Notice2025-18933
Self-Regulatory Organizations; Cboe EDGA Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Introduce a Small Retail Broker Hosted Solutions Program and To Update the Existing Eligibility Requirements for the Small Retail Brokerage Distribution Program for the Cboe One Summary Feed
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
September 30, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 187 (Tuesday, September 30, 2025)</title>
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[Federal Register Volume 90, Number 187 (Tuesday, September 30, 2025)]
[Notices]
[Pages 47055-47061]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-18933]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104043; File No. SR-CboeEDGA-2025-030]
Self-Regulatory Organizations; Cboe EDGA Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Introduce a Small Retail Broker Hosted Solutions Program and To Update
the Existing Eligibility Requirements for the Small Retail Brokerage
Distribution Program for the Cboe One Summary Feed
September 25, 2025.
Pursuant to 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 September 24, 2025, Cboe EDGA Exchange, Inc. (the ``Exchange'' or
``EDGA'') 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.
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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
Cboe EDGA Exchange, Inc. (the ``Exchange'' or ``EDGA'') proposes to
introduce a Small Retail Broker Hosted Solutions Program and to update
the existing eligibility requirements for the Small Retail Brokerage
Distribution Program for the Cboe One Summary Feed. 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 (<a href="http://markets.cboe.com/us/equities/regulation/rule_filings/edga/">http://markets.cboe.com/us/equities/regulation/rule_filings/edga/</a>) and at the Exchange's Office of the Secretary.
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 adopt a Small Retail Broker Hosted
Solutions Program (the ``Program'') for Cboe One Summary Data
(collectively, the ``Applicable Feed'').\3\ This Program will provide
fee waivers and lower data costs for both (i) Small Retail Brokers (as
defined herein) that provide the Applicable Feed to other Small Retail
Brokers via its hosted solutions (the ``Hosting Small Retail Broker
Distributor'') and (ii) the Small Retail Brokers that receive this data
from a Hosting Small Retail Broker Distributor as set forth herein.
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\3\ The Exchange initially submitted the proposed rule change on
May 8, 2025 (SR-CboeEDGA-2025-012). On May 19, 2025, the Exchange
withdrew that filing and submitted SR-CboeEDGA-2025-015. On June 30,
2025, the Exchange withdrew that filing and submitted SR-CboeEDGA-
2025-018. On August 28, 2025, the Exchange withdrew that filing and
submitted SR-Cboe-EDGA-2025-027. On September 24, 2025, the Exchange
withdrew that filing and submitted this filing.
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Further, the Exchange proposes to increase the allowed maximum Non-
Professional Data User subscriber count for the existing Small Retail
Broker Program for Cboe One Summary Feed.\4\ By way of background, the
Exchange currently offers the EDGA Top Data Feed, which is a data feed
that offers top-of-book quotations and last sale information based on
orders entered into the Exchange's System. The EDGA Top Data Feed
benefits investors by facilitating their prompt access to real-time
top-of-book information contained
[[Page 47056]]
in EDGA Top Data. The Exchange's affiliated equities exchanges (i.e.,
Cboe BZX Exchange, Inc. (``BZX''), Cboe BYX Exchange, Inc. (``BYX''),
and Cboe EDGX Exchange, Inc. (``EDGX'') (collectively, ``Affiliates''
and together with the Exchange, ``Cboe Equities Exchanges'') also offer
similar top-of-book data feeds. Particularly, each of the Exchange's
Affiliates offer top-of-book quotation and last sale information based
on their own quotation and trading activity that is substantially
similar to the information provided by the Exchange through the EDGA
Top Data Feed. Additionally, the Exchange also offers Cboe One Summary
Data Feed that disseminates, on a real-time basis, the aggregate BBO of
all displayed orders for securities traded on EDGA and its affiliated
equities exchanges and also contains individual last sale information
for the EDGA and its affiliated equities exchanges. The Cboe One
Summary Data Feed is created using the data from the Exchange and its
Affiliates' Top data feeds.
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\4\ The Exchange also notes that it is including a clarifying
note to the maximum subscriber count that it is for Non-Professional
Users (as opposed to the general ``Users'' term currently used) to
align with its affiliates fee schedules (see e.g., Cboe EDGX
Equities Fee Schedule).
