Talking Points – September 2017

STA discussion document with congressional staff on: Access Fees & Maker/Taker Models;  Disclosure-Order Handling Information; Reg NMS Plans and Market Data.

Access Fees & Maker/Taker models
Access fees and corresponding liquidity rebates (or “maker/taker” models) have evolved and
are now deeply engrained in the current market structure. STA believes that a ban or an
elimination of access fees would present a high risk of disruption to investors. Therefore we
would support a narrowly designed pilot program with a limited number of securities, a limited
number of access fee cap levels, and no other variables. We believe this type of pilot design
would ensure that other variables would not impact the data coming from the pilot.

Disclosure – Order Handling Information
Assessing execution quality requires information on how orders are handled. STA generally
supports new disclosure requirements by broker-dealers to institutional customers and
enhanced disclosures to retail customers. STA believes benefits can accrue to individual
investors when regulators, with industry input, define industry standards in appropriate areas.
Having defined regulatory industry standards ensures information is accurate and uniformly
available. In addition, such standards foster private market solutions which transcend to lower
costs. We strongly encourage the SEC to finalize regulations to provide greater information on
broker and ATS (“Dark Pools”) order handling.

Reg NMS Plans
STA has become increasingly concerned with the Reg NMS Plan process and their impact on
investors, including the timeliness and efficacy of such plans. STA believes conflicts between
SRO and non-SRO participants, who are essential for a successful NMS Plan outcome, play a
role in the shortfalls of these Plans. We believe reforms are needed that address these
conflicts, and that such reforms should be guided by improving investors’ interests.

Market Data
The STA believes that issues involving market data and their fees have become increasingly
complex and carry important implications for investors, exchanges and market participants.
Further highlighting concerns relating to the increasing levels of market data fees and their
potential impacts on market structure, several subcommittees of the SEC Equity Market
Structure Advisory Committee (EMSAC) included market data issues on their agendas. STA
supports EMSAC undergoing a review of market data fees and related issues.

PDF version here