Cboe and Nasdaq Challenge SEC Over Equity Trading Rules

Cboe Global Markets, Nasdaq, Inc. and their affiliated exchanges challenged recent SEC rules to reduce the minimum pricing increments for certain securities, lower access fee caps and increase market transparency requirements. 

Last month, the SEC adopted rule amendments to National Market System regulations ("Regulation NMS") to establish minimum pricing increments (i.e. "tick sizes") for the quoting and trading of NMS stocks and to reduce the access fee caps for protected quotations of trading centers. (See previous coverage.) Before the US Court of Appeals for the District of Columbia, the exchanges petitioned the Court for review of the SEC rule.

According to Bloomberg, Nasdaq and Cboe said "lowering the access fee could make it more costly for them to lure some trade orders to their platforms and away from wholesale trading firms like Citadel Securities and Virtu Financial" and that the rule "threatens to worsen outcomes for investors, listed companies, and the US equity markets."