80_FR_8776 80 FR 8744 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify NASDAQ Rule 7018 Fees

80 FR 8744 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify NASDAQ Rule 7018 Fees

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 32 (February 18, 2015)

Page Range8744-8746
FR Document2015-03231

Federal Register, Volume 80 Issue 32 (Wednesday, February 18, 2015)
[Federal Register Volume 80, Number 32 (Wednesday, February 18, 2015)]
[Notices]
[Pages 8744-8746]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-03231]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74258; File No. SR-NASDAQ-2015-008]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Modify NASDAQ Rule 7018 Fees

February 11, 2015.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on February 2, 2015, The NASDAQ Stock Market LLC (``NASDAQ'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') a 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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASDAQ is proposing to modify NASDAQ Rule 7018 fees assessed for 
execution and routing securities listed on NASDAQ, the New York Stock 
Exchange (``NYSE'') and on exchanges other than NASDAQ and NYSE.
    The text of the proposed rule change is available at 
nasdaq.cchwallstreet.com at NASDAQ's principal office, and at the 
Commission's Public Reference Room.

[[Page 8745]]

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, NASDAQ 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 those 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 parts of such 
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    NASDAQ is proposing to amend NASDAQ Rule 7018(a) to modify the fees 
assessed under the rule for securities it trades priced at $1 or more. 
Specifically, NASDAQ proposes to change the fee assessed for CART 
orders in securities listed on NASDAQ (``Tape C''), NYSE (``Tape A'') 
and on exchanges other than NASDAQ and the NYSE (``Tape B'') 
(collectively, the ``Tapes''). In addition, NASDAQ is proposing to 
change the fee assessed for orders in Tape A securities that are routed 
to NYSE and then routed to another venue for execution. Lastly, NASDAQ 
is proposing to change the fee assessed for orders in Tape B securities 
that are routed to NYSEAmex or NYSEArca and then routed to another 
venue for execution.
    CART is a routing option by which orders in securities of all Tapes 
route to the NASDAQ OMX BX Equities Market (``BX'') then the NASDAQ OMX 
PHLX PSX System (``PSX''), and then the System.\3\ The Exchange 
currently assesses no charge for CART orders that execute on BX and 
passes-through all fees assessed and rebates offered by PSX for such 
orders. CART orders executed on PSX result in a pass through charge of 
$0.0024 per share executed.\4\ The Exchange is proposing to now assess 
a set charge of $0.0030 per share executed for CART orders in any Tape 
security that executes on PSX in lieu of passing through credits and 
rebates.
---------------------------------------------------------------------------

