[Federal Register Volume 84, Number 212 (Friday, November 1, 2019)]
[Notices]
[Pages 58778-58794]
[FR Doc No: 2019-23862]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87408; File No. SR-NYSECHX-2019-12]

Self-Regulatory Organizations; NYSE Chicago, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend the
Fee Schedule of NYSE Chicago, Inc.

October 28, 2019.
    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, 2019 the NYSE Chicago, Inc. (``NYSE Chicago'' or
``Exchange'') filed with the Securities and Exchange Commission
(``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 Fee Schedule of NYSE Chicago,
Inc. to provide for co-location services and fees in connection with
its expected migration to the NYSE Pillar platform in the fourth
quarter of 2019. The proposed rule change is available on the
Exchange's website at www.nyse.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 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 Exchange proposes to amend the Fee Schedule to provide for co-
location services and fees in connection with its expected migration to
the NYSE Pillar platform (``Pillar'') in the fourth quarter of 2019.\4\
Pillar is an integrated trading technology platform designed to use a
single specification for connecting to the equities and options markets
operated by the Exchange's affiliates New York Stock Exchange LLC
(``NYSE''), NYSE American LLC (``NYSE American''), NYSE Arca, Inc.
(``NYSE Arca''), and NYSE National, Inc. (``NYSE National'' and,
together, the ``Affiliate SROs'').\5\ As detailed below, current Users
\6\ would not incur any new fees and no incremental co-location revenue
is expected under this proposal.
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    \4\ Subject to rule approvals, the migration to Pillar is
currently anticipated to be on November 4, 2019. See Exchange Act
Release Nos. 85297 (March 12, 2019), 84 FR 9854 (March 18, 2019)
(SR-CHX-2018-03), and 86709 (August 20, 2019), 84 FR 44654 (August
26, 2019) (SR-CHX-2019-08).
    \5\ In July 2018, the Exchange and its direct parent company
were acquired by NYSE Group, Inc. As a result, the Exchange and the
Affiliate SROs are direct or indirect subsidiaries of NYSE Group,
Inc. and, indirectly, Intercontinental Exchange, Inc. See Exchange
Act Release No. 83635 (July 13, 2018), 83 FR 34182 (July 19, 2018)
(SR-CHX-2018-004); see also Exchange Act Release No. 83303 (May 22,
2018), 83 FR 24517 (May 29, 2018) (SR-CHX-2018-004).
    \6\ Consistent with the Affiliate SRO Price Lists, for purposes
of the Exchange's co-location services, a ``User'' shall mean any
market participant that requests to receive co-location services
directly from the Exchange. See Securities Exchange Act Release Nos.
76008 (September 29, 2015), 80 FR 60190 (October 5, 2015) (SR-NYSE-
2015-40); 76009 (September 29, 2015), 80 FR 60213 (October 5, 2015)
(SR-NYSEMKT-2015-67); and 76010 (September 29, 2015), 80 FR 60197
(October 5, 2015) (SR-NYSEArca-2015-82); and 83351 (May 31, 2018),
83 FR 26314 (June 6, 2018) (SR-NYSENAT-2018-07) (``NYSE National Co-
location Notice'').
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    The Affiliate SROs offer co-location services.\7\ When a User
purchases a co-

location service, it is charged once for the service, despite the
service being offered by all the Affiliate SROs. Under this proposal,
Users purchasing co-location services would continue to pay once, even
though all four Affiliate SROs and the Exchange would offer co-location
services, and would receive access to the Affiliate SROs and the
Exchange in the Mahwah, New Jersey data center (the ``data center'').
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    \7\ With the exception of NYSE National, the Affiliate SROs
initially filed rule changes relating to their co-location services
and related fees with the Commission in 2010. See Securities
Exchange Act Release Nos. 62960 (September 21, 2010), 75 FR 59310
(September 27, 2010) (SR-NYSE-2010-56); 62961 (September 21, 2010),
75 FR 59299 (September 27, 2010) (SR-NYSEAmex-2010-80); and 63275
(November 8, 2010), 75 FR 70048 (November 16, 2010) (SR-NYSEArca-
2010-100). NYSE National initially filed rule changes relating to
its co-location services and related fees with the Commission on May
18, 2018. See NYSE National Co-location Notice, supra note 6. If any
change to the Affiliate SROs' colocation services become operative
after the present filing is made but before it becomes operative,
the Exchange would make an additional rule filing implementing the
change, with the intention that the Exchange would offer the same
co-location services offered by the Affiliate SROs.
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    The Exchange proposes that the additions to the Fee Schedule to
provide for co-location services would become operative upon the
Exchange's migration to Pillar.
    Currently, the Exchange's trading and execution systems are not in
the data center. Once the migration to Pillar is completed, the trading
of all securities on the Exchange will have moved to the data center.
As a result of the migration, Users will be able to have low latency
connections to the Exchange over the Liquidity Center Network
(``LCN''), a local area network available in the data center, and so
would be able to co-locate in the data center by ``rent[ing] space on
premises controlled by the Exchange in order that they may locate their
electronic servers in close physical proximity to the Exchange's
trading and execution systems.'' \8\ Absent this proposal to offer co-
location services, market participants' access to the Exchange would
solely be available outside of co-location, even after the migration of
the Exchange's trading and execution systems to Pillar, and so they
would not be able to ``reduce latency in transmitting market data and
order messages'' to the Exchange.\9\
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    \8\ See 75 FR 59310, supra note 7.
    \9\ See Securities Exchange Act Release No. 61358 (January 14,
2010), 75 CFR 3594 (January 21, 2010), at 3598 (concept release on
equity market structure).
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    The Exchange operates in a highly competitive environment. The
Commission has repeatedly expressed its preference for competition over
regulatory intervention in determining prices, products, and services
in the securities markets. Specifically, in Regulation National Market
System (``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.'' \10\
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    \10\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
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Proposed Services and Fees
    The Exchange proposes the same services and fees set forth in the
price lists and fee schedules of its Affiliate SROs (collectively, the
``Affiliate SRO Price Lists''),\11\ with the non-substantive
differences described below. No new or novel services or fees are
proposed and, as described below, current Users of the Affiliate SROs'
co-location services would not incur any new fees.
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    \11\ See ``Co-Location Fees'' in ``New York Stock Exchange Price
List 2019'' (``NYSE Price List'') at https://www.nyse.com/publicdocs/nyse/markets/nyse/NYSE_Price_List.pdf; ``NYSE American
Equities Price List'' (``NYSE American Equities Price List'') at
https://www.nyse.com/publicdocs/nyse/markets/nyse-american/NYSE_America_Equities_Price_List.pdf; ``NYSE American Options Fee
Schedule'' (``NYSE American Options Fee Schedule'') at https://www.nyse.com/publicdocs/nyse/markets/american-options/NYSE_American_Options_Fee_Schedule.pdf; ``NYSE Arca Equities Fees
and Charges'' (``NYSE Arca Equities Fee Schedule'') at https://www.nyse.com/publicdocs/nyse/markets/nyse-arca/NYSE_Arca_Marketplace_Fees.pdf; ``NYSE Arca Options Fees and
Charges'' (``NYSE Arca Options Fee Schedule'') at https://www.nyse.com/publicdocs/nyse/markets/arca-options/NYSE_Arca_Options_Fee_Schedule.pdf; and ``NYSE National, Inc.
Schedule of Fees and Rebates'' (``NYSE National Fee Schedule'') at
https://www.nyse.com/publicdocs/nyse/regulation/nyse/NYSE_National_Schedule_of_Fees.pdf.
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Definitions
    The Exchange proposes to adopt the definitions of ``Affiliate,''
``Aggregate Cabinet Footprint,'' ``Hosted Customer,'' ``Hosting User,''
and ``User'' as set forth in the Affiliate SRO Price Lists.
Specifically, the Exchange proposes the following definitions:
     An ``Affiliate'' of a User is any other User or Hosted
Customer that is under 50% or greater common ownership or control of
the first User.
     ``Aggregate Cabinet Footprint'' of a User or Hosted
Customer is (a) for a User, the total kW of the User's cabinets,
including both partial and dedicated cabinets, and (b), for a Hosted
Customer, the total kW of the portion of the Hosting User's cabinet,
whether partial or dedicated, allocated to such Hosted Customer.
     A ``Hosted Customer'' means a customer of a Hosting User
that is hosted in a Hosting User's co-location space.
     A ``Hosting User'' means a User of co-location services
that hosts a Hosted Customer in the User's co-location space.
     A ``User'' means any market participant that requests to
receive co-location services directly from the Exchange.
    As in the Affiliate SRO Price Lists, the Exchange would specify
that the definitions were for purposes of the co-location fees only.
General Notes
    The Exchange proposes to adopt General Notes 1 through 4 as set
forth in the Affiliate SRO Price Lists, subject to the differences
discussed below.
    General Note 1: General Note 1 of the Affiliate SRO Price Lists
provides that a User that incurs co-location fees for a particular co-
location service would not be subject to co-location fees for the same
co-location service charged by the other Affiliate SROs. The wording of
General Note 1 differs among the Affiliate SRO Price Lists both where
it references the relevant price list or fee schedule and where it
lists the relevant exchange's affiliates.\12\
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    \12\ For example, the NYSE Arca Options Fee Schedule provides
that ``[a] User that incurs co-location fees for a particular co-
location service pursuant to this Fee Schedule shall not be subject
to co-location fees for the same co-location service charged
pursuant to the NYSE Arca Equities Fee Schedule or by the Exchange's
affiliates NYSE American LLC (NYSE American), New York Stock
Exchange LLC (NYSE) and NYSE National, Inc. (NYSE National)''
(emphasis added) while the NYSE Price List provides that ``[a] User
that incurs co-location fees for a particular co-location service
pursuant to this Price List shall not be subject to co-location fees
for the same co-location service charged by the Exchange's
affiliates NYSE American LLC (NYSE American) and NYSE Arca, Inc.
(NYSE Arca), and NYSE National, Inc. (NYSE National).'' (emphasis
added) The Exchange's proposed text for General Note 1 is consistent
with the wording of General Note 1 in the NYSE Price List, with the
exception that it will use ``this Fee Schedule'' instead of ``this
Price List.''
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    The Exchange proposes to adopt the following General Note 1: \13\
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    \13\ The Exchange expects that each Affiliate SRO will submit a
proposed rule change to update General Note 1 to include NYSE
Chicago as a provider of co-location services and to remove the
definition of NYSE Chicago from General Note 4.
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    A User that incurs co-location fees for a particular co-location
service pursuant to this Fee Schedule shall not be subject to co-
location fees for the same co-location service charged by the
Exchange's affiliates the New York Stock Exchange LLC (NYSE), NYSE
American LLC (NYSE American), NYSE Arca, Inc. (NYSE Arca) and NYSE
National (NYSE National).
    General Note 2: The Exchange proposes the same General Note 2 as in
the Affiliate SRO Price Lists, setting forth the requirements for
qualifying for a ``Partial Cabinet Solution'' bundle.\14\ The proposed
text is as follows:
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    \14\ See Securities Exchange Act Release Nos. 77072 (February 5,
2016), 81 FR 7394 (February 11, 2016) (SR-NYSE-2015-53); 77071
(February 5, 2016), 81 FR 7382 (February 11, 2016) (SR-NYSEMKT-2015-
89); and 77070 (February 5, 2016), 81 FR 7401 (February 11, 2016)
(SR-NYSEArca-2015-102); and NYSE National Co-location Notice, supra
note 6, at 26315.
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    To qualify for a Partial Cabinet Solution bundle, a User must meet
the following conditions: (1) It must purchase only one Partial Cabinet

