[Federal Register Volume 78, Number 123 (Wednesday, June 26, 2013)]
[Notices]
[Pages 38431-38435]
[FR Doc No: 2013-15330]

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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

[Docket No. FMCSA-2011-0097]

Pilot Program on NAFTA Trucking Provisions

AGENCY: Federal Motor Carrier Safety Administration (FMCSA).

ACTION: Notice; request for public comment.

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SUMMARY: FMCSA announces and requests public comment on data and
information concerning the Pre-Authorization Safety Audit (PASA) for
Sergio Tristan Maldonado doing business as Tristan Transfer (Tristan)
with U.S. Department of Transportation (USDOT) number 2348928, which
applied to participate in the Agency's long-haul pilot program to test
and demonstrate the ability of Mexico-domiciled motor carriers to
operate safely in the United States beyond the municipalities in the
United States on the United States-Mexico international border or the
commercial zones of such municipalities. This action is required by the
``U.S. Troop Readiness, Veterans' Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, 2007'' and all subsequent
appropriations.

DATES: Comments must be received on or before July 8, 2013.

 ADDRESSES: You may submit comments identified by
Federal Docket Management System Number FMCSA-

2011-0097 by any one of the following methods:
     Federal eRulemaking Portal: To submit your comment online,
go to http://www.regulations.gov and in the search box insert the
docket number ``FMCSA-2011-0097'' and click the search button. When the
new screen appears, click on the blue ``Comment Now!'' button on the
right hand side of the page. On the new page, enter information
required including the specific section of this document to which each
comment applies, and provide a reason for each suggestion or
recommendation.
     Fax: 1-202-493-2251.
     Mail: Docket Management Facility, (M-30), U.S. Department
of Transportation (DOT), 1200 New Jersey Avenue SE., West Building,
Ground Floor, Room 12-140, Washington, DC 20590-0001.
     Hand Delivery: Same as mail address above, between 9 a.m.
and 5 p.m., ET, Monday through Friday, except Federal holidays. The
telephone number is<PHONE_NUMBER>.
    To avoid duplication, please use only one of these four methods. If
you submit your comments by mail or hand delivery, submit them in an
unbound format, no larger than 8\1/2\ by 11 inches, suitable for
copying and electronic filing. If you submit comments by mail and would
like to know that they reached the facility, please enclose a stamped,
self-addressed postcard or envelope. All submissions must include the
Agency name and docket number for this notice. See the ``Public
Participation'' heading below for instructions on retrieving comments
and additional information.
    Note that all comments received, including any personal information
provided, will be posted without change to http://www.regulations.gov.
Please see the ``Privacy Act'' heading below.
    Docket: For access to the docket to read background documents or
comments received, go to http://www.regulations.gov at any time and in
the search box insert the docket number ``FMCSA-2011-0097'' and click
``Search.'' Next, click ``Open Docket Folder'' and you will find all
documents and comments related to this notice. You may also go to Room
W12-140 on the ground floor of the DOT Headquarters Building at 1200
New Jersey Avenue SE., Washington, DC 20590, between 9 a.m. and 5 p.m.,
ET, Monday through Friday, except Federal holidays.
    Public Participation: The http://www.regulations.gov Web site is
generally available 24 hours each day, 365 days each year. You can get
electronic submission and retrieval help and guidelines under the
``help'' section of the http://www.regulations.gov Web site. Comments
received after the comment closing date will be included in the docket,
and will be considered to the extent practicable.
    Privacy Act: Anyone is able to search the electronic form of all
comments received into any of our dockets by the name of the individual
submitting the comment (or signing the comment, if submitted on behalf
of an association, business, labor union, etc.). You may review the DOT
Privacy Act Statement for the Federal Docket Management System
published in the Federal Register on December 29, 2010 (75 FR 82132),
or you may visit http://www.gpo.gov/fdsys/pkg/FR-2010-12-29/pdf/2010-32876.pdf.