    \3\ If shares remain un-executed, they are posted to the book or 
cancelled. Once on the book, should the order subsequently be locked 
or crossed by another market center, the System will not route the 
order to the locking or crossing market center. See Rule 
4758(a)(1)(A)(xi).
    \4\ See NASDAQ OMX PHLX LLC Pricing Schedule, Section 
VIII(a)(1).
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    The Exchange is also proposing to change the fees assessed for Tape 
A securities routed to NYSE and then routed to another venue for 
execution. The Exchange passes through any routing fees charged to 
NASDAQ by NYSE for these orders, which currently is $0.0030 per share 
executed but may vary based on changes to the NYSE fee schedule. NASDAQ 
is proposing to eliminate pass through fees and assess a set fee of 
$0.0030 per share executed. Similarly, NASDAQ is proposing to eliminate 
pass through fees and assess a fee of $0.0030 per share executed for 
orders in Tape B securities that are routed to NYSEAmex or NYSEArca and 
then routed to another venue for execution. The Exchange currently 
passes through any routing fees charged to NASDAQ by NYSEAmex or 
NYSEArca for these orders, which currently is $0.0030 per share 
executed but may vary based on changes to those exchanges' respective 
fee schedules.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\5\ in general, and with 
Sections 6(b)(4) and 6(b)(5) of the Act,\6\ 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 or system which the Exchange operates or controls, and is 
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; and are not 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    NASDAQ believes that the proposed changes to the charges assessed 
for CART orders in securities of any Tape that execute on PSX are 
reasonable because they eliminate discounted pricing from the fee 
schedule and more closely aligns [sic] the fee received with the costs 
associated with providing routing services. The Exchange incurs costs 
in operating and supporting the routing function, which are in addition 
to the fees of other exchanges that it incurs when a routed order 
executes on another venue. To cover such costs, the Exchange assesses 
the same fee as is being proposed for other routed orders, such as 
STGY, SCAN, SKNY and SKIP orders, which are assessed a charge of 
$0.0030 per share executed.\7\ Thus, the current pass through fee 
results in a discount to the fee assessed for use of the routing 
function for other routed orders. The Exchange notes that CART orders 
that execute on BX are not assessed a charge, but rather the Exchange 
receives a rebate from BX for the routed execution.\8\ The Exchange 
also believes that the proposed changes are reasonable because they 
remove complexity from the fee schedule and assess a fee that is not 
dependent on knowing what the current liquidity removal rate is on PSX. 
NASDAQ believes that the proposed changes to CART order fees are 
equitably allocated because all member firms that receive an execution 
on PSX will be assessed a fee that is more closely aligned with the 
costs incurred by NASDAQ, as noted above. NASDAQ believes that the 
proposed changes to CART order fees do not discriminate unfairly 
because they eliminate a distinction in the fees whereby discounted 
fees are charged for use of the Exchange's routing functionality. 
Moreover, the proposed changes do not discriminate unfairly because 
they eliminate a distinction in the routing fees whereby some fees are 
fixed and others are based on fee assessed by other markets. As noted 
above, most routing fees are based on a set fee, and are not tied to 
the fees of other markets.
---------------------------------------------------------------------------

    \7\ For a description of STGY, SCAN, SKNY and SKIP routing 
strategies, see Rules 4758(a)(1)(A)(i) and (ii) [sic].
    \8\ BX provides rebates to market participants that remove 
liquidity ranging from $0.0004 to $0.0015. See BX Rule 7018(a).
---------------------------------------------------------------------------

    The Exchange believes that the change to eliminate pass through 
fees for Tape A securities that are routed to NYSE and then routed to 
another venue for execution, and the change to eliminate pass through 
fees for Tape B securities that are routed to NYSEAmex and NYSEArca and 
then routed to another venue for execution are reasonable because they 
remove complexity from the fee schedule and assess a fee that is not 
dependent on knowing what the current routing rates are on those 
markets. Moreover, the proposed new fees are identical to the fees 
assessed currently. The Exchange believes that the proposed fee changes 
are equitably allocated because all member firms that receive an 
execution on another venue in these securities will be assessed the 
same fee. Lastly, the Exchange believes that the proposed

[[Page 8746]]

changes do not discriminate unfairly because they eliminate a 
distinction in the routing fees whereby some fees are fixed and others 
are based on fee assessed by other markets. As noted above, most of 
NASDAQ's routing fees are based on a set fee, and are not tied to the 
fees of other markets.

B. Self-Regulatory Organization's Statement on Burden on Competition

    NASDAQ does not believe that the proposed rule changes will result 
in any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act, as amended.\9\ NASDAQ notes 
that it operates in a highly competitive market in which market 
participants can readily favor competing venues if they deem fee levels 
at a particular venue to be excessive, or rebate opportunities 
available at other venues to be more favorable. In such an environment, 
NASDAQ must continually adjust its fees to remain competitive with 
other exchanges and with alternative trading systems that have been 
exempted from compliance with the statutory standards applicable to 
exchanges. Because competitors are free to modify their own fees in 
response, and because market participants may readily adjust their 
order routing practices, NASDAQ believes that the degree to which fee 
changes in this market may impose any burden on competition is 
extremely limited. In this instance, the changes to routing fees and 
credits do not impose a burden on competition because NASDAQ's routing 
services are optional and are the subject of competition from other 
exchanges and broker-dealers that offer routing services, as well as 
the ability of members to use their own routing capabilities. The 
increased fees for execution of CART orders on PSX are reflective of a 
need to better align the fees received with the costs incurred in 
operating and supporting the routing function. The proposed changes to 
orders in certain Tape securities routed to NYSE, NYSEAmex, and 
NYSEArca do not represent an increase or decrease in fees, but rather, 
like the change to CART orders, removes [sic] an unnecessarily complex 
process to determine the fee assessed with a set fee, which is 
consistent with other NASDAQ routing fees. Under the current fees, a 
member firm must know what the respective fee schedules of PSX, NYSE, 
NYSEAmex and NYSEArca are at any given time. Thus, the changes will 
simplify the fee schedule by providing certainty to the fee assessed. 
For these reasons, NASDAQ does not believe that any of the proposed 
changes will impair the ability of members or competing order execution 
venues to maintain their competitive standing in the financial markets. 
While the Exchange does not believe that the proposed changes will 
result in any burden on competition, if the changes proposed herein are 
unattractive to market participants it is likely that NASDAQ will lose 
market share as a result.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78f(b)(8).
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C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act.\10\ At any time within 60 days of the 
filing of the proposed rule change, the Commission summarily may 
temporarily suspend such rule change if it appears to the Commission 
that such action is necessary or appropriate in the public interest, 
for the protection of investors, or otherwise in furtherance of the 
purposes of the Act.
---------------------------------------------------------------------------

