April 7, 2021
NYSE is proposing that all disputes concerning market data fees and credits billed by the Exchange would have to be submitted to the Exchange in writing and accompanied by supporting documentation. Further, all disputes would have to be submitted no later than ninety (90) days after receipt of a billing invoice. After ninety days, all market data fees assessed by the Exchange would be considered final.
In addition NYSE notes that that it routinely conducts audits of its market data customers to ensure that customers are complying with the terms of the subscriber agreement they have signed. The audit process is independent of the billing process. The audit function is administered by the Exchanges market data compliance group and the billing function is administered by the Exchanges market data operations group. Each group is charged with distinct responsibilities that do not overlap. The proposed billing dispute provision is not intended to circumvent the audit process in any manner and the adoption of the ninety (90) day period to dispute billing errors would not affect subscribers ability to take a position with respect to billing charges identified through the audit process.
During an audit the NYSE audit team will compare a customers reported counts to a customers entitled counts. The customers reported counts are used by NYSE to create the invoice. IPUG members are concerned that the unintended consequences of proposal 34-91365 is that, during an audit, any monthly counts that are over reported and therefore over billed will not be netted against any monthly counts that are under reported and therefore under billed.
A simplistic example of this is as follows: in March a customer is entitled for 2 counts of a NYSE product and reports a count of 1, in April a customer is entitled for 2 counts of NYSE product and reports a count of 3. For these 2 months the total count entitled is 4 and the total amount billed is 4, however during an audit it is possible NYSE may state that an under reported count of 1 in March is owed to NYSE by the customer and the over reported count of 1 in April cannot be credited back to the customer by NYSE because it was not queried within 90 days of the invoice being issued.
To alleviate the IPUG members concern IPUG would request that NYSE make it explicitly clear in filing 34-91365 and any related published policies that during an audit any monthly counts that are over reported and therefore over billed can be netted against any monthly counts that are under reported and therefore under billed.