Notice2026-10449
Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule by Introducing a New RPI Add Tier and Amending Its Fee Code Table Applicable to Securities Priced Below $1.00
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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
May 27, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 101 (Wednesday, May 27, 2026)</title>
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[Federal Register Volume 91, Number 101 (Wednesday, May 27, 2026)]
[Notices]
[Pages 31487-31490]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-10449]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-105539; File No. SR-CboeEDGX-2026-035]
Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend Its Fee Schedule by Introducing a New RPI Add Tier and Amending
Its Fee Code Table Applicable to Securities Priced Below $1.00
May 21, 2026.
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 May 11, 2026, Cboe EDGX Exchange, Inc. (``Exchange'' or ``EDGX'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the 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 EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') proposes to
amend its Fee Schedule by introducing a new RPI Add Tier and amending
its fee code table applicable to securities priced below $1.00. The
text of the proposed rule change is provided in Exhibit 5.
The text of the proposed rule change is also available on the
Commission's website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>), the
Exchange's website (<a href="https://www.cboe.com/us/equities/regulation/rule_filings/bzx/">https://www.cboe.com/us/equities/regulation/rule_filings/bzx/</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 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 its Fee Schedule applicable to its
equities trading platform (``EDGX Equities'') by introducing a new RPI
Add Tier. The Exchange proposes to implement these changes effective
May 1, 2026.\3\
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\3\ The Exchange initially submitted the proposed rule change on
May 1, 2026 (SR-CboeEDGX-2026-033). On May 11, 2026, the Exchange
withdrew that filing and submitted this proposal.
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The Exchange first notes that it 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 only one of 17 registered equities exchanges, as well as a
number of alternative trading systems and other off-exchange venues
that do not have similar self-regulatory responsibilities under the
Securities Exchange Act of 1934 (the ``Act''), to which market
participants may direct their order flow. Based on publicly available
information,\4\ no single registered equities exchange has more than
14% of the market share. Thus, in such a low-concentrated and highly
competitive market, no single equities exchange possesses significant
pricing
[[Page 31488]]
power in the execution of order flow. The Exchange in particular
operates a ``maker-taker'' model whereby it pays rebates to members
that add liquidity and assesses fees to those that remove liquidity.
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\4\ See Cboe Global Markets, U.S. Equities Market Volume
Summary, Month-to-Date (April 29, 2026), available at <a href="https://www.cboe.com/us/equities/market_statistics/">https://www.cboe.com/us/equities/market_statistics/</a>.
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The Exchange's Fee Schedule sets forth the standard rebates and
rates applied per share for orders that provide and remove liquidity,
respectively. Currently, for orders in securities priced at or above
$1.00, the Exchange provides a standard rebate of $0.00160 per share
for orders that add liquidity and assesses a fee of $0.0030 per share
for orders that remove liquidity.\5\ For orders in securities priced
below $1.00, the Exchange provides a standard rebate of 0.00003 per
share for orders that add liquidity and assesses a fee of 0.30% of the
dollar value for orders that remove liquidity.\6\ The Exchange offers
various fee codes applicable to orders that add or remove liquidity on
EDGX.
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\5\ See EDGX Equities Fee Schedule, Standard Rates.
\6\ Id.
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On March 19, 2026, the Commission approved the Exchange's proposed
adoption of the EDGX RPI Program.\7\ The EDGX RPI Program launched on
the Exchange on April 10, 2026. The EDGX RPI Program seeks to enable
Members to offer price improvement to eligible Retail Orders through
use of Retail Price Improvement Orders (``RPI Orders'') \8\ in
securities priced at or above $1.00. In anticipation of the EDGX RPI
Program's launch, the Exchange introduced fee code ZP to its Fee
Schedule on April 1, 2026.\9\ Rather than providing the standard
rebate, fee code ZP assesses a fee of $0.0002 to RPI Orders in
securities priced at or above $1.00 that add liquidity to the
Exchange.\10\
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\7\ See Securities Exchange Act Release No. 105052 (March 19,
2026), 91 FR 14052 (March 24, 2026) (SR-CboeEDGX-2025-072).