    \10\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NASDAQ-2015-008 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2015-008. This 
file number should be included on the subject line if email is used.
    To help the Commission process and review your comments more 
efficiently, please use only one method. The Commission will post all 
comments on the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, 
all written statements with respect to the proposed rule change that 
are filed with the Commission, and all written communications relating 
to the proposed rule change between the Commission and any person, 
other than those that may be withheld from the public in accordance 
with the provisions of 5 U.S.C. 552, will be available for Web site 
viewing and printing in the Commission's Public Reference Room on 
official business days between the hours of 10:00 a.m. and 3:00 p.m. 
Copies of such filing also will be available for inspection and copying 
at the principal offices of the Exchange. All comments received will be 
posted without change; the Commission does not edit personal 
identifying information from submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NASDAQ-2015-008, and should be submitted 
on or before March 11, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2015-03231 Filed 2-17-15; 8:45 am]
BILLING CODE 8011-01-P



                                                8744                            Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices

                                                outdated language in the Fees Schedule                     19b–4 8 thereunder. At any time within                 received will be posted without change;
                                                will make the Fees Schedule easier to                      60 days of the filing of the proposed rule             the Commission does not edit personal
                                                read and alleviate potential confusion.                    change, the Commission summarily may                   identifying information from
                                                The alleviation of potential confusion                     temporarily suspend such rule change if                submissions. You should submit only
                                                will remove impediments to and perfect                     it appears to the Commission that such                 information that you wish to make
                                                the mechanism of a free and open                           action is necessary or appropriate in the              available publicly. All submissions
                                                market and a national market system,                       public interest, for the protection of                 should refer to File Number SR–CBOE–
                                                and, in general, protect investors and                     investors, or otherwise in furtherance of              2015–014 and should be submitted on
                                                the public interest.                                       the purposes of the Act. If the                        or before March 11, 2015.
                                                   The Exchange believes assessing the                     Commission takes such action, the
                                                $400 per month, per login ID fee to the                    Commission will institute proceedings                    For the Commission, by the Division of
                                                                                                           to determine whether the proposed rule                 Trading and Markets, pursuant to delegated
                                                first 15 login IDs (instead of the first 10)
                                                                                                           change should be approved or                           authority.9
                                                is reasonable because the Exchange
                                                expended significant resources                             disapproved.                                           Brent J. Fields,
                                                developing PULSe and desires to recoup                     IV. Solicitation of Comments                           Secretary.
                                                more of those costs. The Exchange                                                                                 [FR Doc. 2015–03226 Filed 2–17–15; 8:45 am]
                                                believes this proposed rule change is                        Interested persons are invited to
                                                                                                                                                                  BILLING CODE 8011–01–P
                                                equitable and not unfairly                                 submit written data, views, and
                                                discriminatory because all TPHs who                        arguments concerning the foregoing,
                                                                                                           including whether the proposed rule
                                                desire to use PULSe will be subject to                                                                            SECURITIES AND EXCHANGE
                                                                                                           change is consistent with the Act.
                                                this change.                                                                                                      COMMISSION
                                                                                                           Comments may be submitted by any of
                                                B. Self-Regulatory Organization’s                          the following methods:
                                                Statement on Burden on Competition                                                                                [Release No. 34–74258; File No. SR–
                                                                                                           Electronic Comments                                    NASDAQ–2015–008]
                                                   The Exchange does not believe that                        • Use the Commission’s Internet
                                                the proposed rule change will impose                       comment form (http://www.sec.gov/                      Self-Regulatory Organizations; The
                                                any burden on competition that is not                      rules/sro.shtml ); or                                  NASDAQ Stock Market LLC; Notice of
                                                necessary or appropriate in furtherance                      • Send an email to rule-comments@                    Filing and Immediate Effectiveness of