FOR FURTHER INFORMATION CONTACT: Marcelo Perez, FMCSA, North American
Borders Division, 1200 New Jersey Avenue SE., Washington, DC 20590-
0001. Telephone<PHONE_NUMBER> Ext. 228; email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Background

    On May 25, 2007, the President signed into law the U.S. Troop
Readiness, Veterans' Care, Katrina Recovery, and Iraq Accountability
Appropriations Act, 2007 (the Act), (Pub. L. 110-28, 121 Stat. 112,
183, May 25, 2007). Section 6901 of the Act requires that certain
actions be taken by the Department of Transportation (the Department)
as a condition of obligating or expending appropriated funds to grant
authority to Mexico-domiciled motor carriers to operate beyond the
municipalities in the United States on the United States-Mexico
international border or the commercial zones of such municipalities
(border commercial zones).
    On July 8, 2011, FMCSA announced in the Federal Register [76 FR
40420] its intent to proceed with the initiation of a U.S.-Mexico
cross-border long-haul trucking pilot program to test and demonstrate
the ability of Mexico-domiciled motor carriers to operate safely in the
United States beyond the border commercial zones as detailed in the
Agency's April 13, 2011, Federal Register notice [76 FR 20807]. The
pilot program is a part of FMCSA's implementation of the North American
Free Trade Agreement (NAFTA) cross-border long-haul trucking provisions
in compliance with section 6901(b)(2)(B) of the Act. FMCSA reviewed,
assessed, and evaluated the required safety measures as noted in the
July 8, 2011, notice and considered all comments received on or before
May 13, 2011, in response to the April 13, 2011, notice. Additionally,
to the extent practicable, FMCSA considered comments received after May
13, 2011.
    In accordance with section 6901(b)(2)(B)(i) of the Act, FMCSA is
required to publish in the Federal Register, and provide sufficient
opportunity for public notice and comment comprehensive data and
information on the PASAs conducted of motor carriers domiciled in
Mexico that are granted authority to operate beyond the border
commercial zones. This notice serves to fulfill this requirement.
    FMCSA is publishing for public comment the data and information
relating to one PASA that was completed on November 20, 2012. FMCSA
announces that the Mexico-domiciled motor carrier in Table 1
successfully completed the PASA. Notice of this completion was also
published in the FMCSA Register.
    Tables 2, 3 and 4 all titled (``Successful Pre-Authorization Safety
Audit (PASA) Information'') set out additional information on the
carrier(s) noted in Table 1. A narrative description of each column in
the tables is provided as follows:
    A. Row Number in the Appendix for the Specific Carrier: The row
number for each line in the tables.
    B. Name of Carrier: The legal name of the Mexico-domiciled motor
carrier that applied for authority to operate in the United States
(U.S.) beyond the border commercial zones and was considered for
participation in the long-haul pilot program.
    C. U.S. DOT Number: The identification number assigned to the
Mexico-domiciled motor carrier and required to be displayed on each
side of the motor carrier's power units. If granted provisional
operating authority, the Mexico-domiciled motor carrier will be
required to add the suffix ``X'' to the ending of its assigned U.S. DOT
Number for those vehicles approved to participate in the pilot program.
    D. FMCSA Register Number: The number assigned to the Mexico-
domiciled motor carrier's operating authority as found in the FMCSA
Register.
    E. PASA Initiated: The date the PASA was initiated.
    F. PASA Completed: The date the PASA was completed.
    G. PASA Results: The results upon completion of the PASA. The PASA
receives a quality assurance review before approval. The quality
assurance process involves a dual review by the FMCSA Division Office
supervisor of the auditor assigned to conduct the

