Self-Regulatory Organizations; MEMX LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Exchange's Fee Schedule Concerning Options Transaction Pricing

[Federal Register Volume 91, Number 111 (Wednesday, June 10, 2026)]

[Notices]

[Pages 35281-35283]

From the Federal Register Online via the Government Publishing Office [ www.gpo.gov ]

[FR Doc No: 2026-11568]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-105620; File No. SR-MEMX-2026-15]

Self-Regulatory Organizations; MEMX LLC; Notice of Filing and

Immediate Effectiveness of a Proposed Rule Change To Amend the

Exchange's Fee Schedule Concerning Options Transaction Pricing

June 5, 2026.

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 May 29, 2026, MEMX LLC (``MEMX'' or the ``Exchange'') 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.

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\1\ 15 U.S.C. 78s(b)(1).

\2\ 17 CFR 240.19b-4.

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I. Self-Regulatory Organization's Statement of the Terms of Substance

of the Proposed Rule Change

The Exchange is filing with the Commission a proposed rule change

to amend the Exchange's fee schedule applicable to Members \3\ (the

``Fee Schedule'') pursuant to Exchange Rules 15.1(a) and (c). As is

further described below, the Exchange proposes to amend the MEMX

Options Fee Schedule (the ``Options Fee Schedule'') by eliminating the

Volume Tier 1. The Exchange proposes to implement the changes to the

Options Fee Schedule pursuant to this proposal on June 1, 2026. The

text of the proposed rule change is provided in Exhibit 5.

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\3\ See Exchange Rule 1.5(p).

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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.

[[Page 35282]]

A. Self-Regulatory Organization's Statement of the Purpose of, and

Statutory Basis for, the Proposed Rule Change

1. Purpose

The purpose of the proposed rule change is to amend the Options Fee

Schedule by eliminating the Volume Tier 1.

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. The Exchange is one of only

18 options venues to which market participants may direct their order

flow. Based on publicly available information, no single options

exchange has more than approximately 18.1% of the market share and

currently the Exchange represents only approximately 3.9% of the market

share.\4\ 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, discontinue, or 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. The Exchange's Fee Schedule sets forth standard

rebates and rates applied per contract. The Exchange also provides

tiered pricing which provides Members opportunities to qualify for

higher rebates where certain volume criteria and thresholds are met.

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\4\ Market share percentage calculated as of May 21, 2026. The

Exchange receives and processes data made available through the

consolidated data feeds (i.e., OPRA).

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Currently, the Exchange offers the Volume Tier 1, which provides

Members an enhanced rebate for executions of contracts that add

liquidity in options where the underlying security is in the Penny

Interval Program (``Penny options'') \5\ that are made in a

Professional \6\ capacity (``Added Professional Penny Volume'').

Specifically, under this tier, the Exchange provides an enhanced rebate

of $0.47 per contract for executions of Added Professional Penny Volume

for Members that qualify for Volume Tier 1 by achieving an ADAV \7\ in

the Customer,\8\ Professional,\9\ Firm,\10\ Away Market Maker,\11\ and/

or Broker-Dealer \12\ capacities in Penny symbols that is equal to or

greater than 0.125% of the equity and ETF option TCV.\13\ Now, the

Exchange proposes to eliminate this tier, as the Exchange no longer

wishes to, nor is required to, maintain such tiered pricing.

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\5\ MEMX Options provides Fee Code ``P'' for transactions in

Penny options. Fee Codes are provided by the Exchange on the monthly

invoices provided to Options Members.

\6\ As set forth on the Fee Schedule, ``Professional'' applies

to any order for the account of a Professional. The term

``Professional'' means any person or entity that (A) is not a broker

or dealer in securities; and (B) places more than 390 orders in

listed options per day on average during a calendar month for its

own beneficial account(s). All Professional orders shall be

appropriately marked by Options Members. See Exchange Rule 16.1.

MEMX Options provides fee qualifier ``p'' for professional

transactions.

\7\ As proposed, the term ``ADAV'' means the average daily added

volume calculated as the number of contracts added per day. ADAV is

calculated on a monthly basis. The Exchange is proposing to add this

definition under the ``Definitions'' section of the Fee Schedule.

\8\ As set forth on the Fee Schedule, ``Customer'' applies to

any order for the account of a Prioroity Customer. ``Priority

Customer'' shall have the meaning set forth in Rule 16.1 of the MEMX

Rulebook.

\9\ As set forth on the Fee Schedule, ``Professional'' applies

to any order for the account of a Professional. The term

``Professional'' means any person or entity that (A) is not a broker

or dealer in securities; and (B) places more than 390 orders in

listed options per day on average during a calendar month for its

own beneficial account(s). All Professional orders shall be

appropriately marked by Options Members. See Exchange Rule 16.1.

MEMX Options provides fee qualifier ``p'' for professional

transactions.

\10\ As set forth on the Fee Schedule, ``Firm'' applies to any

order for the proprietary account of an OCC clearing member. MEMX

Options provides fee qualifier ``f'' for firm transactions.