\8\ See Rule 11.21(a)(3). A ``Retail Price Improvement Order''
or ``RPI Order'' consists of nondisplayed interest on the Exchange
that is eligible to interact with incoming Retail Orders and that is
identified by the Retail Liquidity Identifier described in Rule
11.21(e). To be executable, an RPI Order for a security priced at or
above $1.00 must be priced at least $0.001 better than the Protected
NBB or Protected NBO and may be priced in $0.001 increments (e.g.,
$10.001). An RPI Order may not be entered in securities priced below
$1.00. An RPI Order is ineligible to execute at prices equal to or
inferior to the Protected NBB (for buy orders) or Protected NBO (for
sell orders). An RPI Order that is ineligible to execute because it
is priced equal to or inferior to the Protected NBB or Protected NBO
will not be canceled and will become eligible to execute against
incoming Retail Orders should the RPI Order become priced better
than the Protected NBB (for buy orders) or Protected NBO (for sell
orders) at a later time. An incoming RPI Order will not be eligible
to interact with a resting Retail Order on the EDGX Book and upon
entry will post to the EDGX Book to execute against later-arriving
Retail Orders.
\9\ See Securities Exchange Act Release No. 105321 (April 28,
2026), SR-CboeEDGX-2026-026.
\10\ See Rule 11.21(a)(3). Securities with executions priced
below $1.00 are not eligible to be appended with fee code ZP, as an
RPI Order may not be entered in securities priced below $1.00.
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The Exchange now proposes to introduce an RPI Add Tier under new
footnote 6. The proposed RPI Add Tier would provide a reduced fee for
orders yielding fee code ZP where a Member reaches certain criteria.
The proposed criteria for the RPI Add Tier is as follows:
<bullet> RPI Add Tier 1 provides a reduced fee of $0.00000 per
share in securities priced at or above $1.00 to qualifying orders
(i.e., orders yielding fee code ZP) where a Member has an RPI Add ADV
>= 2,000,000.
The Exchange notes that in addition to introducing RPI Add Tier 1
it also proposes to introduce language that will specify that for May
2026, RPI Add Tier 1 will utilize quoting and trading activity from May
2026 for its volume calculations and the tier payment would not begin
until June 2026 for those Members that satisfy the criteria during May
2026. The Exchange believes it is necessary to include this language as
the General Notes section of the Fee Schedule currently states: ``[I]n
compliance with Regulation NMS Rule 610(d), effective February 2, 2026,
unless otherwise indicated, all volume figures will be derived from
quoting or trading activity in the prior month.'' By introducing the
proposed language described above, the Exchange is providing notice to
Members that the proposed RPI Add Tier 1 is utilizing quoting and
trading activity from May 2026 so that Members may begin to attempt to
satisfy the proposed criteria ahead of the first month that the tier
would become payable, which would be June 2026. Given that the EDGX RPI
Program did not launch until April 10, 2026, the Exchange believes it
is appropriate to provide Members the full month of May 2026 to qualify
for RPI Add Tier 1 before the tier becomes payable in June 2026.
The proposed RPI Add Tier 1 is intended to provide an opportunity
to incentivize Members to receive a reduced fee in qualifying orders.
Increased liquidity in RPI Orders may contribute to a deeper, more
liquid market and provide increased execution opportunities to the
benefit of retail market participants. Incentivizing an increase in RPI
Orders encourages Retail Member Organizations to increase transactions
and take execution opportunities provided by such increased liquidity,
providing for enhanced price improvement opportunities on the Exchange.
As such, increased overall order flow benefits all Members by
contributing towards a robust and well-balanced market ecosystem.
Fee Codes
The Exchange currently offers various fee codes applicable to
orders on the Exchange. The table denoting the fees applicable to each
fee code is currently divided into rates for securities priced at or
above $1.00 and rates for securities priced below $1.00.\11\ For
securities priced below $1.00, a rate of 0.00000 is shown for each fee
code that does not assess a fee or provide a rebate to orders appended
with the relevant fee code. However, for securities priced at or above
$1.00 the table reflects ``Free'' for any fee code where the Exchange
does not assess a fee or provide a rebate. The Exchange now proposes to
replace 0.00000 with the word ``Free'' to match the structure of the
table for securities priced at or above $1.00.
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\11\ See EDGX Equities Fee Schedule, Fee Codes and Associated
Fees.