PASA and by the FMCSA Service Center New Entrant Specialist designated
for the specific FMCSA Division Office. This dual review ensures the
successfully completed PASA was conducted in accordance with FMCSA
policy, procedures and guidance. Upon approval, the PASA results are
uploaded into the FMCSA's Motor Carrier Management Information System
(MCMIS). The PASA information and results are then recorded in the
Mexico-domiciled motor carrier's safety performance record in MCMIS.
    H. FMCSA Register: The date FMCSA published notice of a
successfully completed PASA in the FMCSA Register. The FMCSA Register
notice advises interested parties that the application has been
preliminarily granted and that protests to the application must be
filed within 10 days of the publication date. Protests are filed with
FMCSA Headquarters in Washington, DC. The notice in the FMCSA Register
lists the following information:
    a. Current registration number (e.g., MX--not yet
assigned);
    b. Date the notice was published in the FMCSA Register;
    c. The applicant's name and address; and
    d. Representative or contact information for the applicant.
    The FMCSA Register may be accessed through FMCSA's Licensing and
Insurance public Web site at http://li-public.fmcsa.dot.gov/, and
selecting FMCSA Register in the drop down menu.
    I. U.S. Drivers: The total number of the motor carrier's drivers
approved for long-haul transportation in the United States beyond the
border commercial zones.
    J. U.S. Vehicles: The total number of the motor carrier's power
units approved for long-haul transportation in the United States beyond
the border commercial zones.
    K. Passed Verification of 5 Elements (Yes/No): A Mexico-domiciled
motor carrier will not be granted provisional operating authority if
FMCSA cannot verify all of the following five mandatory elements. FMCSA
must:
    a. Verify a controlled substances and alcohol testing program
consistent with 49 CFR part 40.
    b. Verify a system of compliance with hours-of-service rules of 49
CFR part 395, including recordkeeping and retention;
    c. Verify the ability to obtain financial responsibility as
required by 49 CFR 387, including the ability to obtain insurance in
the United States;
    d. Verify records of periodic vehicle inspections; and
    e. Verify the qualifications of each driver the carrier intends to
use under such authority, as required by 49 CFR parts 383 and 391,
including confirming the validity of each driver's Licencia Federal de
Conductor and English language proficiency.
    L. If No, Which Element Failed: If FMCSA cannot verify one or more
of the five mandatory elements outlined in 49 CFR part 365, Appendix A,
Section III, this column will specify which mandatory element(s) cannot
be verified.
    Please note that for items L through P below, during the PASA,
after verifying the five mandatory elements discussed in item K above,
FMCSA will gather information by reviewing a motor carrier's compliance
with ``acute and critical'' regulations of the Federal Motor Carrier
Safety Regulations (FMCSRs) and Hazardous Materials Regulations (HMRs).
Acute regulations are those where noncompliance is so severe as to
require immediate corrective actions by a motor carrier regardless of
the overall basic safety management controls of the motor carrier.
Critical regulations are those where noncompliance relates to
management and/or operational controls. These regulations are
indicative of breakdowns in a carrier's management controls. A list of
acute and critical regulations is included in 49 CFR part 385, Appendix
B, Section VII.
    Parts of the FMCSRs and HMRs having similar characteristics are
combined together into six regulatory areas called ``factors.'' The
regulatory factors are intended to evaluate the adequacy of a carrier's
management controls.
    M. Passed Phase 1, Factor 1: A ``yes'' in this column indicates the
carrier has successfully met Factor 1 (listed in part 365, Subpart E,
Appendix A, Section IV(f)). Factor 1 includes the General Requirements
outlined in parts 387 (Minimum Levels of Financial Responsibility for
Motor Carriers) and 390 (Federal Motor Carrier Safety Regulations--
General).
    N. Passed Phase 1, Factor 2: A ``yes'' in this column indicates the
carrier has successfully met Factor 2, which includes the Driver
Requirements outlined in parts 382 (Controlled Substances and Alcohol
Use and Testing), 383 (Commercial Driver's License Standards;
Requirements and Penalties) and 391 (Qualifications of Drivers and
Longer Combination Vehicle (LCV) Driver Instructors).
    O. Passed Phase 1, Factor 3: A ``yes'' in this column indicates the
carrier has successfully met Factor 3, which includes the Operational
Requirements outlined in parts 392 (Driving of Commercial Motor
Vehicles) and 395 (Hours of Service of Drivers).
    P. Passed Phase 1, Factor 4: A ``yes'' in this column indicates the
carrier has successfully met Factor 4, which includes the Vehicle
Requirements outlined in parts 393 (Parts and Accessories Necessary for
Safe Operation) and 396 (Inspection, Repair and Maintenance) and
vehicle inspection and out-of-service data for the last 12 months.
    Q. Passed Phase 1, Factor 5: A ``yes'' in this column indicates the
carrier has successfully met Factor 5, which includes the hazardous
material requirements outlined in parts 171 (General Information,
Regulations, and Definitions), 177 (Carriage by Public Highway), 180
(Continuing Qualification and Maintenance of Packagings) and 397
(Transportation of Hazardous Materials; Driving and Parking Rules).
    R. Passed Phase 1, Factor 6: A ``yes'' in this column indicates the
carrier has successfully met Factor 6, which includes Accident History.
This factor is the recordable accident rate during the past 12 months.
A recordable ``accident'' is defined in 49 CFR 390.5, and means an
accident involving a commercial motor vehicle operating on a public
road in interstate or intrastate commerce which results in a fatality;
a bodily injury to a person who, as a result of the injury, immediately
received medical treatment away from the scene of the accident; or one
or more motor vehicles incurring disabling damage as a result of the
accident requiring the motor vehicle to be transported away from the
scene by a tow truck or other motor vehicle.
    S. Number U.S. Vehicles Inspected: The total number of vehicles
(power units) the motor carrier is approved to operate in the United
States beyond the border commercial zones that received a vehicle
inspection during the PASA. During a PASA, FMCSA inspected all power
units to be used by the motor carrier in the pilot program and applied
a current Commercial Vehicle Safety Alliance (CVSA) inspection decal,
if the inspection is passed successfully. This number reflects the
vehicles that were inspected, irrespective of whether the vehicle
received a CVSA inspection at the time of the PASA decal as a result of
a passed inspection.
    T. Number U.S. Vehicles Issued CVSA Decal: The total number of
inspected vehicles (power units) the motor carrier is approved to
operate in the United States beyond the border commercial