                                                of the purposes of the Act. The                            sec.gov. Please include File Number SR–                Proposed Rule Change To Modify
                                                proposed changes to alleviate confusion                    CBOE–2015–014 on the subject line.                     NASDAQ Rule 7018 Fees
                                                are not intended for competitive reasons
                                                and only apply to CBOE. Additionally,                      Paper Comments                                         February 11, 2015.
                                                the Exchange does not believe the                             • Send paper comments in triplicate
                                                                                                                                                                     Pursuant to Section 19(b)(1) of the
                                                proposed change to assess the PULSe                        to Brent J. Fields, Secretary, Securities
                                                login Id [sic] fee to the first 15 login Ids                                                                      Securities Exchange Act of 1934
                                                                                                           and Exchange Commission, 100 F Street
                                                [sic] of a TPH will impose any burden                      NE., Washington, DC 20549–1090.                        (‘‘Act’’),1 and Rule 19b–4 thereunder,2
                                                on intramarket competition that is not                                                                            notice is hereby given that on February
                                                                                                           All submissions should refer to File
                                                necessary or appropriate in furtherance                                                                           2, 2015, The NASDAQ Stock Market
                                                                                                           Number SR–CBOE-2015–014. This file
                                                of the purposes of the Act because the                     number should be included on the                       LLC (‘‘NASDAQ’’ or the ‘‘Exchange’’)
                                                proposed change applies to all Trading                     subject line if email is used. To help the             filed with the Securities and Exchange
                                                Permit Holders. The Exchange believes                      Commission process and review your                     Commission (‘‘Commission’’) a
                                                this proposal will not cause an                            comments more efficiently, please use                  proposed rule change as described in
                                                unnecessary burden on intermarket                          only one method. The Commission will                   Items I, II and III below, which Items
                                                competition because the proposed                           post all comments on the Commission’s                  have been prepared by the Exchange.
                                                change was not motivated by                                Internet Web site (http://www.sec.gov/                 The Commission is publishing this
                                                intermarket competition. To the extent                     rules/sro.shtml ). Copies of the                       notice to solicit comments on the
                                                that the proposed changes make CBOE                        submission, all subsequent                             proposed rule change from interested
                                                a more attractive marketplace for market                   amendments, all written statements                     persons.
                                                participants at other exchanges, such                      with respect to the proposed rule
                                                market participants are welcome to                                                                                I. Self-Regulatory Organization’s
                                                                                                           change that are filed with the
                                                become CBOE market participants.                                                                                  Statement of the Terms of Substance of
                                                                                                           Commission, and all written
                                                                                                           communications relating to the                         the Proposed Rule Change
                                                C. Self-Regulatory Organization’s
                                                Statement on Comments on the                               proposed rule change between the                          NASDAQ is proposing to modify
                                                Proposed Rule Change Received From                         Commission and any person, other than                  NASDAQ Rule 7018 fees assessed for
                                                Members, Participants, or Others                           those that may be withheld from the                    execution and routing securities listed
                                                                                                           public in accordance with the                          on NASDAQ, the New York Stock
                                                  The Exchange neither solicited nor                       provisions of 5 U.S.C. 552, will be
                                                received comments on the proposed                                                                                 Exchange (‘‘NYSE’’) and on exchanges
                                                                                                           available for Web site viewing and
                                                rule change.                                                                                                      other than NASDAQ and NYSE.
                                                                                                           printing in the Commission’s Public
                                                                                                           Reference Room, 100 F Street NE.,                         The text of the proposed rule change
                                                III. Date of Effectiveness of the
emcdonald on DSK67QTVN1PROD with NOTICES




