Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Modify the NYSE American Options Fee Schedule To Modify Pricing for the Customer Best Execution (“CUBE”) Auctions

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<title>Federal Register, Volume 91 Issue 208 (Thursday, October 29, 2026)</title>
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[Federal Register Volume 91, Number 208 (Thursday, October 29, 2026)]
[Notices]
[Pages 68196-68198]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-22028]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106730; File No. SR-NYSEAMER-2026-94]


Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Modify 
the NYSE American Options Fee Schedule To Modify Pricing for the 
Customer Best Execution (``CUBE'') Auctions

October 26, 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 October 15, 2026, NYSE American LLC (``NYSE American'' 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 amend the NYSE American Options Fee 
Schedule (``Fee Schedule'') to modify pricing for the Customer Best 
Execution (``CUBE'') Auctions. The Exchange proposes to implement the 
fee change effective October 15, 2026. 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 purpose of this filing is to amend the Fee Schedule to modify 
participant rebates offered for initiating CUBE Auctions.\4\ The 
Exchange proposes to implement the fee change effective October 15, 
2026.\5\
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    \4\ See generally Rules 971.1NYP and 971.2NYP and Commentaries 
.04 (describing the CUBE Auction, which is an electronic crossing 
mechanism for single-leg, complex, and AON orders with a price 
improvement auction on the Exchange).
    \5\ The Exchange originally filed to amend the Fee Schedule on 
October 1, 2026 (SR-NYSEAMER-2026-91). SR-NYSEAMER-2026-91 was 
withdrawn on October 15, 2026 and replaced by this filing.
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Background
    The Exchange has established various pricing incentives designed to 
encourage increased electronic volume executed on the Exchange, 
including, but not limited to, the American Customer Engagement 
(``ACE'') Program.\6\ To encourage participation in the ACE Program and 
CUBE Auctions, the Exchange offers an ACE Initiating Participant Rebate 
to ACE Program participants that initiate Single-Leg CUBE Auctions,\7\ 
Complex CUBE Auctions,\8\ and AON Single-Leg or AON Complex CUBE 
Auctions.\9\ Currently, the ACE Initiating Participant Rebate for each 
of these auctions $0.12 per contact for all issues (i.e., penny and 
non-penny).
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    \6\ See Fee Schedule Sections I.E. (American Customer Engagement 
(``ACE'') Program).
    \7\ See Fee Schedule Section I.G (CUBE Auction Fees & Credits, 
Single-Leg CUBE Auction), note 2, Rebate is applied to each of the 
first 5,000 contracts per leg of a CUBE Order executed in a CUBE 
Auction, except in MXEA, MXEF, MXUSA, MXWLD, and MXACW, and the 
Rebate amount is tied to the ACE Program Tiers. This Rebate is in 
addition to any additional credits set forth above.
    \8\ See Fee Schedule Section I.G (CUBE Auction Fees & Credits, 
Complex CUBE Auction), note 2, Rebate applied to each of the first 
1,000 contracts per leg of a Complex CUBE Order executed in a 
Complex CUBE Auction, except in MXEA, MXEF, MXUSA, MXWLD, and MXACW 
and is in addition to any additional credits set forth above.
    \9\ See Fee Schedule Section I.G (CUBE Auction Fees & Credits, 
AON Single-Leg or AON Complex Cube Auction), note 2 Rebate may be 
applied to each of the first 5,000 contracts of an AON CUBE Order 
executed in an AON Single-Leg CUBE auction, or the first 1,000 
contracts per leg of an AON CUBE Order executed in an AON Complex 
CUBE auction, except in MXEA, MXEF, MXUSA, MXWLD, and MXACW. The 
Rebate is in addition to any additional credits set forth above.
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    In addition, the Exchange offers the Alternative Initiating 
Participant Rebate that enables non-ACE Program participants to qualify 
for this Rebate on certain initiating Complex CUBE

[[Page 68197]]