Solution bundle; (2) the User and its Affiliates must not currently
have a Partial Cabinet Solution bundle; and (3) after the purchase of
the Partial Cabinet Solution bundle, the User, together with its
Affiliates, will have an Aggregate Cabinet Footprint of no more than 2
kW.
     A User requesting a Partial Cabinet Solution bundle will
be required to certify to the Exchange (a) whether any other Users or
Hosted Customers are Affiliates of the certificating User, and (b) that
after the purchase of the Partial Cabinet Solution bundle, the User,
together with its Affiliates, would have an Aggregate Cabinet Footprint
of no more than 2 kW. The certificating User will be required to inform
the Exchange immediately of any event that causes another User or
Hosted Customer to become an Affiliate. The Exchange shall review
available information regarding the entities and may request additional
information to verify the Affiliate status of a User or Hosted
Customer. The Exchange shall approve a request for a Partial Cabinet
Solution bundle unless it determines that the certification is not
accurate.
     If a User that has purchased a Partial Cabinet Solution
bundle becomes affiliated with one or more other Users or Hosted
Customers and thereby no longer meets the conditions for access to the
Partial Cabinet Solution bundle, or if the User otherwise ceases to
meet the conditions for access to the Partial Cabinet Solution bundle,
the Exchange will no longer offer it to such User and the User will be
charged for each of the services individually, at the price for each
such service set out in the Fee Schedule. Such price change would be
effective as of the date that the User ceased to meet the conditions.
    In addition, a User that changes its Partial Cabinet Solution
bundle from one option to another will not be subject to a second
initial charge, but will be required to pay the difference, if any,
between the bundles' initial charges.
    General Note 3: The Exchange proposes the same General Note 3 as in
the Affiliate SRO Price Lists, setting forth the provisions relating to
the use of a waitlist.\15\ The proposed text is as follows:
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    \15\ See Securities Exchange Act Release Nos. 77681 (April 21,
2016), 81 FR 24915 (April 27, 2016 (SR-NYSE-2016-13); 77680 (April
21, 2016), 81 FR 24905 (April 27, 2016) (NYSEMKT-2016-17); and 77682
(April 21, 2016), 81 FR 24913 (April 27, 2016 (NYSEArca-2016-21);
and NYSE National Co-location Notice, supra note 6, at 26315.
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    The initial and monthly charge for 2 bundles of 24 cross connects
will be waived for a User that is waitlisted for a cage for the
duration of the waitlist period, provided that the cross connects may
only be used to connect the User's non-contiguous cabinets. The charge
will no longer be waived once a User is removed from the waitlist.
     If a waitlist is created, a User seeking a new cage will
be placed on the waitlist based on the date a signed order for the cage
is received.
     A User that turns down a cage because it is not the
correct size will remain on the waitlist. A User that requests to be
removed or that turns down a cage that is the size that it requested
will be removed from the waitlist.
     A User that is removed from the waitlist but subsequently
requests a cage will be added back to the bottom of the waitlist,
provided that, if the User was removed from the waitlist because it
turned down a cage that is the size that it requested, it will not
receive a second waiver of the charge.
    General Note 4: Proposed General Note 4 would establish that, when
a User purchases access to the Liquidity Center Network (``LCN'') or
the internet protocol (``IP'') network, the two local area networks
available in the data center,\16\ a User would receive (a) the ability
to access the trading and execution systems of the Exchange and
Affiliate SROs (``Exchange Systems'') as well as of Global OTC (the
``Global OTC System'') and (b) connectivity to any of the listed data
products (``Included Data Products'') that it selects. The proposed
General Note 4 would be the same as the General Note 4 in the Affiliate
SRO Price Lists.\17\
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    \16\ See Securities Exchange Act Release Nos. 79730 (January 4,
2017), 82 FR 3045 (January 10, 2017) (SR-NYSE-2016-92); 79728
(January 4, 2017), 82 FR 3035 (January 10, 2017) (SR-NYSEMKT-2016-
126); and 79729 (January 4, 2017), 82 FR 3061 (January 10, 2017)
(SR-NYSEArca-2016-172); and NYSE National Co-location Notice, supra
note 6, at 26316.
    \17\ See Securities Exchange Act Release Nos. 85952 (May 29,
2019), 84 FR 25880 (June 4, 2019) (SR-NYSE-2019-31); 85960 (May 29,
2019), 84 FR 25848 (June 4, 2019) (SR-NYSEAmer-2019-21); 85958 (May
29, 2019), 84 FR 25858 (June 4, 2019) (SR-NYSEArca-2019-40); and
85959 (May 29, 2019), 84 FR 25887 (June 4, 2019) (SR-NYSENat-2019-
13); see also Securities Exchange Act Release Nos. 85300 (March 13,
2019), 84 FR 10152 (March 19, 2019) (SR-NYSE-2019-11); 85302 (March
13, 2019), 84 FR 10164 (March 19, 2019) (SR-NYSEAmer-2019-02); 85306
(March 13, 2019), 84 FR 10159 (March 19, 2019) (SR-NYSEArca-2019-
11); 85305 (March 13, 2019), 84 FR 10154 (March 19, 2019) (SR-
NYSENat-2019-05; 83404 (June 11, 2018), 83 FR 28048 (June 15, 2018)
(SR-NYSE-2018-23); 83402 (June 11, 2018), 83 FR 28041 (June 15,
2018) (SR-NYSEAmer-2018-23); and 83403 (June 11, 2018), 83 FR 28053
(June 15, 2018) (SR-NYSEArca-2018-36).
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    The Exchange proposes to adopt the following General Note 4:
    When a User purchases access to the LCN or IP network, it receives
the ability to access the trading and execution systems of the NYSE,
NYSE American, NYSE Arca, NYSE Chicago, Inc. (NYSE Chicago), and NYSE
National (together, the Exchange Systems) as well as of Global OTC (the
``Global OTC System''), subject, in each case, to authorization by the
NYSE, NYSE American, NYSE Arca, NYSE Chicago, NYSE National or Global
OTC, as applicable. Such access includes access to the customer
gateways that provide for order entry, order receipt (i.e. confirmation
that an order has been received), receipt of drop copies and trade
reporting (i.e. whether a trade is executed or cancelled), as well as
for sending information to shared data services for clearing and
settlement. A User can change the access it receives at any time,
subject to authorization by NYSE, NYSE American, NYSE Arca, NYSE
Chicago, NYSE National or Global OTC. NYSE, NYSE American, NYSE Arca,
NYSE Chicago and NYSE National also offer access to Exchange Systems to
their members, such that a User does not have to purchase access to the
LCN or IP network to obtain access to Exchange Systems. Global OTC
offers access to the Global OTC System to its subscribers, such that a
User does not have to purchase access to the LCN or IP network to
obtain access to the Global OTC System.
    When a User purchases access to the LCN or IP network it receives
connectivity to any of the Included Data Products that it selects,
subject to any technical provisioning requirements and authorization
from the provider of the data feed. Market data fees for the Included
Data Products are charged by the provider of the data feed. A User can
change the Included Data Products to which it receives connectivity at
any time, subject to authorization from the provider of the data feed.
The Exchange is not the exclusive method to connect to the Included
Data Products.
    The Included Data Products are as follows:
NMS feeds
    NYSE:

NYSE Alerts
NYSE BBO
NYSE Integrated Feed
NYSE OpenBook
NYSE Order Imbalances
NYSE Trades

    NYSE American:

NYSE American Alerts
NYSE American BBO
NYSE American Integrated Feed
NYSE American OpenBook
NYSE American Order Imbalances
NYSE American Trades

NYSE American Options
    NYSE Arca:

NYSE ArcaBook
NYSE Arca BBO
NYSE Arca Integrated Feed
NYSE Arca Order Imbalances
NYSE Arca Trades
NYSE Arca Options
NYSE Best Quote and Trades (BQT)
NYSE Bonds
NYSE Chicago
NYSE National
Cabinet-Related Fees
    The Exchange proposes the same services and fees set forth in the
Affiliate SRO Price Lists under ``Initial Fee per Cabinet''; ``Monthly
Fee per Cabinet''; ``Cabinet Upgrade Fee''; ``PNU Cabinet''; and ``Cage
Fees'' (collectively, the ``Cabinet-Related Fees'').
    Initial Fee per Cabinet and Monthly Fee per Cabinet: As in the
Affiliate SRO Price Lists, the Exchange proposes that, to house its
servers and other equipment in the data center, a User have the option
of an entire cabinet dedicated solely to that User (``dedicated
cabinet'') or a partial cabinet alternative (``partial cabinet'').\18\
Partial cabinets would be made available in increments of eight-rack
units of space. Users would pay an initial fee and a monthly fee based
on the number of kilowatts (``kW'').
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    \18\ See Securities Exchange Act Release Nos. 71122 (December
18, 2013), 78 FR 77739 (December 24, 2013) (SR-NYSE-2013-81); 71131
(December 18, 2013), 78 FR 77750 (December 24, 2013) (SR-NYSEMKT-
2013-103); and 71130 (December 18, 2013), 78 FR 77765 (December 24,
2013) (SR-NYSEArca-2013-143) and NYSE National Co-location Notice,
supra note 6, at 26316.
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    Cabinet Upgrade Fee: Users that require additional power allocation
may prefer to maintain their hardware within one of their existing
cabinets rather than add an additional cabinet. Specifically, Users may
develop their hardware infrastructure within a particular cabinet in
such a way that, if expansion of such hardware is needed, it can be
accomplished within the space constraints of that particular cabinet.
If this type of User requires additional power allocation, it would
likely want to modify its existing cabinet in this manner, rather than
taking an additional dedicated cabinet due to the expense of re-
developing its infrastructure within such additional dedicated cabinet.
Accordingly, as in the Affiliate SRO Price Lists, the Exchange would
offer Users the option of a ``Cabinet Upgrade'' and related fee,
pursuant to which the Exchange would accommodate requests for
additional power allocation beyond the typical amount that the Exchange
allocates per dedicated cabinet, at which point the Exchange must
upgrade the cabinet's power capacity.\19\
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    \19\ See id.
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    The Exchange notes that the Cabinet Upgrade Fees in the Affiliate
SRO Price Lists have a parenthetical setting forth lower fees for a
User that submitted a written order for a Cabinet Upgrade by January
31, 2014, provided that the Cabinet Upgrade became fully operational by
March 31, 2014. Because a User that incurs co-location fees for a
particular co-location service would not be subject to co-location fees
for the same co-location service charged by the Affiliate SROs and such
Users may already be subject to this different charge based on the
Price List of an Affiliate SRO, the Exchange proposes to maintain the
information regarding the lower price on its Fee Schedule.
    PNU Fee: As in the Affiliate SRO Price Lists, the Exchange proposes
to offer Users the option of an unused cabinet for which power is not
utilized (``PNU cabinet'') and charge a monthly fee.\20\ A User may
wish to have a PNU cabinet it reserves for future use. Although PNU
cabinets do not use power, when the Exchange establishes a PNU cabinet,
it would include wiring, circuitry, and hardware and allocate kWs of
unused power capacity. This would allow the PNU cabinet to be powered
and used promptly upon the User's request.
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    \20\ See Securities Exchange Act Release Nos. 70913 (November
21, 2013), 78 FR 70987 (November 27, 2013 (SR-NYSE-2013-74); 70914
(November 21, 2013), 78 FR 71000 (November 27, 2013) (SR-NYSEMKT-
2013-93); and 70916 (November 21, 2013), 78 FR 70989 (November 21,
2013) (SR-NYSEArca-2013-124) and NYSE National Co-location Notice,
supra note 6, at 26316.
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    Cage Fee: As in the Affiliate SRO Price Lists, the Exchange
proposes to offer Users the use of cages to house their cabinets within
the data center, with initial and monthly charges based on the size of
the cage.\21\ A cage would typically be purchased by a User that has
several cabinets within the data center and that wishes to enhance
privacy around its cabinets, e.g., so that other Users cannot see what
type of hardware is being utilized.
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    \21\ See Securities Exchange Act Release Nos. 67666 (August 15,
2012), 77 FR 50742 (August 22, 2012) (SR-NYSE-2012-18); 67665
(August 15, 2012), 77 FR 50734 (August 22, 2012) (SR-NYSEMKT-2012-
11); 67669 (August 15, 2012), 77 FR 50746 (August 22, 2012) (SR-
NYSEArca-2012-62); and 67667 (August 15, 2012), 77 FR 50743 (August
22, 2012) (SR-NYSEArca-2012-63); and NYSE National Co-location
Notice, supra note 6, at 26316.
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    The Exchange proposes to add the following fees and language to its
Fee Schedule:

------------------------------------------------------------------------

------------------------------------------------------------------------
                         Initial Fee per Cabinet
------------------------------------------------------------------------
Dedicated Cabinet......................  $5,000
8-Rack Unit of a Partial Cabinet.......  $2,500
------------------------------------------------------------------------
                         Monthly Fee per Cabinet
------------------------------------------------------------------------
Dedicated Cabinet:
    Number of kWs                           Per kW Fee Monthly
        4-8                                   $1,200
        9-20                                  $1,050
        21-40                                 $950
        41+                                   $900
8-Rack Unit of a Partial Cabinet:
    Number of kWs                           Total Fee Monthly
        1                                     $1,500
        2                                     $2,700
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                           Cabinet Upgrade Fee
------------------------------------------------------------------------
Dedicated Cabinet......................  $9,200 ($4,600 for a User that
                                          submitted a written order for
                                          a Cabinet Upgrade by January
                                          31, 2014, provided that the
                                          Cabinet Upgrade became fully
                                          operational by March 31,
                                          2014).
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PNU Cabinet............................  monthly charge of $360 per kW
                                          allocated to PNU Cabinet.
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                                Cage Fees
------------------------------------------------------------------------
2-14 Cabinets..........................  $5,000 initial charge plus
                                          $2,700 monthly charge.
15-28 Cabinets.........................  $10,000 initial charge plus
                                          $4,100 monthly charge.
29+ Cabinets...........................  $15,000 initial charge plus
                                          $5,500 monthly charge.
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Access and Service Fees
    The Exchange proposes to adopt the same services and fees set forth
in the Affiliate SRO Price Lists under ``LCN Access''; ``Bundled
Network Access''; ``Partial Cabinet Solution bundles''; ``IP Network
Access''; ``Testing and Certification IP Network Access''; ``Wireless
Connections for Third Party Data''; ``Virtual Control Circuit between
two Users''; ``Hosting Fee''; ``Data Center Fiber Cross Connect'';
``Connection to Time Protocol Feed'' and ``Expedite Fee''
(collectively, the ``Access and Service Fees'').
    LCN Access: As in the Affiliate SRO Price Lists, the Exchange
proposes to offer Users the option to purchase 1 Gb, 10 Gb, 40 Gb, and
10 Gb LX LCN circuits, with initial and monthly charges.\22\ As in the
Affiliate SRO Price Lists, the Exchange proposes that a User that
purchases five 10 Gb LCN connections would only be charged the initial
fee for a sixth 10 Gb LCN connection and would not be charged the
monthly fee that would otherwise be applicable. This would apply to a
User that purchases six 10 Gb LCN connections at one time as well as to
a User that purchases six 10 Gb LCN connections at separate times.\23\
---------------------------------------------------------------------------

    \22\ See note 16, supra.
    \23\ See note 21, supra.
---------------------------------------------------------------------------

    Bundled Network Access: As in the Affiliate SRO Price Lists, the
Exchange proposes to offer Users two ``Bundled Network Access''
options, with initial and monthly charges.\24\ Both bundles would
include two LCN connections, two IP network connections, and two optic
connections to outside access centers. One bundle would have 1 Gb
connections, and the other 10 Gb connections.
---------------------------------------------------------------------------

    \24\ See note 16, supra.
---------------------------------------------------------------------------

    Partial Cabinet Solution Bundles: As in the Affiliate SRO Price
Lists, the Exchange proposes to offer Users four ``Partial Cabinet
Solution'' bundles.\25\ Each Partial Cabinet Solution bundle option
would include a one or two kW partial cabinet, one LCN connection, one
IP network connection, two fiber cross connections, and connectivity to
either the Network Time Protocol (``NTP'') or Precision Timing Protocol
(``PTP'') time feed. The power of the partial cabinet and Gb of the
network connections would vary by bundle.\26\ A User and its Affiliates
would be limited to one Partial Cabinet Solution bundle at a time, and
must have an Aggregate Cabinet Footprint of 2 kW or less to qualify. As
noted above, such requirements would be set forth in General Note
2.\27\ Finally, a User purchasing a Partial Cabinet Solution bundle
would be subject to a 90-day minimum commitment, after which period it
would be subject to the 60-day rolling time period.
---------------------------------------------------------------------------

    \25\ See note 14, supra; Securities Exchange Act Release Nos.
84893 (December 20, 2018), 83 FR 67455 (December 28, 2018) (SR-NYSE-
2018-63); 84925 (December 21, 2018), 83 FR 67754 (December 31, 2018)
(SR-NYSEAmer-2018-55); 84893 (December 20, 2018), 83 FR 67455
(December 28, 2018) (SR-NYSEArca-2018-93); and 84895 (December 20,
2018), 83 FR 67405 (December 28, 2018) (SR-NYSENat-2018-26).
    \26\ The Affiliate SROs have filed to amend two of the Partial
Cabinet Solution bundles by replacing the 10 Gb LCN connection with
a LCN 10 Gb LX connection. According to the Affiliate SROs, the
change is expected to become operative during the fourth quarter of
2019, and the implementation date will be announced through a
customer notice. See Securities Exchange Act Release Nos. 86550
(August 1, 2019), 84 FR 38696 (August 7, 2019) (SR-NYSE-2019-41);
86548 (August 1, 2019), 84 FR 38704 (August 7, 2019) (SR-NYSEAmer-
2019-28); 86547 (August 1, 2019), 84 FR 38708 (August 7, 2019) (SR-
NYSEArca-2019-54); and 86549 (August 1, 2019), 84 FR 38700 (August
7, 2019) (SR-NYSENat-2019-17). The Exchange proposes to include
notes to the Partial Cabinet Solution bundles in the Fee Schedule
indicating the expected change.
    \27\ See text accompanying note 14, supra.
---------------------------------------------------------------------------

    IP Network Access: As in the Affiliate SRO Price Lists, the
Exchange proposes to offer Users the option to purchase 1 Gb, 10 Gb,
and 40 Gb IP network circuits, with initial and monthly charges.\28\
---------------------------------------------------------------------------

    \28\ See note 16, supra. See also Securities Exchange Act
Release Nos. 74222 (February 6, 2015), 80 FR 7888 (February 12, 2015
(SR-NYSE-2015-05); 74220 (February 6, 2015), 80 FR 7894 (February
12, 2015) (SR-NYSEMKT-2015-08); and 74219 (February 6, 2015), 80 FR
7899 (February 12, 2015) (SR-NYSEArca-2015-03) and NYSE National Co-
location Notice, supra note 6, at 26317.
---------------------------------------------------------------------------

    Testing and Certification IP Network Access: As in the Affiliate
SRO Price Lists, the Exchange proposes to offer Users access to an IP
network circuit for testing and certification at no charge.\29\ The
circuit could only be used for testing and certification, and the
testing and certification period would be limited to three months.
---------------------------------------------------------------------------

    \29\ See id. 80 FR at 7888, 80 FR at 7894, 80 FR at 7899, and
NYSE National Co-location Notice, supra note 6, at 26318.
---------------------------------------------------------------------------

    Wireless Connections for Third Party Data: As in the Affiliate SRO
Price Lists, the Exchange proposes to offer Users a means to receive
market data feeds from third party markets (``Wireless Third Party
Data'') through a wireless connection, for an initial and monthly
fee.\30\ Fees would be subject to a 30-day testing period, during which
the monthly charge per connection would be waived. The wireless
connections would include the use of one port for connectivity to the
Wireless Third Party Data. If a User that has more than one wireless
connection wishes to use more than one port to connect to the Wireless
Third Party Data, the Exchange proposes to make such additional ports
available for a monthly fee per port.\31\
---------------------------------------------------------------------------

    \30\ See Securities Exchange Act Release Nos. 76748 (December
23, 2015), 80 FR 81609 (December 30, 2015) (SR-NYSE-2015-52); 76750
(December 23, 2015), 80 FR 81648 (December 30, 2015) (SR-NYSEMKT-
2015-85); and 76749 (December 23, 2015), 80 FR 81640 (December 30,
2015) (SR-NYSEArca-2015-99); and NYSE National Co-location Notice,
supra note 6, at 26318.
    \31\ Id.
---------------------------------------------------------------------------

    Virtual Control Circuit between two Users: As in the Affiliate SRO
Price Lists, the Exchange proposes to offer Users ``Virtual Control
Circuits'' (``VCCs'') between two Users for a monthly charge based on
the size of the VCC. \32\ VCCs are connections between two points over
dedicated bandwidth using the IP network. A VCC is a two-way connection
which the two participants can use for any purpose. The Exchange would
bill the User requesting the VCC, but would not set up a VCC until the
other User confirmed that it wishes to have the VCC set up.
---------------------------------------------------------------------------

    \32\ See Securities Exchange Act Release Nos. 80311 (March 24,
2017), 82 FR 15749 (March 30, 2017) (SR-NYSE-2016-45); 80309 (March
24, 2017), 82 FR 15725 (March 30, 2017) (SR-NYSEMKT-2016-63); and
80310 (March 24, 2017), 82 FR 15763 (March 30, 2017) (SR-NYSEArca-
2016-89); and NYSE National Co-location Notice, supra note 6, at
26318.
---------------------------------------------------------------------------

    Hosting Fee: As in the Affiliate SRO Price Lists, the Exchange
proposes to offer Users a hosting service for a monthly fee per cabinet
per Hosted Customer for each cabinet in which such Hosted Customer is
hosted.\33\ ``Hosting'' would be a service offered by a User to another
entity in the User's

space within the data center and could include, for example, a User
supporting such other entity's technology, whether hardware or
software, through the User's co-location space. A Hosting User would be
required to be a User pursuant to the definition of User proposed
above. Since only Users could be Hosting Users, a Hosted Customer would
not be able to provide hosting services to any other entities in the
space in which it is hosted.
---------------------------------------------------------------------------

    \33\ See note 6, supra.
---------------------------------------------------------------------------

    Data Center Fiber Cross Connect: As in the Affiliate SRO Price
Lists, the Exchange proposes to offer Users fiber cross connects for an
initial and monthly charge.\34\ A User would be able to use cross
connects between its cabinets or between its cabinet(s) and the
cabinets of separate Users within the data center. A cross connect
would be used to connect cabinets of separate Users when, for example,
a User receives technical support, order routing, and/or market data
delivery services from another User in the data center. Cross connects
may be bundled (i.e., multiple cross connects within a single sheath)
such that a single sheath can hold either one cross connect or several
cross connects in multiples of six (e.g., six or 12 cross connects).
The Exchange is proposing fees for bundled cross connects[thinsp]that
correspond to the number of cross connects in the bundle.
---------------------------------------------------------------------------