                                                                                                           Washington, DC 20549 on official                       is available at nasdaq.cchwallstreet.com
                                                Proposed Rule Change and Timing for
                                                Commission Action                                          business days between the hours of                     at NASDAQ’s principal office, and at
                                                                                                           10:00 a.m. and 3:00 p.m. Copies of the                 the Commission’s Public Reference
                                                   The foregoing rule change has become                    filing also will be available for                      Room.
                                                effective pursuant to Section 19(b)(3)(A)                  inspection and copying at the principal
                                                of the Act 7 and paragraph (f) of Rule                     office of the Exchange. All comments                     9 17 CFR 200.30–3(a)(12).
                                                                                                                                                                    1 15 U.S.C. 78s(b)(1).
                                                  7 15   U.S.C. 78s(b)(3)(A).                                8 17   CFR 240.19b–4(f).                               2 17 CFR 240.19b–4.




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                                                                          Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices                                                        8745

                                                II. Self-Regulatory Organization’s                         The Exchange is also proposing to                    another venue. To cover such costs, the
                                                Statement of the Purpose of, and                        change the fees assessed for Tape A                     Exchange assesses the same fee as is
                                                Statutory Basis for, the Proposed Rule                  securities routed to NYSE and then                      being proposed for other routed orders,
                                                Change                                                  routed to another venue for execution.                  such as STGY, SCAN, SKNY and SKIP
                                                                                                        The Exchange passes through any                         orders, which are assessed a charge of
                                                  In its filing with the Commission,                    routing fees charged to NASDAQ by                       $0.0030 per share executed.7 Thus, the
                                                NASDAQ included statements                              NYSE for these orders, which currently                  current pass through fee results in a
                                                concerning the purpose of, and basis for,               is $0.0030 per share executed but may                   discount to the fee assessed for use of
                                                the proposed rule change and discussed                  vary based on changes to the NYSE fee                   the routing function for other routed
                                                any comments it received on the                         schedule. NASDAQ is proposing to                        orders. The Exchange notes that CART
                                                proposed rule change. The text of those                 eliminate pass through fees and assess                  orders that execute on BX are not
                                                statements may be examined at the                       a set fee of $0.0030 per share executed.                assessed a charge, but rather the
                                                places specified in Item IV below. The                  Similarly, NASDAQ is proposing to                       Exchange receives a rebate from BX for
                                                Exchange has prepared summaries, set                    eliminate pass through fees and assess                  the routed execution.8 The Exchange
                                                forth in sections A, B, and C below, of                 a fee of $0.0030 per share executed for                 also believes that the proposed changes
                                                the most significant parts of such                      orders in Tape B securities that are                    are reasonable because they remove
                                                statements.                                             routed to NYSEAmex or NYSEArca and                      complexity from the fee schedule and
                                                A. Self-Regulatory Organization’s                       then routed to another venue for                        assess a fee that is not dependent on
                                                Statement of the Purpose of, and                        execution. The Exchange currently                       knowing what the current liquidity
                                                Statutory Basis for, the Proposed Rule                  passes through any routing fees charged                 removal rate is on PSX. NASDAQ
                                                Change                                                  to NASDAQ by NYSEAmex or                                believes that the proposed changes to
                                                                                                        NYSEArca for these orders, which                        CART order fees are equitably allocated
                                                1. Purpose                                              currently is $0.0030 per share executed                 because all member firms that receive
                                                   NASDAQ is proposing to amend                         but may vary based on changes to those                  an execution on PSX will be assessed a
                                                NASDAQ Rule 7018(a) to modify the                       exchanges’ respective fee schedules.                    fee that is more closely aligned with the
                                                fees assessed under the rule for                                                                                costs incurred by NASDAQ, as noted
