Notice2026-22130
Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Pursuant to IEX Rule 15.110(a) and (c) To Amend the Exchange's Fee Schedule To Adopt Transaction Fees and Routing Fees
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
October 30, 2026
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 91 Issue 209 (Friday, October 30, 2026)</title>
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[Federal Register Volume 91, Number 209 (Friday, October 30, 2026)]
[Notices]
[Pages 68573-68579]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-22130]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-106741; File No. SR-IEX-2026-41]
Self-Regulatory Organizations; Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Pursuant to
IEX Rule 15.110(a) and (c) To Amend the Exchange's Fee Schedule To
Adopt Transaction Fees and Routing Fees
October 27, 2026.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on October 14, 2026, the Investors Exchange LLC (``IEX'' 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
Pursuant to the provisions of Section 19(b)(1) under the Act,\4\
and Rule 19b-4 thereunder,\5\ the Exchange is filing with the
Commission a proposed rule change to amend the Exchange's fee schedule
applicable to Options Members \6\ (``Options Fee Schedule'') pursuant
to IEX Rules 15.110(a) and (c) to adopt transaction fees and routing
fees, and to update the Preface and Definitions sections of the Options
Fee Schedule. Changes to the Options Fee Schedule pursuant to this
proposal are effective upon filing.\7\
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\4\ 15 U.S.C. 78s(b)(1).
\5\ 17 CFR 240.19b-4.
\6\ See Rule 17.100.
\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
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The text of the proposed rule change is available at the Exchange's
website at <a href="https://www.iexexchange.io/resources/regulation/rule-filings">https://www.iexexchange.io/resources/regulation/rule-filings</a>
and at the principal office of the Exchange.
II. Self-Regulatory Organization's Statement of the Purpose of, and the
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 these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
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 the
Statutory Basis for, the Proposed Rule Change
1. Purpose
In preparation for the October 2, 2026 commencement of trading
options on IEX Options, IEX filed a proposed rule change to establish
the transaction and routing fees it would charge Options
[[Page 68574]]
Members.\8\ On October 14, 2026, IEX concurrently withdrew the Initial
Transaction Fee Filing and replaced it with this proposed rule change,
which makes no changes to the fees and credits proposed in the Initial
Transaction Fee Filing, but provides additional support and context for
certain of the fees and credits. Thus, this filing also (i) defines
terms in the Preface and Definitions Sections of the Options Fee
Schedule that are used throughout the Options Fee Schedule; (ii)
establishes transaction fees and credits applicable to all Options
Members trading on IEX Options (``Transaction Fees and Credits''); and
(iii) establishes routing fees applicable to all Options Members
trading on IEX Options who route orders to away exchanges (``Linkage
Routing Fees'').
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\8\ See SR-IEX-2026-38 (filed September 30, 2026) (``Initial
Transaction Fee Filing'').
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Updates to Preface Section
The Options Fee Schedule has a Preface section that currently has
one paragraph, which provides information about billing disputes. The
Exchange proposes to add a new paragraph directly following the billing
disputes paragraph, which describes the rounding of fees that the
Exchange would calculate on the basis of transaction volume.
Specifically, the Exchange proposes to add a paragraph with the heading
``Rounding,'' which explains that the Exchange would apply the
applicable fee rate to the sum of an Option Member's volume for the
month and where a fractional cent occurs, the Exchange would round up
to the nearest whole cent for purposes of computing the Option Member's
invoice. The proposed text reads in full:
All volume for the month will be summed and the applicable rate
applied. In those cases where a fractional cent occurs, the Exchange
will round up to the nearest whole cent for purposes of computing
the invoice.
The Exchange believes that including this Rounding paragraph in the
Preface to the Options Fee Schedule provides clarity about how the
Exchange computes fees. The Exchange's proposed language is consistent
with similar language included in the fee schedule of one other
exchange.\9\
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\9\ See NYSE American Options Fee Schedule, effective September
17, 2026, available at <a href="https://www.nyse.com/publicdocs/nyse/markets/american-options/NYSE_American_Options_Fee_Schedule.pdf">https://www.nyse.com/publicdocs/nyse/markets/american-options/NYSE_American_Options_Fee_Schedule.pdf</a>; Securities
Exchange Act Rel. No. 74086 (January 16, 2015), 80 FR 3701 (January
23, 2015) (SR-NYSEMKT-2015-04) (proposing to add a description of
the exchange's rounding practices to the fee schedule).
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Updates to Definitions Section
The Exchange includes a Definitions section at the beginning of the
Options Fee Schedule for terms that are used throughout the Options Fee
Schedule. The purpose of the Definitions section is to streamline the
Options Fee Schedule by placing many of the defined terms used in the
Options Fee Schedule in one location. For ease of reference and
readability, the Exchange proposes adding several definitions to the
Definitions section of the Options Fee Schedule, all of which relate to
the Transaction Fees and Credits section of the Options Fee Schedule.
