons described above, the Exchange believes that 
the proposed rule change reflects this competitive environment.

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

    No written comments were 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) \30\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \31\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78s(b)(3)(A).
    \31\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

    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) \32\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

    \32\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------

IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEAMER-2017-42 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-NYSEAMER-2017-42. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549, on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NYSEAMER-2017-42 and should be submitted 
on or before February 8, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\33\
---------------------------------------------------------------------------

    \33\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-00723 Filed 1-17-18; 8:45 am]
 BILLING CODE 8011-01-P