    \34\ See note 21, supra.
---------------------------------------------------------------------------

    Connection to Time Protocol Feed: As in the Affiliate SRO Price
Lists, the Exchange proposes to offer Users the option to purchase
connectivity to one or more of three time feeds, with monthly and
initial charges.\35\ Each proposed time feed would provide a feed with
the current time of day using one of three different time protocols:
GPS Time Source, the Network Time Protocol Feed (``NTP''), and the
Precision Time Protocol (``PTP''). Users may make use of time feeds to
receive time and to synchronize clocks between computer systems or
throughout a computer network, and time feeds may assist Users in other
functions, including record keeping or measuring response times. Only
the NTP and PTP time feeds would be available to partial cabinet Users,
whereas dedicated cabinet Users would have access to all three time
feeds. The NTP feed would only be available on the LCN.
---------------------------------------------------------------------------

    \35\ See note 14, supra.
---------------------------------------------------------------------------

    Expedite Fee: As in the Affiliate SRO Price Lists, the Exchange
proposes to offer Users the option to expedite the completion of co-
location services purchased or ordered by the User, for which the
Exchange would charge an ``Expedite Fee.'' \36\
---------------------------------------------------------------------------

    \36\ See note 21, supra.
---------------------------------------------------------------------------

    The Exchange proposes to add the following fees and language to its
Fee Schedule:

------------------------------------------------------------------------
       Type of service             Description        Amount of charge
------------------------------------------------------------------------
LCN Access..................  1 Gb Circuit........  $6,000 per
                                                     connection initial
                                                     charge plus $5,000
                                                     monthly per
                                                     connection.
LCN Access..................  10 Gb Circuit.......  $10,000 per
                                                     connection initial
                                                     charge plus $14,000
                                                     monthly per
                                                     connection. A User
                                                     that purchases 5 10
                                                     GB LCN Circuits
                                                     will receive the
                                                     6th 10 GB LCN
                                                     Circuit without an
                                                     additional monthly
                                                     charge.
LCN Access..................  10 Gb LX Circuit....  $15,000 per
                                                     connection initial
                                                     charge plus $22,000
                                                     monthly per
                                                     connection.
LCN Access..................  40 Gb Circuit.......  $15,000 per
                                                     connection initial
                                                     charge plus $22,000
                                                     monthly per
                                                     connection.
Bundled Network Access (2     1 Gb Bundle.........  $25,000 initial
 LCN connections, 2 IP        ....................   charge plus $13,000
 network connections, and 2   10 Gb Bundle........   monthly charge.
 optic connections to                               $50,000 initial
 outside access center).                             charge plus $53,000
                                                     monthly charge.
Partial Cabinet Solution      Option A: 1 kW        $7,500 initial
 bundles.                      partial cabinet, 1    charge per bundle
Note: A User and its           LCN connection (1     plus monthly charge
 Affiliates are limited to     Gb), 1 IP network     per bundle as
 one Partial Cabinet           connection (1 Gb),    follows:
 Solution bundle at a time.    2 fiber cross         For Users
 A User and its Affiliates     connections and       that order on or
 must have an Aggregate        either the Network    before December 31,
 Cabinet Footprint of 2 kW     Time Protocol Feed    2019: $3,000
 or less to qualify for a      or Precision Timing   monthly for first
 Partial Cabinet Solution      Protocol.             24 months of
 bundle. See Note 2 under     ....................   service, and $6,000
 ``General Notes.''.          ....................   monthly thereafter.
                              ....................   For Users
                              Option B: 2 kW         that order after
                               partial cabinet, 1    December 31, 2019:
                               LCN connection (1     $6,000 monthly.
                               Gb), 1 IP network    $7,500 initial
                               connection (1 Gb),    charge per bundle
                               2 fiber cross         plus monthly charge
                               connections and       per bundle as
                               either the Network    follows:
                               Time Protocol Feed    For Users
                               or Precision Timing   that order on or
                               Protocol.             before December 31,
                                                     2019: $3,500
                                                     monthly for first
                                                     24 months of
                                                     service, and $7,000
                                                     monthly thereafter.
                                                     For Users
                                                     that order after
                                                     December 31, 2019:
                                                     $7,000 monthly.

                              Option C: 1 kW        $10,000 initial
                               partial cabinet, 1    charge per bundle
                               LCN connection (10    plus monthly charge
                               Gb),* 1 IP network    per bundle as
                               connection (10 Gb),   follows:
                               2 fiber cross         For Users
                               connections and       that order on or
                               either the Network    before December 31,
                               Time Protocol Feed    2019: $7,000
                               or Precision Timing   monthly for first
                               Protocol.             24 months of
                              * The LCN connection   service, and
                               (10 Gb) will be       $14,000 monthly
                               replaced with an      thereafter.
                               LCN connection (10    For Users
                               Gb LX) on a date to   that order after
                               be announced by       December 31, 2019:
                               customer notice,      $14,000 monthly.
                               expected to be       $10,000 initial
                               during the fourth     charge per bundle
                               quarter of 2019.      plus monthly charge
                                                     per bundle as
                                                     follows:
                                                     For Users
                                                     that order on or
                                                     before December 31,
                                                     2019: $7,000
                                                     monthly for first
                                                     24 months of
                                                     service, and
                                                     $14,000 monthly
                                                     thereafter.
                                                     For Users
                                                     that order after
                                                     December 31, 2019:
                                                     $14,000 monthly.
                              Option D: 2 kW        $10,000 initial
                               partial cabinet, 1    charge per bundle
                               LCN connection (10    plus monthly charge
                               Gb),* 1 IP network    per bundle as
                               connection (10 Gb),   follows:
                               2 fiber cross         For Users
                               connections and       that order on or
                               either the Network    before December 31,
                               Time Protocol Feed    2019: $7,500
                               or Precision Timing   monthly for first
                               Protocol.             24 months of
                              * The LCN connection   service, and
                               (10 Gb) will be       $15,000 monthly
                               replaced with an      thereafter.
                               LCN connection (10    For Users
                               Gb LX) on a date to   that order after
                               be announced by       December 31, 2019:
                               customer notice,      $15,000 monthly.
                               expected to be
                               during the fourth
                               quarter of 2019.
IP Network Access...........  1 Gb Circuit........  $2,500 per
                                                     connection initial
                                                     charge plus $2,500
                                                     monthly per
                                                     connection.
IP Network Access...........  10 Gb Circuit.......  $10,000 per
                                                     connection initial
                                                     charge plus $11,000
                                                     monthly per
                                                     connection.
IP Network Access...........  40 Gb Circuit.......  $10,000 per
                                                     connection initial
                                                     charge plus $18,000
                                                     monthly per
                                                     connection.
Testing and certification IP  IP network circuit    No charge.
 Network Access.               for testing and
                               certification.
                               Circuit can only be
                               used for testing
                               and certification
                               and testing and
                               certification
                               period is limited
                               to three months.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of Cboe Pitch BZX     connection initial
                               Gig shaped data and   charge plus monthly
                               Cboe Pitch BYX Gig    charge per
                               shaped data.          connection of
                                                     $6,000.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of Cboe EDGX Gig      connection initial
                               shaped data and       charge plus monthly
                               Cboe EDGA Gig         charge per
                               shaped data.          connection of
                                                     $6,000.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of NASDAQ Totalview-  connection initial
                               ITCH data.            charge plus monthly
                                                     charge per
                                                     connection of
                                                     $8,500.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of NASDAQ BX          connection initial
                               Totalview-ITCH data.  charge plus monthly
                                                     charge per
                                                     connection of
                                                     $6,000.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of NASDAQ Totalview   connection initial
                               Ultra (FPGA).         charge plus monthly
                                                     charge per
                                                     connection of
                                                     $11,000.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of NASDAQ Totalview-  connection initial
                               ITCH and BX           charge plus monthly
                               Totalview-ITCH data.  charge per
                                                     connection of
                                                     $12,000.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of NASDAQ Totalview   connection initial
                               Ultra (FPGA) and BX   charge plus monthly
                               Totalview-ITCH data.  charge per
                                                     connection of
                                                     $14,500.
                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Wireless connection   $5,000 per
 Third Party Data.             of Toronto Stock      connection initial
                               Exchange (TSX).       charge plus monthly
                                                     charge per
                                                     connection of
                                                     $8,500.

                                                    Fees are subject to
                                                     a 30-day testing
                                                     period, during
                                                     which the monthly
                                                     charge per
                                                     connection is
                                                     waived.
Wireless Connection for       Port for wireless     $3,000 monthly
 Third Party Data.             connection.           charge per port,
                                                     excluding first
                                                     port.
Virtual Control Circuit       1Mb.................  $200 monthly charge.
 between two Users.
                              3Mb.................  $400 monthly charge.
                              5Mb.................  $500 monthly charge.
                              10Mb................  $800 monthly charge.
                              25Mb................  $1,200 monthly
                                                     charge.
                              50Mb................  $1,800 monthly
                                                     charge.
                              100Mb...............  $2,500 monthly
                                                     charge.
Hosting Fee.................  ....................  $1,000 monthly
                                                     charge per cabinet
                                                     per Hosted Customer
                                                     for each cabinet in
                                                     which such Hosted
                                                     Customer is hosted.
Data Center Fiber Cross       Furnish and install   $500 initial charge
 Connect.                      1 cross connect.      plus $600 monthly
                                                     charge.
                              Furnish and install   $500 initial charge
                               bundle of 6 cross     plus $1,800 monthly
                               connects.             charge.
                              Furnish and install   $500 initial charge
                               bundle of 12 cross    plus $3,000 monthly
                               connects.             charge.
                              Furnish and install   $500 initial charge
                               bundle of 18 cross    plus $3,840 monthly
                               connects.             charge.
                              Furnish and install   $500 initial charge
                               bundle of 24 cross    plus $4,680 monthly
                               connects.             charge
                                                    See General Note 3.
Connection to Time Protocol   Network Time          $300 initial charge
 Feed.                         Protocol Feed         plus $100 monthly
                               (Note: LCN only).     charge.
                              Precision Time        $1,000 initial
                               Protocol.             charge plus $250
                                                     monthly charge.
                              GPS Time Source       $3,000 initial
                               (Note: dedicated      charge plus $400
                               cabinets only).       monthly charge.
Expedite Fee................  Expedited             $4,000 per request.
                               installation/
                               completion of a
                               User's co-location
                               service.
------------------------------------------------------------------------

Service-Related Fees
    The Exchange proposes to adopt the same services and fees set forth
in the Affiliate SRO Price Lists under ``Change Fee''; ``Initial
Install Services''; ``Hot Hands Service''; ``Shipping and Receiving'';
``Badge Request''; ``External Cabinet Cable Tray''; ``Custom External
Cabinet Cable Tray'' and ``Visitor Security Escort'' (collectively, the
``Service-related Fees'') and related note, as follows.
    Change Fee: As in the Affiliate SRO Price Lists, the Exchange
proposes to charge a User a ``Change Fee'' if the User requests a
change to one or more existing co-location services that the Exchange
has already established or completed for the User.\37\ The Change Fee
would be charged per order. If a User ordered two or more services at
one time (for example, through submitting an order form requesting
multiple services) the User would be charged a one-time Change Fee,
which would cover the multiple services.
---------------------------------------------------------------------------

    \37\ See id.
---------------------------------------------------------------------------