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Currently, the Exchange offers a Small Retail Broker Distribution
Program \5\ for the Applicable Feed. This program provides a discounted
Distribution Fee of $3,500/month for Cboe One Summary Data Feed as well
as a discounted Data Consolidation Fee \6\ of $350/month for Cboe One
Summary Data for eligible participants.\7\ Participants of the existing
Small Retail Broker Distribution Program must be an External
Distributor that meets the following criteria: (i) Distributor is a
broker-dealer distributing the Applicable Feed to Non-Professional Data
Users with whom the broker-dealer has a brokerage relationship; (ii) At
least 90% of the Distributor's total subscriber population must consist
of Non-Professional subscribers, inclusive of any subscribers not
receiving the Applicable Feed; and (iii) Distributor distributes the
Applicable Feed to no more than 5,000 Non-Professional Data Users (the
Exchange notes that it is proposing to increase this to 10,000 Non-
Professional Data Users as described further herein).\8\ The Exchange
introduced this program to allow small retail brokers that purchase top
of book market data from the Exchange to benefit from discounted fees
for access to such market data. The Small Retail Broker Distribution
Program reduces the distribution and consolidation fees paid by small
broker-dealers that operate a retail business. In turn, the Small
Retail Broker Distribution Program is intended to increase retail
investor access to real-time U.S. equity quote and trade information,
and allow the Exchange to better compete for this business with
competitors \9\ that offer similar optional products.\10\
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\5\ See Cboe EDGA Equities Fee Schedule.
\6\ This fee reflects the value of the aggregation and
consolidation function the Exchange performs in creating the Cboe
One Summary Feed.
\7\ See Cboe EDGA Equities Fee Schedule.
\8\ Id.
\9\ Such as NYSE Arca BBO feed or Nasdaq Basic.
\10\ See Securities Exchange Act Release No. 85 FR 9912
(February 20, 2020) (SR-CboeEDGA-2020-004); and 88219 (February 14,
2020).
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The Exchange now proposes to create a new Program based on the
proposed eligibility criteria for Small Retail Brokers to specifically
support Small Retail Brokers who are operating platforms on behalf of
other Small Retail Brokers. Based on customer feedback, there are Small
Retail Brokers who would like to provide this data via a hosted
solution as a White Label Service \11\ to other Small Retail Brokers,
who then provide this data to their retail clients (an ``External
Hosted Subscriber'').\12\ Unfortunately, under the existing structure,
while the Small Retail Broker may be eligible for the discounted
Distribution Fee and the discounted Data Consolidation Fee, the
External Hosted Subscriber must also pay the Distribution Fee and the
Data Consolidation Fee, in addition to the standard Professional and
Non-Professional User fees. Therefore, the existing fee structure does
not allow for any additional benefits for Hosting Small Retail Broker
Distributors for providing the valuable service of operating platforms
that External Hosted Subscribers may use for their clients.
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\11\ A ``White Label Service'' is a type of hosted display
solution in which an External Distributor hosts or maintains a
website or platform on behalf of the External Hosted Subscriber. The
service allows the External Distributor to make the applicable data
(i.e., Cboe One Summary Data) available on a platform that is
branded with the External Hosted Subscriber, or co-branded with the
External Hosted Subscriber and the External Distributor. The
External Distributor maintains control of the application's data,
entitlements and display.
\12\ An External Hosted Subscriber of an Exchange Market Data
product is a Distributor that receives the Exchange Market Data
product from an External Distributor through a hosted display
solution where the External Hosted Subscriber's Users are hosted by
the External Distributor and data is distributed for display use
only to one or more Users outside the External Hosted Subscriber's
own entity. The Exchange proposes to add this definition into its
Fee Schedule.
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Of further note, the Hosting Small Retail Broker is responsible for
reporting its External Hosted Subscribers and their users, and
ultimately the Hosting Small Retail Broker is responsible for payment
of all data fees for both its External Subscribers and itself. While
the Exchange is not privy to pass-through costs between Hosting Small
Retail Broker Distributor and the External Hosted Subscribers, the
Hosting Small Retail Broker is ultimately charged Distribution Fees (in
addition to the other applicable fees) for the (i) Applicable Feed to
the External Hosted Subscriber and (ii) Applicable Feed to the External
Hosted Subscriber's end users, despite the Hosting Small Retail Broker
managing the application for the External Hosted Subscriber's users.
This proposed Program is intended to provide relief for the overall
charges that a Hosting Small Retail Broker incurs based on operating a
platform that allows an External Hosted Subscriber's retail users to
receive data.
Additionally, given that External Hosted Subscribers are smaller
relative to other Small Retail Brokers currently participating in the
existing Small Retail Broker Distribution Program, their ability to
subscribe to the Applicable Feed as Hosting Small Retail Broker
Distributors is likely not feasible. Specifically, the costs of the
Applicable Feed may themselves make access to this data impractical.
Additionally, the costs associated with building and maintaining the
technological infrastructure to receive and disseminate data, may make
access to such data impractical. Generally speaking, technology,
infrastructure, and connectivity costs are a significant monetary
investment and require significant human expertise and resources to
maintain. As such, the totality of costs can make access to data
difficult. The Exchange believes, though, that the proposed fees and
the ability to subscribe to the Applicable Feed as External Hosted
Subscribers will make access to data more feasible. Indeed, the
Exchange anticipates that the retail broker-dealers that would seek to
become External Hosted Subscribers are broker-dealers that do not have
the technological infrastructure in place to ingest and disseminate
data as a Hosting Small Retail Broker, and that are likely to have
smaller client bases and business models not as conducive to making the
investments necessary to become a Hosting Small Retail Broker
Distributor.