Many of the defined terms are also defined in the IEX Options Rules,
particularly in Rule 17.100. IEX proposes arranging the following
definitions in alphabetical order with the previously defined terms in
the Options Fee Schedule: \10\
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\10\ Currently, the defined terms in the Options Fee Schedule
are: ``Clearing Member,'' ``Market Maker,'' ``MPID,'' and ``Order
Entry Firms'' (or ``OEFs'').
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<bullet> An ``Away Market Maker'' for the purposes of this fee
schedule shall mean a non-IEX Market Maker.
<bullet> A ``Broker-Dealer'' means an individual or organization
registered with the Commission in accordance with Section 15(b)(1) of
the Exchange Act or a foreign broker or dealer exempt from such
registration pursuant to Rule 15a-6 under the Exchange Act. See Rule
28.100.
<bullet> The ``Exchange System'' or ``System'' means the automated
trading system used by IEX Options for the trading of options
contracts. See Rule 22.100(a).
<bullet> A ``Firm'' means a Broker-Dealer that is not registered as
a Market Maker that is an Options Member of the Exchange. See Rule
28.100.
<bullet> A ``Non-Penny'' option refers to option classes that do
not participate in the Penny Interval Program, as described in Rule
22.140.
<bullet> A ``Non-Priority Customer'' means anyone who is not a
``Priority Customer.''
<bullet> A ``Penny'' option refers to option classes that
participate in the Penny Interval Program, as described in Rule 22.140.
<bullet> A ``Priority Customer'' means any person or entity that is
not: (A) a broker or dealer in securities; or (B) a Professional.
<bullet> A ``Professional'' means any person or entity that (A) is
not a broker or dealer in securities; and (B) places more than 390
orders in listed options per day on average during a calendar month for
its own beneficial account(s).
<bullet> The ``Step Up Mechanism'' is a feature within the System
that provides automated order handling in designated classes trading
for qualifying orders that are not automatically executed by the
System. See Rule 22.270.
IEX notes that other exchanges similarly set forth certain
definitions of terms used in their fee schedules in definitions
sections in their respective fee schedules.\11\
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\11\ See, e.g., MIAX Sapphire Options Exchange Fee Schedule as
of August 17, 2026 (``MIAX Sapphire Fee Schedule''), available at
<a href="https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX_Sapphire_Fee_Schedule_08172026.pdf">https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX_Sapphire_Fee_Schedule_08172026.pdf</a>; MIAX Emerald Options
Exchange Fee Schedule as of August 1, 2026 (``MIAX Emerald Fee
Schedule''), available at <a href="https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX__Emerald__Fee__Schedule__08012026.pdf">https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX__Emerald__Fee__Schedule__08012026.pdf</a>.
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Transaction Fees and Credits
IEX Options generally operates a ``Maker-Taker'' model, whereby it
provides credits to Options Members that provide liquidity and charges
fees to those that remove liquidity. The proposed credits and fees vary
depending on the capacity of the two sides to a transaction, whether
the applicable options class participates in the Penny Interval Program
(``Penny Classes'') \12\ or does not participate in the Penny Interval
Program (``Non-Penny Classes''),\13\ and whether the transaction adds
or removes liquidity from the IEX Options Book.
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\12\ Options trading pursuant to the Penny Interval Program have
a minimum quoting increment of $0.01 if the series is trading at
less than $3.00 per contract and $0.05 if the series is trading at
$3.00 or higher per contract, except for QQQ, SPY, and IWM which
always have $0.01 quoting increments. See Rule 22.140(a)(3).
\13\ Options that do not trade pursuant to the Penny Interval
Program have a minimum quoting increment of $0.05 if the series is
trading at less than $3.00 per contract and $0.10 if the series is
trading at $3.00 or higher per contract. See Rule 22.140(a)(1) &
(2).
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Section I of the Options Fee Schedule, which is titled
``Transaction Fees and Credits,'' is currently ``Reserved.'' IEX
proposes to delete the word ``Reserved'' and replace it with language
describing the transaction fees and credits in this fee proposal.
Specifically, IEX proposes to begin Section I with the words ``The
following transaction rates apply to all options classes. Listed rates
are per contract.
Credits are indicated by parentheses ( ).'' This introductory text
will be followed by Section I.A (``Options Transaction Fees and
Credits'') that has two tables showing fees and credits for Penny
Classes and for Non-Penny Classes followed by some additional text,
which is followed by Section I.B (``Linkage Routing Fees'') that has a
table showing fees for routing Penny Class and Non-Penny Class options.