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2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\12\ Specifically, the Exchange believes the proposed rule change
is consistent with the Section 6(b)(5) \13\ requirements that the rules
of an exchange be 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.
Additionally, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \14\ requirement that the rules of
an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers as well as Section 6(b)(4) \15\
as it is designed to provide for the equitable allocation of reasonable
dues, fees and other charges among its Members and other persons using
its facilities.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(5).
\14\ Id.
\15\ 15 U.S.C. 78f(b)(4).
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[[Page 31489]]
As described above, 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. The Exchange believes that
its proposal to introduce RPI Add Tier 1 reflects a competitive pricing
structure designed to incentivize market participants to direct their
order flow to the Exchange, which the Exchange believes would enhance
market quality to the benefit of all Members. Specifically, the
Exchange's proposed RPI Add Tier 1 is not a significant departure from
existing criteria, is reasonably correlated to the reduced fee offered
by the Exchange and other competing exchanges,\16\ and will continue to
incentivize Members to submit order flow to the Exchange. Additionally,
the Exchange notes that relative volume-based incentives and discounts
have been widely adopted by exchanges,\17\ including the Exchange,\18\
and are reasonable, equitable and non-discriminatory because they are
open to all Members on an equal basis and provide additional benefits
or discounts that are reasonably related to (i) the value to an
exchange's market quality and (ii) associated higher levels of market
activity, such as higher levels of liquidity provision and/or growth
patterns. Competing equity exchanges offer similar tiered pricing
structures, including schedules or rebates and fees that apply based
upon members achieving certain volume and/or growth thresholds, as well
as assess similar fees or rebates for similar types of orders, to that
of the Exchange.
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\16\ See NYSE Arca Equities Fees and Charges, Retail Tiers,
available at: <a href="https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf">https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf</a>. While the retail tiers offered
by NYSE Arca offer discounted fees to removers of retail liquidity
as opposed to the Exchange's proposed discounted fees for liquidity
adders, the Exchange believes the comparison is useful in that it
shows that exchanges, including the Exchange, seek to provide
pricing incentives to encourage growth in retail liquidity
generally.
\17\ See e.g., BZX Equities Fee Schedule, Footnote 1, Add/Remove
Volume Tiers.
\18\ See e.g., EDGX Equities Fee Schedule, Footnote 1, Add/
Remove Volume Tiers.
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In particular, the Exchange believes its proposed RPI Add Tier 1 is
reasonable because the proposed tier will be available to all Members
and provide all Members with an opportunity to be assessed a reduced
fee. The Exchange further believes its proposed RPI Add Tier 1 will
provide a reasonable means to encourage liquidity adding RPI Orders in
Members' order flow to the Exchange and to incentivize Members to
continue to provide liquidity adding volume to the Exchange by offering
them an opportunity to receive a reduced fee on qualifying orders. An
overall increase in activity would deepen the Exchange's liquidity
pool, offer additional cost savings, offer additional price improvement
for Retail Orders, and improve market quality, for all investors.
The Exchange believes that its proposed RPI Add Tier 1 is
reasonable as the proposed criteria does not represent a significant
departure from the criteria currently offered in the Fee Schedule. The
Exchange also believes that the proposal represents an equitable
allocation of fees and rebates and is not unfairly discriminatory
because all Members will be eligible for proposed RPI Add Tier 1 and
have the opportunity to meet the tier's criteria and receive the
corresponding reduced fee if such criteria is met. Without having a
view of activity on other markets and off-exchange venues, the Exchange
has no way of knowing whether this proposed rule change would
definitely result in any Members qualifying for proposed RPI Add Tier
1. While the Exchange has no way of predicting with certainty how the
proposed changes will impact Member activity, based on the prior
month's volume, the Exchange anticipates that no Member will be able to
satisfy the proposed RPI Add Tier. The Exchange also notes that
proposed changes will not adversely impact any Member's ability to
qualify for reduced fees offered under other tiers. Should a Member not
meet the proposed new criteria, the Member will merely not receive that
corresponding reduced fee.
