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

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-104357; File No. SR-CboeBZX-2025-155]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee Schedule</SUBJECT> <DATE>December 10, 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 December 1, 2025, Cboe BZX Exchange, Inc. (the “Exchange” or “BZX”) 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> Cboe BZX Exchange, Inc. (the “Exchange” or “BZX”) proposes to amend its Fees Schedule with respect to the Customer Penny Add Volume Tier program. The text of the proposed rule change is provided in Exhibit 5. The text of the proposed rule change is also available on the Commission's website ( <E T="03">https://www.sec.gov/rules/sro.shtml</E> ), the Exchange's website ( <E T="03">https://www.cboe.com/us/equities/regulation/rule_filings/bzx/</E> ), and at the principal office of the Exchange. <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 the Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> The Exchange proposes to amend its Fee Schedule, effective December 1, 2025. 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 18 options venues to which market participants may direct their order flow. Based on publicly available information, no single options exchange has more than 15% of the market share. <SU>3</SU> <FTREF/> Thus, in such a low-concentrated and highly competitive market, no single options 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. In response to competitive pricing, the Exchange, like other options exchanges, offers rebates and assesses fees for certain order types executed on or routed through the Exchange. <FTNT> <SU>3</SU>   <E T="03">See</E> Cboe Global Markets U.S. Options Monthly Market Volume Summary (November 24, 2025), available at <E T="03">https://markets.cboe.com/us/options/market_statistics/.</E> </FTNT> The Exchange's Fees Schedule sets forth standard rebates and rates applied per contract. For example, the Exchange provides a rebate of $0.25 per contract for Customer orders that add liquidity in Penny Securities, yielding fee code PY. Additionally, in response to the competitive environment, the Exchange also offers tiered pricing, which provides Members 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. The Exchange currently offers six Customer Penny Add Volume Tiers (“Customer Penny Add Tiers”) under footnote 1 of the Fee Schedule which provide rebates between $0.35 and $0.52 per contract for qualifying Customer orders which meet certain add liquidity thresholds and yield fee code PY. <SU>4</SU> <FTREF/> Currently, the Customer Penny Add Tiers include one Customer Cross-Asset Add Tier, which requires participation on the Exchange's equities platform (“BZX Equities”). Under the Customer Cross-Asset Add Tier, <SU>5</SU> <FTREF/> the Exchange provides a rebate of $0.50 per contract where a Member has (1) an ADAV  <SU>6</SU> <FTREF/> in Simple Customer order ≥0.50% of average OCV;  <SU>7</SU> <FTREF/> and (2) on BZX Equities an ADAV ≥0.35% of average TCV, <SU>11</SU> excluding sub-dollar securities. <FTNT> <SU>4</SU>  Fee Code “PY” is appended to Customer Penny orders that add liquidity. </FTNT> <FTNT> <SU>5</SU>  As part of the proposed change, the Exchange proposes to rename this Customer Cross-Asset Add Tier as “Customer Cross-Asset Add Tier 1.” </FTNT> <FTNT> <SU>6</SU>  “ADAV” means average daily added volume (in shares) calculated as the number of contracts added. </FTNT> <FTNT> <SU>7</SU>  “OCC Customer Volume” or “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. Average OCV is the average daily OCV for the month ( <E T="03">i.e.,</E> total OCV divided by the number of trading days in the month); for example, in a month with 20 trading days, if OCV is 1,040,000,000, the average OCV would be 1,040,000,000/20, or 52,000,000. </FTNT> The Exchange proposes to update the Customer Penny Add Tiers by adopting a new Customer Cross-Asset Add Tier 2, which requires participation on BZX Equities. Under the proposed tier, the Exchange would provide a rebate of $0.52 per contract where a Member has (1) an ADAV  <SU>8</SU> <FTREF/> in Simple Market-Maker order ≥0.25% of average OCV;  <SU>9</SU> <FTREF/> and (2) on BZX Equities an ADAV ≥0.45% of average TCV, <SU>11</SU> excluding sub-dollar securities. <FTNT> <SU>8</SU>  “ADAV” means average daily added volume (in shares) calculated as the number of contracts added. </FTNT> <FTNT> <SU>9</SU>  “OCC Customer Volume” or “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. Average OCV is the average daily OCV for the month ( <E T="03">i.e.,</E> total OCV divided by the number of trading days in the month); for example, in a month with 20 trading days, if OCV is 1,040,000,000, the average OCV would be 1,040,000,000/20, or 52,000,000. </FTNT> The required criteria and corresponding rebates for current Tiers 1 through 5 and Customer Cross-Asset Add Tier 1 remain unchanged. <HD SOURCE="HD3">2. Statutory Basis</HD> 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. <SU>10</SU> <FTREF/> Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5)  <SU>11</SU> <FTREF/> 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)  <SU>12</SU> <FTREF/> requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. The Exchange also believes the proposed rule change is consistent with Section 6(b)(4) of the Act, <SU>13</SU> <FTREF/> which requires that Exchange rules provide for the equitable allocation of reasonable dues, fees, and other charges among its Members and other persons using its facilities. <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">Id.</E> </FTNT> <FTNT> <SU>13</SU>  15 U.S.C. 78f(b)(4). </FTNT> As noted above, the Exchange operates in a highly competitive market. The Exchange is only one of several options venues to which market participants may direct their order flow, and it represents a small percentage of the overall market. Competing options exchanges offer similar tiered pricing structures to that of the Exchange, including schedules of ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 25k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━