                                                                                                        2. Statutory Basis
                                                                                                                                                                above. NASDAQ believes that the
                                                securities it trades priced at $1 or more.                 NASDAQ believes that the proposed                    proposed changes to CART order fees do
                                                Specifically, NASDAQ proposes to                        rule change is consistent with the                      not discriminate unfairly because they
                                                change the fee assessed for CART orders                 provisions of Section 6 of the Act,5 in                 eliminate a distinction in the fees
                                                in securities listed on NASDAQ (‘‘Tape                  general, and with Sections 6(b)(4) and                  whereby discounted fees are charged for
                                                C’’), NYSE (‘‘Tape A’’) and on exchanges                6(b)(5) of the Act,6 in particular, in that             use of the Exchange’s routing
                                                other than NASDAQ and the NYSE                          it provides for the equitable allocation                functionality. Moreover, the proposed
                                                (‘‘Tape B’’) (collectively, the ‘‘Tapes’’).             of reasonable dues, fees and other                      changes do not discriminate unfairly
                                                In addition, NASDAQ is proposing to                     charges among members and issuers and                   because they eliminate a distinction in
                                                change the fee assessed for orders in                   other persons using any facility or                     the routing fees whereby some fees are
                                                Tape A securities that are routed to                    system which the Exchange operates or                   fixed and others are based on fee
                                                NYSE and then routed to another venue                   controls, and is designed to prevent                    assessed by other markets. As noted
                                                for execution. Lastly, NASDAQ is                        fraudulent and manipulative acts and                    above, most routing fees are based on a
                                                proposing to change the fee assessed for                practices, to promote just and equitable                set fee, and are not tied to the fees of
                                                orders in Tape B securities that are                    principles of trade, to foster cooperation              other markets.
                                                routed to NYSEAmex or NYSEArca and                      and coordination with persons engaged                      The Exchange believes that the
                                                then routed to another venue for                        in regulating, clearing, settling,                      change to eliminate pass through fees
                                                execution.                                              processing information with respect to,                 for Tape A securities that are routed to
                                                   CART is a routing option by which                    and facilitating transactions in                        NYSE and then routed to another venue
                                                orders in securities of all Tapes route to              securities, to remove impediments to                    for execution, and the change to
                                                the NASDAQ OMX BX Equities Market                       and perfect the mechanism of a free and                 eliminate pass through fees for Tape B
                                                (‘‘BX’’) then the NASDAQ OMX PHLX                       open market and a national market                       securities that are routed to NYSEAmex
                                                PSX System (‘‘PSX’’), and then the                      system, and, in general, to protect                     and NYSEArca and then routed to
                                                System.3 The Exchange currently                         investors and the public interest; and                  another venue for execution are
                                                assesses no charge for CART orders that                 are not designed to permit unfair                       reasonable because they remove
                                                execute on BX and passes-through all                    discrimination between customers,                       complexity from the fee schedule and
                                                fees assessed and rebates offered by PSX                issuers, brokers, or dealers.                           assess a fee that is not dependent on
                                                for such orders. CART orders executed                      NASDAQ believes that the proposed                    knowing what the current routing rates
                                                on PSX result in a pass through charge                  changes to the charges assessed for                     are on those markets. Moreover, the
                                                of $0.0024 per share executed.4 The                     CART orders in securities of any Tape                   proposed new fees are identical to the
                                                Exchange is proposing to now assess a                   that execute on PSX are reasonable                      fees assessed currently. The Exchange
                                                set charge of $0.0030 per share executed                because they eliminate discounted                       believes that the proposed fee changes
                                                for CART orders in any Tape security                    pricing from the fee schedule and more                  are equitably allocated because all
                                                that executes on PSX in lieu of passing                 closely aligns [sic] the fee received with              member firms that receive an execution
                                                through credits and rebates.                            the costs associated with providing                     on another venue in these securities will
emcdonald on DSK67QTVN1PROD with NOTICES