zones that received a CVSA inspection decal as a result of an
inspection during the PASA.
    U. Controlled Substances Collection: Refers to the applicability
and/or country of origin of the controlled substance and alcohol
collection facility that will be used by a motor carrier that has
successfully completed the PASA.
    a. ``US'' means the controlled substance and alcohol collection
facility is based in the United States.
    b. ``MX'' means the controlled substance and alcohol collection
facility is based in Mexico.
    c. ``Non-CDL'' means that during the PASA, FMCSA verified that the
motor carrier is not utilizing commercial motor vehicles subject to the
commercial driver's license requirements as defined in 49 CFR 383.5
(Definition of Commercial Motor Vehicle). Any motor carrier that does
not operate commercial motor vehicles as defined in Sec.  383.5 is not
subject to DOT controlled substance and alcohol testing requirements.
    V. Name of Controlled Substances and Alcohol Collection Facility:
Shows the name and location of the controlled substances and alcohol
collection facility that will be used by a Mexico-domiciled motor
carrier that has completed the PASA.

                                 Table 1
   [Row number in Tables 2, 3 and 4 of the Appendix to today's notice]
------------------------------------------------------------------------
                      Name of carrier                         USDOT No.
------------------------------------------------------------------------
Sergio Tristan Maldonado dba Tristan Transfer..............      2348928
------------------------------------------------------------------------

