August 11, 2015.
On June 19, 2015, certain participants (“Approving Participants”) 
of the Consolidated Tape Association (“CTA”) Plan filed with the Securities and Exchange Commission (“SEC” or “Commission”) pursuant to Section 11A of the Securities Exchange Act of 1934 (“Act”),
and Rule 608 thereunder,
a proposal to amend the Second Restatement of the CTA Plan (“CTA Plan”).
The proposal represents the Twenty Third Substantive Amendment to the CTA Plan (“Amendment”).
The Amendment proposes to establish a fee that will be charged to a vendor or other data redistributor that fails to comply with the CTA Plan participants' Consolidated Volume display statement, and related requirements. The non-compliance charge seeks to provide incentives for data redistributors to comply with the participants' consolidated volume requirements. The proposed Amendment was published for comment in the Federal Register on July 10, 2015.
No comment letters were received in response to the Notice. This order approves the proposed Amendment to the Plan.
II. Description of the Proposal
Historically, the Plan participants have not applied device fees to devices that receive consolidated volume (i.e., aggregate volume for trades taking place on all market centers under the Plan) in displays that do not also include CTA Plan prices or CQ Plan quotation information. The participants do not plan to change this policy.
However, some data redistributors include consolidated volume in displays of unconsolidated last sale prices and/or unconsolidated bid-asked quotes, such as displays of one exchange's trade prices and quotes. The Participants believe that such displays, whether displayed internally or externally, could mislead investors regarding the nature of the information they are viewing. A significant number of data users receive proprietary trade prices and quotes. Unless the data users understand the content being displayed, they could mistakenly think that they are seeing consolidated trades and quotes because the volume is consolidated volume.
To make the displays transparent and less likely to mislead, data redistributors that include consolidated volume in displays of unconsolidated prices and quotes must incorporate into those displays the following statement (or a close iteration of the statement that the network administrator(s) have approved): “Realtime quote and/or trade prices are not sourced from all markets.”
A data redistributor must also assure that any person included in the redistribution chain starting with the data redistributor places the statement in any such display that it provides. The statement must be clearly visible to the end users so that they understand the differences in the sources of the data. In addition, data redistributors need to assure that they, and any person or entity included in the redistribution chain starting with them, clearly incorporate the display statement into any advertisement, sales literature or other material displaying CTA Consolidated Volume alongside unconsolidated prices or quotes. These requirements apply to both real-time and delayed displays of consolidated volume.
In order to ensure compliance with these requirements, all recipients of the CTA last sale price datafeed (whether directly or indirectly) must submit a declaration. The Amendment will require firms that include consolidated volume in displays of unconsolidated prices and quotes to submit to NYSE a screen print of the displays, which include the display statement. The CTA Administrator will work with firms to facilitate their compliance.
The Approving Participants' representatives met with SIFMA and the CTA Plan's Advisory Committee to discuss the consolidated volume requirements and responded to their questions. They shortened the display statement in response to comments and made clear that a datafeed recipient that provides an exchange's trading volume with displays of the exchange's trade prices and quotes is not subject to the display requirement.Start Printed Page 48941
In order to motivate data recipients to comply with the display statement requirements, including the requisite declarations and screen submissions, the Amendment establishes a non-compliance fee for each month of non-compliance. For each of Network A and Network B, the monthly fee is $3,000.
A datafeed recipient must submit the required screen prints upon the Amendment's implementation date 
or within thirty days of the effective date of its Vendor Agreement. It must submit those screen prints (including previously provided, new, or changed screen prints) annually by the 31st day of January.
The non-compliance charges will be assessed against a data redistributor for each month in which it fails to provide the declaration or a copy of a Consolidated Volume screen print with the required display statement in a timely manner. The charge will also be assessed against a data redistributor each month for non-compliance by persons in the redistribution chain starting with the data redistributor where such persons have not entered into an applicable agreement with CTA.
The Approving Participants expect the non-compliance charges to provide incentives for data redistributors to comply with the consolidated volume requirements; they do not view the non-compliance fee as establishing a new revenue source. Rather, they hope it encourages all data redistributors to submit their declarations and screen prints (where applicable) in a timely fashion. They hope that the fee will motivate non-compliant redistributors to adopt the same practices that the majority of redistributors follow.
The Approving Participants included delayed displays of consolidated volume in the Amendment to make it clear that if a data redistributor accompanies displays of real-time unconsolidated prices and quotes with delayed consolidated volume, it is subject to the new requirement.
After careful review, the Commission finds that the proposed Amendment to the Plan is consistent with the requirements of the Act and the rules and regulations thereunder,
and, in particular, Section 11A(a)(1) of the Act 
and Rule 608 thereunder 
in that it is necessary or appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, to remove impediments to, and perfect the mechanisms of, a national market system.
The proposal is consistent with Section 11A(a)(1)(C)(iii) of the Act,
which sets forth Congress' finding that it is in the public interest and appropriate for the protection of investors and the maintenance of fair and orderly markets to assure the availability to brokers, dealers, and investors of information with respect to quotations and transactions in securities. These goals are furthered by the proposed changes to establish a fee that will be charged to a vendor or other data redistributor that fails to comply with the CTA Plan participants' Consolidated Volume display statement, and related requirements. Consolidated data continues to provide a great deal of value for investors in assessing the current market for trades and the quality of the execution they receive for their trades. The Commission believes it is important for market participants to know when Consolidated Volume is displayed alongside unconsolidated prices and quotes by data redistributors. The Consolidated Volume display policy should provide greater transparency on the source of the data for users of displays that contain both consolidated and proprietary data from redistributors. Additionally, the non-compliance charge should provide incentives for data redistributors to comply with the Consolidated Volume requirement.
It is therefore ordered, pursuant to Section 11A of the Act,
and the rules thereunder, that the proposed Amendment to the CTA Plan (File No. SR-CTA-2015-02) is approved.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Jill M. Peterson,
[FR Doc. 2015-20147 Filed 8-13-15; 8:45 am]
BILLING CODE 8011-01-P