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Federal Register / Vol. 86, No. 51 / Thursday, March 18, 2021 / Notices
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liquidity present on the Exchange. All ETP Holders would benefit from the greater amounts of liquidity that would be present on the Exchange, which would provide greater execution opportunities.
The Exchange believes the proposed rule change would also improve market quality for all market participants seeking to remove liquidity on the Exchange and, as a consequence, attract more liquidity to the Exchange, thereby improving market-wide quality. The Exchange believes that the proposal constitutes an equitable allocation of fees because all similarly situated ETP
Holders and other market participants would be eligible for the same basic and tiered rates and would be eligible for the same fees and credits. Moreover, the proposed change is equitable because the revised criteria would apply equally to all similarly situated ETP Holders.
Step Up Tier The Exchange believes that the proposed modification of the volume threshold to qualify for Step Up Tier represents an equitable allocation of fees. The Exchange is not proposing to adjust the amount of the Step Up Tier credits, which will remain at the current level for all ETP Holders. Rather, the proposal would continue to encourage ETP Holders to send orders that add liquidity to the Exchange, thereby contributing to robust levels of liquidity, which benefits all market participants.
The Exchange believes that lowering the requirements would make it easier for liquidity providers to qualify for the Step Up Tier credits. The proposed change will thereby encourage the submission of additional liquidity to a national securities exchange, thus promoting price discovery and transparency and enhancing order execution opportunities for ETP Holders from the substantial amounts of liquidity present on the Exchange. All ETP Holders would benefit from the greater amounts of liquidity that will be present on the Exchange, which would provide greater execution opportunities.
Without having a view of ETP
Holders activity on other markets and off-exchange venues, the Exchange has no way of knowing whether this proposed rule change would result in any additional ETP Holders qualifying for this established tier. However, the Exchange believes the proposed lower volume requirement would provide an incentive for ETP Holders to continue to submit liquidity-providing order flow, which would promote price discovery and increase execution opportunities for all ETP Holders. While the Exchange has no way of knowing whether this
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proposed rule change would definitively result in any particular ETP
Holder qualifying for this established tier, the Exchange anticipates a number of ETP Holders meeting, or being reasonably able to meet, the proposed lower volume threshold. The proposed change will thereby encourage the submission of additional liquidity to a national securities exchange, thus promoting price discovery and transparency and enhancing order execution opportunities for ETP Holders from the substantial amounts of liquidity present on the Exchange, which would benefit all market participants on the Exchange.
The Exchange believes the proposed rule change would improve market quality for all market participants on the Exchange and, as a consequence, attract more liquidity to the Exchange thereby improving market-wide quality. ETP
Holders that currently qualify for credits associated with Step Up pricing tiers on the Exchange will continue to receive credits when they provide liquidity to the Exchange. The Exchange believes that recalibrating the requirements for providing liquidity will continue to attract order flow and liquidity to the Exchange for the benefit of investors generally.
Cross-Asset Tier 1
The Exchange believes the proposal to eliminate Cross-Asset Tier 1 is equitably allocated because it would apply to all ETP Holders i.e., the tier wont be available for any ETP Holder. The Exchange notes that the proposed elimination of the tier does not preclude any ETP Holder from qualifying for the remaining Cross-Asset pricing tier or other pricing tiers.19
Specifically, the Exchange believes that the proposal constitutes an equitable allocation of fees because all similarly situated ETP Holders and other market participants would be equally ineligible for the tier proposed for deletion. The Exchange believes that eliminating requirements and credits, and even entire pricing tiers from the Fee Schedule when such incentives become ineffective is equitable and not unfairly discriminatory because the requirements, and credits, and even entire pricing tiers would be eliminated in their entirety and would no longer be available to any ETP Holder.
19 See e.g., Fee Schedule, Tier 2, which provides and fees and credits to ETP Holders affiliated with an OTP Holder or OTP Firm that has a market maker account on NYSE Arca Options.

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The Proposed Fee Change Is Not Unfairly Discriminatory The Exchange believes that the proposal is not unfairly discriminatory.
In the prevailing competitive environment, ETP Holders are free to disfavor the Exchanges pricing if they believe that alternatives offer them better value.
Tape C Tiers 1 4
The Exchange believes that the proposed change to eliminate Tape C
Tier 1 and Tier 2 and adopt Tape C
Tiers 14 is not unfairly discriminatory because all ETP Holders will be impacted equally i.e., each wont be able to access current Tape C Tier 1 and Tier 2 and will equally be able to qualify for the proposed new Tape C Tiers 1
4 rebates if they meet the requirement under the new pricing tiers. The proposed new tiers are designed as an incentive to any and all ETP Holders interested in meeting the tier criteria to submit additional order flow to the Exchange and each will receive the proposed rebate if the tier criteria are met. While the Exchange has no way of knowing whether this proposed rule change would definitively result in any particular ETP Holder qualifying for the proposed tiers, the Exchange anticipates a number of ETP Holders meeting, or being reasonably able to meet, the proposed criteria; however, the proposed tiers are open to any ETP
Holder that satisfies each tiers criteria.
The Exchange also notes that the proposed change will not adversely impact any ETP Holders pricing or their ability to qualify for other tiers. Rather, should an ETP Holder not meet the criteria of the proposed new pricing tiers, the ETP Holder will merely not receive the corresponding rebate.
Tier 1
The Exchange believes that the proposed rule change to introduce alternative criteria for ETP Holders to qualify for Tier 1 is not unfairly discriminatory. In the prevailing competitive environment, ETP Holders are free to disfavor the Exchanges pricing if they believe that alternatives offer them better value. Moreover, the proposal neither targets nor will it have a disparate impact on any particular category of market participant. The Exchange believes that the proposal does not permit unfair discrimination because the proposal would be applied to all similarly situated ETP Holders and all ETP Holders would be subject to the same modified Tier 1. Accordingly, no ETP Holder already operating on the Exchange would be disadvantaged by
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