Notice2026-10366
Self-Regulatory Organizations; NYSE Texas, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Delete the Cabinet Upgrade Fee
Primary source
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Published
May 26, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 100 (Tuesday, May 26, 2026)</title>
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[Federal Register Volume 91, Number 100 (Tuesday, May 26, 2026)]
[Notices]
[Pages 30763-30765]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-10366]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-105531; File No. SR-NYSETEX-2026-16]
Self-Regulatory Organizations; NYSE Texas, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Delete the
Cabinet Upgrade Fee
May 20, 2026.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on May 7, 2026, the NYSE Texas, Inc. (``NYSE Texas'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to delete the cabinet upgrade fee for
dedicated cabinets from the Connectivity Fee Schedule (``Fee
Schedule''). The proposed rule change is available on the Exchange's
website at <a href="http://www.nyse.com">www.nyse.com</a> and at the principal office of the Exchange.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to delete the cabinet upgrade fee for
dedicated cabinets (``Cabinet Upgrade Fee'') from the Fee Schedule.
Currently, the Exchange charges a one-time Cabinet Upgrade Fee of
$9,200 when a User \4\ requests additional power allocation for its
dedicated cabinet beyond the specified amount that the Exchange
allocates per dedicated cabinet, at which point the Exchange must
upgrade the cabinet's power capacity.
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\4\ For purposes of the Exchange's colocation services, a
``User'' means any market participant that requests to receive
colocation services directly from the Exchange. See Securities
Exchange Act Release No. 87408 (October 28, 2019), 84 FR 58778 at
n.6 (November 1, 2019) (SR-NYSECHX-2019-12). As specified in the Fee
Schedule, a User that incurs colocation fees for a particular
colocation service pursuant thereto would not be subject to
colocation fees for the same colocation service charged by the New
York Stock Exchange LLC, NYSE American LLC, NYSE Arca, Inc., and
NYSE National, Inc. (together, the ``Affiliate SROs''). Each
Affiliate SRO has submitted substantially the same proposed rule
change to propose the change described herein.
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More specifically, the Exchange makes dedicated cabinets available
to Users to house their servers and other equipment. Each dedicated
cabinet has a standard kilowatt (``kW'') power allocation, but
additional power can be added if the User requests it, either when the
cabinet is first set up or later. A Cabinet Upgrade Fee is charged when
a User requests additional power for one cabinet in excess of 11
kWs.\5\
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\5\ See id. at 58781.
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As technology has evolved, the Exchange finds that Users may
require more power. Under the proposed rule change, a User would not
incur a Cabinet Upgrade Fee if it requests a greater power allocation
than the standard power allocated to a cabinet.
By not charging a Cabinet Upgrade Fee, the Exchange will not charge
a fee for additional power allocation, whether the User requests that
such additional power be allocated to a dedicated cabinet when the
cabinet is first set up or later. The Exchange will be able to offer
cabinets without a User being charged a fee for additional power
allocation no matter what the standard power allocation may be. As is
true now, all cabinets will have the same initial fee,\6\ no matter
what the standard power allocation of the cabinet, and the Exchange
will charge a monthly fee based on the total kW allocated to all of a
User's dedicated cabinets.\7\
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\6\ See id.
\7\ See Securities Exchange Act Release No. 91731 (April 29,
2021), 86 FR 24096 (May 5, 2021) (SR-NYSECHX-2021-08).
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Accordingly, the Exchange proposes to delete the Cabinet Upgrade
Fee from the Fee Schedule, as follows (proposed deletion bracketed):
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[Cabinet upgrade fee
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Dedicated Cabinet................. $9,200 ($4,600 for a User that
submitted a written order for a
Cabinet Upgrade by January 31,
2014, provided that the Cabinet
Upgrade became fully operational by
March 31, 2014)].
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[[Page 30764]]
Application and Impact of the Proposed Change
The proposed change would not apply differently to distinct types
or sizes of market participants. Rather, it would apply to all Users
equally.
Users that require different sizes or combinations of cabinets,
network connections, and cross connects could still request them. As is
currently the case, the purchase of any colocation service is
completely voluntary and the Fee Schedule is applied uniformly to all
Users.
The Exchange expects to obtain no new Users as a result of the
proposed deletion.
The proposed changes are not otherwise intended to address any
other issues relating to co-location services and/or related fees, and
the Exchange is not aware of any problems that Users would have in
complying with the proposed change.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\8\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\9\ in particular, because it
is designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, 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 because it is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers. The Exchange further believes
that the proposed rule change is consistent with Section 6(b)(4) of the
Act,\10\ because it provides for the equitable allocation of reasonable
dues, fees, and other charges among its members and issuers and other
persons using its facilities and does not unfairly discriminate between
customers, issuers, brokers, or dealers.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
\10\ 15 U.S.C. 78f(b)(4).