    Initial Install Services: As in the Affiliate SRO Price Lists, the
Exchange proposes to charge a User an ``Initial Install Services'' fee
for the installation of a dedicated or partial cabinet.\38\ The
proposed fee would be lower for a partial cabinet. The Initial Install
Services fee would include initial racking of equipment in the cabinet,
provision of cables and labor. The number of hours would depend on
whether the cabinet was partial or dedicated.
---------------------------------------------------------------------------

    \38\ See note 18, supra.
---------------------------------------------------------------------------

    Hot Hands Service: As in the Affiliate SRO Price Lists, the
Exchange proposes to offer Users a ``Hot Hands'' service, which would
allow Users to use on-site data center personnel to maintain User
equipment, support network troubleshooting, rack and stack a server in
a User's cabinet; power recycling; and install and document the fitting
of cable in a User's cabinet(s).\39\ The Hot Hands fee would be charged
per half hour.
---------------------------------------------------------------------------

    \39\ See Securities Exchange Act Release Nos. 72721 (July 30,
2014), 79 FR 45562 (August 5, 2014) (SR-NYSE-2014-37); 72719 (July
30, 2014), 79 FR 45502 (August 5, 2014) (SR-NYSEMKT-2014-61); and
72720 (July 30, 2014), 79 FR 45577 (August 5, 2014) (SR-NYSEArca-
2014-81); and NYSE National Co-location Notice, supra note 6, at
26320.
---------------------------------------------------------------------------

    Shipping and Receiving: As in the Affiliate SRO Price Lists, the
Exchange proposes to offer Users shipping and receiving services, with
a per shipment fee for the receipt of one shipment of goods at the data
center from the User or supplier.\40\
---------------------------------------------------------------------------

    \40\ See note 7, supra.
---------------------------------------------------------------------------

    Badge Request: As in the Affiliate SRO Price Lists, the Exchange
proposes to offer Users the option to obtain a permanent data center
site access badge for a User representative. \41\
---------------------------------------------------------------------------

    \41\ Id.
---------------------------------------------------------------------------

    External Cabinet Cable Tray: As in the Affiliate SRO Price Lists,
the Exchange proposes to offer to engineer, furnish and install a
Rittal 5''H x 12''W cable tray on a cabinet for a flat fee per
tray.\42\
---------------------------------------------------------------------------

    \42\ Id.
---------------------------------------------------------------------------

    Custom External Cabinet Cable Tray: As in the Affiliate SRO Price
Lists, the Exchange proposes to offer to engineer, furnish and install
4'' H x 24'' W custom basket cable tray above a client's cabinet rows
for a fee per linear foot. \43\
---------------------------------------------------------------------------

    \43\ Id.
---------------------------------------------------------------------------

    Visitor Security Escort: As in the Affiliate SRO Price Lists, the
Exchange proposes that User representatives be required to be
accompanied by a visitor security escort during visits to the data
center, unless visiting the User's cage. A fee per visit would be
charged.\44\ The proposed requirement would include User
representatives who have a permanent data center site access badge.
---------------------------------------------------------------------------

    \44\ See note 15, supra.
---------------------------------------------------------------------------

    In order to be able to meet its obligation to accommodate demand,
and in particular to make available more contiguous, larger spaces for
new and existing Users, if necessary, the Exchange would exercise its
right to move some Users' equipment within the

data center (``Migration''). To manage the process for a future
Migration, the Exchange proposes to put the same Migration procedures
in place as the Affiliate SROs, as follow: \45\
---------------------------------------------------------------------------

    \45\ See Securities Exchange Act Release Nos. 76269 (October 26,
2015), 80 FR 66942 (October 30, 2015) (SR-NYSE-2015-42); 76268
(October 26, 2015), 80 FR 66944 (October 30, 2015) (SR-NYSEMKT-2015-
70); and 76270 (October 26, 2015), 80 FR 66958 (October 30, 2015)
(SR-NYSEArca-2015-85); and NYSE National Co-location Notice, supra
note 6, at 26321.
---------------------------------------------------------------------------

     First, the Exchange would identify Users that would be
required to move in the Migration based on (a) the current location of
the User and its current equipment and power requirements and (b) the
availability of another location in the Data Center that would
accommodate the equipment and power requirements for which such User
currently subscribes. No User would be required to move more than once
within any 12-month period.
     Second, the Exchange would notify a User in writing (the
``Notice'') that the User's equipment and network connections in the
Data Center were to be moved as part of the Migration. The Notice would
identify the 90-day period during which the User must move its
equipment, which period would commence at least 60 days from the date
of the Notice. The exact date or dates for the move for each User would
be agreed upon between the User and the Exchange. If a move date or
dates cannot be agreed on, the Exchange would schedule the move for a
date or dates no later than 180 days after the date of the Notice.
     Third, each User's move would be facilitated by the
Exchange in cooperation with the User, including the un-racking and re-
racking of all of the User's equipment, and the re-installation of the
User's networking connections, and the Exchange would make reasonable
efforts to ensure that the moves take place outside of the Exchange's
hours for business.
     Fourth, in connection with facilitating each User's move,
the Exchange proposes to waive certain fees. Specifically, the Exchange
proposes to waive:
    [cir] The monthly recurring fees for the User's existing space,
based on the rate of the monthly recurring fees that the User is paying
as of the date of the Notice, for the month during which the User's
move takes place. This waiver of the monthly recurring fees would mean
that the User would not incur these fees for the period of overlapping
use of the equipment and services in the old and the new locations, as
long as the move is completed within one month.
    [cir] all Service-Related Fees that the User would incur if such a
move were to take place at a User's request with respect to the User's
existing services and equipment.
    [cir] for the month following the completion of a User's move, the
monthly recurring charges for that User, based on the rate of the
monthly recurring fees that the User is paying as of the date of the
Notice, in consideration for the Migration.
    The Exchange proposes to add a note to each Service-Related Fee
outlining the Migration process, as in the Affiliate SRO Price
Lists.\46\ The Exchange proposes to add the following fees and note to
its Fee Schedule:
---------------------------------------------------------------------------

    \46\ The Exchange notes that, while the other Affiliate SRO
Price Lists use three asterisks to identify the Service-Related Fees
and the corresponding note, the NYSE Amex Options Fee Schedule uses
the numeral ``1''. The Exchange proposes to use three asterisks.

------------------------------------------------------------------------
        Type of service               Description       Amount of charge
------------------------------------------------------------------------
Change Fee ***................  Change to a co-         $950 per
                                 location service that   request.
                                 has already been
                                 installed/completed
                                 for a User.
Initial Install Services ***    Dedicated Cabinet:      $800 per
 (Required per cabinet).         Includes initial        dedicated
                                 racking of equipment    cabinet.
                                 in cabinet and
                                 provision of cables
                                 (4 hrs)..
                                Partial Cabinet:        $400 per eight-
                                 Includes initial        rack unit in a
                                 racking of equipment    partial
                                 in cabinet and          cabinet.
                                 provision of cables
                                 (2 hrs)..
Hot Hands Service ***.........  Allows Users to use on- $100 per half
                                 site data center        hour.
                                 personnel to maintain
                                 User equipment,
                                 support network
                                 troubleshooting, rack
                                 and stack, power
                                 recycling, and
                                 install and document
                                 cable..
Shipping and Receiving ***....  Receipt of one          $100 per
                                 shipment of goods at    shipment.
                                 data center from User/
                                 supplier. Includes
                                 coordination of
                                 shipping and
                                 receiving..
Badge Request ***.............  Request for provision   $50 per badge.
                                 of a permanent data
                                 center site access
                                 badge for a User
                                 representative..
External Cabinet Cable Tray     Engineer, furnish and   $400 per tray.
 ***.                            install Rittal 5``H x
                                 12``W cable tray on
                                 cabinet..
Custom External Cabinet Cable   Engineer, furnish and   $100 per linear
 Tray ***.                       install 4'' H x 24''    foot.
                                 W custom basket cable
                                 tray above client's
                                 cabinet rows..
Visitor Security Escort ***...  All User                $75 per visit.
                                 representatives are
                                 required to be
                                 accompanied by a
                                 visitor security
                                 escort during visits
                                 to the data center,
                                 unless visiting the
                                 User's cage.
                                 Requirement includes
                                 User representatives
                                 who have a permanent
                                 data center site
                                 access badge..
------------------------------------------------------------------------
*** These fees are waived for the move of a User's equipment within the
  Data Center when incurred in connection with such a move required by
  the Exchange (``Migration Move''). A User selected by the Exchange for
  a Migration Move will receive written notice (the ``Notice''). The
  Notice will identify the 90-day period during which a User must move
  its equipment, which period would commence at least 60 days from the
  date of the Notice. Monthly recurring fees for the User's existing
  space based on the rate of the monthly recurring fees that the User
  was paying as of the date of the Notice are also waived for the month
  during which a User's Migration Move takes place, so the User would
  not incur these fees for the period of overlapping use of equipment
  and services in the old and new locations. In addition, the monthly
  recurring charges are waived for the month following the completion of
  a User's Migration Move, based on the rate of the monthly recurring
  fees that the User was paying as of the date of the Notice. No User
  will be required to move more than once within any 12-month period.

Connectivity to Third Party Systems, Data Feeds, Testing and
Certification Feeds, and DTCC
    The Exchange proposes to adopt the same services and fees set forth
in the Affiliate SRO Price Lists under ``Connectivity to Third Party
Systems, Data Feeds, Testing and Certification Feeds, and DTCC.'' \47\
---------------------------------------------------------------------------

    \47\ See note 32, supra.
---------------------------------------------------------------------------

    Connectivity to Third Party Systems: As in the Affiliate SRO Price
Lists, the Exchange proposes to provide that Users may obtain access to
the trading and execution services of Third Party markets and other
content service providers (``Third Party Systems'') of multiple third
party markets and other

content service providers for a fee.\48\ Users would connect to Third
Party Systems over the IP network.
---------------------------------------------------------------------------

    \48\ See id. See also Securities Exchange Release Nos. 83706
(July 25, 2018), 83 FR 37033 (July 31, 2018) (SR-NYSE-2018-32; 83707
(July 25, 2018), 83 FR 36985 (July 31, 2018) (SR-NYSEAmer-2018-35);
83708 (July 25, 2018), 83 FR 36980 (July 31, 2018) (SR-NYSEArca-
2018-52); and 83709 (July 25, 2018), 83 FR 37028 (July 31, 2018)
(SR-NYSENat-2018-15).
---------------------------------------------------------------------------

    In order to obtain access to a Third Party System, a User would
enter into an agreement with the relevant third party content service
provider, pursuant to which the third party content service provider
would charge the User for access to the Third Party System. The
Exchange would then establish a unicast connection between the User and
the relevant third party content service provider over the IP network.
The Exchange would charge the User for the connectivity to the Third
Party System. A User would only receive, and would only be charged for,
access to Third Party Systems for which it enters into agreements with
the third party content service provider.
    With the exception of the ICE feed, the Exchange would have no
ownership interest in the Third Party Systems. Establishing a User's
access to a Third Party System would not give the Exchange any right to
use the Third Party Systems. Connectivity to a Third Party System would
not provide access or order entry to the Exchange's execution system,
and a User's connection to a Third Party System would not be through
the Exchange's execution system.
    The Exchange would charge a monthly recurring fee for connectivity
to a Third Party System. Specifically, when a User requested access to
a Third Party System, it would identify the applicable third party
market or other content service provider and what bandwidth connection
it required.
    The Exchange proposes to add the following fees and language to its
Fee Schedule:
Connectivity to Third Party Systems
    Pricing for access to the execution systems of third party markets
and other service providers (Third Party Systems) is for connectivity
only. Connectivity to Third Party Systems is subject to any technical
provisioning requirements and authorization from the provider of the
data feed. Connectivity to Third Party Systems is over the IP network.
Any applicable fees are charged independently by the relevant third
party content service provider. The Exchange is not the exclusive
method to connect to Third Party Systems.