In these regards, the Exchange believes that the proposed program
will incentivize Hosting Small Retail Broker Distributors to offer the
Applicable Feed to External Hosted Subscribers, thereby making data
accessible to a larger number of broker-dealers and their clients, at
an affordable cost. Specifically, under the proposed program, a Hosting
Small Retail Broker Distributor providing the data to at least one
External Hosted Subscriber would
[[Page 47057]]
be eligible for a credit of its Distribution Fee (a credit of $3,500/
month for Cboe One Summary Feed) that it is normally responsible for
under the existing Small Retail Broker Program. Additionally, the
External Hosted Subscriber shall also receive a waiver of the
Distribution Fee (a credit of $3,500/month for Cboe One Summary Feed).
The External Hosted Subscriber will also receive a waiver of the Data
Consolidation Fee for the Cboe One Summary Data (a credit of $350/
month), and in lieu of paying the Non-Professional User fees, it shall
be a set monthly fee $850 for Cboe One Summary Data.\13\ The
Professional User fees shall remain the same. Once an External Hosted
Subscriber exceeds the Non-Professional Data User maximum (no more than
10,000 Non-Professional Data Users for Cboe One Summary Data), the
External Hosted Subscriber shall no longer be eligible for the program
and will be required to directly license with the Exchange for the
Applicable Feed.\14\
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\13\ As the Program is capped at 10,000 users for Cboe One
Summary Feed this equates to a maximum, savings of $1,650 (10,000
Users x 0.25/Non-Professional = $2,500 and $2,500-850 = $1,650) for
Cboe One Summary Feed.
\14\ The Exchange notes that it will include a clarifying note
in its Fee Schedule to specify that in the event a Hosting Small
Retail Broker Distributor joins this program mid-month, that its
fees shall be prorated for the month based on the initial date of
the subscription; however, the External Hosted Subscriber's fees
shall not be prorated.
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In addition to the changes set forth above, the Exchange also
proposes to modify the existing Small Retail Broker Program for Cboe
One Summary Feed to increase the number of Non-Professional Data User
maximum from 5,000 to 10,000 to be consistent with the proposed
threshold for External Hosted Subscribers. As previously discussed, the
Exchange proposes to also use the cap of 10,000 Non-Professional Data
Users for the proposed Program. The Exchange proposes to increase this
in support of increased participation across both retail and investor
markets in order to facilitate the growth of smaller retail brokers on
a global scale.
As mentioned above, the existing fee structure makes it costly for
both Hosting Small Retail Broker Distributors and its External Hosted
Subscribers to provide data to the External Hosted Subscribers' retail
clients as Distribution Fees are assessed on both Small Retail Brokers.
Overall, the Exchange believes that this fee proposal will help to make
its data more widely accessible for retail users who receive their data
from External Hosted Subscribers. Specifically, the Exchange believes
that that this proposal will (i) further increase the competitiveness
of the Exchange's top of book market data products compared to
competitor offerings that may currently be cheaper for firms with a
limited subscriber base that do not yet have the scale to take
advantage of the lower subscriber fees offered by the Exchange; and
will (ii) provide additional incentives for Hosting Small Retail Broker
Distributors to provide hosted solution services for other Small Retail
Brokers in order to make data more widely available to retail
investors. In turn, the Exchange believes that this change may benefit
market participants and investors by spurring additional competition
and increasing the accessibility of the Exchange's top of book data.
The Exchange notes that at least one other exchange has a similar
offering. For example, the New York Stock Exchange has a Redistribution
Fee Waiver for NYSE Trades, for which redistributors of data may have
their redistribution fee waived so long as they provide the data to at
least one data feed recipient and reports such data feed recipient or
recipients to the Exchange.\15\
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\15\ See Securities Exchange Act Release No. 90407 (November 12,
2020), 85 FR 73570 (November 18, 2020) (SR-NYSE-2020-91).
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Without the proposed pricing discounts, the Exchange believes that
(i) prospective customers may not be interested in purchasing top of
book data from the Exchange, and may instead purchase such data from
other national securities exchanges or the Securities Information
Processors (``SIPs''), potentially at a higher cost than would be
available pursuant to the proposed program and (ii) that Hosting Small
Retail Broker Distributors are not incentivized to make the Applicable
Feed available via a hosted solution for retail investors of its
External Hosted Subscribers. Similar to the existing Small Retail
Broker Program previously introduced, the Exchange believes that the
proposed Program will continue to increase competition for such market
data, and that enhanced competition could help to further reduce data
fees as providers compete for subscribers, as well as help diversify
the availability and quality of data offerings available to retail
investors through their Hosting Small Retail Broker Distributors.
Ultimately, the Exchange believes that it is critical that it be
allowed to compete by offering attractive pricing to customers as
increasing the availability of such products ensures continued
competition with alternative offerings. Such competition may be
constrained when competitors are impeded from offering alternative and
cost-effective solutions to customers.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the objectives of Section 6 of the Act,\16\ in general, and
furthers the objectives of Section 6(b)(4),\17\ 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.