[[Page 68575]]
IEX's proposed transaction fees and credits for Penny Classes do
not differentiate between the capacity of the counterparties to the
transaction. The following fees shall apply to executions of Penny
Classes:
<bullet> A Priority Customer that adds liquidity will receive a
$0.32 credit per contract, and a Priority Customer that removes
liquidity will pay a $0.34 fee per contract.
<bullet> A Professional that adds liquidity will receive a $0.28
credit per contract, and a Professional that removes liquidity will pay
a $0.40 fee per contract.
<bullet> A Market Maker that adds liquidity will receive a $0.26
credit per contract, and a Market Maker that removes liquidity will pay
a $0.43 fee per contract.
<bullet> An Away Market Maker that adds liquidity will receive a
$0.22 credit per contract, and an Away Market Maker that removes
liquidity will pay a $0.45 fee per contract.
<bullet> A Firm/Broker-Dealer that adds liquidity will receive a
$0.26 credit per contract, and a Firm/Broker-Dealer that removes
liquidity will pay a $0.40 fee per contract.
IEX's proposed transaction fees and credits for Non-Penny Classes
differentiate between the capacity of the counterparties to the
transaction, as described below. Specifically, IEX proposes to charge
different transaction fees and credits to the Options Member depending
on whether its counterparty in a transaction is a Priority Customer or
a Non-Priority Customer. The following fees and credits shall apply to
executions of Non-Penny Classes:
<bullet> A Priority Customer that adds liquidity will receive a
$0.70 credit per contract if the counterparty is a Non-Priority
Customer and pay $0.00 per contract if the counterparty is a Priority
Customer; a Priority Customer that removes liquidity will receive an
$0.85 credit per contract if the counterparty is a Non-Priority
Customer and pay $0.00 per contract if the counterparty is a Priority
Customer.
<bullet> A Professional that adds liquidity will pay $0.00 per
contract if the counterparty is a Non-Priority Customer and pay $0.95
per contract if the counterparty is a Priority Customer; a Professional
that removes liquidity will pay $0.25 per contract if the counterparty
is a Non-Priority Customer and pay $0.95 per contract if the
counterparty is a Priority Customer.
<bullet> A Market Maker that adds liquidity will receive a $0.10
credit per contract if the counterparty is a Non-Priority Customer and
pay $0.95 per contract if the counterparty is a Priority Customer; a
Market Maker that removes liquidity will pay $0.25 per contract if the
counterparty is a Non-Priority Customer and pay $0.95 per contract if
the counterparty is a Priority Customer.
<bullet> An Away Market Maker that adds liquidity will pay $0.00
per contract if the counterparty is a Non-Priority Customer and pay
$0.95 per contract if the counterparty is a Priority Customer; an Away
Market Maker that removes liquidity will pay $0.25 per contract if the
counterparty is a Non-Priority Customer and pay $0.95 per contract if
the counterparty is a Priority Customer.
<bullet> A Firm/Broker-Dealer that adds liquidity will pay $0.00
per contract if the counterparty is a Non-Priority Customer and pay
$0.95 per contract if the counterparty is a Priority Customer; a Firm/
Broker-Dealer that removes liquidity will pay $0.25 per contract if the
counterparty is a Non-Priority Customer and pay $0.95 per contract if
the counterparty is a Priority Customer.
IEX proposes to add language immediately after the Options
Transaction Fees and Credits section explaining that orders that are
exposed and execute via the Step Up Mechanism will be assigned the
applicable fee or credit associated with removing liquidity, while
orders that execute against an order exposed via the Step Up Mechanism
will be assigned the applicable fee or credit associated with adding
liquidity.
IEX also proposes adding a second paragraph that explains that
transaction fees and credits associated with executions that occur as
part of the Opening Process described in Rule 22.160 are waived.
Linkage Routing Fees
The Exchange proposes to assess Linkage Routing Fees on orders
routed to other options exchanges. The amount of the applicable fee
will be based on whether the order is in a Penny Class or Non-Penny
Class. The Exchange proposes to charge a fee of $1.20 for Penny Class
options routed to another options exchange and $1.63 for Non-Penny
Class options routed to another options exchange.
The purpose of the proposed Linkage Routing Fees is to offset costs
incurred by IEX Options when routing orders to other options exchanges
on behalf of Options Members. In determining its proposed Linkage
Routing Fees, the Exchange took into account transaction fees and
credits assessed by the away markets to which the Exchange routes
orders, as well as the Exchange's clearing, administrative, regulatory,
and technical costs associated with routing orders to an away market.
The Exchange will use unaffiliated routing brokers to route orders to
the away markets; the costs associated with the use of these services
are reflected in the Linkage Routing Fees specified in the Fee
Schedule.
