[Federal Register Volume 87, Number 74 (Monday, April 18, 2022)]
[Notices]
[Pages 22998-22999]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-08168]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94689; File No. SR-CboeBZX-2022-025]


Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
the Fees Applicable to Various Market Data Products

April 12, 2022.
    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 April 1, 2022, Cboe BZX Exchange, Inc. (the ``Exchange'' or 
``BZX'') 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.
---------------------------------------------------------------------------

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

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

    Cboe BZX Exchange, Inc. (``BZX'' or the ``Exchange'') is filing 
with the Securities and Exchange Commission (the ``Commission'') a 
proposed rule change to amend the fees applicable to various market 
data products. The text of the proposed rule change is provided in 
Exhibit 5.
    The text of the proposed rule change is also available on the 
Exchange's website (http://www.cboe.com/AboutCBOE/CBOELegalRegulatoryHome.aspx), at the Exchange's Office of the 
Secretary, 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 amend the Market Data section of its Fees 
Schedule for its options trading platform (``BZX Options''). 
Particularly, the Exchange proposes to adopt a free trial program for 
Exchange market data products, effective April 1, 2022.
    The Exchange proposes a 30-day free trial for any User or 
Distributor that subscribes to or distributes, respectively, an 
Exchange real-time market data product (``Product'') listed on the Fee 
Schedule for the first time. As proposed, a first-time User would be 
any entity or individual that has not previously subscribed to a 
particular Product and a first-time Distributor would be any entity 
that has not previously distributed, internally or externally, a 
particular Product. A first-time User or Distributor of a particular 
Exchange market data product would not be charged any applicable fees 
listed in the Fee Schedule for that product for the duration of the 30 
days.\3\ For example, a firm that currently subscribes to BZX Options 
Top would be eligible to receive a free 30-day trial of BZX Options 
Depth, whether in a display-only format or for non-display use. 
However, a firm that currently receives BZX Options Depth for non-
display use would not be eligible to receive a free 30-day trial of BZX 
Options Depth in a display-only format. The Exchange would provide the 
30-day free trial for each particular product to each first-time User 
or Distributor once.
---------------------------------------------------------------------------

    \3\ For example, if a User that has elected to participate in 
the free trial program for BZX Options Top data is approved on April 
15, 2022, that User will not be subject to any applicable fees 
(i.e., User Fee) through May 14, 2022.
---------------------------------------------------------------------------

    The Exchange believes that providing a 30-day free trial to 
Exchange real-time market data products listed on the Exchange's Fee 
Schedule would enable potential Users and Distributors to determine 
whether a particular Exchange market data product provides value to 
their business models or investment strategies, as applicable, before 
fully committing to expend development and implementation costs related 
to the receipt or distribution of that product, and is intended to 
encourage increased use of the Exchange's market data products by 
defraying some of the development and implementation costs Users or 
Distributors would ordinarily have to expend before using a product. 
The Exchange notes that other exchanges have similar free trial 
programs.\4\
---------------------------------------------------------------------------

    \4\ See The Nasdaq Stock Market LLC (``Nasdaq'') Equity 7 
Pricing Schedule, Section 112(b)(1) and New York Stock Exchange LLC 
(``NYSE'') Proprietary Market Data Fees Schedule, General.
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with the objectives of Section 6 of the Act,\5\ in general, and 
furthers the objectives of Section 6(b)(4),\6\ in particular, as it is 
designed to provide for the equitable allocation of reasonable dues, 
fees and other charges among its members and other recipients of 
Exchange data. In addition, the Exchange believes that the proposed 
rule change is consistent with Section 11(A) of the Act as it supports 
(i) fair competition among brokers and dealers, among exchange markets, 
and between exchange markets and markets other than exchange markets, 
and (ii) the availability to brokers, dealers, and investors of 
information with respect to quotations for and transactions in 
securities.\7\
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(4).
    \7\ 15 U.S.C. 78k-1.
---------------------------------------------------------------------------

