Notice2022-22280
Self-Regulatory Organizations: Notice of Filing and Immediate Effectiveness of a Proposed Rule Change by Miami International Securities Exchange LLC To Amend Its Fee Schedule
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
October 13, 2022
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 87 Issue 197 (Thursday, October 13, 2022)</title>
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[Federal Register Volume 87, Number 197 (Thursday, October 13, 2022)]
[Notices]
[Pages 62147-62151]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-22280]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-96006; File No. SR-MIAX-2022-35]
Self-Regulatory Organizations: Notice of Filing and Immediate
Effectiveness of a Proposed Rule Change by Miami International
Securities Exchange LLC To Amend Its Fee Schedule
October 7, 2022.
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 October 4, 2022, 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 Substance
of the Proposed Rule Change
The Exchange is filing a proposal to amend the MIAX Options Fee
Schedule (the ``Fee Schedule'').
The text of the proposed rule change is available on the Exchange's
website at <a href="http://www.miaxoptions.com/rule-filings">http://www.miaxoptions.com/rule-filings</a>, 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 amend the Fee Schedule to (i) amend the
Other Market Participant Transaction Fees table \3\ to amend the fee
applicable to the option component of a stock-option order; and (ii)
modify the Priority Customer Rebate Program (``PCRP'') \4\ as it
pertains to per contract credits for PRIME Agency Orders submitted by
Priority Customers.\5\ The Exchange initially filed this proposal on
September 1, 2022 as SR-MIAX-2022-28. On September 20, 2022, the
Exchange withdrew SR-MIAX-2022-28 and resubmitted the proposal as SR-
MIAX-2022-31. On September 28, 2022, the Exchange withdrew SR-MIAX-
2022-31 and resubmitted the proposal as SR-MIAX-2022-33. On October 4,
2022, the Exchange withdrew SR-MIAX-2022-33 and resubmitted the
proposal as SR-MIAX-2022-35. The proposed changes are immediately
effective.
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\3\ See Section (1)(a)(ii) of the Exchange's Fee Schedule.
\4\ Under the PCRP, MIAX Options credits each Member the per
contract amount resulting from each Priority Customer order
transmitted by that Member which is executed electronically on the
Exchange in all multiply-listed option classes (excluding, in simple
or complex as applicable, QCC and cQCC Orders, mini-options,
Priority Customer-to-Priority Customer Orders, C2C and cC2C Orders,
PRIME and cPRIME AOC Responses, PRIME and cPRIME Contra-side Orders,
PRIME and cPRIME Orders for which both the Agency and Contra-side
Order are Priority Customers, and executions related to contracts
that are routed to one or more exchanges in connection with the
Options Order Protection and Locked/Crossed Market Plan referenced
in Exchange Rule 1400), provided the Member meets certain percentage
thresholds in a month as described in the Priority Customer Rebate
Program table. See Fee Schedule, Section (1)(a)(iii).
\5\ The term ``Priority Customer'' means a person or entity that
(i) is not a broker or dealer in securities, and (ii) does not place
more than 390 orders in listed options per day on average during a
calendar month for its own beneficial account(s). See Exchange Rule
100.
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Background
Stock-Option Orders
A ``complex order'' is any order involving the concurrent purchase
and/or sale of two or more different options in the same underlying
security (the ``legs'' or ``components'' of the complex order), for the
same account, in a ratio that is equal to or greater than one-to-three
(.333) and less than or equal to three-to-one (3.00) and for the
purposes
[[Page 62148]]
of executing a particular investment strategy. Mini-options may only be
part of a complex order that includes other mini-options. Only those
complex orders in the classes designated by the Exchange and
communicated to Members via Regulatory Circular with no more than the
applicable number of legs, as determined by the Exchange on a class-by-
class basis and communicated to Members via Regulatory Circular, are
eligible for processing.