------------------------------------------------------------------------
                                             Monthly  recurring  fee per
  Bandwidth of connection to Third Party     connection  to Third  Party
                  System                               System
------------------------------------------------------------------------
1 Mb......................................  $200
3 Mb......................................  400
5 Mb......................................  500
10 Mb.....................................  800
25 Mb.....................................  1,200
50 Mb.....................................  1,800
100 Mb....................................  2,500
200 Mb....................................  3,000
1 Gb......................................  3,500
------------------------------------------------------------------------

Third Party Systems
Americas Trading Group (ATG)
BM&F Bovespa
Boston Options Exchange (BOX)
Canadian Securities Exchange (CSE)
Cboe BYX Exchange (CboeBYX), Cboe BZX Exchange (CboeBZX), Cboe EDGA
Exchange (CboeEDGA), and Cboe EDGX Exchange (CboeEDGX)
Cboe Exchange (Cboe) and Cboe C2 Exchange (C2)
Chicago Mercantile Exchange (CME Group)
Credit Suisse
Euronext Optiq Cash and Derivatives Unicast (EUA)
Euronext Optiq Cash and Derivatives Unicast (Production)
Investors Exchange (IEX)
ITG TriAct Matchnow
Miami International Securities Exchange
MIAX PEARL
Nasdaq
NASDAQ Canada (CXC, CXD, CX2)
NASDAQ ISE
Neo Aequitas
NYFIX Marketplace
Omega
OneChicago
OTC Markets Group
TMX Group

    Connectivity to Third Party Data Feeds: As in the Affiliate SRO
Price Lists, the Exchange proposes to provide that Users may obtain
connectivity to data feeds from third party markets and other content
service providers (``Third Party Data Feeds'') for a fee.\49\ The
Exchange would receive Third Party Data Feeds from multiple national
securities exchanges and other content service providers at its data
center. It would then provide connectivity to that data to Users for a
fee. With the exceptions of Global OTC and ICE Data Global Index, Users
would connect to Third Party Data Feeds over the IP network.
---------------------------------------------------------------------------

    \49\ Id.
---------------------------------------------------------------------------

    In order to connect to a Third Party Data Feed, a User would enter
into a contract with the relevant third party market or other content
service provider, pursuant to which the content service provider would
charge the User for the Third Party Data Feed. The Exchange would
receive the Third Party Data Feed over its fiber optic network and,
after the data provider and User enter into the contract and the
Exchange receives authorization from the data provider, the Exchange
would re-transmit the data to the User over the User's port. The
Exchange would charge the User for the connectivity to the Third Party
Data Feed. A User would only receive, and would only be charged for,
connectivity to the Third Party Data Feeds for which it entered into
contracts.
    With the exception of the ICE Data Services, ICE and Global OTC
feeds, the Exchange would have no affiliation with the sellers of the
Third Party Data Feeds. It would have no right to use the Third Party
Data Feeds other than as a redistributor of the data. The Third Party
Data Feeds would not provide access or order entry to the Exchange's
execution system. With the exception of the ICE feeds, the Third Party
Data Feeds would not provide access or order entry to the execution
systems of the third party generating the feed. The Exchange would
receive Third Party Data Feeds via arms-length agreements and would
have no inherent advantage over any other distributor of such data.
    The Exchange would charge a monthly recurring fee for connectivity
to each Third Party Data Feed. The monthly recurring fee would be per
Third Party Data Feed, with the exception that the monthly recurring
fee for the ICE Data Services Consolidated Feeds (including the ICE
Data Services Consolidated FeedsShared Farm feeds), SR Labs-SuperFeeds
and MSCI feeds would vary by the bandwidth of the connection. Depending
on its needs and bandwidth, a User may opt to receive all or some of
the feeds or services included in a Third Party Data Feed.
    Third Party Data Feed providers may charge redistribution fees. The
Exchange proposes that, when it receives a redistribution fee, it pass
through the charge to the User, without change to the fee. The fee
would be labeled as a pass-through of a redistribution fee on the
User's invoice. As in the Affiliate SRO Price Lists, the Exchange
proposes to add language to the Fee Schedule accordingly.
    The Exchange proposes that it not charge Users that are third party
markets or content providers for connectivity to their own feeds, as it
understands that such parties generally receive their own feeds for
purposes of diagnostics and

testing. As in the Affiliate SRO Price Lists, the Exchange proposes to
add language to the Fee Schedule accordingly.
    The Exchange proposes to add the following fees and language to its
Fee Schedule:
Connectivity to Third Party Data Feeds
    Pricing for data feeds from third party markets and other content
service providers (Third Party Data Feeds) is for connectivity only.
Connectivity to Third Party Data Feeds is subject to any technical
provisioning requirements and authorization from the provider of the
data feed. Connectivity to Third Party Data Fees is over the IP
network, with the exception that Users can connect to Global OTC and
ICE Data Global Index over the IP network or LCN. Market data fees are
charged independently by the relevant third party market or content
service provider. The Exchange is not the exclusive method to connect
to Third Party Data Feeds.
    Third Party Data Feed providers may charge redistribution fees.
When the Exchange receives a redistribution fee, it passes through the
charge to the User, without change to the fee. The fee is labeled as a
pass-through of a redistribution fee on the User's invoice. The
Exchange does not charge third party markets or content providers for
connectivity to their own feeds.

------------------------------------------------------------------------
                                                              Monthly
                                                             recurring
                                                           connectivity
                  Third party data feed                   fee per  third
                                                            party  data
                                                               feed
------------------------------------------------------------------------
BM&F Bovespa............................................          $3,000
Boston Options Exchange (BOX)...........................           1,000
Canadian Securities Exchange (CSE)......................           1,000
Cboe BZX Exchange (CboeBZX) and Cboe BYX Exchange                  2,000
 (CboeBYX)..............................................
Cboe EDGX Exchange (CboeEDGX) and Cboe EDGA Exchange               2,000
 (CboeEDGA).............................................
Cboe Exchange (Cboe) and Cboe C2 Exchange (C2)..........           2,000
CME Group...............................................           3,000
Euronext Optiq Compressed Cash..........................             900
Euronext Optiq Compressed Derivatives...................             600
Euronext Optiq Shaped Cash..............................           1,200
Euronext Optiq Shaped Derivatives.......................             900
Financial Industry Regulatory Authority (FINRA).........             500
Global OTC..............................................             100
ICE Data Global Index...................................             100
ICE Data Services Consolidated Feed <=100 Mb............             200
ICE Data Services Consolidated Feed >100 Mb to <=1 Gb...             500
ICE Data Services Consolidated Feed >1 Gb...............           1,000
ICE Data Services Consolidated Feed Shared Farm <=100Mb.             200
ICE Data Services Consolidated Feed Shared Farm >100 Mb              500
 to <=1 Gb..............................................
ICE Data Services Consolidated Feed Shared Farm >1 Gb...           1,000
ICE Data Services PRD...................................             200
ICE Data Services PRD CEP...............................             400
Intercontinental Exchange (ICE).........................           1,500
Investors Exchange (IEX)................................           1,000
ITG TriAct Matchnow.....................................           1,000
Miami International Securities Exchange/MIAX PEARL......           2,000
Montr[eacute]al Exchange (MX)...........................           1,000
MSCI 5 Mb...............................................             500
MSCI 25 Mb..............................................           1,200
NASDAQ Stock Market.....................................           2,000
NASDAQ OMX Global Index Data Service....................             100
NASDAQ OMDF.............................................             100
NASDAQ UQDF & UTDF......................................             500
NASDAQ Canada (CXC, CXD, CX2)...........................           1,500
NASDAQ ISE..............................................           1,000
Neo Aequitas............................................           1,200
Omega...................................................           1,000
OneChicago..............................................           1,000
OTC Markets Group.......................................           1,000
SR Labs--SuperFeed <500 Mb..............................             250
SR Labs--SuperFeed >500 Mb to <1.25 Gb..................             800
SR Labs--SuperFeed >1.25 Gb.............................           1,000
TMX Group...............................................           2,500
------------------------------------------------------------------------

    Connectivity to Third Party Testing and Certification Feeds: As in
the Affiliate SRO Price Lists, the Exchange proposes to provide that
Users may obtain connectivity to third party testing and certification
feeds.\50\ Certification feeds would be used to certify that a User
conforms to any of the relevant content service provider's requirements
for accessing Third Party Systems or receiving Third Party Data, while
testing feeds would provide Users an environment in which to conduct
tests with non-live data. Such feeds, which would solely be used for
certification and testing and do not carry live production data, would
be available over the IP network.
---------------------------------------------------------------------------

    \50\ Id.
---------------------------------------------------------------------------

    The Exchange proposes to add the following fees and language to its
Fee Schedule:

Connectivity to Third Party Testing and Certification Feeds
    The Exchange provides connectivity to third party testing and
certification feeds provided by third party markets and other content
service providers. Pricing for third party testing and certification
feeds is for connectivity only. Connectivity to third party testing and
certification feeds is subject to any technical provisioning
requirements and authorization from the provider of the data feed.
Connectivity to third party testing and certification feeds is over the
IP network. Any applicable fees are charged independently by the
relevant third party market or content service provider. The Exchange
is not the exclusive method to connect to third party testing and
certification feeds.

Connectivity to third party certification   $100 monthly recurring fee
 and testing feeds.                          per feed.

    Connectivity to DTCC: As in the Affiliate SRO Price Lists, the
Exchange proposes to provide Users connectivity to Depository Trust &
Clearing Corporation (``DTCC'') for clearing, fund transfer, insurance,
and settlement services.\51\
---------------------------------------------------------------------------

    \51\ Id.
---------------------------------------------------------------------------

    In order to connect to DTCC, a User would enter into a contract
with DTCC, pursuant to which DTCC would charge the User for the
services provided. The Exchange would receive the DTCC feed over its
fiber optic network and, after DTCC and the User entered into the
services contract and the Exchange received authorization from DTCC,
the Exchange would provide connectivity to DTCC to the User over the
User's IP network port. The Exchange would charge the User for the
connectivity to DTCC.
    Connectivity to DTCC would not provide access or order entry to the
Exchange's execution system, and a User's connection to DTCC would not
be through the Exchange's execution system.
    The Exchange proposes to add the following fees and language to its
Fee Schedule:
    Connectivity to DTCC
    Pricing for connectivity to DTCC feeds is for connectivity only.
Connectivity to DTCC feeds is subject to any technical provisioning
requirements and authorization from DTCC. Connectivity to DTCC feeds is
over the IP network. Any applicable fees are charged independently by
DTCC. The Exchange is not the exclusive method to connect to DTCC
feeds.

5 Mb connection to DTCC...................  $500 monthly recurring fee.
50 Mb connection to DTCC..................  $2,500 monthly recurring
                                             fee.