2. Statutory Basis
IEX believes that the proposed rule change is consistent with the
provisions of Section 6(b) of the Act \14\ in general and furthers the
objectives of Section 6(b)(4) of the Act,\15\ in particular, in that it
is designed to provide for the equitable allocation of reasonable dues,
fees, and other charges among its members and other persons using its
facilities. In addition, the Exchange believes that the proposed fees
are consistent with the purposes of Section 6(b)(5) \16\ of the Act in
that they are designed 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 a
free and open market and national market system, and, in general, to
protect investors and the public interest, and particularly, are not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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\14\ 15 U.S.C. 78f(b).
\15\ 15 U.S.C. 78f(b)(4).
\16\ 15 U.S.C. 78f(b)(5).
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IEX Options operates in a highly fragmented and 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, and the Exchange represents only a small
percentage of the overall market. Accordingly, competitive forces
constrain the Exchange's transaction fees and credits, and market
participants can readily trade on competing venues if they deem pricing
levels at those other venues to be more favorable. The Exchange
believes the proposal reflects a reasonable and competitive pricing
structure which will promote price discovery and enhance liquidity and
market quality on the Exchange to the benefit of all Options Members
and market participants. Additionally, the Exchange believes these fees
are reasonable, equitable and not designed to permit unfair
discrimination because these fees will apply equally to similarly
situated Options Members for transactions executed in the same
capacity, options class, liquidity role and applicable counterparty
category.
[[Page 68576]]
As a threshold matter, the Exchange notes that it has structured
its options transaction fee structure to incentivize the types of order
flow the Exchange believes will enhance liquidity on IEX Options
overall, in a manner that is consistent with the maintenance of a fair
and orderly market.
The Exchange believes that it is reasonable, equitable and not
designed to permit unfair discrimination, to offer its highest credits
and lowest fees for Penny Class transactions to Priority Customers
($0.32 credit per contract to a Priority Customer that adds liquidity;
$0.34 fee per contract to a Priority Customer that removes liquidity)
because the Exchange believes that Priority Customer order flow
enhances liquidity on the Exchange for the benefit of all market
participants.\17\ Moreover, the options industry has a long history of
providing preferential pricing to Priority Customers.\18\ Additionally,
the Exchange notes that these fees are comparable to the fees and
credits other options exchanges apply to Priority Customers adding and
removing liquidity in Penny Class options.\19\
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\17\ Other exchanges that offer pricing incentives to Priority
Customers also charge higher fees for Non-Priority Customers to
transact with Priority Customers. For example, BOX charges $0.00 to
public customers adding liquidity against non-public customers
(Penny and Non-Penny Classes), and offers credits of $0.20 (Penny
Classes) to $0.50 (Non-Penny Classes) to public customers taking
liquidity against non-public customers, while it charges $0.50 to a
non-public customer adding or removing liquidity against a public
customer in a Penny Class option and charges $0.95 to a non-public
customer adding or removing liquidity against a public customer in a
Non-Penny Class option. See BOX Exchange Fee Schedule, effective
October 1, 2026, available at <a href="https://boxoptions.com/resources/fee-schedule/">https://boxoptions.com/resources/fee-schedule/</a>.
\18\ See, e.g., Securities Exchange Act Release No. 95885
(September 22, 2022), 87 FR 58856 (September 28, 2022) (SR-EMERALD-
2022-29) (``Priority Customer liquidity benefits all market
participants by providing more trading opportunities. An increase in
the activity of these market participants in turn facilitates
tighter spreads, which may cause an additional corresponding
increase in order flow from other market participants.'');
Securities Exchange Act Release No. 78421 (July 26, 2016), 81 FR
50580 (August 1, 2016) (SR-C2-2016-013) (giving enhanced credits to
``public customers'', noting that there is a long history of options
exchanges providing preferential pricing to such customers).
\19\ For example, IEX's proposed fees and credits are comparable
to the fees and credits NYSE Arca charges for the same transaction
in a Penny Class option ($0.25 credit to add; $0.49 fee to remove).
See NYSE Arca Options Fee Schedule, effective September 17, 2026,
available at <a href="https://www.nyse.com/publicdocs/nyse/markets/arca-options/NYSE_Arca_Options_Fee_Schedule.pdf">https://www.nyse.com/publicdocs/nyse/markets/arca-options/NYSE_Arca_Options_Fee_Schedule.pdf</a>.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination, in a transaction in a Penny
Class option, to offer a $0.28 credit per contract to a Professional
that adds liquidity, and to charge a $0.40 fee per contract to a
Professional that removes liquidity. Specifically, the Exchange does
not believe it is inequitable or unfairly discriminatory to assess
lower credits and higher fees to Professionals, compared to Priority
Customers, because there is a greater level of proficiency associated
with Professionals due to the frequency upon which they access the
market. Additionally, IEX notes that other exchanges also have a
similar fee structure in Penny Class options where Priority Customers
and Professionals (i.e., customers) are subject to preferential rates
compared to other types of market participants.\20\ Thus, the Exchange
does not believe it is inequitable or unfairly discriminatory to offer
a lower fee or higher credit to Priority Customers and Professionals
than it offers to other market participants.