\11\ As set forth on the Fee Schedule, ``Away Market Maker''

applies to any order for the account of a market maker on another

options exchange. MEMX Options provides fee qualifier ``a'' for away

market maker transactions.

\12\ As set forth on the Fee Schedule, ``Broker Dealer'' applies

to any order for the account of a broker-dealer, including a foreign

broker dealer. MEMX Options provides fee qualifier ``b'' for broker-

dealer transactions.

\13\ As proposed, the term ``TCV'' means the total consolidated

volume calculated as the volume reported by all exchanges to the

consolidated transaction reporting plan for the month for which the

fees apply. The Exchange is also proposing to add this definition

under the ``Definitions'' section of the Fee Schedule.

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2. Statutory Basis

The Exchange believes that its proposal to amend the Options Fee

Schedule is consistent with the provisions of Section 6 of the Act,\14\

in general, and with Sections 6(b)(4) and 6(b)(5) of the Act,\15\ in

particular, in that it provides for the equitable allocation of

reasonable dues, fees and other charges among Options Members and other

persons using its facilities. The Exchange also believes the proposal

furthers the objectives of Section 6(b)(5) of the Act in that it is

designed to promote just and equitable principles of trade, 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 and is not designed to permit unfair discrimination

between customers, issuers, brokers, or dealers.

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\14\ 15 U.S.C. 78f.

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

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MEMX Options operates in a highly fragmented and 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, and the Exchange represents only a small

percentage of the overall market. The Commission and the courts have

repeatedly expressed their preference for competition over regulatory

intervention in determining prices, products, and services in the

securities markets. 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.'' \16\

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\16\ Securities Exchange Act Release No. 51808 (June 9, 2005),

70 FR 37496, 37499 (June 29, 2005).

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Accordingly, competitive forces constrain the Exchange's

transaction fees and rebates, and market participants can readily trade

on competing venues if they deem pricing levels at those other venues

to be more favorable. The Exchange believes the proposal to eliminate

the Volume Tier 1 is reasonable because the Exchange is not required to

maintain this rebate nor provide Members an opportunity to receive

enhanced rebates. The Exchange believes its proposal to eliminate this

rebate is equitable and not unfairly discriminatory because it applies

to all Members (i.e., the rebate will no longer be available to any

Member). The proposed rule change merely results in Members not

receiving an enhanced rebate, which, as noted above, the Exchange is

not required to offer or maintain. Further, the proposed rule change to

eliminate the Volume Tier 1 enables the Exchange to redirect resources

and funding into other programs and tiers intended to incentivize

increased order flow. and competitive pricing structure which the

[[Page 35283]]

Exchange believes would promote price discovery and enhance liquidity

and market quality on the Exchange to the benefit of all Members and

market participants.

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

The Exchange does not believe that the proposal will result in any

burden on competition that is not necessary or appropriate in

furtherance of the purposes of the Act. Rather, as discussed above, the

proposal relates to the elimination of a Volume Tier and as such, does

not have any impact on intra- or inter-market competition because the

proposed change is solely designed to accurately reflect the pricing

that the Exchange currently offers, thereby adding clarity to the Fee

Schedule.

Additionally, 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.'' \17\ The fact

that this market is competitive has also long been recognized by the

courts. In NetCoalition v. SEC, 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'. . . .''.\18\ Accordingly, the Exchange does not believe its

proposed pricing changes impose any burden on competition that is not

necessary or appropriate in furtherance of the purposes of the Act.

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\17\ Id.

\18\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010)

(quoting Securities Exchange Act Release No. 59039 (December 2,

2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSE-2006-21)).

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C. Self-Regulatory Organization's Statement on Comments on the Proposed

Rule Change Received From Members, Participants, or Others

The Exchange 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)(ii) of the Act \19\ and Rule 19b-4(f)(2) \20\ thereunder.

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\19\ 15 U.S.C. 78s(b)(3)(A)(ii).

\20\ 17 CFR 240.19b-4(f)(2).

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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 shall institute proceedings to

determine whether the proposed rule change should be approved or

disapproved.

IV. Solicitation of Comments

Interested persons are invited to submit written data, views and

arguments concerning the foregoing, including whether the proposed rule

change is consistent with the Act. Comments may be submitted by any of

the following methods:

Electronic Comments

Use the Commission's internet comment form ( https://www.sec.gov/rules/sro.shtml ); or

Send an email to [email protected] . Please include

file number SR-MEMX-2026-15 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-MEMX-2026-15. 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 ( https://www.sec.gov/rules/sro.shtml ). Copies of the filing also will be available for inspection

and copying at the principal office of the Exchange. Do not include

personal identifiable information in submissions; you should submit

only information that you wish to make available publicly. We may

redact in part or withhold entirely from publication submitted material

that is obscene or subject to copyright protection. All submissions

should refer to file number SR-MEMX-2026-15 and should be submitted on

or before July 1, 2026.

For the Commission, by the Division of Trading and Markets,

pursuant to delegated authority.\21\

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\21\ 17 CFR 200.30-3(a)(12).

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Sherry R. Haywood,

Assistant Secretary.

[FR Doc. 2026-11568 Filed 6-9-26; 8:45 am]

BILLING CODE 8011-01-P