Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Options 7, Section 6

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-103887; File No. SR-GEMX-2025-22]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Options 7, Section 6</SUBJECT> <DATE>September 5, 2025.</DATE> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)  <SU>1</SU> <FTREF/> , and Rule 19b-4 thereunder, <SU>2</SU> <FTREF/> notice is hereby given that on August 26, 2025, Nasdaq GEMX, LLC (“GEMX” or “Exchange”) filed with the Securities and Exchange Commission (“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. <FTNT> <SU>1</SU>  15 U.S.C. 78s(b)(1). </FTNT> <FTNT> <SU>2</SU>  17 CFR 240.19b-4. </FTNT> <HD SOURCE="HD1">I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change</HD> The Exchange proposes to amend its Specialized Quote Feed  <SU>3</SU> <FTREF/> or “SQF” Port and SQF Purge Port  <SU>4</SU> <FTREF/> pricing at Options 7, Section 6, C, Ports and Other Services. <FTNT> <SU>3</SU>  “Specialized Quote Feed” or “SQF” is an interface that allows Market Makers to connect, send, and receive messages related to quotes, Immediate-or-Cancel Orders, and auction responses to the Exchange. Features include the following: (1) options symbol directory messages ( <E T="03">e.g.,</E> underlying instruments); (2) System event messages ( <E T="03">e.g.,</E> start of trading hours messages and start of opening); (3) trading action messages ( <E T="03">e.g.,</E> halts and resumes); (4) execution messages; (5) quote messages; (6) Immediate-or-Cancel Order messages; (7) risk protection triggers and purge notifications; (8) opening imbalance messages; (9) auction notifications; and (10) auction responses. The SQF Purge Interface only receives and notifies of purge requests from the Market Maker. Market Makers may only enter interest into SQF in their assigned options series. Immediate-or-Cancel Orders entered into SQF are not subject to the Order Price Protection, Market Order Spread Protection, and Size Limitation Protection in Options 3, Section 15(a)(1)(A), (1)(B), and (2)(B) respectively. <E T="03">See</E> Supplementary Material .03(c) to Options 3, Section 7. </FTNT> <FTNT> <SU>4</SU>  SQF Purge is a specific port for the SQF interface that only receives and notifies of purge requests from the Market Maker. Dedicated SQF Purge Ports enable Market Makers to seamlessly manage their ability to remove their quotes in a swift manner. The SQF Purge Port is designed to assist Market Makers in the management of, and risk control over, their quotes. Market Makers may utilize a purge port to reduce uncertainty and to manage risk by purging all quotes in their assigned options series. Of note, Market Makers may only enter interest into SQF in their assigned options series. Additionally, the SQF Purge Port may be utilized by a Market Maker in the event that the Member has a system issue and determines to purge its quotes from the order book. </FTNT> While the changes proposed herein are effective upon filing, the Exchange has designated the amendments become operative on January 1, 2026. The text of the proposed rule change is available on the Exchange's website at <E T="03">https://listingcenter.nasdaq.com/rulebook/gemx/rulefilings,</E> at the principal office of the Exchange, and at the Commission's Public Reference Room. <HD SOURCE="HD1">II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> 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. <HD SOURCE="HD2">A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> The Exchange proposes to amend Options 7, Section 6, C, Ports and Other Services. Specifically, GEMX proposes to amend its current SQF Port Fee of $1,350 per port, per month, and its SQF Purge Port fee of $1,350 per port, per month. Today, the SQF Port and the SQF Purge Port are subject to a monthly cap of $18,900. GEMX proposes to amend the SQF Port Fee and the SQF Purge Port Fee as follows: The first 5 ports (1-5) would be assessed $1,620 per port, per month; the next 15 ports (6-20) would be assessed $1,080 per port, per month; and all ports over 20 ports (21 and above) would be assessed $540 per port, per month. The Nasdaq Options Market LLC (“NOM”) has identical SQF Port fees and identical SQF Purge Port fees. <SU>5</SU> <FTREF/> With this proposal, GEMX would no longer offer the cap the SQF Port fee and SQF