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\16\ 15 U.S.C. 78f.
\17\ 15 U.S.C. 78f(b)(4).
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The Exchange also believes that the proposed rule change is
consistent with Section 11(A) of the Act.\18\ Specifically, the
proposed rule change 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. In addition, the
proposed rule change is consistent with Rule 603 of Regulation NMS,\19\
which provides that any national securities exchange that distributes
information with respect to quotations for or transactions in an NMS
stock do so on terms that are not unreasonably discriminatory.
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\18\ 15 U.S.C. 78k-1.
\19\ See 17 CFR 242.603.
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In adopting Regulation NMS, the Commission granted SROs and broker-
dealers increased authority and flexibility to offer new and unique
market data to the public. It was believed that this authority would
expand the amount of data available to consumers, and also spur
innovation and competition for the provision of market data. The
Exchange believes that the proposed fee change would further broaden
the availability of U.S. equity market data to investors, and in
particular retail investors, consistent with the principles of
Regulation NMS.
The Exchange operates in a highly competitive environment. Indeed,
there are sixteen registered national securities exchanges that trade
U.S. equities and offer associated top of book market data products to
their customers. The national securities exchanges also compete with
the SIPs for market data customers. 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
[[Page 47058]]
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.'' \20\ The proposed fee change is a result of the
competitive environment, as the Exchange seeks to amend its fees to
attract additional subscribers for its proprietary top of book data
offerings.
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\20\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
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Making alternative data products available to market participants
ultimately ensures increased competition in the marketplace and
constrains the ability of exchanges to charge prohibitive fees. If a
market participant views one exchange's top of book data fees as more
or less attractive than the competition they can, and frequently do,
switch between competing products. In fact, the competitiveness of the
market for such top of book data products is one of the primary factors
animating this proposed rule change, which is designed to allow the
Exchange to further compete for this business. As mentioned above, at
least one other Exchange provides a similar waiver for redistribution
of market data.
The Exchange notes that the Applicable Feed is distributed and
purchased on a voluntary basis, in that neither the Exchange nor market
data distributors are required by any rule or regulation to make these
data products available. Distributors (including vendors) and Users can
therefore discontinue use at any time and for any reason, including due
to an assessment of the reasonableness of fees charged. Further, the
Exchange is not required to make any proprietary data products
available or to offer any specific pricing alternatives to any
customers.
The Commission has long stressed the need to ensure that the
equities markets are structured in a way that meets the needs of
ordinary investors. For example, the Commission's strategic plan for
fiscal years 2018-2022 touts ``focus on the long-term interests of our
Main Street investors'' as the Commission's number one strategic
goal.\21\ The Program would be consistent with the Commission's stated
goal of improving the retail investor experience in the public markets.
Furthermore, national securities exchanges commonly charge reduced fees
and offer market structure benefits to retail investors, and the
Commission has consistently held that such incentives are consistent
with the Act. The Exchange believes that the Program is consistent with
longstanding precedent indicating that it is consistent with the Act to
provide reasonable incentives to retail investors that rely on the
public markets for their investment needs.
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\21\ See U.S. Securities and Exchange Commission, Strategic
Plan, Fiscal Years 2018-2022, available at <a href="https://www.sec.gov/files/SEC_Strategic_Plan_FY18-FY22_FINAL_0.pdf">https://www.sec.gov/files/SEC_Strategic_Plan_FY18-FY22_FINAL_0.pdf</a>.
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The Exchange notes that the proposed waivers for the Applicable
Feed only apply to Hosting Small Retail Broker Distributors and its
External Hosted Subscribers for three reasons. The first is that the
Hosting Small Retail Broker Distributors undertake the operation of the
platform of which the ultimate retail investors view the data provided
by the External Hosted Subscriber. The Hosting Small Retail Broker
Distributor maintains control of the application's data, entitlements
and display. In comparison, to the existing Small Retail Broker
Program, eligible participants have no such obligations and are
eligible for this only by meeting the requirements and externally
distributing the data (which may be directly to retail investors). In
order to incentivize the Hosting Small Retail Broker Distributors to
undergo this challenge, the Exchange believes it is not unfairly
discriminatory to provide a waiver of the Distribution Fee for the
Hosting Small Retail Broker, as opposed to the standard discounted
Distribution Fee normally paid under the current Small Retail Broker
Distribution Program.
Second, by creating this program, the Exchange is further able to
reach additional retail investors. By waiving Distribution Fees for
both the Hosting Small Retail Broker Distributor and its External
Hosted Subscriber, both parties are incentivized to work together to
provide data to retail investors. Finally, as mentioned previously, the
Hosting Small Retail Broker Distributor is responsible for the fees and
reporting for both its activity and its External Hosted Subscriber.