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\20\ See e.g., Nasdaq Options 7, Section 2 (charging $0.49 for
Priority Customers and Professionals to remove liquidity in Penny
Class options, and charging all other market participants $0.50 for
the same transactions).
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The Exchange believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Penny Class option, to offer a $0.26 credit per
contract to a Firm/Broker-Dealer that adds liquidity, and to charge a
$0.40 fee per contract to a Firm/Broker-Dealer that removes liquidity.
IEX notes that it is not uncommon for options exchanges to charge
different rates to different non-customers based upon their trading
capacity, such as the proposed fees (credits) which are higher (lower)
than those charged to customers but lower (higher) than those charged
to other non-customer type market participants.\21\ Additionally, IEX
notes that these fees are comparable to the fees and credits other
options exchanges apply to Firms/Broker-Dealers adding and removing
liquidity in Penny Class options.\22\
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\21\ See, e.g., BOX Exchange Fee Schedule, supra, note 17 (for
Penny Class options, offering free trades or providing credits to
Priority Customers adding or removing liquidity, while charging
between $0.00 and $0.50 for liquidity adding and removing trades by
market makers, professionals, and broker-dealers).
\22\ For example, IEX's fees and credits are comparable to the
fees and credits MIAX Emerald charges for the same transaction in a
Penny Class option ($0.25 credit to add; $0.50 fee to remove). See
MIAX Emerald Options Fee Schedule, supra, note 11.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Penny Class option, to offer a $0.26 credit per
contract to a Market Maker that adds liquidity, and to charge a $0.43
fee per contract to a Market Maker that removes liquidity. The Exchange
believes that the proposed fee structure is consistent with the Act
because it is designed to incentivize Market Makers to provide
competitively priced liquidity on IEX Options. The Exchange further
believes that the differences in fees and credits for Market Makers, as
compared to Professionals and Firms/Broker-Dealers, is reasonable,
equitable and not designed to permit unfair discrimination because it
reflects each type of market participant's level of sophistication and
typical liquidity adding or removing role. More specifically, the
proposed credit for Market Makers and Firms/Broker-Dealers is designed
to incentivize these professional market participants to provide tight
and deep quotes in Penny Class options. Similarly, the proposed fees
for removing liquidity reflect the trading activity in which the
Exchange expects such market participants to generally engage.
Specifically, Market Makers are sophisticated market participants, and
their role is generally to provide rather than take liquidity, while
Professionals and Firms/Broker-Dealers often seek to take liquidity
provided by Market Makers. Additionally, the Exchange notes that these
proposed rates are comparable to the fees and credits other options
exchanges apply to Market Makers adding and removing liquidity in Penny
Class options.\23\
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\23\ For example, IEX's fees and credits are comparable to the
fees and credits NYSE Arca charges for the same transaction in a
Penny Class option ($0.28 credit to add; $0.50 fee to remove). See
NYSE Arca Options Fee Schedule, supra, note 19.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination, in a transaction in a Penny
Class option, to offer its least attractive fees and credits to Away
Market Makers. The Exchange understands that Away Market Makers are
generally as sophisticated as Market Makers but are not subject to
Market Makers' obligations.\24\ Thus the Exchange believes it is
consistent with the Act to assess Away Market Makers its lowest credits
and highest fees for Penny Class transactions. IEX notes that an Away
Market Maker could register with IEX Options as a Market Maker, which
would make it eligible for Market Maker fees and credits. Additionally,
IEX notes that its Away Market Maker fees are comparable to the fees
and credits other options exchanges apply to Away Market Makers for
adding and
[[Page 68577]]
removing liquidity in Penny Class options.\25\
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\24\ See Rule 23.140 (Obligations of Market Makers).