Purge Port fee. <SU>6</SU> <FTREF/> <FTNT> <SU>5</SU>   <E T="03">See</E> NOM Options 7, Section 3(i). </FTNT> <FTNT> <SU>6</SU>  GEMX will also renumber other notes in Options 7, Section 6, C. </FTNT> Only Market Makers  <SU>7</SU> <FTREF/> utilize SQF Ports and SQF Purge Ports for quoting purposes. A GEMX Market Maker requires only one SQF Port to submit quotes in its assigned options series into GEMX. While a Market Maker may elect to obtain multiple SQF Ports and SQF Purge Ports to organize its business, <SU>8</SU> <FTREF/> only one SQF Port and SQF Purge Port is necessary for a Market Maker to fulfill its regulatory quoting obligations. <SU>9</SU> <FTREF/> <FTNT> <SU>7</SU>  The term “Market Makers” refers to “Competitive Market Makers” and “Primary Market Makers” collectively. <E T="03">See</E> Options 1, Section 1(a)(21). </FTNT> <FTNT> <SU>8</SU>  For example, a Market Maker may desire to utilize multiple SQF Ports for accounting purposes, to measure performance, for regulatory reasons or other determinations that are specific to that Member. </FTNT> <FTNT> <SU>9</SU>  GEMX Market Makers have various regulatory requirements as provided for in Options 2, Section 4. Additionally, GEMX Market Makers have certain quoting requirements with respect to their assigned options series as provided in Options 2, Section 5. SQF Ports are the only quoting protocol available on GEMX and only Market Makers may utilize SQF Ports. The same is true for SQF Purge Ports. </FTNT> <HD SOURCE="HD3">2. Statutory Basis</HD> The Exchange believes that its proposal is consistent with Section 6(b) of the Act, <SU>10</SU> <FTREF/> in general, and furthers the objectives of Section 6(b)(5) of the Act, <SU>11</SU> <FTREF/> in particular, 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. Additionally, the Exchange believes that its proposal furthers the objectives of Sections 6(b)(4) and 6(b)(5) of the Act, <SU>12</SU> <FTREF/> in particular, in that it provides for the equitable allocation of reasonable dues, fees, and other charges among members and issuers and other persons using any facility, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. <FTNT> <SU>10</SU>  15 U.S.C. 78f(b). </FTNT> <FTNT> <SU>11</SU>  15 U.S.C. 78f(b)(5). </FTNT> <FTNT> <SU>12</SU>   <E T="03">See</E> 15 U.S.C. 78f(b)(4) and (5). </FTNT> <HD SOURCE="HD3">Proposed Port Fees Are Reasonable, Equitable and Not Unfairly Discriminatory</HD> The Exchange believes that its proposal furthers the objectives of Sections 6(b)(4) and 6(b)(5) of the Act, <SU>13</SU> <FTREF/> in particular, in that it provides for the equitable allocation of reasonable dues, fees, and other charges among members and issuers and other persons using any facility, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. This belief is based on comparability, the proposed fees are comparable to, and in some cases less than, those of similarly situated exchanges. <FTNT> <SU>13</SU>   <E T="03">See</E> 15 U.S.C. 78f(b)(4) and (5). </FTNT> The proposed fees for GEMX SQF Ports and GEMX SQF Purge Ports are identical to NOM SQF Ports and NOM SQF Purge Ports fees. <SU>14</SU> <FTREF/> NOM has identical SQF Port and SQF Purge Port protocols. <SU>15</SU> <FTREF/> Additionally, the proposed fees for GEMX SQF Ports and GEMX SQF Purge Ports are comparable to those of its closest competitors, MIAX Pearl, LLC (“Pearl”);  <SU>16</SU> <FTREF/> MIAX Emerald, LLC (“Emerald”);  <SU>17</SU> <FTREF/> Cboe BZX Exchange, Inc. (“BATS”);  <SU>18</SU> <FTREF/> Cboe C2 Exchange, Inc. (“C2”);  <SU>19</SU> <FTREF/> MIAX Sapphire, LLC (“Sapphire”)  <SU>20</SU> <FTREF/> based on market share. <FTNT> <SU>14</SU>   <E T="03">See</E> NOM Options 7, Section 3(i). </FTNT> <FTNT> <SU>15</SU>   <E T="03">See</E> Supplementary Material .03(c) to Options 3, Section 7. </FTNT> <FTNT> <SU>16</SU>  Pearl assesses Market Makers $5,000.00 for up to 10 classes and up to 20% of classes by volume; 7,5000 for up to 40 classes and up to 35% of classes by volume; 10,000.00 for up to 100 classes and up to 50% of classes by volume; 12,000.00 for over 100 classes and up to 50% of classes by volume up to all classes listed on Pearl. For the calculation of the monthly Full Service MEO Port fees Market Makers, the appli ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 41k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━