                                                                                                        routing services. The Exchange incurs                   be assessed the same fee. Lastly, the
                                                  3 If shares remain un-executed, they are posted to    costs in operating and supporting the                   Exchange believes that the proposed
                                                the book or cancelled. Once on the book, should the     routing function, which are in addition
                                                order subsequently be locked or crossed by another      to the fees of other exchanges that it                    7 For a description of STGY, SCAN, SKNY and
                                                market center, the System will not route the order                                                              SKIP routing strategies, see Rules 4758(a)(1)(A)(i)
                                                to the locking or crossing market center. See Rule      incurs when a routed order executes on                  and (ii) [sic].
                                                4758(a)(1)(A)(xi).                                                                                                8 BX provides rebates to market participants that
                                                  4 See NASDAQ OMX PHLX LLC Pricing                       5 15   U.S.C. 78f.                                    remove liquidity ranging from $0.0004 to $0.0015.
                                                Schedule, Section VIII(a)(1).                             6 15   U.S.C. 78f(b)(4) and (5).                      See BX Rule 7018(a).



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                                                8746                         Federal Register / Vol. 80, No. 32 / Wednesday, February 18, 2015 / Notices

                                                changes do not discriminate unfairly                       believe that any of the proposed changes                 (http://www.sec.gov/rules/sro.shtml).
                                                because they eliminate a distinction in                    will impair the ability of members or                    Copies of the submission, all subsequent
                                                the routing fees whereby some fees are                     competing order execution venues to                      amendments, all written statements
                                                fixed and others are based on fee                          maintain their competitive standing in                   with respect to the proposed rule
                                                assessed by other markets. As noted                        the financial markets. While the                         change that are filed with the
                                                above, most of NASDAQ’s routing fees                       Exchange does not believe that the                       Commission, and all written
                                                are based on a set fee, and are not tied                   proposed changes will result in any                      communications relating to the
                                                to the fees of other markets.                              burden on competition, if the changes                    proposed rule change between the
                                                B. Self-Regulatory Organization’s                          proposed herein are unattractive to                      Commission and any person, other than
                                                Statement on Burden on Competition                         market participants it is likely that                    those that may be withheld from the
                                                                                                           NASDAQ will lose market share as a                       public in accordance with the
                                                  NASDAQ does not believe that the                         result.                                                  provisions of 5 U.S.C. 552, will be
                                                proposed rule changes will result in any                                                                            available for Web site viewing and
                                                burden on competition that is not                          C. Self-Regulatory Organization’s
                                                                                                                                                                    printing in the Commission’s Public
                                                necessary or appropriate in furtherance                    Statement on Comments on the
                                                                                                                                                                    Reference Room on official business
                                                of the purposes of the Act, as amended.9                   Proposed Rule Change Received From
                                                                                                                                                                    days between the hours of 10:00 a.m.
                                                NASDAQ notes that it operates in a                         Members, Participants, or Others
                                                                                                                                                                    and 3:00 p.m. Copies of such filing also
                                                highly competitive market in which                           Written comments were neither                          will be available for inspection and
                                                market participants can readily favor                      solicited nor received.                                  copying at the principal offices of the
                                                competing venues if they deem fee                                                                                   Exchange. All comments received will
                                                levels at a particular venue to be                         III. Date of Effectiveness of the
                                                                                                           Proposed Rule Change and Timing for                      be posted without change; the
                                                excessive, or rebate opportunities                                                                                  Commission does not edit personal
                                                available at other venues to be more                       Commission Action
                                                                                                                                                                    identifying information from
                                                favorable. In such an environment,                            The foregoing change has become                       submissions. You should submit only
                                                NASDAQ must continually adjust its                         effective pursuant to Section                            information that you wish to make
                                                fees to remain competitive with other                      19(b)(3)(A)(ii) of the Act.10 At any time                available publicly. All submissions
                                                exchanges and with alternative trading                     within 60 days of the filing of the                      should refer to File Number SR–
                                                systems that have been exempted from                       proposed rule change, the Commission                     NASDAQ–2015–008, and should be
                                                compliance with the statutory standards                    summarily may temporarily suspend                        submitted on or before March 11, 2015.