This means that under the existing program, if a Hosting Small Retail
Broker has one External Hosted Subscriber, the Hosting Small Retail
Broker is receiving a bill for two Distribution Fees, two Data
Consolidation fees and the cost of both its and its External Hosted
Subscriber's Professional Users and Non-Professional Users. Through
this Program, the fees will not be a deterrent for Hosting Small Retail
Broker Distributors and External Hosted Subscribers to establish
platforms that reach a wider scope of retail investors.
Furthermore, while this Program would be effectively limited to
smaller firms in accordance with the proposed eligibility requirements,
the Exchange does not believe that this limitation makes the fees
inequitable or unfairly discriminatory. The Exchange notes that large
broker-dealers and/or vendors that distribute the Exchange's data
products to a sizeable number of investors benefit from the current fee
structure, which includes lower subscriber fees and Enterprise
licenses. Due to lower subscriber fees, distributors that provide the
Applicable Data Feed to more than the proposed capped amounts of Users
permitted under either the Small Retail Broker Program or this Program
already enjoy cost savings compared to competitor products. The
Program, in addition to the existing Small Retail Broker Program, would
therefore continue to ensure that small retail brokers that distribute
top of book data to their retail investor customers could also benefit
from reduced pricing, and would aid in increasing the competitiveness
of the Exchange's data products for this key segment of the market.
Moreover, the Exchange does not believe that the proposed fees
unfairly discriminate between Hosting Small Retail Broker Distributors
and External Hosted Subscribers. While the proposal provides additional
benefits to External Hosted Subscribers that would not otherwise accrue
to them under the current program, the Exchange notes that such
benefits are designed only to make access to market data more
accessible to smaller retail broker-dealers that either do not possess
the financial and technological resources necessary to receive data as
a Small Retail Broker, or simply choose not commit such resourced based
on their business models. In turn, to continue to incentivize the
provision of the Applicable Feed by Hosting Small Retail Broker
Distributors, the Exchange has sought to provide appropriate incentives
to these brokers as well. Collectively, the fee structure provides
benefits to both Hosting Small Retail Broker Distributors and External
Hosted Subscribers.
While External Hosted Subscribers would receive benefits they would
not accrue under the current program, these are not benefits that
today's Small Retail Brokers would choose to avail themselves of under
the new fee structure, because it is highly unlikely that today's Small
Retail Brokers would choose to instead become External Hosted
Subscribers. The Exchange notes that today's Small Retail Brokers that
qualify under the current program, have already committed significant
capital in terms of time, technology, and finances towards building out
and maintaining the technological infrastructure and
[[Page 47059]]
staffing needed to receive and distribute the Applicable Feedt o their
end users. To forego such financial and technological commitments
simply to avail themselves of additional benefits afforded to External
Hosted Subscribers under this proposal, would very likely require an
existing Small Retail Broker to drastically change their current
business model simply to avail themselves of the additional benefits
provided to External Hosted Subscribers. Moreover, today's existing
Small Retail Brokers are likely to be providing services to their
subscribers other than the Additional Feeds, such as market access,
order management systems, and other trading tools. To cease providing
such a full suite of services--which required significant time and cost
contributions--is unlikely and, again, would require a significant
reversal in a Small Retail Broker's business model.
Rather, the Exchange believes that the more likely case is that the
proposed fee structure will attract a new population of Small Retail
Brokers who will seek to access the Applicable Feed as Hosted External
Subscribers, at a cost-effective price point, thereby providing even
more investors with access to top of book market data for U.S.
equities. Another likely use case is that the proposed fee structure
may incentivize more Small Retail Brokers to subscribe to the
Applicable Feed as External Hosted Subscribers and, as they build their
own business models and attract subscribers of their own, eventually
commit time and resources to building their own infrastructure to
evolve into a Hosting Small Retail Broker.
Furthermore, the Exchange acknowledges that under the proposed fee
schedule that a Hosting Small Retail Broker Distributor is eligible for
a waiver of its Distribution Fee once its first External Hosted
Subscriber is subscribed, whereas under current program a Small Retail
Broker is not eligible for such a waiver. However, the Exchange does
not believe that this proposed fee structure unfairly discriminates
between existing Small Retail Brokers and Hosting Small Retail Brokers,
because the application of these fees is based on meaningful
differences between existing Small Retail Brokers and potential Hosting
Small Retail Broker Distributors.
Specifically, existing Small Retail Brokers are brokers that
distribute the Applicable Feed to their own customers. These Small
Retail Brokers typically operate their own retail trading businesses,
and the provision of the Applicable Feed is part of the package of
services provided to their own customers. Comparatively, similar to
certain subscribers \22\ of NYSE's BQT proprietary data product
(discussed above), the Exchange believes that Hosting Small Retail
Broker Distributors are more akin to that of a traditional vendor, or a
redistributor of data, whose typical business model is to collect and
process data from other sources (e.g., the Applicable Feed), and
redistribute such data to other businesses or individuals for their own
use. As such, the proposed fees are narrowly tailored to a specific
subset of the market data consumer base--i.e., vendors/redistributors
that subscribe to competitively priced market data and, in turn,
redistribute such data downstream to their customers. In performing
this service, the Hosting Small Retail Broker Distributors are offering
a White Label Service where they are technologically hosting or
maintaining a website or platform on behalf of their External Hosted
Subscribers, and are responsible for maintaining control of the
platform's data, entitlements, and display, for the Applicable Feeds,
and any other comparable data products to which they subscribe. In this
regard, the proposed fees are designed to account for the additional
technological and capital costs a Hosting Small Retail Broker
Distributor may need to expend in order to host and redistribute market
data downstream to its customers.