A complex order can also be a ``stock-option order'' as described
further, and subject to the limitations set forth, in Interpretations
and Policies .01 of Exchange Rule 518. A stock-option order is an order
to buy or sell a stated number of units of an underlying security
(stock or Exchange Traded Fund Share (``ETF'')) or a security
convertible into the underlying stock (``convertible security'')
coupled with the purchase or sale of options contract(s) on the
opposite side of the market representing either (i) the same number of
units of the underlying security or convertible security, or (ii) the
number of units of the underlying stock necessary to create a delta
neutral position, but in no case in a ratio greater than eight-to-one
(8.00), where the ratio represents the total number of units of the
underlying security or convertible security in the option leg to the
total number of units of the underlying security or convertible
security in the stock leg. Only those stock-option orders in the
classes designated by the Exchange and communicated to Members via
Regulatory Circular with no more than the applicable number of legs as
determined by the Exchange on a class-by-class basis and communicated
to Members via Regulatory Circular, are eligible for processing.\6\
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\6\ See Exchange Rule 518(a)(5).
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Currently, under the Other Market Participant Transaction Fees
table, the Exchange charges Public Customers that are not Priority
Customers a fee of $0.47 per contract for executions of simple and
complex orders in Penny Classes and $0.75 per contract for executions
of simple and complex orders in Non-Penny Classes, and assesses a $0.12
per contract surcharge for trading against a Priority Customer complex
order in Penny and Non-Penny Classes.
The Exchange now proposes to adopt new note ``!!'' which will be
applicable to the option component of a stock-option order and which
will provide that, any Member whose Affiliate qualifies for Priority
Customer Rebate Program volume tier 4 in the relevant month will be
assessed a total of $0.10 per contract on the option component of a
stock-option order for executions in Penny or Non-Penny Classes, and
the per contract surcharge for trading against a Priority Customer
complex order will not apply.\7\ Therefore, a qualifying Member will be
charged $0.10 per contract for executions in Penny or Non-Penny
Classes, and the $0.12 per contract surcharge for trading against a
Priority Customer Order in Penny or Non-Penny Classes will not be
assessed.
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\7\ The Exchange charges a stock-handling fee of $0.0010 per
share (capped at $50 per order, per day) for the stock leg of stock-
option orders (including stock-option eQuotes) executed against
other stock-option orders in the complex order book, which the
Exchange must route to an outside venue. In addition, the Exchange
will pass through to the Member any fees assess by the routing
broker-dealer utilized by the Exchange with respect to the execution
of the stock leg of any such order (with such fees to be passed
through at cost). The Exchange notes that this fee is not changing
under this proposal. See the Exchange's Fee Schedule, Section
(1)(a)(x) on its public website (available at <a href="https://www.miaxoptions.com/fees">https://www.miaxoptions.com/fees</a>).
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PRIME Agency Orders
PRIME is a process by which a Member may electronically submit for
execution (``Auction'') an order it represents as agent (``Agency
Order'') against principal interest, and/or an Agency Order against
solicited interest.\8\ The Member that submits the Agency Order
(``Initiating Member'') agrees to guarantee the execution of the Agency
Order by submitting a contra-side order representing principal interest
or solicited interest.\9\ Currently, the Exchange provides a per
contract credit for PRIME Agency Orders of $0.10 for Priority Customer
Agency Orders in Tier 1, and a per contract credit of $0.11 for
Priority Customer Agency Orders in Tiers 2 through 4.\10\
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\8\ See Exchange Rule 515A(a).
\9\ See Exchange Rule 51A(a)(ii).
\10\ See the Exchange's Fee Schedule, Section (1)(a)(iii), on
its public website (available at <a href="https://www.miaxoptions.com/fees">https://www.miaxoptions.com/fees</a>).
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Proposal
The Exchange proposes to adopt a new table under the PCRP for PRIME
Agency Orders for Priority Customers Origins that will provide an
adjustment to the credit provided for PRIME Agency Orders to Priority
Customers in a tiered structure dependent upon the break-up percentage
of the order. The Exchange proposes to adopt new note ``!!!'' to state
that, for Priority Customer PRIME Agency Orders the Exchange will apply
the per contract adjustment to the PRIME Agency rebate provided under
the Priority Customer Rebate Program dependent upon the order break-up
percentage as described in the table above, (the Per Contract
Adjustment for PRIME Agency Order table).
