[Federal Register Volume 78, Number 215 (Wednesday, November 6, 2013)]
[Notices]
[Pages 66796-66798]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-26553]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-70788; File No. SR-MIAX-2013-50]
Self-Regulatory Organizations: Miami International Securities
Exchange LLC; Notice of Filing and Immediate Effectiveness of a
Proposed Rule Change To Amend the MIAX Fee Schedule
October 31, 2013.
Pursuant to the provisions of 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 October 24, 2013, Miami International
Securities Exchange LLC (``MIAX'' or ``Exchange'') filed with the
Securities and Exchange Commission (``Commission'') a 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
The Exchange is filing a proposal to amend its Fee Schedule.
The text of the proposed rule change is available on the Exchange's
Web site at http://www.miaxoptions.com/filter/wotitle/rule_filing, at
MIAX's principal office, and at the Commission's Public Reference Room.
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 establish a $0.08 transaction fee for
executions in standard option contracts and $0.008 transaction fee for
Mini Option contracts for Market Makers \3\ registered on the Exchange.
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\3\ Market Makers may be registered as a Lead Market Maker or as
a Registered Market Maker. See Exchange Rule 600(b). Market Makers
registered on the Exchange for purposes of the transaction fee and
Section 1(a)(i) of the Fee Schedule include: (i) Registered Market
Maker (``RMM''); (ii) Lead Market Maker (``LMM''); (iii) Directed
Order Lead Market Maker (``DLMM''); (iv) Primary Lead Market Maker
(``PLMM''); and Directed Order Primary Lead Market Maker
(``DPLMM''). See MIAX Options Fee Schedule, Section 1(a)(i)--Market
Maker Transaction Fees.
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The current transaction fees for Market Makers are: (i) RMMs $0.05
per contract for standard options or $0.005 for Mini Options; (ii) LMMs
$0.05 per contract for standard options or $0.005 for Mini Options;
(iii) DLMMs and PLMMs $0.05 per contract for standard options or $0.005
for Mini Options; and (iv) DPLMMs $0.05 per contract for standard
options or $0.005 for Mini Options.\4\ The proposal will increase the
transaction fees for all Market Makers in both standard options and
Mini Options. The Exchange proposes to implement the new transaction
fees beginning November 1, 2013.
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\4\ See MIAX Options Fee Schedule, Section 1(a)(i)--Market Maker
Transaction Fees. See also Securities Exchange Act Release No. 70346
(September 9, 2013), 78 FR 56762 (September 13, 2013) (SR-MIAX-2013-
41).
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The previous transaction fees were designed both to enhance the
Exchange's competitiveness with other option exchanges and to
strengthen its market quality. Now that both intermarket and
intramarket competition has been increased the
[[Page 66797]]
Exchange believes that it would be beneficial to marginally increase
the transaction fees for all Market Makers to bring rates closer in
line with transaction fees charged to other market participants that
execute orders on the Exchange. The Exchange notes that Market Maker
transactions fees will still remain lower than other market
participants in order to continue to incent market participants and
market makers on other exchanges to register as Market Makers on the
Exchange. The Exchange believes that maintaining lower transaction fees
for Market Makers registered on the Exchange promotes tighter bid-ask
spreads by Market Makers, and increases the volume of transactions in
order to allow the Exchange to compete more effectively with other
options exchanges for such transactions.
2. Statutory Basis
The Exchange believes that its proposal to amend its fee schedule
is consistent with Section 6(b) of the Act \5\ in general, and furthers
the objectives of Section 6(b)(4) of the Act \6\ in particular, in that
it is an equitable allocation of reasonable fees and other charges
among Exchange members.
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\5\ 15 U.S.C. 78f(b).
\6\ 15 U.S.C. 78f(b)(4).
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The Exchange believes that the proposal is fair, equitable and not
unreasonably discriminatory. The proposal is reasonable because it
results in a marginal increase in transactions fees for all Market
Makers on the Exchange to bring rates closer in line with transaction
fees charged to other market participants that execute orders on the
Exchange. The proposed fees are fair and equitable and not unreasonably
discriminatory because they will apply equally to all Market Makers
regardless of type. All Market Makers will be subject to the same
transaction fee, and access to the Exchange is offered on terms that
are not unfairly discriminatory. The registration as an Exchange Market
Maker is equally available to all market participants and Electronic
Exchange Members (``EEMs'') that satisfy the requirements of Rule 600.
Any market participant may choose to satisfy the additional
requirements and obligations of being a Market Maker in order to
qualify for the transaction fee.
The Exchange believes that maintaining lower transaction fees for
Market Makers is equitable and not unfairly discriminatory because
Market Markers on the Exchange have enhanced quoting obligations
measured in both quantity (% time) and quality (minimum bid-ask
differentials) that other market participants do not have.
Additionally, maintaining lower transaction fees for Market Makers
registered on the Exchange promotes tighter bid-ask spreads by Market
Makers, and increases the volume of transactions in order to allow the
Exchange to compete more effectively with other options exchanges for
such transactions. To the extent that this purpose is achieved, all the
Exchange's market participants should benefit from the improved market
liquidity. Enhanced market quality and increased transaction volume
that results from the increase in Market Maker activity on the Exchange
will benefit all market participants and improve competition on the
Exchange.
B. Self-Regulatory Organization's Statement on Burden on Competition
MIAX does not believe that the proposed rule change will impose any
burden on competition not necessary or appropriate in furtherance of
the purposes of the Act. The Exchange believes that the proposal
increases both intermarket and intramarket competition by marginally
increasing transactions fees for all Market Makers on the Exchange to
bring rates closer in line with transaction fees charged to other
market participants that execute orders on the Exchange. The Exchange
notes that it operates in a highly competitive market in which market
participants can readily favor competing venues if they deem fee levels
at a particular venue to be excessive. In such an environment, the
Exchange must continually adjust its fees to remain competitive with
other exchanges and to attract order flow. The Exchange believes that
the proposal reflects this competitive environment because it increases
the Exchange's fees in a manner that continues to encourage market
participants to register as Market Makers, to provide liquidity, and to
attract order flow to the Exchange. To the extent that this purpose is
achieved, all the Exchange's market participants should benefit from
the improved market liquidity. Enhanced market quality and increased
transaction volume that results from the increase in Market Maker
activity on the Exchange will benefit all market participants and
improve competition on the Exchange.
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.\7\ 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 to determine whether the proposed rule should be
approved or disapproved.
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\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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
Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-MIAX-2013-50 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-MIAX-2013-50. 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 Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public
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Reference Room, 100 F Street NE., Washington, DC 20549, on official
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of
the filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change; the Commission does not edit personal identifying
information from submissions. You should submit only information that
you wish to make available publicly. All submissions should refer to
File Number SR-MIAX-2013-50 and should be submitted on or before
November 27, 2013
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
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\8\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-26553 Filed 11-5-13; 8:45 am]
BILLING CODE 8011-01-P