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\22\ In a 2020 fee filing, NYSE sought to reduce certain of its
market data fees for Redistributors that subscribed only to NYSE BBO
and NYSE Trades, and did not subscribe to any other market data
product listed on the NYSE fee schedule, other than NYSE BQT. In
that filing, NYSE defined a redistributor as, ``a vendor or any
other person that provides a NYSE data product to a data recipient
or to any system that a data recipient uses, irrespective of the
means of transmission or access.'' Supra note 15, 7357.
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Relatedly, the proposed fees are based on the competitive
environment for market data products such as the Applicable Feed. In
response to competition from other market data feeds such as NYSE BQT,
the Exchange's proposed fees are merely intended to provide a financial
incentive for vendors/redistributors that do not currently subscribe to
any Exchange market data products to subscribe to the Applicable Feed.
By focusing on this segment of the market, the Exchange believes that
the proposed fees will make the Applicable Feed more competitive and
attractive for vendors/redistributors to subscribe to, thereby
increasing the availability of the Exchange's data products, expanding
the options available to firms making data purchasing decisions on
their business needs, and generally increasing competition. In this
regard, the Exchange believes that the proposed fees--particularly the
waiver of the Distribution Fee--will incentivize Hosting Small Broker
Distributors (i.e., vendors/redistributors) to subscribe to the
Applicable Feed and make them available to their end customers. Indeed,
as discussed above, NYSE BQT offers redistributors a similar waiver,
which NYSE noted \23\ was necessary in order to enable them to better
compete with Nasdaq Basic and Cboe One. Similarly, the Exchange
believes that the proposed fees would also better enable the Exchange
to compete more effectively with similar products such as NYSE BQT and
Nasdaq Basic, thereby expanding the number of vendors/redistributors
that would subscribe to the Applicable Feeds as Hosting Small Retail
Broker Distributors, and therefore make the product available to data
subscribers interested in the Applicable Feeds. Without a similar
waiver, the Exchange notes that its ability to compete would be
drastically impaired.
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\23\ Supra note 15, 73573. (``The proposed rule change is
intended to encourage greater use of NYSE BQT by making it more
affordable for Redistributors that have customers interested in
subscribing to NYSE BQT . . . The proposed fee reduction would allow
the Exchange to compete more effectively with Nasdaq Basic and Cboe
One Feed by expanding the number of Redistributors that would
subscribe to NYSE BQT, and therefore make the product available to
data subscribers interested in NYSE BQT.'').
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Moreover, the Exchange believes that the proposed change to provide
a waiver of the Distribution Fee to a Hosting Small Retail Broker
Distributor (i.e., vendor/distributor) is not unfairly discriminatory
because the proposed waiver applies equally to all Hosting Small Retail
Broker Distributors that are eligible for such waiver and choose to
redistribute the Applicable Feeds, and would serve as an incentive for
Hosting Small Retail Broker Distributors that do not currently
subscribe to the Applicable Feeds to start doing so, and then make the
Applicable Feeds available to their customers.
Finally, the Exchange notes that nothing in the current proposal
prevents an existing Small Retail Broker from choosing to instead
subscribe to the Applicable Feed as an External Hosted Subscriber.
However, the Exchange does not believe that this makes the proposal
unfairly discriminatory between Hosting Small Retail Broker
Distributors and External Hosted Subscribers, as broker-dealers are
free operate their businesses however they may choose in response to a
host of a reasons, only one of which are associated costs.
The Exchange believes that the proposed cap of 10,000 for the Cboe
One Summary Data Feed for this Program, as
[[Page 47060]]
well as increasing this cap to 10,0000 for the Cboe One Summary Data
Feed for the Small Retail Broker Program is reasonable and not unfairly
discriminatory as the Exchange believes it is in the best interest of
all market participants to more broadly expand this in support of
inclusion for more retail investors by participation in both programs
by small retail brokers on a global scale.
Distribution Fee Waiver
The Exchange believes that the Distribution Fee Waivers for both
the External Hosted Subscriber and the Hosting Small Retail Broker
Distributor are reasonable as they represent a significant cost
reduction for the Hosting Small Retail Broker Distributor to provide a
hosted solution for the External Hosted Subscriber, to ultimately
provide the data to the External Hosted Subscriber's retail investors.