\25\ For example, IEX's fees and credits are comparable to the
fees and credits MIAX Emerald charges for the same transaction in a
Penny Class option ($0.25 credit to add; $0.50 fee to remove). See
MIAX Emerald Options Fee Schedule, effective August 1, 2026,
available at <a href="https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX__Emerald__Fee__Schedule__08012026.pdf">https://www.miaxglobal.com/sites/default/files/fee_schedule-files/MIAX__Emerald__Fee__Schedule__08012026.pdf</a>.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Non-Penny Class option, to offer a $0.70 credit per
contract to a Priority Customer that adds liquidity with a Non-Priority
Customer counterparty; charge $0.00 per contract to a Priority Customer
that adds liquidity in a transaction with a Priority Customer
counterparty; offer an $0.85 credit per contract to a Priority Customer
that removes liquidity in a transaction with a Non-Priority Customer
counterparty; and charge $0.00 per contract to a Priority Customer that
removes liquidity in a transaction with a Priority Customer
counterparty, because these fees are comparable to the fees and credits
other options exchanges apply to Priority Customers adding and removing
liquidity in Non-Penny Class options.\26\
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\26\ For example, IEX's fees and credits are comparable to the
fees and credits BOX Exchange charges for the same transaction in a
Non-Penny Class option, in particular BOX and IEX both offer credits
to Priority Customers (called ``public customers'' by BOX) that
remove liquidity against a Non-Priority Customer. Although BOX does
not offer a similar credit to a public customer that adds liquidity
against a non-public customer, it charges less for that transaction
($0.00 fee) than it would if the trade was executed in any other
capacity with the exception of some market maker trades (fees
ranging from $0.15 to $0.95). And BOX, like IEX, charges a fee of
$0.00 for Priority Customer trades executed against other Priority
Customers. See BOX Exchange Fee Schedule, supra, note 17.
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Additionally, the Exchange believes that providing relatively
higher credits for Priority Customer trades \27\ with Non-Priority
Customer counterparties in Non-Penny Class options and charging
relatively higher fees to the Non-Priority Customer counterparties \28\
is consistent with the purposes of the Act because, as described above,
the Exchange believes that Priority Customer liquidity benefits all
market participants by providing more trading opportunities, which can
attract Market Makers and other market participants.\29\ IEX also
believes that an increase in the activity of Priority Customers would
in turn facilitate tighter spreads, which may cause an additional
corresponding increase in order flow from Market Makers and other
market participants. Moreover, as discussed above, the options industry
has a long history of providing preferential pricing to Priority
Customers.\30\ Finally, all fee and credit amounts proposed to apply to
Priority Customers will be applied equally to all Priority Customers.
Thus, the Exchange believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange to
incentivize Priority Customer orders with the higher credits and lower
fees contained in this proposal.
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\27\ The proposed credits are $0.70 for Priority Customers
adding liquidity against a Non-Priority Customer and $0.85 for a
Priority Customer taking liquidity against a Non-Priority Customer
in a Non-Penny Class option.
\28\ The proposed fees are $0.95 for Non-Priority Customer
adding or removing liquidity against a Priority Customer in a Non-
Penny Class option.
\29\ See supra, note 17.
\30\ See supra, note 18.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Non-Penny Class option, to charge $0.00 per contract
to a Professional that adds liquidity in a transaction with a Non-
Priority Customer counterparty; charge $0.95 per contract to a
Professional that adds liquidity in a transaction with a Priority
Customer counterparty; charge $0.25 per contract to a Professional that
removes liquidity in a transaction with a Non-Priority Customer
counterparty; and charge $0.95 per contract to a Professional that
removes liquidity in a transaction with a Priority Customer
counterparty, because these fees are comparable to the fees and credits
other options exchanges apply to Professionals adding and removing
liquidity in Non-Penny Class options.\31\
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\31\ For example, IEX's proposed fees are either lower than, or
comparable to, the fees BOX charges for the same transaction in a
Non-Penny Class option ($0.95 fee for a Professional to add or
remove liquidity against a public customer; $0.15 fee for a
Professional to add and $0.85 fee to remove liquidity against a non-
public customer). See BOX Exchange Fee Schedule, supra, note 17.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Non-Penny Class option, to offer a $0.10 credit per
contract to a Market Maker that adds liquidity in a transaction with a
Non-Priority Customer counterparty; charge $0.95 per contract to a
Market Maker that adds liquidity in a transaction with a Priority
Customer counterparty; charge $0.25 per contract to a Market Maker that
removes liquidity in a transaction with a Non-Priority Customer
counterparty and charge $0.95 per contract to a Market Maker that
removes liquidity in a transaction with a Priority Customer
counterparty, because these fees are comparable to the fees and credits
other options exchanges apply to Market Makers adding and removing
liquidity in Non-Penny Class options.\32\
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\32\ For example, IEX's fees and credits are either lower than
(or with respect to credits, higher than), or comparable to, the
fees and credits BOX charges for the same transaction in a Non-Penny
Class option ($0.95 fee for a market maker to add or remove
liquidity against a public customer; $0.00 fee for a market maker to
add and $0.75 fee to remove liquidity against a non-public
customer). See BOX Exchange Fee Schedule, supra, note 17.