                                          Table 2--Successful Pre-Authorization Safety Audit (PASA) Information
                                                                [See also Tables 3 and 4]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                         Column C--                     Column E--   Column F--                     Column H--   Column I--   Column J--
Column A--row No.   Column B--name of    US DOT No.   Column D--FMCSA      PASA         PASA      Column G--PASA      FMCSA      US drivers  US vehicles
                         carrier                       register No.     initiated    completed        results        register
--------------------------------------------------------------------------------------------------------------------------------------------------------
1................  Sergio Tristan           2348928  MX-None.........   11/13/2012   11/20/2012  Pass............    6/17/2013            2            1
                    Maldonado dba
                    Tristan Transfer.
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                                          Table 3--Successful Pre-Authorization Safety Audit (PASA) Information
                                                                [See also Tables 2 and 4]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Column K--
                                   Column C--    Column D--        Passed      Column L-- If    Column M--     Column N--     Column O--     Column P--
 Column A--row   Column B--name    US DOT No.       FMCSA       verification     no, which     Passed phase   passed phase   passed phase   passed phase
      No.          of carrier                   register No.    of 5 elements     element      1  factor 1    1  factor 2    1  factor 3    1  factor 4
                                                                  (yes/no)         failed
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1.............  Sergio Tristan        2348928  MX-None.......  Yes...........  None.........  Pass.........  Pass.........  Pass.........  Pass.
                 Maldonado dba
                 Tristan
                 Transfer.
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                                          Table 4--Successful Pre-Authorization Safety Audit (PASA) Information
                                                                [See also Tables 2 and 3]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                Column V--name
                                                                   Column Q--                    Column S--   Column T--    Column U--     of controlled
 Column A--row   Column B--name of   Column C--  Column D--FMCSA     passed       Column R--     number US    number US     controlled    substances and
      No.             carrier        US DOT No.    register No.     phase I     passed phase I    vehicles     vehicles      substance        alcohol
                                                                    factor 5       factor 6      inspected   issued CVSA    collection      collection
                                                                                decal                        facility
--------------------------------------------------------------------------------------------------------------------------------------------------------
1..............  Sergio Tristan         2348928  MX-None........          N/A  Pass...........            3            3  MX............  Laredo Urgent
                  Maldonado dba                                                                                Care.
                  Tristan Transfer.
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    In an effort to provide as much information as possible for review,
the application and PASA results for this carrier are posted at the
Agency's Web site for the pilot program at http://www.fmcsa.dot.gov/intl-programs/trucking/Trucking-Program.aspx. For carriers that
participated in the Agency's demonstration project that ended in 2009,
copies of the previous PASA and compliance review, if conducted, are
also posted. All documents were redacted so that personal information
regarding the drivers is not released. Sensitive business information,
such as the carrier's tax identification number, is also redacted. In
response to previous comments received regarding the PASA notice
process, FMCSA also posted copies of the vehicle inspections conducted
during the PASA in the PASA document.
    A list of the carrier's vehicles approved by FMCSA for use in the
pilot program is also available at the above referenced Web site.
    The Agency acknowledges that through the PASA process it was
determined that Sergio Tristan Maldonado had an affiliation not
identified in the original application. It was noted during the
Agency's vetting and documented as an attachment to the PASA. Sergio
Tristan Maldonado submitted for the record a letter explaining the
relationship with a Mexico-domiciled motor carrier, Maria Higinia
Tristan Maldonado dba Trujillo's Transfer (USDOT 1771021).
Maria Higinia Tristan Maldonado is the sister of Sergio Tristan
Maldonado. She currently employs him as a manager and operates the
vehicle and employs the two drivers that Sergio Tristan Maldonado plans
to use in the Pilot Program. During its vetting of the application and
the PASA, FMCSA

confirmed that Sergio Tristan Maldonado did not establish or use the
affiliated company to evade FMCSA regulation in continuing motor
carrier operations, or fail to disclose the affiliation for the purpose
of avoiding or hiding previous non-compliance or safety problems.
    FMCSA reviewed the inspection records of the affiliated carrier,
Maria Higinia Tristan Maldonado dba Trujillo's Transfer, an OP-2
carrier. This affiliated company has Safety Measurement System (SMS)
scores that exceed the Behavioral Analysis and Safety Improvement
Categories (BASICs) thresholds in two areas: Driver Fitness and Vehicle
Maintenance. The Agency will be monitoring the safety of the affiliated
carrier through SMS and will take action directly on the carriers, if
appropriate.
    Researching further, FMCSA reviewed a relationship that Maria
Higinia Tristan Maldonado dba Trujillo's Transfer has with a Mexico-
domiciled motor carrier, Maria Dolores Rosas Velazquez dba Transportes
Cel; USDOT 2161024, because Trujillo's Transfer vehicles
(including the vehicle Tristan Transfer plans to use in the Pilot
Program) were used by Transportes Cel in the past. According to a
statement provided by the Pilot Program applicant Sergio Tristan
Maldonado, Transportes Cel operated these vehicles for a period of time
under an agreement made between Trujillo's Transfer and Transportes
Cel. Sergio Tristan Maldonado has no affiliation with Transportes Cel.
    Two of the three vehicles submitted for planned operation in the
Pilot Program, a 1995 U.S. manufactured Volvo, and a 1996 U.S.
manufactured International, were deemed ineligible for participation as
not able to meet EPA vehicle emissions standards required for the Pilot
Program.
    The two approved drivers passed the English language proficiency
evaluation during the PASA.

Request for Comments

    In accordance with the Act, FMCSA requests public comment from all
interested persons on the PASA information presented in this notice.
All comments received before the close of business on the comment
closing date indicated at the beginning of this notice will be
considered and will be available for examination in the docket at the
location listed under the ADDRESSES section of this notice. Comments
received after the comment closing date will be filed in the public
docket and will be considered to the extent practicable. In addition to
late comments, the FMCSA will also continue to file, in the public
docket, relevant information that becomes available after the comment
closing date. Interested persons should continue to examine the public
docket for new material.
    FMCSA notes that under its regulations, preliminary grants of
authority, pending the carrier's showing of compliance with insurance
and process agent requirements and the resolution of any protests, are
publically noticed through publication in the FMCSA Register. Any
protests of such grants must be filed within 10 days of publication of
notice in the FMCSA Register.