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The Proposed Change Is Reasonable
The Exchange believes that the proposed rule change is reasonable
and would perfect the mechanisms of a free and open market and a
national market system and, in general, protect investors and the
public interest, for the following reasons.
The Exchange believes the proposed change is reasonable because, by
removing the Cabinet Upgrade Fee, Users may optimize the power
allocated to their existing or potential dedicated cabinets without
being submitted to a one-time fee for additional power allocation. This
would be true whether the User requests that additional power be
allocated to a dedicated cabinet when it is first set up or later.
Accordingly, a User would be able to tailor its colocation operations
to the requirements of its business operations without incurring any
Cabinet Upgrade Fee.
Moreover, removal of the Cabinet Upgrade Fee would result in the
Exchange charging the same initial fee to all Users, no matter what the
standard power allocation of the cabinet. The Exchange would not charge
for additional power allocations. The User would continue to be charged
a monthly fee based on the total kW allocated to all that User's
dedicated cabinets.
The Exchange believes that this is a reasonable response to the
fact that, as technology has evolved, Users may require more power. The
proposed change would allow the Exchange to accommodate requests for
additional power without the User incurring an upgrade fee. Indeed, the
Exchange would be able to offer cabinets without a User being charged a
fee for additional power allocation no matter what the standard power
allocation may be.
The Proposed Change Is Equitable and Not Unfairly Discriminatory
The Exchange believes that the proposed change provides for the
equitable allocation of reasonable dues, fees, and other charges among
its members and issuers and other persons using its facilities and does
not unfairly discriminate between customers, issuers, brokers, or
dealers.
As a result of the change, a User would be able to request
additional power without incurring a one-time Cabinet Upgrade Fee,
whether the User requests that such additional power be allocated to a
dedicated cabinet when it is first set up or later. The User would
continue to be charged a monthly fee based on the total kW allocated to
all of that User's dedicated cabinets. At the same time, however, no
User would be obligated to purchase an additional power allocation.
The Fee Schedule would omit the Cabinet Upgrade Fee as obsolete,
and so it would accurately reflect the fees charged and not charged,
removing any possible market confusion.
The Cabinet Upgrade Fee would be removed for all Users, and so the
proposed change is not designed to permit unfair discrimination between
market participants. Rather, it would apply to all market participants
equally.
For the reasons above, the proposed changes do not unfairly
discriminate between or among market participants that are otherwise
capable of satisfying any applicable co-location fees, requirements,
terms and conditions established from time to time by the Exchange.
For these reasons, the Exchange believes that the proposal is
consistent with the Act.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule changes will not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
Section 6(b)(8) of the Act.\11\
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\11\ 15 U.S.C. 78f(b)(8).
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The proposed change does not affect competition among national
securities exchanges or among members of the Exchange.
The proposed change may enhance competition between Users by
removing the Cabinet Upgrade Fee, further enabling Users to optimize
the power allocated to their existing or potential dedicated cabinets
by not charging a one-time fee for additional power allocation. At the
same time, however, no User would be obligated to purchase an
additional power allocation.
The Exchange operates in a highly competitive market in which
exchanges and other vendors offer co-location services as a means to
facilitate the trading and other market activities of those market
participants who believe that co-location enhances the efficiency of
their operations.
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.'' \12\
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\12\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
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For the reasons described above, the Exchange believes that the
proposed rule changes reflect this competitive environment.
[[Page 30765]]
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
D. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \13\ and Rule 19b-4(f)(6) thereunder.\14\
Because the proposed rule change does not: (i) significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.\15\
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\13\ 15 U.S.C. 78s(b)(3)(A)(iii).
\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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A proposed rule change filed under Rule 19b-4(f)(6) \16\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\17\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange requested
that the Commission waive the 30-day operative delay so that the
proposal may become operative immediately upon filing. The Exchange
believes that waiver of the operative delay would allow Users to
immediately cease charging the Cabinet Upgrade Fee. For this reason,
the Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest.
Accordingly, the Commission waives the 30-day operative delay and
designates the proposed rule change operative upon filing.\18\
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\16\ 17 CFR 240.19b-4(f)(6).
\17\ 17 CFR 240.19b-4(f)(6)(iii).
\18\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of such proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \19\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\19\ 15 U.S.C. 78s(b)(2)(B).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
<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#0674736a632b65696b6b636872754675636528616970"><span class="__cf_email__" data-cfemail="b3c1c6dfd69ed0dcdeded6ddc7c0f3c0d6d09dd4dcc5">[email protected]</span></a>. Please include
file number SR-NYSETEX-2026-16 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-NYSETEX-2026-16. 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-NYSETEX-2026-16 and should be submitted
on or before June 16, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\20\
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\20\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-10366 Filed 5-22-26; 8:45 am]
BILLING CODE 8011-01-P
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