By targeting the Distribution Fee waiver to vendors/redistributors that
provide external distribution of the Applicable Feeds, the Exchange
believes that this would provide an incentive for redistributors to
make the Applicable Feeds available to its customers. Specifically, if
a data recipient is interested in subscribing to the Applicable Feeds
and relies on a vendor/redistributor to obtain market data products
from the Exchange, that data customer would need the vendor/
redistributor to first subscribe to and distribute the Applicable
Feeds. In this regard, the Exchange believes the proposed waiver would
provide an incentive for vendors/redistributors to make the Applicable
Feeds available to their customers, which will increase the
availability of the Applicable Feeds to a larger potential population
of retail investors.
While the existing fee structure does provide a benefit of a
discounted waiver for Small Retail Brokers that externally distribute
the data, these discounted Distribution Fees are still incurred by both
the external Hosted Subscriber and the Hosting Small Retail Broker
Distributor. In an attempt to alleviate these costs, and make this data
more available to retail investors, the Exchange proposes to waive the
Distribution Fees for both the Hosting Small Retail Broker Distributor
and the External Hosted Subscriber. With this Program, the Exchange
believes it will increase market accessibility and data to investors on
a global scale. Exchange Hosted Subscribers may not have the
infrastructure or technical capabilities to offer market data and/or
execution services to its retail investors. Through waiving these fees
for the External Hosted Subscriber, the Exchange hopes to reach a
broader scale of retail investors globally. Further, as discussed
above, the Exchange also believes it is appropriate and not unfairly
discriminatory to limit this specific credit to the External Hosted
Subscriber and the Hosting Small Retail Broker Distributor given the
development and maintenance the Hosting Small Retail Broker Distributor
undergoes to provide this data to the External Hosted Subscriber's end
users.
Data Consolidation Fee Waiver
The Exchange believes it is reasonable to not charge the External
Hosted Subscriber the Data Consolidation Fee for Cboe One Summary Data
for the duration of the time that they are eligible for this program.
As previously discussed, the waiver of fees for the External Hosted
Subscriber is intended to make this data more available to retail
investors. The Exchange also believes it is appropriate and not
unfairly discriminatory to limit this specific credit to the External
Hosted Subscriber because, as described above, the Exchange believes by
alleviating some of the barriers to entry, that Exchange Hosted
Subscribers are able to bring this data and execution services to their
retail investors. Of further note, the Exchange believes it is
reasonable to maintain this cost for the Hosting Small Retail Broker
Distributor as the Hosting Small Retail Broker Distributor is the party
receiving this data from the Exchange where it is consolidated for the
benefit of the Hosting Small Retail Broker Distributor.
Fixed Cost of Non-Professional Users
The Exchange believes it is reasonable to set a fixed cost for Non-
Professional Users fees for External Hosted Subscribers by charging a
flat, fixed cost instead of charging per user to allow for additional
savings. Under this structure, the External Hosted Subscriber shall
still be responsible by paying the standard per User fee of a
Professional Users under the Applicable Feed. The Exchange does not
believe this is unfairly discriminatory as the program is based around
making the Applicable Feed available for Non-Professional Users. The
Exchange also notes that it has taken a similar approach here to the
NYSE Per User Access Fee, which sets a fixed cost where the data is
used only for display purposes.\24\
---------------------------------------------------------------------------
\24\ See NYSE Proprietary Market Data Pricing Guide, April 1,
2025.
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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: (i) Competition among exchanges
that offer similar data products to their customers; and (ii) the
existence of inexpensive real-time consolidated data disseminated by
the SIPs. Top of book data is disseminated by both the SIPs and the
sixteen equities exchanges. There are therefore a number of alternative
products available to market participants and investors. In this
competitive environment potential subscribers are free to choose which
competing product to purchase to satisfy their need for market
information. Often, the choice comes down to price, as broker-dealers
or vendors look to purchase the cheapest top of book data product, or
quality, as market participants seek to purchase data that represents
significant market liquidity. In order to better compete for this
segment of the market, the Exchange is proposing to reduce the cost of
top of book data provided by Hosting Small Retail Broker Distributors
to its External Hosted Subscribers, and in turn, their retail
investors. The Exchange believes that this would facilitate greater
access to such data, ultimately benefiting the retail investors that
are provided access to such market data.
The Exchange also believes the proposed fee changes will better
enable it to compete in the Asia Pacific region, which is an area of
increasing interest and growth within the U.S. equities markets,
generally. As the Asia Pacific investor base seeks access to the
liquidity and efficient price discovery processes that exist in the
U.S. equities markets, various broker-dealers have begun offering
trading in this region, and exchanges have begun to contemplate 24-hour
trading solutions designed to capture the increased demand from the
Asia Pacific investor base.\25\ Naturally, U.S. equities market
[[Page 47061]]
data will be in demand as Asia Pacific trading increases in the U.S.
markets. Indeed, in formulating its current pricing, the Exchange has
considered the growth in the Asia Pacific reason and has sought to
propose fees that would continue to appeal to the existing Small Retail
Brokers in this region, and that would incentivize additional smaller
retail broker-dealers in this region to subscribe to the Applicable
Feed as External Hosted Subscribers. In this regard, the Exchange
believes its proposed fees will better enable it to compete in Asia
Pacific, thereby offering competitively priced data products to more
and more investors, at attractive price points.