    Issued on: June 18, 2013.
Anne S. Ferro,
Administrator.
[FR Doc. 2013-15330 Filed 6-25-13; 8:45 am]
BILLING CODE 4910-EX-P


[Federal Register Volume 88, Number 12 (Thursday, January 19, 2023)]
[Notices]
[Pages 3453-3455]
[FR Doc No: 2023-00906]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-96645; File No. SR-CboeEDGX-2023-002]

Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend Its Fee Schedule

January 12, 2023.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on January 3, 2023, Cboe EDGX Exchange, Inc. (the ``Exchange'' or
``EDGX'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX Options'')
proposes to amend its Fee Schedule. The text of the proposed rule
change is provided in Exhibit 5.
    The text of the proposed rule change is also available on the
Exchange's website (http://markets.cboe.com/us/options/regulation/rule_filings/edgx/), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Fee Schedule to amend three
Market Maker Volume Tiers and increase the Market Maker Add Liquidity
Fee, effective January 3, 2023.
    The Exchange first notes that it operates in a highly competitive
market in which market participants can readily direct order flow to
competing venues if they deem fee levels at a particular venue to be
excessive or incentives to be insufficient. More specifically, the
Exchange is only one of 16 options venues to which market participants
may direct their order flow. Based on publicly available information,
no single options exchange has more than 18% of the market share and
currently the Exchange represents only approximately 6% of the market
share.\3\ Thus, in such a low-concentrated and highly competitive
market, no single options exchange, including the Exchange, possesses
significant pricing power in the execution of option order flow. The
Exchange believes that the ever-shifting market share among the
exchanges from month to month demonstrates that market participants can
shift order flow or discontinue to reduce use of certain categories of
products, in response to fee changes. Accordingly, competitive forces
constrain the Exchange's transaction fees, and market participants can
readily trade on competing venues if they deem pricing levels at those
other venues to be more favorable.
---------------------------------------------------------------------------

    \3\ See Cboe Global Markets U.S. Options Market Monthly Volume
Summary (December 27, 2022), available at https://markets.cboe.com/us/options/market_statistics/.
---------------------------------------------------------------------------

    The Exchange's Fees Schedule sets forth standard rebates and rates
applied per contract. For example, the Exchange assesses a standard fee
of $0.20 per contract for Market Maker orders that add liquidity in
both Penny and Non-Penny Securities and $0.23 per contract for Market
Maker orders that remove liquidity in both Penny and Non-Penny
securities. The Fee Codes and Associated Fees section of the Fees
Schedule also provide for certain fee codes associated with certain
order types and market participants that provide for various other fees
or rebates. Additionally, the Fee Schedule offers tiered pricing which
provides Members \4\ opportunities to qualify for higher rebates or
reduced fees where certain volume criteria and thresholds are met.
Additionally, in response to the competitive environment, the Exchange
also offers tiered pricing, which provides Members with opportunities
to qualify for higher rebates or reduced fees where certain volume
criteria and thresholds are met. Tiered pricing provides an incremental
incentive for Members to strive for higher tier levels, which provides
increasingly higher benefits or discounts for satisfying increasingly
more stringent criteria.
---------------------------------------------------------------------------

    \4\ See Exchange Rule 1.5(n).
---------------------------------------------------------------------------

    For example, pursuant to Footnote 2 of the Fees Schedule, the
Exchange currently offers eight [sic] Market Maker Volume Tiers which
provide reduced fees between $0.01 and $0.17 per contract for
qualifying Market Makers orders that yield fee code PM or NM where a
Member meets the respective tiers' volume thresholds.\5\ The Exchange
proposes to amend the reduced fees that correspond to Market Maker
Volume Tiers 4, 5 and 6. Currently, Market Maker Volume Tier 4 provides
a reduced fee of $0.07 per contract for a Member's qualifying orders
(i.e., yielding fee code PM or NM) if a Member has an ADV \6\ in
Customer