The proposed Per Contract Adjustment for PRIME Agency Order table
will provide that if the PRIME Agency Order has a break-up percentage
of 0-20% the per contract credit provided for PRIME Agency Orders will
be reduced by $0.02. If the PRIME Agency Order has a break-up
percentage greater than 20% and up to 40% the per contract credit
provided for PRIME Agency Orders will be reduced by $0.01. If the PRIME
Agency Order has a break-up percentage greater than 40% and up to 60%
no adjustment will be applied to the per contract credit provided for
PRIME Agency Orders. If the PRIME Agency Order has a break-up
percentage greater than 60% and up to 80% the per contract credit
provided for PRIME Agency Orders will be increased by $0.01. If the
PRIME Agency Order has a break-up percentage greater than 80% and up to
100% the per contract credit provided for PRIME Agency Orders will be
increased by $0.02. Current break-up and other credits remain unchanged
and will continue to apply.
The Exchange currently provides a PRIME Break-up credit of $0.25
per contract in Penny Classes and $0.60 per contract in Non-Penny
Classes. Additionally, the Exchange provides an enhanced PRIME break-up
credit of $0.69 per contract to the EEM that submitted a PRIME Order in
a Non-Penny Class that trades with PRIME AOC Responses and/or PRIME
participating quotes or orders, if the PRIME Order experiences a break-
up of greater than 40%, which is not changing under this proposal.\11\
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\11\ See the Exchange's Fee schedule, footnote ``*'' of Section
(1)(a)(v), on its public website (available at <a href="https://www.miaxoptions.com/fees">https://www.miaxoptions.com/fees</a>).
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The following examples are provided to illustrate how the base
agency (unchanged under this proposal), proposed adjustment, and break-
up credits (unchanged under this proposal), will apply. For example, as
proposed if an Electronic Exchange Member (``EEM'') \12\ in Tier 1
submits a Priority Customer PRIME Agency Order in a Penny Class that
trades 100% with the contra side order, the EEM will receive the Agency
Rebate of $0.10 with the appropriate $0.02 adjustment applied ($0.02
credit reduction) for a net credit of $0.08. If an EEM in Tier 1
submits a Priority Customer PRIME Agency Order in a Penny Class that is
100% broken
[[Page 62149]]
up, the EEM will receive the Agency Rebate of $0.10 with the
appropriate $0.02 adjustment applied ($0.02 additional credit) for a
net credit of $0.12, in addition to a break-up credit of $0.25 (which
is not changing under this proposal) \13\ for a total credit of $0.37.
Similarly if the order had been 70% broken up, the EEM would receive
the Agency Rebate of $0.10 with the appropriate $0.01 adjustment
applied ($0.01 additional credit) for a net credit of $0.11, in
addition to a break-up credit of $0.25 for a total credit of $0.36. If
the order had been 30% broken up, the EEM would receive the Agency
Rebate of $0.10 with the appropriate $0.01 adjustment applied ($0.01
credit reduction) for a net credit of $0.09, in addition to a break-up
credit of $0.25 for a total credit of $0.34. The break-up credit and
its application remains unchanged under the Exchange's proposal.
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\12\ The term ``Electronic Exchange Member'' or ``EEM'' means
the holder of Trading Permit who is not a Market Maker. Electronic
Exchange Members are deemed ``members'' under the Exchange Act. See
Exchange Rule 100.
\13\ See the Exchange's Fee Schedule, Section (1)(a)(v), on its
public website (available at <a href="https://www.miaxoptions.com/fees">https://www.miaxoptions.com/fees</a>).
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The Exchange is making the proposed change for business and
competitive reasons, as the Exchange believes that adjusting its
rebates will allow the Exchange to remain competitive and will continue
to incentivize EEMs to submit Priority Customer PRIME Agency Orders to
the Exchange.
b. Statutory Basis
The Exchange believes that its proposal to amend its Fee Schedule
is consistent with Section 6(b) of the Act \14\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \15\ in
particular, in that it is an equitable allocation of reasonable dues,
fees, and other charges among its members and issuers and other persons
using its facilities. The Exchange also believes the proposal furthers
the objectives of Section 6(b)(5) of the Act \16\ in that it is
designed to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and, in general, to protect investors and the
public interest and is not designed to permit unfair discrimination
between customers, issuers, brokers and dealers.
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\14\ 15 U.S.C. 78f(b).
\15\ 15 U.S.C. 78f(b)(4).