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Non-Penny Class option, to charge $0.00 per contract
to an Away Market Maker that adds liquidity in a transaction with a
Non-Priority Customer counterparty; charge $0.95 per contract to an
Away Market Maker that adds liquidity in a transaction with a Priority
Customer counterparty; charge $0.25 per contract to an Away Market
Maker that removes liquidity in a transaction with a Non-Priority
Customer counterparty; and charge $0.95 per contract to an Away Market
Maker that removes liquidity in a transaction with a Priority Customer
counterparty, because these fees are comparable to the fees and credits
other options exchanges apply to Away Market Makers adding and removing
liquidity in Non-Penny Class options.\33\
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\33\ For example, IEX's fees and credits are comparable to the
fees and credits the Nasdaq Options Market charges for the same
transaction in a Non-Penny Class option ($0.45 fee for an away
market maker to add liquidity against any counterparty; $1.25 fee
for an away market maker to take liquidity against any
counterparty). See Nasdaq Options 7, Section 2(1).
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The Exchange also believes that it is reasonable, equitable and not
designed to permit unfair discrimination for the Exchange, in a
transaction in a Non-Penny Class option, to charge $0.00 per contract
to a Firm/Broker-Dealer that adds liquidity in a transaction with a
Non-Priority Customer counterparty; charge $0.95 per contract to a
Firm/Broker-Dealer that adds liquidity in a transaction with a Priority
Customer counterparty; charge $0.25 per contract to a Firm/Broker-
Dealer that removes liquidity in a transaction with a Non-Priority
Customer counterparty; and charge $0.95 per contract to a Firm/Broker-
Dealer that removes liquidity in a transaction with a Priority Customer
counterparty, because these fees are comparable to the fees and credits
other options exchanges apply to Firm/Broker-Dealers adding and
removing liquidity in Non-Penny Class options.\34\
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\34\ For example, IEX's fees and credits are comparable to the
fees and credits BOX charges for the same transaction in a Non-Penny
Class option ($0.95 fee for a firm/broker-dealer to add or remove
liquidity against a public customer; $0.15 fee for a firm/broker-
dealer to add and $0.85 fee to remove liquidity against a non-public
customer). See BOX Exchange Fee Schedule, supra, note 17.
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[[Page 68578]]
Further, the Exchange believes it is appropriate, reasonable, and
consistent with the Act to specify in its Fee Schedule that orders that
are exposed and execute via the Step Up Mechanism will be assigned the
applicable fee or credit associated with removing liquidity, while
orders that execute against an order exposed via the Step Up Mechanism
will be assigned the applicable fee or credit associated with adding
liquidity, because other options exchanges specify in their fee
schedules that they treat executions that occurred within their step up
mechanisms in the identical manner.\35\
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\35\ For example, IEX's language is functionally identical to
language in the C2 Options Fee Schedule, which states ``For
executions that occur within the Step Up Mechanism (``SUM'')
auctions, the incoming order will receive applicable Remove rates,
and auction responses and unrelated orders will receive applicable
Add rates.'' See C2 Options Fee Schedule, effective September 11,
2026, available at <a href="https://www.cboe.com/us/options/membership/fee_schedule/ctwo/">https://www.cboe.com/us/options/membership/fee_schedule/ctwo/</a>.
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Furthermore, the Exchange believes it is appropriate, reasonable,
and consistent with the Act to waive any transaction fees and credits
associated with executions that occur as part of the Opening Process,
because other options exchanges also waive transaction fees and credits
associated with executions that occur as part of their opening
processes.\36\
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\36\ For example, IEX's waiver of fees and credits is identical
to the practice of NYSE Arca, which states in its fee schedule that
``Transaction fees do not apply to executions occurring during the
Opening Auction.'' See NYSE Arca Options Fee Schedule, supra, note
19.
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The Exchange also believes that the Exchange's proposed Linkage
Routing Fees for orders routed to other options exchanges ($1.20 for
Penny Class option contracts and $1.63 for Non-Penny Class option
contracts) are appropriate, reasonable, and consistent with the Act. As
discussed in the Purpose section, the proposed Linkage Routing Fees are
designed to offset costs incurred by IEX Options when routing orders to
other options exchanges on behalf of Options Members. In determining
its proposed Linkage Routing Fees, the Exchange took into account
transaction fees and credits assessed by the away markets to which the
Exchange routes orders, as well as the Exchange's clearing,
administrative, regulatory, and technical costs associated with routing
orders to an away market, and the costs associated with the use of
unaffiliated routing brokers to route orders to the away markets.
Further, the Exchange notes that its Linkage Routing Fees are identical
to the fees charged by MEMX for routing Penny and Non-Penny Classes to
away exchanges.\37\
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\37\ See MEMX Options Fee Schedule, effective September 1, 2026,
available at <a href="https://info.memxtrading.com/memx-options-fee-schedule-memx/">https://info.memxtrading.com/memx-options-fee-schedule-memx/</a>.