    The Exchange believes that adopting a free trial program for real-
time market data products listed in its Fees Schedule is equitable and 
reasonable. Particularly, providing Exchange real-time market data 
products to new Users and Distributors free-of-charge for the first 30 
days is reasonable because it would allow vendors and subscribers to 
become familiar with the feeds and determine whether they suit their 
needs without incurring fees. It is also intended to incentivize 
Distributors to enlist more Users to subscribe to Exchange market data 
products in an effort to broaden the products' distribution. Making a 
new market data product available for free for a trial period is also 
consistent with offerings of other exchanges. For example, NYSE and 
Nasdaq offer similar free trial programs.\8\
---------------------------------------------------------------------------

    \8\ See Nasdaq Equity 7 Pricing Schedule, Section 112(b)(1) and 
NYSE Proprietary Market Data Fees Schedule, General.
---------------------------------------------------------------------------

    The Exchange believes the proposal to provide the Exchange market 
data products to new Users or Distributors free-of-charge for their 
first 30 days subscribing or distributing the data, as applicable, is 
equitable and not unfairly

[[Page 22999]]

discriminatory because it applies to any first-time User or 
Distributor, regardless of the use they plan to make of the feed. As 
proposed, any first-time User or Distributor would not be charged any 
applicable fee listed in the Fee Schedule for any of the Exchange's 
real-time market data products listed in the Fee Schedule for 30 days. 
The Exchange believes it is equitable to restrict the availability of 
this free trial to Users or Distributors that have not previously 
subscribed to, or distributed, respectively the particular market data 
product, since Users or Distributors who are current or previous 
subscribers or Distributors, respectively of that product are already 
familiar with the product and whether it would suit their needs.
    The Exchange believes that the proposed rule change providing for a 
free trial period to test is not unfairly discriminatory because the 
financial benefit of the fee waiver would be available to all Users 
subscribing to, and all Distributors distributing, an Exchange Product 
for the first time on a free-trial basis. The Exchange believes there 
is a meaningful distinction between Users and Distributors that are 
subscribing to or distributing a market data product for the first 
time, who may benefit from a period within which to set up and test use 
of the product before it becomes fee liable, and Users and Distributors 
that are already receiving or distributing the Exchange's market data 
products and are deriving value from such use. The Exchange believes 
that the limited period of the free trial would not be unfairly 
discriminatory to other users of the Exchange's market data products 
because it is designed to provide a reasonable period of time to set up 
and test a new market data product. The Exchange further believes that 
providing a free trial for 30 days would ease administrative burdens 
for data recipients to subscribe to or distribute a new data product 
and eliminate fees for a period before such users are able to derive 
any benefit from the data.

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

    The Exchange does not believe that the proposed rule change would 
result in any burden on competition that is not necessary or 
appropriate in furtherance of the purposes of the Act. The Exchange 
operates in a highly competitive environment, and its ability to price 
these data products is constrained by competition among exchanges that 
offer similar data products to their customers. The Exchange believes 
that the proposed free trial program does not put any market 
participants at a relative disadvantage compared to other market 
participants. As discussed, the proposed trial would apply to first 
time Users and Distributors on an equal and non-discriminatory basis. 
Further, the Exchange believes that the proposed program does not 
impose a burden on competition or on other SROs that is not necessary 
or appropriate in furtherance of the purposes of the Act. The Exchange 
does not believe that the proposal would cause any unnecessary or 
inappropriate burden on intermarket competition as other exchanges are 
free to lower their prices or provide a free trial to better compete 
with the Exchange's offering. Indeed, other national securities 
exchanges already offer similar free trial programs today.\9\ The 
proposed amendments are also designed to enhance competition by 
providing an incentive to Distributors to enlist new subscribers and 
Users to subscribe to Exchange real-time market data products.
---------------------------------------------------------------------------

    \9\ See Nasdaq Equity 7 Pricing Schedule, Section 112(b)(1) and 
NYSE Proprietary Market Data Fees Schedule, General.
---------------------------------------------------------------------------

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) of the Act \10\ and paragraph (f) of Rule 19b-4 \11\ 
thereunder. 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 will institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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-CboeBZX-2022-025 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-CboeBZX-2022-025. 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-CboeBZX-2022-
025 and should be submitted on or before May 9, 2022.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
---------------------------------------------------------------------------

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

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-08168 Filed 4-15-22; 8:45 am]
BILLING CODE 8011-01-P