\16\ 15 U.S.C. 78f(b)(5).
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The Exchange believes its proposal provides for the equitable
allocation of reasonable dues and fees and is not unfairly
discriminatory for the following reasons. The Exchange operates in a
highly competitive market in which market participants can readily
direct order flow to competing venues if they deem fee levels at a
particular venue to be excessive or incentives to be insufficient. More
specifically, the Exchange is one of 16 registered options exchanges
competing for order flow. Based on publicly-available information, and
excluding index-based options, no single exchange has more than
approximately 12% of the market share of executed volume of multiply-
listed equity and exchange-traded fund (``ETF'') options trades as of
August 29, 2022, for the month of August 2022.\17\ Therefore, no
exchange possesses significant pricing power in the execution of
multiply-listed equity and ETF options order flow. More specifically,
as of August 29, 2022, the Exchange has a total market share of 5.67%
of all equity options volume, for the month of August 2022.\18\
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\17\ See MIAX's ``The market at a glance/MTD AVERAGE'',
available at <a href="https://www.miaxoptions.com/">https://www.miaxoptions.com/</a> (last visited August 29,
2022).
\18\ See id.
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The Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
shift order flow, or discontinue use of certain categories of products,
in response to fee changes. For example, on March 1, 2019, the Exchange
filed with the Commission an immediately effective filing to decrease
certain credits assessable to Members pursuant to the PCRP.\19\ The
Exchange experienced a decrease in total market share between the
months of February and March of 2019. Accordingly, the Exchange
believes that the March 1, 2019, fee change may have contributed to the
decrease in the Exchange's market share and, as such, the Exchange
believes competitive forces constrain options exchange transaction and
non-transaction fees.
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\19\ See Securities Exchange Act Release No. 85301 (March 13,
2019), 84 FR 10166 (March 19, 2019) (SR-MIAX-2019-09).
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Accordingly, competitive forces constrain the Exchange's
transaction fees, and market participants can readily trade on
competing venues if they deem pricing levels at those other venues to
be more favorable. In response to the competitive environment, the
Exchange offers specific rates and credits in its fees schedule, like
those of other options exchanges' fees schedules, which the Exchange
believes provides incentives to Members to increase order flow of
certain qualifying orders.
The Exchange believes that its proposal to modify the Other Market
Participant Transaction Fees table to provide for a total per contract
fee of $0.10 on the option component of a stock-option order for
qualifying participants is consistent with Section 6(b)(4) of the Act
\20\ because it is equitable and not unfairly discriminatory as the fee
is assessed uniformly to all Public Customers that are not Priority
Customers that have an Affiliate in Tier 4 of the PCRP for the relevant
month, that execute stock-option orders on the Exchange.
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\20\ 15 U.S.C. 78f(b)(4).
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The Exchange also believes that this proposal is consistent with
Section 6(b)(5) of the Act \21\ because it perfects the mechanisms of a
free and open market and a national market system and protects
investors and the public interest because it provides an additional
incentive for Members to increase Priority Customer order flow to the
Exchange in order to obtain the highest volume threshold, which
benefits all market participants by providing more trading
opportunities and tighter spreads. Additionally, the proposed discount
encourages Members to submit Priority Customer Orders to the Exchange
which will continue to result in increased volume which benefits all
Exchange participants by providing more trading opportunities.
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\21\ 15 U.S.C. 78f(b)(1) and (b)(5).
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The Exchange believes that its proposal to adopt a tiered
adjustment table for per contract credits applied to PRIME Agency
Orders based upon break-up percentage is consistent with Section
6(b)(4) of the Act \22\ in that the proposal is reasonable, equitable
and not unfairly discriminatory as it applies uniformly to all
similarly situated Members.
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\22\ Id.
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The Exchange believes that the proposed incentive structure is
fair, equitable and not unreasonably discriminatory. The PCRP is
reasonably designed because it will continue to provide an incentive to
providers of Priority Customer order flow to send that Priority
Customer order flow to the Exchange to receive a credit in a manner
that enables the Exchange to improve its overall competitiveness and
strengthen its market quality for all participants.