orders greater than or equal to 0.50% of average OCV \7\; Market Maker
Volume Tier 5 provides a reduced fee of $0.03 per contract for a
Member's qualifying orders (i.e., yielding fee code PM or NM) if a
Member has an ADV in Customer orders greater than or equal to 0.95% of
average OCV; and Market Maker Volume Tier 6 provides a reduced fee of
$0.01 per contract for a Member's qualifying orders (i.e., yielding fee
code PM or NM) if a Member has an ADV in Customer orders greater than
or equal to 1.45% of average OCV. The Exchange proposes to increase
each of the offered reduced fees for each of these tiers by $0.01 per
contract. More specifically, the Exchange proposes to increase the
reduced fees as follows: under Tier 4 from $0.07 per contract to $0.08
per contract; under Tier 5 from $0.03 per contract to $0.04 per
contract; and under Tier 6 from $0.01 per contract to $0.02 per
contract. The Exchange also proposes to amend the criteria under Tier
5.\8\ Particularly, the Exchange proposes to require that Members have
an ADV in Market Maker orders of greater than or equal to 1.20%
(instead of 0.95%) of average OCV.
---------------------------------------------------------------------------

    \5\ See Cboe EDGX U.S. Options Exchange Fees Schedule, Footnote
2, Market Maker Volume Tiers.
    \6\ ``ADV'' means average daily volume calculated as the number
of contracts added or removed, combined, per day. ADV is calculated
on a monthly basis. See Cboe EDGX Options Exchange Fee Schedule.
    \7\ ``OCV'' means the total equity and ETF options volume that
clears in the Customer range at the Options Clearing Corporation
(``OCC'') for the month for which the fees apply, excluding volume
on any day that the Exchange experiences an Exchange System
Disruption and on any day with a scheduled early market close. See
Cboe EDGX Options Exchange Fee Schedule.
    \8\ In connection with the proposed fee changes, the Exchange
also proposes to update the corresponding listed fees of ``$0.07'',
``$0.03'' and ``$0.01'' for fee codes PM and NM in the Standard
Rates table to the proposed new rates of ``$0.08'', ``$0.04'' and
``$0.02'', respectively.
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    The Exchange lastly proposes to increase the standard fee for
Market Maker orders that remove liquidity in both Penny and Non-Penny
Securities (i.e., yield fee codes PT and NT, respectively) from $0.23
per contract to $0.024 per contract.
Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\9\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \10\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \11\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ Id.
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    As described above, the Exchange operates in a highly competitive
market in which market participants can readily direct order flow to
competing venues if they deem fee levels at a particular venue to be
excessive or incentives to be insufficient. Additionally, the Exchange
notes that relative volume-based incentives and discounts have been
widely adopted by exchanges,\12\ including the Exchange,\13\ and are
reasonable, equitable and non-discriminatory because they are open to
all Members on an equal basis and provide additional benefits or
discounts that are reasonably related to (i) the value to an exchange's
market quality and (ii) associated higher levels of market activity,
such as higher levels of liquidity provision and/or growth patterns.
Competing exchanges offer similar tiered pricing structures, including
schedules of rebates and fees that apply based upon members achieving
certain volume and/or growth thresholds, as well as assess similar fees
or rebates for similar types of orders, to that of the Exchange.
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    \12\ See EDGX Equities Fee Schedule, Footnote 1, Add/Remove
Volume Tiers.
    \13\ See BZX Equities Fee Schedule, Footnote 1, Add/Remove
Volume Tiers.
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    The Exchange believes that increasing the reduced fees offered
under Market Maker Volume Tiers 4, 5 and 6 under Footnote 2 are
reasonable because Members are still eligible to receive reduced fees
for meeting the corresponding criteria, albeit at less of a discount
than before. While Market Maker Volume Tiers 4, 5 and 6 will provide a
lower fee reduction than that currently offered and while the proposed
change to the criteria under Tier 5 will make it more difficult to
attain, the Exchange still believes that the changes are reasonable as
the tiers, even as amended, will continue to incentivize Members to
send additional Market Maker orders to the Exchange. An overall
increase in activity would deepen the Exchange's liquidity pool, offers
additional cost savings, support the quality of price discovery,
promote market transparency and improve market quality, for all
investors. Moreover, the Exchange is not required to maintain these
tiers nor provide reduced fees. The Exchange believes the proposed
changes to the reduced fees offered under these tiers still remain
commensurate with the corresponding criteria under the respective
tiers, including the proposed change to the criteria under Tier 5.
Further, Members still have other opportunities to obtain reduced fees
that are not being modified such as via Market Maker Volume Tiers 1
through 3.\14\
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    \14\ See Cboe EDGX Options Fees Schedule, Footnote 2.
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    The Exchange believes the proposed change is also equitable and not
unfairly discriminatory because it applies uniformly to all Members.
Without having a view of activity on other markets and off-exchange
venues, the Exchange has no way of knowing whether these proposed
changes would definitely result in any Members qualifying for Tiers 4,
5 and 6. While the Exchange has no way of predicting with certainty how
the proposed changes will impact Member activity, based on trading
activity from the prior months, the Exchange anticipates that at least
3 Members will achieve Tier 4, 1 Member will achieve Tier 5, and 1
Member will achieve Tier 6. The Exchange also believes that the
proposed changes will not adversely impact any Member's ability to
otherwise qualify for reduced fees or enhanced rebates offered under
other tiers.
    The Exchange believes the proposed change to increase the standard
fee for Market Maker orders that remove liquidity in both Penny and
Non-Penny Securities (i.e., yield fee codes PT and NT, respectively) is
reasonable because it is a modest increase and is still in line with
(and in fact lower than) fees assessed for similar transactions at
other exchanges.\15\ The Exchange believes the proposed change is
equitable and not unfairly discriminatory because it applies uniformly
to all Members.
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    \15\ See, e.g., NYSE Arca Fee Schedule, Transaction Fee for
Electronic Executions--Per Contract, which provides Market Makers
that remove liquidity are assessed $0.50 per contract in Penny
Issues and $1.10 per contract in Non-Penny Issues. See also Cboe BZX
Options Fees Schedule, which provides Market Makers that remove
liquidity are assessed $0.50 per contract in Penny Program
Securities and $1.10 per contract in Non-Penny Program Securities.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose