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Finally, the Exchange believes that it is reasonable to update the
Preface and Definitions sections of the Options Fee Schedule, because
the additional language will clearly set forth the terms used in the
Transaction Fees portion of the Options Fee Schedule. Further, the
Exchange believes this section is equitable and not unfairly
discriminatory because the definitions section (as part of the Options
Fee Schedule) will be distributed to all Options Members, so that all
Options Members will have equal clarity on fees charged and credits
provided.
For the reasons discussed above, the Exchange believes that its
proposed changes to the Options Fee Schedule satisfy the requirements
of Sections 6(b)(4) \38\ and 6(b)(5) \39\ of the Act in that they
provide for the equitable allocation of reasonable dues, fees and other
charges among Options Members and other persons using its facilities
and are not designed to unfairly discriminate between customers,
issuers, brokers, or dealers. As described more fully below in the
Exchange's statement regarding the burden on competition, the Exchange
believes that its transaction pricing is subject to significant
competitive forces, and that the proposed fees and credits described
herein are appropriate to address such forces.
---------------------------------------------------------------------------
\38\ 15 U.S.C. 78f(b)(4).
\39\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
IEX does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
As a new entrant in the already highly competitive environment for
options trading, the Exchange believes that the proposed changes would
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 Options Members. IEX Options proposes transaction fees,
credits, and routing fees that are comparable to transaction fees,
credits and routing fees assessed by other options exchanges. As a
result, the Exchange believes that the proposal will have a positive
effect on competition.
The Exchange does not believe that the proposed rule change will
impose any burden on intramarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act because the
proposed fees and credits will apply equally to similarly situated
Options Members for transactions executed in the same capacity, options
class, liquidity role and applicable counterparty category. The
proposed pricing structure is intended to encourage participants to
trade on IEX Options by providing credits that are comparable to those
offered by other exchanges as well as providing competitive fees. The
Exchange believes that the proposed credits and fees will help to
encourage Options Members to send orders to the Exchange to the benefit
of all Exchange participants. As the proposed fees and credits are
equally applicable to all similarly situated market participants, the
Exchange does not believe there is any burden on intramarket
competition. Further, as discussed in the Statutory Basis section,
while different fees are assessed to different market participants
based upon the market participant's capacity (or in the case of Non-
Penny Classes, based upon the capacities of both parties to the
transaction), these different market participants have different
obligations to the Exchange. Additionally, as discussed in the
Statutory Basis, the fees are designed to incentivize market
participants to engage in the trading activity that is most common for
each type of market participant.
The Exchange does not believe that the proposed rule change will
impose any burden on intermarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. To the contrary,
the Exchange believes that the proposed pricing structure will increase
competition and is intended to draw volume to the Exchange as it
commences operations. The Exchange believes that the ever-shifting
market share among the exchanges from month to month demonstrates that
market participants can shift order flow or discontinue or reduce use
of certain categories of products, in response to new or different
pricing structures being introduced into the market. Accordingly,
competitive forces constrain the Exchange's transaction fees and
credits, and market participants can readily trade on competing venues
if they deem pricing levels at those other venues to be more favorable.
Currently, no single registered options exchange has more than
approximately 19% of the total market share of
[[Page 68579]]
executed volume of listed options trading.\40\ As a new exchange, the
Exchange expects to face intense competition from existing exchanges.
The proposed pricing structure is intended to encourage market
participants to trade on the Exchange by providing credits and
assessing fees that are comparable to those offered by other exchanges,
which the Exchange believes will help to encourage Options Members to
send orders to the Exchange to the benefit of all Exchange
participants.
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\40\ See Options Clearing Corporation Options Volume by
Exchange, available at <a href="https://www.theocc.com/market-data/market-data-reports/volume-and-open-interest/volume-by-exchange">https://www.theocc.com/market-data/market-data-reports/volume-and-open-interest/volume-by-exchange</a>.
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act \41\ and Rule 19b-4(f)(2) thereunder.\42\
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\41\ 15 U.S.C. 78s(b)(3)(A)(ii).
\42\ 17 CFR 240.19b-4(f)(2).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings under
Section 19(b)(2)(B) \43\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\43\ 15 U.S.C. 78s(b)(2)(B).
---------------------------------------------------------------------------
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#a6d4d3cac38bc5c9cbcbc3c8d2d5e6d5c3c588c1c9d0"><span class="__cf_email__" data-cfemail="f486819891d9979b9999919a8087b4879197da939b82">[email protected]</span></a>. Please include
File Number SR-IEX-2026-41 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-IEX-2026-41. 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-IEX-2026-41 and should be submitted on
or before November 20, 2026.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\44\
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\44\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2026-22130 Filed 10-29-26; 8:45 am]
BILLING CODE 8011-01-P
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