The Exchange believes that its proposed Per Contract Adjustment for
PRIME Agency Order table will continue to incentivize EEMs to submit
Priority Customer PRIME Agency Orders to the Exchange, and that the
reduction of the rebate when the break-up percentage is less than 40%,
is not so significant that it will disincentivize EEMs from submitting
Priority Customer PRIME Agency Orders to the Exchange. The Exchange
believes that adjusting its rebates and providing an
[[Page 62150]]
additional credit of $0.01 (when the order break-up percentage is
greater than 60%) and an additional credit of $0.02 (when the order
break-up percentage is greater than 80%) will both incentivize EEMs to
submit Priority Customer PRIME Agency Orders to the Exchange and will
also contribute to more robust PRIME Auctions and potentially lead to
greater liquidity and price improvement for orders submitted to the
Exchange's PRIME. The decision to implement the Per Contract Adjustment
for PRIME Agency Order table is based on an analysis of current revenue
and volume levels and is designed to encourage Priority Customer order
flow to PRIME Auctions.
In addition, The Exchange believes that its proposal is consistent
with Section 6(b)(5) of the Act \23\ because it perfects the mechanisms
of a free and open market and a national market system and protects
investors and the public interest because Priority Customer order flow
will bring greater volume and liquidity to the Exchange, which benefits
all market participants by providing more trading opportunities and
tighter spreads. To the extent Priority Customer order flow is
increased by this proposal, market participants will increasingly
compete for the opportunity to trade on the Exchange including sending
more orders and provided narrower and larger-sized quotations in the
effort to trade with such Priority Customer order flow.
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\23\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that the proposed Per Contract Adjustment for
PRIME Agency Order table that provides a tiered incentive structure for
Priority Customer PRIME Agency Orders based upon order break-up
percentage is equitable and not unfairly discriminatory because the
proposed incentive table will apply equally to all similarly situated
EEMs that submit Priority Customer PRIME Agency Orders to the Exchange.
The Exchange believes that providing an adjustment to the rebate
provided to EEMs that submit Priority Customer PRIME Agency Orders that
are broken-up by a certain percentage is equitable and not unfairly
discriminatory because the proposed Per Contract Adjustment for PRIME
Agency Order table will apply equally to all Priority Customer PRIME
Agency Orders. The Exchange does not believe the reduction of the
rebate will serve to disincentivize EEMs from submitting Priority
Customer PRIME Agency Orders to the Exchange, and believes that the
enhanced rebate may further incentivize EEMs to submit Priority
Customer PRIME Agency Orders to the Exchange. Further, the Exchange
believes that the application of the Per Contract Adjustment for PRIME
Agency Order table is equitable and not unfairly discriminatory because
Priority Customer order flow enhances liquidity on the Exchange, in
turn providing more trading opportunities and attracting other market
participants, thus improving liquidity and facilitating tighter
spreads, to the benefit of all market participants.
The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. In Regulation NMS,
the Commission highlighted the importance of market forces in
determining prices and self-regulatory organization (``SRO'') revenues
and, also, recognized that current regulation of the market system
``has been remarkably successful in promoting market competition in its
broader forms that are most important to investors and listed
companies.'' \24\
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\24\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005).
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The Exchange believes that the ever-shifting market shares among
the exchanges from month to month demonstrates that market participants
can shift order flow or discontinue or reduce use of certain categories
of products, in response to transaction and non-transaction fee
changes. Accordingly, competitive forces constrain the Exchange's
transaction fees and rebates, and market participants can readily trade
on competing venues if they deem pricing levels at those other venues
to be more favorable. The Exchange believes the proposal reflects a
reasonable and competitive pricing structure which will continue to
incentivize market participants to direct liquidity adding orders to
the Exchange, which the Exchange believes would enhance liquidity and
market quality on the exchange to the benefit of all Members.
For the reasons discussed above, the Exchange submits that the
proposal satisfies the requirements of Sections 6(b)(4) and 6(b)(5) of
the Act \25\ in that it provides for the equitable allocation of
reasonable dues, fees and other charges among its Members and other
persons using its facilities and is not designed to unfairly
discriminate between customers, issuers, brokers, or dealers.
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\25\ 15 U.S.C. 78f(b)(4) and (5).
