[Federal Register Volume 79, Number 249 (Tuesday, December 30, 2014)]
[Notices]
[Pages 78547-78548]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-30226]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73889; File No. SR-ISEGemini-2014-30]
Self-Regulatory Organizations; ISE Gemini, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Amend the
Schedule of Fees
December 19, 2014.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on December 15, 2014, ISE Gemini, LLC (the ``Exchange'' or ``ISE
Gemini'') filed with the Securities and Exchange Commission (``SEC'' or
``Commission'') the proposed rule change, as described in Items I, II,
and III 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\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
ISE Gemini is proposing to amend language in the Schedule of Fees
related to excluding days from its average daily volume (``ADV'')
calculations when the market is not open for the entire trading day.
The text of the proposed rule change is available on the Exchange's
Internet Web site at http://www.ise.com, at the principal office of the
Exchange, 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 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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend language in the Schedule of Fees
related to excluding days from its ADV calculations when the market is
not open for the entire trading day. The Exchange currently provides
tiered fees and rebates to market participants based on members' ADV in
a given month. In determining applicable tiers, the Exchange may
exclude from its ADV calculation any day that the market is not open
for the entire trading day. This allows the Exchange to exclude days,
for example, where the Exchange declares a trading halt in all
securities, honors a market-wide trading halt declared by another
market, or closes early for holiday observance. On November 3, 2013,
the Exchange's affiliate, the International Securities Exchange, LLC
(``ISE''), amended its Schedule of Fees to permit it to exclude days
only for those members that would have a lower ADV with the day
included.\3\ As noted in the ISE proposed rule filing, some members may
be inadvertently disadvantaged when a day is removed from the ADV
calculation if the member continues to trade significant volume on that
day. In order to prevent this undesirable result, and preserve the
Exchange's intent behind adopting volume-based pricing, ISE Gemini
proposes to adopt language similar to ISE, allowing the Exchange to
exclude days from its ADV calculation only for members that would have
a lower ADV with the day included.
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\3\ See Securities Exchange Act Release No. 73601 (November 14,
2014), 79 FR 69170 (November 20, 2014) (SR-ISE-2014-51).
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2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\4\ in general, and Section
6(b)(4) of the Act,\5\ 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. The
Exchange believes that it is reasonable and equitable to only exclude a
day from its ADV calculations for members that would otherwise have a
lower ADV for the month as this preserves the Exchange's intent behind
adopting volume-based pricing, and avoids penalizing members that
continue to actively trade during excluded days. Without this change,
members that step up and trade significant volume on days where the
market is not open for the entire trading day may be negatively
impacted, resulting in an effective cost increase for those members.
The Exchange further believes that the proposed rule change is not
unfairly discriminatory because it applies equally to all members and
ADV calculations. As is ISE Gemini's current practice, the Exchange
will provide a notice, and post it on the Exchange's Web site, to
inform members of any day that is to be excluded from its ADV
calculations in connection with this proposed rule change.
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\4\ 15 U.S.C. 78f.
\5\ 15 U.S.C. 78f(b)(4).
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B. Self-Regulatory Organization's Statement on Burden on Competition
In accordance with Section 6(b)(8) of the Act,\6\ the Exchange does
not believe that the proposed rule change will impose any burden on
intermarket or intramarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The Exchange
believes that the proposed
[[Page 78548]]
modifications to its ADV calculation are pro-competitive and will
result in lower total costs to end users, a positive outcome of
competitive markets. The Exchange operates in a highly competitive
market in which market participants can readily direct their order flow
to competing venues. In such an environment, the Exchange must
continually review, and consider adjusting, its fees and rebates to
remain competitive with other exchanges. For the reasons described
above, the Exchange believes that the proposed fee changes reflect this
competitive environment.
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\6\ 15 U.S.C. 78f(b)(8).
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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 has not solicited, and does not intend to solicit,
comments on this proposed rule change. The Exchange has not received
any unsolicited written comments from members or other interested
parties.
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\ and subparagraph (f)(2) of Rule 19b-4
thereunder,\8\ because it establishes a due, fee, or other charge
imposed by ISE Gemini.
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\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
\8\ 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 to
determine whether the proposed rule should be approved or disapproved.
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-ISEGemini-2014-30 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-ISEGemini-2014-30. 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 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 such 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-ISEGemini-2014-30, and
should be submitted on or before January 20, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2014-30226 Filed 12-29-14; 8:45 am]
BILLING CODE 8011-01-P