Application of Proposed Change
    As noted above, none of the proposed services and fees are new or
novel. Current Users would not incur any new fees and the Exchange does
not expect to attract any new Users as a result of the proposed change,
for the following reasons.
    First, as stated in the proposed Fee Schedule, a User that incurs
co-location fees for a particular co-location service would not be
subject to fees for the same service charged by the Affiliate SROs.\52\
In other words, even though all four Affiliate SROs and the Exchange
would offer co-location services, a User that purchased services would
only be charged once. This would be true irrespective of whether the
User were a member of all, some, or none of the Affiliate SROs and the
Exchange.
---------------------------------------------------------------------------

    \52\ Co-location fees already work in this manner. See
Securities Exchange Act Release Nos. 70206 (August 15, 2013), 78 FR
51765 (August 21, 2013) (SR-NYSE-2013-59); 70176 (August 13, 2013),
78 FR 50471 (August 19, 2013) (SR-NYSEMKT-2013-67); and 70173
(August 13, 2013), 78 FR 50459 (August 19, 2013) (SR-NYSEArca-2013-
80); and NYSE National Co-location Notice, supra note 6, at 26314.
---------------------------------------------------------------------------

    Second, the Exchange expects that a current User that starts to
trade on the Exchange or connect to its market data as a result of the
proposed change would not incur any new fees. Access to trade on the
Exchange and connectivity to its data products comes with connections
to the local area networks in the data center for no additional fee
\53\--and Users that trade or connect to market data would already have
a connection to the local area networks, either directly or through
another User.
---------------------------------------------------------------------------

    \53\ See 84 FR 10152, 84 FR 10164, 84 FR 10159, and 84 FR 10154,
supra note 17.
---------------------------------------------------------------------------

    Third, the Exchange does not expect any market participants to
become Users in order to connect to the Exchange's data feed. Under the
proposed change any authorized User would be able to obtain a lower
latency connection to the Exchange's data feeds. However, in the first
eight months of 2019, the Exchange averaged less than 0.6% market share
of executed volume of non-auction equity trading.\54\ Given the small
volume of trades on the Exchange and the fact that the NMS feeds
include NYSE Chicago data, the Exchange does not believe that a lower
latency connection to Exchange data would be sufficient reason for a
firm to become a User.
---------------------------------------------------------------------------

    \54\ Based on Cboe U.S. Equities Market Volume Summary, the
Exchange's market share of intraday trading (excluding auctions) for
the months of January 2019, February 2019, March 2019, April 2019,
May 2019, June 2019, July 2019 and August 2019 was 0.52%, 0.52%,
0.56%, 0.50%, 0.50%, 0.48%, 0.46% and 0.43%, respectively. See
http://markets.cboe.com/us/equities/market_share/.
---------------------------------------------------------------------------

    Finally, the Exchange believes that, as a practical matter, only
Participants \55\ would be interested in becoming new Users in order to
trade on the Exchange, as non-Participants cannot trade on the
Exchange. The pool of relevant Participants is small: Only nine
Participants are not also members of one or more of the Affiliate
SROs.\56\ Of those nine Participants, two are already Users, and
therefore, as explained above, would not be subject to any new or
different fees as a result of this filing. The Exchange does not expect
that any of the remaining seven Participants would opt to become Users
in order to trade on the Exchange.\57\ Simply put, the Exchange does
not expect that low latency access to such a small market would be
sufficient reason for a firm to become a User.
---------------------------------------------------------------------------

    \55\ A ``Participant'' is, except as otherwise described in the
Rules of the Exchange, ``any Participant Firm that holds a valid
Trading Permit and any person associated with a Participant Firm who
is registered with the Exchange under Articles 16 and 17 as a Market
Maker Authorized Trader or Institutional Broker Representative,
respectively.'' Article I, Rule 1(s). A Participant is considered a
``member'' of the Exchange for purposes of the Act. ``Institutional
Broker'' means a member of the Exchange who is registered as an
Institutional Broker pursuant to the provisions of Article 17 and
has satisfied all Exchange requirements to operate as an
Institutional Broker on the Exchange. Article 1, Rule 1(n). See 84
FR 44654, note 6, supra, at notes 7 and 11.
    \56\ The other Participants are a member of one or more of the
Affiliate SROs. The Exchange believes that if such a Participant's
business model required co-location, that Participant would already
be co-located, given its membership in one or more Affiliate SROs.
    \57\ The seven Participants are all either Institutional Brokers
or trade through a third party clearing firm. Institutional Brokers'
usage of the Exchange is largely conducted in a non-automated
fashion through manual tools such as the Exchange's Brokerplex
interface. See Article 17, Rule 3, Interpretations and Policies .01
(``Institutional Brokers essentially are order-entry firms that act
primarily as brokers for other broker-dealers or institutional
customers''); and 84 FR 44654, note 6, supra, at 44661-44662 and
44666. The remaining Participants trade through a third party, which
increases latency, suggesting that co-location is not a priority for
their business model. For these reasons, the Exchange does not
expect the seven Participants to opt to become Users in order to
trade on the Exchange.
---------------------------------------------------------------------------

    The proposed change is not targeted at, or expected to be limited
in applicability to, a specific segment of market participant, as co-
location is available to any market participant that wishes to be a
User. If, contrary to the Exchange's beliefs, a market participant
elects to co-locate in response to the proposed change, that new User
would be subject to the same fees as all other Users--the same fees it
would be subject to today, irrespective of what type or size of market
participant it is.

    As with the Affiliate SROs' co-location services, Users that
receive co-location services from the Exchange would not receive any
means of access to the Exchange's trading and execution systems that is
separate from or superior to that of Users that do not receive co-
location services.\58\ All orders sent to the Exchange would enter the
Exchange's trading and execution systems through the same order gateway
regardless of whether the sender is co-located in the Exchange's data
center or not. In addition, co-located Users would not receive any
market data or data service product that is not available to all Users.
However, Users that receive co-location services normally would expect
reduced latencies in sending orders to the Exchange and receiving
market data from the Exchange.
---------------------------------------------------------------------------

    \58\ See note 52, supra.
---------------------------------------------------------------------------

    As with the co-location services of the Affiliate SROs, (i) neither
a User nor any of the User's customers would be permitted to submit
orders directly to the Exchange unless such User or customer is a
member organization, a Sponsored Participant or an agent thereof (e.g.,
a service bureau providing order entry services); (ii) use of the
proposed co-location services would be completely voluntary and
available to all Users on a non-discriminatory basis; and (iii) a User
would only incur one charge for the particular co-location service
described herein, regardless of whether the User connects only to the
Exchange or to the Exchange and one or more of the Affiliate SROs.\59\
---------------------------------------------------------------------------

    \59\ Id.
---------------------------------------------------------------------------

    The proposed changes are not otherwise intended to address any
other issues, and the Exchange is not aware of any problems that member
organizations would have in complying with the proposed change.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\60\ in general, and furthers the
objectives of Sections 6(b)(4) and (5) of the Act,\61\ 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. In addition, it is designed to
foster cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to, and
perfect the mechanisms of, a free and open market and a national market
system and, in general, to protect investors and the public interest
and because it is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \60\ 15 U.S.C. 78f(b).
    \61\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

The Proposed Rule Change Is Reasonable
    The Exchange believes that the proposed rule change is reasonable
for the following reasons.
    As noted above, the Exchange operates in a highly competitive
market. The Commission has repeatedly expressed its preference for
competition over regulatory intervention in determining prices,
products, and services in the securities markets. Specifically, in
Regulation NMS, the Commission highlighted the importance of market
forces in determining prices and SRO revenues and, also, recognized
that current regulation of the market system ``has been remarkably
successful in promoting market competition in its broader forms that
are most important to investors and listed companies.'' \62\
---------------------------------------------------------------------------

    \62\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005).
---------------------------------------------------------------------------

    With respect to co-location, the Exchange operates in a highly
competitive market in which exchanges offer co-location services as a
means to facilitate the trading and other market activities of those
market participants who believe that co-location enhances the
efficiency of their operations. Accordingly, fees charged for co-
location services would be constrained by the active competition for
the order flow of, and other business from, such market participants.
If a particular exchange charges excessive fees for colocation
services, affected market participants will opt to terminate their
colocation arrangements with that exchange, and adopt a possible range
of alternative strategies, including placing their servers in a
physically proximate location outside the exchange's data center (which
could be a competing exchange), or pursuing strategies less dependent
upon the lower exchange-to-participant latency associated with co-
location. Accordingly, the exchange charging excessive fees would stand
to lose not only co-location revenues but also the liquidity of the
formerly co-located trading firms, which could have additional follow-
on effects on the market share and revenue of the affected exchange.
    Importantly, with respect to co-location services and fees, all
market participants can be Users, irrespective of whether or not they
are Participants or members of any of the Affiliate SROs.\63\ In
addition, the proposed changes are neither new nor novel, as the
Exchange proposes to adopt the same services and fees set forth in the
Affiliate SRO Price Lists, with the non-substantive differences
described above. As a result, the proposed rule change would simply
offer market participants the same services and fees to which they
already have access. The sole substantive change that would result from
the Exchange offering co-location services would be that Users would be
able to have low latency connections to the Exchange. In other words,
the sole change would be a benefit to market participants, with no
change in the related costs. If the proposed rule change is not
operative, the Exchange will not offer co-location, and market
participants will not be able to receive that benefit.
---------------------------------------------------------------------------

    \63\ See note 6, supra.
---------------------------------------------------------------------------

    In addition, the Exchange believes that the proposed rule change is
reasonable because, for the reasons discussed above, current Users
would not incur any new fees and the Exchange does not expect to
attract any new Users as a result of the proposed change. Even though
all four Affiliate SROs and the Exchange would offer co-location
services, a User that purchased services would only be charged once.
This would be true irrespective of whether the User were a member of
all, some, or none of the Affiliate SROs and the Exchange. As noted
above, the Exchange expects that a current User that starts to trade on
the Exchange or connects to its market data as a result of the proposed
change would not incur any new fees. With respect to market
participants that are not current Users, the Exchange does not expect
any of them to become Users in order to connect to the Exchange's data
feed or trade on the Exchange.
    The Exchange believes that the proposed co-location services and
fees are reasonable because under the proposed change the Exchange
would provide market participants with the option to co-locate, but
would not require it. The co-location services, including various
options for cabinets, LCN and IP network access, connectivity to
Included Data Products, Third Party Data Feeds, third party testing and
certification feeds, DTCC and Wireless Third Party Data (collectively,
``Connectivity''), access to Exchange Systems and Third Party Systems
(together, ``Access''), hosting, and services, would be provided as
conveniences to Users.