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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 does not believe
that the proposed change in connection with stock-option orders or
Priority Customer PRIME Agency Orders will impose any burden on
intramarket competition that is not necessary or appropriate in
furtherance of the purposes of the Act because the changes apply
uniformly to all similarly situated Members in a uniform manner.
The Exchange believes that its proposal to modify the Other Market
Participant Transaction Fees table to provide for a total per contract
fee of $0.10 on the option component of a stock-option order for
qualifying participants provides an additional incentive for Members to
increase Priority Customer order flow to the Exchange in order to
obtain the highest volume threshold, which benefits all market
participants by providing more trading opportunities and tighter
spreads. Additionally, the proposed discount encourages Members to
submit Priority Customer Orders to the Exchange which will continue to
result in increased volume on the Exchange which benefits all Exchange
participants by providing more trading opportunities.
The Exchange believes that its proposal to adopt a tiered
adjustment table for per contract credits applied to PRIME Agency
Orders based upon break-up percentage will not impose a burden on
competition as it applies uniformly to all similarly situated Members.
Similarly, the Exchange believes the proposed Per Contract Adjustment
for PRIME Agency Order table should continue to incentivize EEMs to
submit Priority Customer PRIME Agency Orders to the Exchange, and that
the reduction of the rebate when the break-up percentage is less than
40%, is not so significant that it will disincentivize EEMs from
submitting Priority Customer PRIME Agency Orders to the Exchange.
These proposed changes should enable the Exchange to continue to
attract liquidity to the Exchange and compete for order flow with other
exchanges. However, this competition does not create an undue burden on
competition but rather offers all market participants the opportunity
to receive the benefit of competitive pricing. The proposed changes are
intended to keep the Exchange's fees and rebates highly
[[Page 62151]]
competitive with those of other exchanges, and to encourage liquidity
on the Exchange. 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 rebates and fees to remain competitive with other exchanges and to
attract order flow. The Exchange believes that the proposed rule
changes reflect this competitive environment because the proposal
modifies the Exchange's fees and rebates in a manner that encourages
market participants to continue to provide liquidity and to send order
flow to the Exchange.
Moreover, the Commission has repeatedly expressed its preference
for competition over regulatory intervention in determining prices,
products, and services in the securities markets. Specifically, in
Regulation NMS, the Commission highlighted the importance of market
forces in determining prices and SRO revenues and, also, recognized
that current regulation of the market system ``has been remarkably
successful in promoting market competition in its broader forms that
are most important to investors and listed companies.'' \26\ The fact
that this market is competitive has also long been recognized by the
courts. In NetCoalition v. Securities and Exchange Commission, the D.C.
Circuit stated as follows: ``[n]o one disputes that competition for
order flow is `fierce.' . . . As the SEC explained, `[i]n the U.S.
national market system, buyers and sellers of securities, and the
broker-dealers that act as their order-routing agents, have a wide
range of choices of where to route orders for execution'; [and] `no
exchange can afford to take its market share percentages for granted'
because `no exchange possesses a monopoly, regulatory or otherwise, in
the execution of order flow from broker dealers'. . . .''.\27\
Accordingly, the Exchange does not believe its proposed fee change
imposes any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act.
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\26\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 47396, 37499 (June 29, 2005).
\27\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir 2010)
(quoting Securities Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-
21)).
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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
19(b)(3)(A)(ii) of the Act,\28\ and Rule 19b-4(f)(2) \29\ 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 shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
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\28\ 15 U.S.C. 78s(b)(3)(A)(ii).
\29\ 17 CFR 240.19b-4(f)(2).
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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
<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#c7b5b2aba2eaa4a8aaaaa2a9b3b487b4a2a4e9a0a8b1"><span class="__cf_email__" data-cfemail="fa888f969fd7999597979f948e89ba899f99d49d958c">[email protected]</span></a>. Please include
File SR-MIAX-2022-35 on the subject line.
Paper Comments
<bullet> 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-MIAX-2022-35. 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 (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>).
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 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. 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-MIAX-2022-35 and should be submitted on
or before November 3, 2022.
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\30\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\30\
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. 2022-22280 Filed 10-12-22; 8:45 am]
BILLING CODE 8011-01-P
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</html>Indexed from Federal Register on October 13, 2022.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.