Auctions provided they meet certain monthly volume qualification levels 
and increase their initiating CUBE volume.\10\ Currently, the 
Alternative Initiating Participant Rebate is $0.12 per contract for all 
issues.
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    \10\ See Fee Schedule Section I.G (CUBE Auction Fees & Credits, 
Complex CUBE Auction), note 2, Rebate is applied to each of the 
first 1,000 contracts per leg of a Complex CUBE Order executed in a 
Complex CUBE Auction, except in MXEA, MXEF, MXUSA, MXWLD, and MXACW. 
This Rebate is in addition to any additional credits set forth 
above.
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    Another incentive program offered by the Exchange is the 
Professional Volume Incentive Program under which ATP Holders that 
achieve Electronic volume in the Professional Customer, Broker Dealer, 
Non-NYSE American Options Market Maker, and Firm range (i.e., the 
``Professional Range'') are eligible to receive discounted rates on 
their total monthly Professional Volume and credits on their monthly 
Customer Electronic volume.\11\
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    \11\ See Fee Schedule, I.H. (Professional Volume Incentive).
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    To encourage participation in this program and CUBE Auctions, the 
Exchange offers a Professional Volume Incentive Initiating Participant 
Rebate to program participants that initiate Single-Leg CUBE Auctions, 
Complex CUBE Auctions, or AON Single-Leg or AON Complex CUBE 
Auctions.\12\ Currently, the Professional Volume Incentive Initiating 
Participant Rebate for each of these auctions $0.12 per contact for all 
issues (i.e., penny and non-penny).
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    \12\ See Fee Schedule Section I.G (CUBE Auction Fees & Credits), 
footnoe3, the Professional Volume Incentive Initiating Participant 
Rebate is payable to ATP Holders that qualify for Tier B of the 
Professional Volume Incentive, per Section I.H., except in MXEA, 
MXEF, MXUSA, MXWLD, and MXACW .
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Proposal
    The Exchange proposes to reduce the ACE Initiating Participant 
Rebate for all three auctions and the Alternative Initiating 
Participant Rebate, for Complex CUBE Auctions, from $0.12 per contract 
to $0.115 per contract across all issues. The proposed change is the 
result of the Exchange's ongoing reassessment and rebalancing of its 
fee structure overall and, in this instance, its CUBE rebate structure. 
The proposal slightly reduces the amount of the ACE Initiating 
Participant Rebate and the Alternative Initiating Participant Rebate 
where applicable. As such, the Exchange believes that the Rebates will 
continue to encourage ATP Holders to initiate CUBE Auctions, whether 
single-leg, complex, or AON. Accordingly, the Exchange believes all 
market participants stand to benefit from the continuing increased 
order flow, which promotes market depth, facilitates tighter spreads 
and enhances price discovery. Increased order flow promotes market 
depth, facilitates tighter spreads and enhances price discovery, which 
enhances market quality for all participants.
    The Exchange also proposes to eliminate the Professional Volume 
Incentive Initiating Participant Rebate program for Single-leg CUBE 
Auctions, Complex CUBE Auctions and AON Single-Leg/AON Complex CUBE 
Auctions. The Exchange adopted this rebate program in an effort to 
attract greater liquidity to the Exchange generally and believed, 
therefore, that it would benefit all market participants increased 
order flow, which promotes market depth, facilitates tighter spreads 
and enhances price discovery. It was hoped that this increased order 
flow would improve price discovery and make the Exchange a more 
competitive venue for order execution, which, in turn, would improve 
market quality for all market participants. However, the Rebate has 
been underutilized and thus has not achieved its intended effect. As a 
result, the Exchange now proposes to eliminate it from the Fee 
Schedule.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\13\ in general, and furthers the 
objectives of Sections 6(b)(4) and (5) of the Act,\14\ in particular, 
because it provides for the equitable allocation of reasonable dues, 
fees, and other charges among its members, issuers and other persons 
using its facilities and does not unfairly discriminate between 
customers, issuers, brokers or dealers.
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    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(4) and (5).
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    As a threshold matter, the Exchange is subject to significant 
competitive forces in the market for options securities transaction 
services that constrain its pricing determinations in that market. The 
Commission has repeatedly expressed its preference for competition over 
regulatory intervention in determining prices, products, and services 
in the securities markets. In Regulation NMS, the Commission 
highlighted the importance of market forces in determining prices and 
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.'' \15\
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    \15\ See Securities Exchange Act Release No. 51808 (June 9, 
2005), 70 FR 37496, 37499 (June 29, 2005) (S7-10-04) (``Reg NMS 
Adopting Release'').
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    There are currently 20 registered options exchanges competing for 
order flow. Based on publicly available information and, excluding 
index-based options, no single exchange has more than 16% of the market 
share of executed volume of multiply-listed equity and ETF options 
trades.\16\ Therefore, currently no exchange possesses significant 
pricing power in the execution of multiply-listed equity and ETF 
options order flow. More specifically, in August 2026, the Exchange had 
11.30% market share of executed volume of multiply-listed equity and 
ETF options order flow. In such a low concentrated and highly 
competitive market, no single options exchange possesses significant 
pricing power in the execution of option order flow.
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    \16\ The OCC publishes options and futures volume in a variety 
of formats, including daily and monthly volume by exchange, 
available at: <a href="https://www.theocc.com/Market-Data/Market-Data-Reports/Volume-and-Open-Interest/Monthly-Weekly-Volume-Statistics">https://www.theocc.com/Market-Data/Market-Data-Reports/Volume-and-Open-Interest/Monthly-Weekly-Volume-Statistics</a>.
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    In response to these competitive forces and as discussed herein, 
the Exchange has established various pricing incentives regarding its 
CUBE Auctions, including, but not limited to, the ACE Initiating 
Participant Rebate, the Alternative Initiating Rebate and Professional 
Volume Incentive Initiating Participant Rebate, which are designed to 
encourage ATP Holders to utilize the CUBE Auction and to direct 
(increased) volume to the Exchange.
    The Exchange believes that the proposed change in ACE Initiating 
Participant Rebate and the Alternative Initiating Rebates is 
reasonable, equitable, and not unfairly discriminatory and will 
continue to provide the intended incentive for ATP Holders to utilize 
the CUBE Auctions. To the extent this purpose is achieved, the Exchange 
believes that the proposed rebate reduction would not discourage ATP 
Holders from directing activity to the Exchange. The Exchange also 
believes that the proposal represents an equitable allocation of 
credits and is not unfairly discriminatory because the proposal will 
apply equally to all similarly situated ATP Holders.
    Additionally, the Exchange believes that the elimination of the 
Professional Volume Incentive Initiating Participant Rebate for Single-
leg CUBE Auctions, Complex CUBE Auctions and AON Single-Leg/AON Complex 
CUBE Auctions is reasonable, equitable, and