    As is true now, use of any co-location service would be completely
voluntary, and each market participant would be able to determine
whether to use co-location services based on the requirements of its
business operations. If it chose to co-locate, it would be able to
determine what size of cabinet, form, and latency of network, would
best suit its needs. Users would not be required to use any of their
bandwidth for Access or Connectivity unless they wished to do so.
Rather, a User would only receive the services it selected, and a User
could change what services it receives at any time, subject, in the
case of Access and Connectivity, to authorization from the relevant
third party system or data provider, Affiliate SRO or the Exchange.
    As alternatives to using co-location, a market participant would be
able to access or connect to Exchange Systems, Third Party Systems,
Included Data Products, Third Party Data Feeds, third party testing and
certification feeds, DTCC and Wireless Third Party Data through a
Hosting User or a connection to an Exchange access center outside the
data center, third party access center, or third party vendor. The
market participant could make such connection through a third party
telecommunication provider, third party wireless network, the Secure
Financial Transaction Infrastructure (``SFTI'') network, or a
combination thereof.
    The proposed Fee Schedule would set forth: (a) The relevant
definitions and General Notes, including a detailed description of the
Access and Connectivity Users receive with their purchase of access to
the LCN or IP network; (b) the Cabinet-Related Fees; (c) the Access and
Service Fees; (d) the Service-related Fees; (e) a description of the
Migration; and (f) information regarding connectivity to Third Party
Systems, Third Party Data Feeds, third party testing and certification
feeds, and DTCC. Such Fee Schedule text would make the description of
co-location services and fees accessible and transparent, providing
market participants with clarity as to what services were offered
within co-location and what the related fees would be.
    The Exchange believes that charging distinct fees for different co-
location services would be reasonable because not all Users would need,
or wish, to utilize the same co-location services. The proposed variety
of services would allow Users to select which co-location services to
use, based on their business needs, and Users would only be charged for
the services that they selected. By charging only those Users that
utilize a co-location service the related fee, those Users that
directly benefit from a service would support its cost.
    Similarly, the Exchange believes the proposed fees are reasonable
because they would allow the Exchange to defray or cover the costs
associated with offering different co-location services while providing
Users the benefit of such services, including the benefits of, among
other things, choosing among the array of different options for
cabinets, power, LCN and IP network access, Connectivity, Access,
hosting and services; having an efficient connection to clearing, fund
transfer, insurance, and settlement services; and having an environment
in which to conduct tests with nonlive data and to certify conformance
to any applicable technical requirements.
    The Exchange believes that the proposed charges are reasonable
because the Exchange would offer co-location services as conveniences
to Users, but in order to do so would have to provide, maintain and
operate the data center facility hardware and technology
infrastructure. The Exchange would need to expand the network
infrastructure to keep pace with the number of services available to
Users, including any increasing demand for bandwidth, and to establish
any additional administrative controls. The Exchange would have to
handle the installation, administration, monitoring, support and
maintenance of such services, including by responding to any production
issues. In addition, in order to provide connectivity to Third Party
Data Feeds, Third Party Systems, third party testing and certification
feeds and DTCC, the Exchange would have to maintain multiple
connections to each Third Party Data Feed, Third Party System, and
DTCC, allowing the Exchange to provide resilient and redundant
connections; adapt to any changes made by the relevant third party; and
cover any applicable fees (other than redistribution fees) charged by
the relevant third party, such as port fees.
    The Exchange believes it is reasonable that redistribution fees
charged by providers of Third Party Data Feeds would be passed through
to the User, without change to the fee. If not passed through, the cost
of the re-distribution fees would be factored into the proposed fees
for connectivity to Third Party Data Feeds. The Exchange believes that
passing through the fees makes them more transparent to the User,
allowing the User to better assess the cost of the connectivity to a
Third Party Data Feed by seeing the individual components of the cost,
i.e., the Exchange's fee and the redistribution fee.
    The Exchange believes that it is reasonable to not charge third
party markets or content providers for connectivity to their own Third
Party Data Feeds, as the Exchange understands that such parties
generally receive their own feeds for purposes of diagnostics and
testing. The Exchange believes that facilitating such diagnostics and
testing would remove impediments to, and perfect the mechanisms of, a
free and open market and a national market system and, in general,
protect investors and the public interest.
The Proposed Rule Change Is Equitable
    The Exchange believes the proposed rule change is an equitable
allocation of its fees and credits for the following reasons.
    The Exchange believes that the proposed co-location services and
fees are reasonable because under the proposed change the Exchange
would provide market participants with the option to co-locate, but
would not require it. The co-location services, including various
options for cabinets, LCN and IP network access, Connectivity, Access,
hosting, and services, would be provided as conveniences to Users.
    As is true now, use of any co-location service would be completely
voluntary, and each market participant would be able to determine
whether to use co-location services based on the requirements of its
business operations. If it chose to co-locate, it would be able to
determine what size of cabinet, form, and latency of network, would
best suit its needs. Users would not be required to use any of their
bandwidth for Access or Connectivity unless they wished to do so.
Rather, a User would only receive the services it selected, and a User
could change what services it receives at any time, subject, in the
case of Access and Connectivity, to authorization from the relevant
third party system or data provider, Affiliate SRO or the Exchange.
    In addition to the co-location services being completely voluntary,
they would be available to all Users on an equal basis (i.e., the same
co-location services would be available to all Users). All Users that
voluntarily elected to receive a co-location service would be charged
the same amount for the same service.
    Further, by having the Fee Schedule set forth the same co-location
services and fees offered by the Affiliate SROs, with only non-
substantive differences from the Affiliate SRO Price Lists, Users would
benefit from having consistent products and pricing across the

Exchange and the four Affiliate SROs. As is true for the Affiliate SROs
and as specified in the proposed Fee Schedule, a User that incurred co-
location fees for a particular co-location service pursuant thereto
would not be subject to co-location fees for the same co-location
service charged by the Affiliate SROs.
    The Exchange believes that the proposal to establish procedures and
waive certain fees in connection with the movement of equipment at the
data center in a Migration would provide for the equitable allocation
of reasonable fees because, pursuant to the proposed procedures for
selecting which Users would be required to move within the data center,
a User would be required to move only if the Exchange would be able to
accommodate such User's current space and power requirements at the new
location, so as to minimize the disruption to the User. The Exchange
believes that the waiver of overlapping monthly recurring charges, the
waiver of the Service-Related Fees, and the waiver of one month of
monthly recurring charges in a Migration would be reasonable because
Users would be moving at the Exchange's request and the waivers would
help to alleviate the burden on the Users that are required to move.
The Proposed Rule Change Is Not Unfairly Discriminatory
    The Exchange believes that the proposed change is not unfairly
discriminatory for the following reasons.
    As is true now, use of any co-location service would be completely
voluntary, and each market participant would be able to determine
whether to use co-location services based on the requirements of its
business operations. In addition to the co-location services being
completely voluntary, they would be available to all Users on an equal
basis (i.e., the same co-location services would be available to all
Users). All Users that voluntarily elected to receive a co-location
service would be charged the same amount for the same service.
    The Exchange believes that charging distinct fees for different co-
location services is not unfairly discriminatory because not all Users
would need, or wish, to utilize the same co-location services. The
proposed variety of services would allow Users to select which co-
location services to use, based on their business needs, and Users
would only be charged for the services that they selected. By charging
only those Users that utilize a co-location service the related fee,
those Users that directly benefit from a service would support its
cost.
    The Exchange believes that the proposed charges are not unfairly
discriminatory because the Exchange would offer co-location services as
conveniences to Users, but in order to do so would have to provide,
maintain and operate the data center facility hardware and technology
infrastructure. The Exchange would need to expand the network
infrastructure to keep pace with the number of services available to
Users, including any increasing demand for bandwidth, and to establish
any additional administrative controls. The Exchange would have to
handle the installation, administration, monitoring, support and
maintenance of such services, including by responding to any production
issues. In addition, in order to provide connectivity to Third Party
Data Feeds, Third Party Systems, third party testing and certification
feeds and DTCC, the Exchange would have to maintain multiple
connections to each Third Party Data Feed, Third Party System, and
DTCC, allowing the Exchange to provide resilient and redundant
connections; adapt to any changes made by the relevant third party; and
cover any applicable fees (other than redistribution fees) charged by
the relevant third party, such as port fees.
The Proposed Rule Change Would Protect Investors and the Public
Interest
    The Exchange believes that the proposed rule change relating to co-
location would perfect the mechanisms of a free and open market and a
national market system and, in general, protect investors and the
public interest for the following reasons.
    The proposed Fee Schedule would set forth: (a) The relevant
definitions and General Notes, including a detailed description of the
Access and Connectivity Users receive with their purchase of access to
the LCN or IP network; (b) the Cabinet-Related Fees; (c) the Access and
Service Fees; (d) the Service-related Fees; (e) a description of the
Migration; and (f) information regarding connectivity to Third Party
Systems, Third Party Data Feeds, third party testing and certification
feeds, and DTCC. Such Fee Schedule text would make the description of
co-location services and fees accessible and transparent, providing
market participants with clarity as to what services were offered
within co-location and what the related fees would be.
    Providing connectivity to testing and certification feeds would
provide Users an environment in which to conduct tests with non-live
data, including testing for upcoming releases and product enhancements
or the User's own software development, and allow Users to certify
conformance to any applicable technical requirements.
    The Exchange believes that it is reasonable to not charge third
party markets or content providers for connectivity to their own Third
Party Data Feeds, as the Exchange understands that such parties
generally receive their own feeds for purposes of diagnostics and
testing. Similarly, providing connectivity to DTCC would provide
efficient connection to clearing, fund transfer, insurance, and
settlement services.
    Finally, the Exchange believes that the proposal to establish
procedures and waive certain fees in connection with the movement of
equipment at the data center in a Migration would allow the Exchange to
have sufficient space in the data center to accommodate demand on an
equitable basis for the foreseeable future. The Exchange believes that
the waiver of overlapping monthly recurring charges, the waiver of the
Service-Related Fees, and the waiver of one month of monthly recurring
charges in a Migration would be reasonable because Users would be
moving at the Exchange's request and the waivers would help to
alleviate the burden on the Users that are required to move.
* * * * *
    For the foregoing reasons, the Exchange believes that the proposal
is consistent with the Act.

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

    In accordance with Section 6(b)(8) of the Act,\64\ the Exchange
believes that the proposed rule change would not impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act because all of the proposed services are completely
voluntary.
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    \64\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

    In accordance with Section 6(b)(8) of the Act,\65\ the Exchange
believes that the proposed rule change would not impose any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act.
---------------------------------------------------------------------------

    \65\ 15 U.S.C. 78f(b)(8).
---------------------------------------------------------------------------

Intramarket Competition
    The Exchange believes that the proposed rule change would not have
an impact on intramarket competition because the proposed rule change
would simply offer market participants the same services and fees to
which they already have access. The sole substantive change that would
result from the Exchange offering co-location services would be that
Users would be

able to have low latency connections to the Exchange. In other words,
the only change would be a benefit to market participants, with no
change in the related costs. If the proposed rule change is not
operative, the Exchange will not offer co-location, and market
participants will not be able to receive that benefit.
    Further, current Users would not incur any new fees and the
Exchange does not expect to attract any new Users as a result of the
proposed change. Accordingly, the proposed rule change would not have
an impact on intramarket competition. Even though all four Affiliate
SROs and the Exchange would offer co-location services, a User that
purchased services would only be charged once. This would be true
irrespective of whether the User were a member of all, some, or none of
the Affiliate SROs and the Exchange. As noted above, the Exchange
expects that a current User that starts to trade on the Exchange or
connects to its market data as a result of the proposed change would
not incur any new fees. With respect to market participants that are
not current Users, the Exchange does not expect any of them to become
Users in order to connect to the Exchange's data feed or trade on the
Exchange. Finally, as noted above, the Exchange believes that, as a
practical matter, only Participants would be interested in becoming new
Users in order to trade on the Exchange, as non-Participants cannot
trade on the Exchange. The pool of relevant Participants is small: Only
nine Participants are not also members of one or more of the Affiliate
SROs.\66\ Of those nine Participants, two are already Users, and
therefore, as explained above, would not be subject to any new or
different fees as a result of this filing. The Exchange does not expect
that any of the remaining seven Participants would opt to become Users
in order to trade on the Exchange.\67\ Simply put, the Exchange does
not expect that low latency access to such a small market would be
sufficient reason for a firm to become a User.
---------------------------------------------------------------------------

    \66\ See note 56, supra.
    \67\ See note 57, supra.
---------------------------------------------------------------------------

    The proposed co-location services would be available to all Users
on an equal basis. All Users that voluntarily selected to receive co-
location services, including cabinets, LCN and IP network access,
Connectivity, Access and other services, would be charged the same
amount for the same services. In the case of a Migration, all Users