Additionally, the Exchange believes the text accompanying RPI Add
Tier 1 promotes just and equitable principles of trade and is not
unfairly discriminatory because it applies to all Members equally, in
that any Member seeking to achieve the criteria of proposed RPI Add
Tier 1 will be utilizing quoting and trading activity from May 2026 and
shall not receive payment for the proposed RPI Add Tier 1 until June
2026. Providing this additional clarity on the Exchange's Fee Schedule
ensures that all market participants have information regarding the
quoting and trading activity being utilized to determine qualification
for the proposed RPI Add Tier 1.
Lastly, the Exchange believes that amending the fee code table to
reflect a rate of ``Free'' as opposed to 0.00000 for securities priced
below $1.00 promotes just and equitable principles of trade and is not
unfairly discriminatory because it applies to all Members equally, in
that all Members will be aware that the rate applicable to the relevant
fee code is ``Free.'' Providing this additional clarity on the
Exchange's Fee Schedule ensures that all market participants have
accurate information regarding the rate applicable to each fee code in
both securities priced at or above $1.00 and securities priced below
$1.00.
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 that is not necessary or appropriate
in furtherance of the purposes of the Act. Rather, as discussed above,
the Exchange believes that the proposed changes will encourage the
submission of additional order flow to a public exchange, thereby
promoting market depth, execution incentives and enhanced execution
opportunities, as well as price discovery and transparency for all
Members. As a result, the Exchange believes that the proposed changes
further the Commission's goal in adopting Regulation NMS of fostering
competition among orders, which promotes ``more efficient pricing of
individual stocks for all types of orders, large and small.''
The Exchange believes the proposed rule change does not impose any
burden on intramarket competition that is not necessary or appropriate
in furtherance of the purposes of the Act. Particularly, the proposed
introduction of RPI Add Tier 1 does not impose an unnecessary burden as
all Members will be eligible to achieve the reduced fee under the
proposed tier. The Exchange does not believe the proposed introduction
of the RPI Add Tier 1 burdens competition, but rather, enhances
competition as it is intended to increase the competitiveness of EDGX
by amending existing pricing incentives to attract order flow and
incentivize participants to increase their participation on the
Exchange. Greater overall order flow, trading opportunities, and
pricing transparency benefits all market participants on the Exchange
by enhancing market quality and continuing to encourage Members to send
orders, thereby contributing towards a robust and well-balanced market
ecosystem.
Additionally, the Exchange does not believe that the change to the
fee code section of the Fee Schedule imposes any burden on intramarket
competition that is not necessary or appropriate in furtherance of the
Act because the change is not being made for competitive reasons, but
rather to align
[[Page 31490]]
the text of the table applicable to securities priced below $1.00 with
that of the table applicable to securities priced at or above $1.00.
Next, the Exchange believes the proposed rule changes do not impose
any burden on intermarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. As previously
discussed, the Exchange operates in a highly competitive market.
Members have numerous alternative venues that they may participate on
and direct their order flow, including other equities exchanges, off-
exchange venues, and alternative trading systems. Additionally, the
Exchange represents a small percentage of the overall market. Based on
publicly available information, no single equities exchange has more
than 14% of the market share.\19\ Therefore, no exchange possesses
significant pricing power in the execution of order flow. Indeed,
participants can readily choose to send their orders to other exchange
and off-exchange venues if they deem fee levels at those other venues
to be more favorable. 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.'' \20\ 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' . . . .''.\21\ Accordingly, the Exchange does not believe its
proposed fee changes impose any burden on competition that is not
necessary or appropriate in furtherance of the purposes of the Act.
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\19\ Supra note 2.
\20\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
\21\ 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
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 \22\ and paragraph (f) of Rule 19b-4 \23\
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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\22\ 15 U.S.C. 78s(b)(3)(A).
\23\ 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#5220273e377f313d3f3f373c2621122137317c353d24"><span class="__cf_email__" data-cfemail="d4a6a1b8b1f9b7bbb9b9b1baa0a794a7b1b7fab3bba2">[email protected]</span></a>. Please include
file number SR-CboeEDGX-2026-035 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-CboeEDGX-2026-035. 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-CboeEDGX-2026-035 and should be
submitted on or before June 17, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\24\
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\24\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-10449 Filed 5-26-26; 8:45 am]
BILLING CODE 8011-01-P
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