any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. In particular, the Exchange
believes the proposed rule change does not impose any burden on
intramarket competition that is not necessary or appropriate in
furtherance of the purposes of the Act. Particularly, the proposal to
amend the Market Maker Volume Tiers and Market Maker fees for orders
that remove liquidity applies to all Members. All Members will continue
to have an opportunity to receive reduced fees under various tiers,
including Market Maker Volume Tiers 1 through 6, which tiers are
generally designed to increase the competitiveness of EDGX and attract
order flow and incentivize participants to increase their participation
on the Exchange, providing for additional execution opportunities for
market participants and improved price transparency. Greater overall
order flow, trading opportunities, and pricing transparency benefit all
market participants on the Exchange by enhancing market quality and
continuing to encourage Members to send orders, thereby contributing
towards a robust and well-balanced market ecosystem.
    The Exchange also believes the proposed rule change does not impose
any burden on intermarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act. As previously
discussed, the Exchange operates in a highly competitive market.
Members have numerous alternative venues they may participate on and
direct their order flow, including 15 other options exchanges.
Additionally, the Exchange represents a small percentage of the overall
market. Based on publicly available information, no single options
exchange has more than 18% of the market share. Therefore, no exchange
possesses significant pricing power in the execution of order flow.
Indeed, participants can readily choose to send their orders to other
exchanges if they deem fee levels at those other venues to be more
favorable. Moreover, 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.'' The fact that
this market is competitive has also long been recognized by the courts.
In NetCoalition v. Securities and Exchange Commission, the D.C. Circuit
stated as follows: ``[n]o one disputes that competition for order flow
is `fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution'; [and] `no exchange can afford to
take its market share percentages for granted' because `no exchange
possesses a monopoly, regulatory or otherwise, in the execution of
order flow from broker dealers'. . . .''. Accordingly, the Exchange
does not believe its proposed fee change imposes any burden on
competition that is not necessary or appropriate in furtherance of the
purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \16\ and paragraph (f) of Rule 19b-4 \17\
thereunder. At any time within 60 days of the filing of the proposed
rule change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
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    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-CboeEDGX-2023-002 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-CboeEDGX-2023-002. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-CboeEDGX-2023-002, and
should be submitted on or before February 9, 2023.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-00906 Filed 1-18-23; 8:45 am]
BILLING CODE 8011-01-P