---------------------------------------------------------------------------
\25\ See ``Cboe Announces Plans to Launch 24x5 U.S. Equities
Trading,'' February 3, 2025, available at: <a href="https://ir.cboe.com/news/news-details/2025/Cboe-Announces-Plans-to-Launch-24x5-U.S.-Equities-Trading-2025-NwujmKvsxb/default.aspx">https://ir.cboe.com/news/news-details/2025/Cboe-Announces-Plans-to-Launch-24x5-U.S.-Equities-Trading-2025-NwujmKvsxb/default.aspx</a>, (``[Cboe] continue[s] to hear
from market participants globally--particularly those in Asia
Pacific markets like Hong Kong, Japan, Korea, Singapore and
Australia--that they want greater access to U.S. equities trading
and need trusted venues that can offer transparency, robust
liquidity and efficient price discovery,'' said Oliver Sung, Head of
North American Equities at Cboe Global Markets. ``As the world's
largest global exchange operator, Cboe is uniquely positioned to
meet that demand. By leveraging our global infrastructure, leading-
edge technology, and proven experience facilitating around-the-clock
trading in global markets, we believe we can seamlessly support a
24x5 trading model for U.S. equities.''; see also ``Nasdaq's View:
The Road to 24 Hour Trading,'' June 16, 2025, available at: <a href="https://www.nasdaq.com/newsroom/nasdaqs-view-road-24-hour-trading">https://www.nasdaq.com/newsroom/nasdaqs-view-road-24-hour-trading</a>; see also
``The New York Stock Exchange Plans to Extend Weekday Trading on its
NYSE Arca Equities Exchange to 22 Hours a Day,'' October 25, 2024,
available at: <a href="https://ir.theice.com/press/news-details/2024/The-New-York-Stock-Exchange-Plans-to-Extend-Weekday-Trading-on-its-NYSE-Arca-Equities-Exchange-to-22-Hours-a-Day/default.aspx">https://ir.theice.com/press/news-details/2024/The-New-York-Stock-Exchange-Plans-to-Extend-Weekday-Trading-on-its-NYSE-Arca-Equities-Exchange-to-22-Hours-a-Day/default.aspx</a>; see also
``Robinhood 24 Hour Market,'' available at: <a href="https://robinhood.com/us/en/support/articles/24hour-market/">https://robinhood.com/us/en/support/articles/24hour-market/</a>.
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The Exchange does not believe that this price reduction would cause
any unnecessary or inappropriate burden on intermarket competition as
other exchanges and data vendors are free to lower their prices to
better compete with the Exchange's offering. Indeed, as explained in
the basis section of this proposed rule change, the Exchange's decision
to (i) waive the Distribution Fee for the Hosting Small Retail Broker
Distributor and the External Hosted Subscriber and (ii) waiving the
Consolidation Fee (when applicable) for the External Hosted Subscriber
and (iii) setting a fixed cost for the Non-Professional Users for the
External Hosted Subscriber is itself a competitive response to
different fee structures available on competing markets. The Exchange
therefore believes that the proposed rule change is pro-competitive as
it seeks to offer pricing incentives to customers to better position
the Exchange as it competes to attract additional market data
subscribers. The Exchange also believes that the proposed reduction in
fees the Hosting Small Retail Broker Distributor and the External
Hosted Subscriber would not cause any unnecessary or inappropriate
burden on intramarket competition. Although the proposed fee discount
would be largely limited to small retail broker subscribers, larger
broker-dealers and vendors can already purchase top of book data from
the Exchange at prices that represent a significant cost savings when
compared to competitor products that combine higher subscriber fees
with lower fees for distribution. In light of the benefits already
provided to this group of subscribers, the Exchange believes that
additional discounts to small retail brokers would increase rather than
decrease competition among broker-dealers that participate on the
Exchange. Furthermore, as discussed earlier in this proposed rule
change, the Exchange believes that offering pricing benefits to brokers
that represent retail investors facilitates the Commission's mission of
protecting ordinary investors, and is therefore consistent with the
Act.
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 \26\ and paragraph (f) of Rule 19b-4 \27\
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.
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\26\ 15 U.S.C. 78s(b)(3)(A).
\27\ 17 CFR 240.19b-4(f).
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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="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#7604031a135b15191b1b131802053605131558111900"><span class="__cf_email__" data-cfemail="95e7e0f9f0b8f6faf8f8f0fbe1e6d5e6f0f6bbf2fae3">[email protected]</span></a>. Please include
file number SR-CboeEDGA-2025-030 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-CboeEDGA-2025-030. 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="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-CboeEDGA-2025-030 and should be
submitted on or before October 21, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\28\
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\28\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-18933 Filed 9-29-25; 8:45 am]
BILLING CODE 8011-01-P
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