[[Page 68198]]

not unfairly discriminatory. Its removal would affect all similarly 
situated ATP Holders equally. Moreover, the program has not encouraged 
participants in the Professional Range to increase their participation 
in CUBE Auctions and eliminating this underutilized incentive program 
would simplify the Fee Schedule.

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

    In accordance with Section 6(b)(8) of the Act, the Exchange does 
not believe that the proposed rule change would impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act.
    Intramarket Competition. The Exchange believes that the proposed 
change to the ACE Initiating Participant Rebate and the Alternative 
Initiating Rebates would not affect intramarket competition because, as 
noted above, it would impact all market participants equally and, 
therefore, would not impose a disparate burden on competition among 
market participants on the Exchange. Similarly, the proposed change is 
designed to continue to attract order flow to the Exchange by offering 
ATP Holders competitive incentives to continue to direct their order 
flow to the Exchange, thereby increasing liquidity to the benefit of 
all market participants.
    In addition, the Exchange believes that the proposed elimination of 
the Professional Volume Incentive Initiating Participant Rebate would 
not affect intramarket competition because, as noted above, the program 
has not effectively encouraged increased professional range 
participation, and its elimination would impact all similarly situated 
ATP Holders equally.
    Intermarket Competition. The Exchange believes that the proposed 
change to the ACE Initiating Participant Rebate and the Alternative 
Initiating Rebates would not affect intermarket competition. As noted 
above, the Exchange operates in a highly competitive market in which 
the Exchange must continually adjust its fees and rebates to remain 
competitive with other exchanges and to attract order flow to the 
Exchange. The proposed change reflects this competitive reality.
    In addition, the Exchange believes that the proposed elimination of 
the Professional Volume Incentive Initiating Participant Rebate for 
Single-leg CUBE Auctions, Complex CUBE Auctions and AON Single-Leg/AON 
Complex CUBE Auctions would not affect intramarket competition because, 
as noted above, the programs have not effectively encouraged increased 
Floor Broker participation, and its elimination would impact all Floor 
Brokers equally.

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.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \17\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \18\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(2).
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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#6f1d1a030a420c0002020a011b1c2f1c0a0c41080019"><span class="__cf_email__" data-cfemail="1163647d743c727e7c7c747f6562516274723f767e67">[email&#160;protected]</span></a>. Please include 
file number SR-NYSEAMER-2026-94 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-NYSEAMER-2026-94. 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-NYSEAMER-2026-94 and should be submitted 
on or before November 19, 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. 2026-22028 Filed 10-28-26; 8:45 am]
BILLING CODE 8011-01-P


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