                                                applicable to exchanges. Because                           such rule change if it appears to the
                                                competitors are free to modify their own                   Commission that such action is                             For the Commission, by the Division of
                                                fees in response, and because market                                                                                Trading and Markets, pursuant to delegated
                                                                                                           necessary or appropriate in the public                   authority.11
                                                participants may readily adjust their                      interest, for the protection of investors,
                                                order routing practices, NASDAQ                                                                                     Brent J. Fields,
                                                                                                           or otherwise in furtherance of the
                                                believes that the degree to which fee                      purposes of the Act.                                     Secretary.
                                                changes in this market may impose any                                                                               [FR Doc. 2015–03231 Filed 2–17–15; 8:45 am]
                                                burden on competition is extremely                         IV. Solicitation of Comments                             BILLING CODE 8011–01–P
                                                limited. In this instance, the changes to                    Interested persons are invited to
                                                routing fees and credits do not impose                     submit written data, views, and
                                                a burden on competition because                            arguments concerning the foregoing,                      SMALL BUSINESS ADMINISTRATION
                                                NASDAQ’s routing services are optional                     including whether the proposed rule
                                                and are the subject of competition from                    change is consistent with the Act.                       Regulatory Fairness Hearing, Region
                                                other exchanges and broker-dealers that                    Comments may be submitted by any of                      III—Virginia Beach, Virginia
                                                offer routing services, as well as the                     the following methods:                                   AGENCY:  U.S. Small Business
                                                ability of members to use their own
                                                routing capabilities. The increased fees                   Electronic Comments                                      Administration (SBA).
                                                for execution of CART orders on PSX                          • Use the Commission’s Internet                        ACTION: Notice of open Hearing of
                                                are reflective of a need to better align                   comment form (http://www.sec.gov/                        Region III Small Business Owners in
                                                the fees received with the costs incurred                  rules/sro.shtml); or                                     Virginia Beach, VA.
                                                in operating and supporting the routing                      • Send an email to rule-comments@
                                                                                                                                                                    SUMMARY:   The SBA, Office of the
                                                function. The proposed changes to                          sec.gov. Please include File Number SR–
                                                                                                                                                                    National Ombudsman is issuing this
                                                orders in certain Tape securities routed                   NASDAQ–2015–008 on the subject line.
                                                                                                                                                                    notice to announce the location, date
                                                to NYSE, NYSEAmex, and NYSEArca
                                                                                                           Paper Comments                                           and time of the Virginia Beach, VA
                                                do not represent an increase or decrease
                                                                                                              • Send paper comments in triplicate                   Regulatory Fairness Hearing. This
                                                in fees, but rather, like the change to
                                                                                                           to Brent J. Fields, Secretary, Securities                hearing is open to the public.
                                                CART orders, removes [sic] an
                                                unnecessarily complex process to                           and Exchange Commission, 100 F Street                    DATES: The hearing will be held on
                                                determine the fee assessed with a set                      NE., Washington, DC 20549–1090.                          Tuesday, March 24, 2015, from 10:00
                                                fee, which is consistent with other                        All submissions should refer to File                     a.m. to 12:00 p.m. (EDT).
                                                NASDAQ routing fees. Under the                             Number SR–NASDAQ–2015–008. This                          ADDRESSES: The hearing will be at the
                                                current fees, a member firm must know                      file number should be included on the                    Meyera Oberndorf Library Auditorium,
emcdonald on DSK67QTVN1PROD with NOTICES




                                                what the respective fee schedules of                       subject line if email is used.                           4100 Virginia Beach Boulevard, Virginia
                                                PSX, NYSE, NYSEAmex and NYSEArca                              To help the Commission process and                    Beach, VA 23452.
                                                are at any given time. Thus, the changes                   review your comments more efficiently,                   SUPPLEMENTARY INFORMATION: Pursuant
                                                will simplify the fee schedule by                          please use only one method. The                          to the Small Business Regulatory
                                                providing certainty to the fee assessed.                   Commission will post all comments on                     Enforcement Fairness Act (Pub. L. 104–
                                                For these reasons, NASDAQ does not                         the Commission’s Internet Web site                       121), Sec. 222, SBA announces the
                                                  9 15   U.S.C. 78f(b)(8).                                   10 15   U.S.C. 78s(b)(3)(A)(ii).                         11 17   CFR 200.30–3(a)(12).



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Document Created: 2018-02-16 11:10:42
Document Modified: 2018-02-16 11:10:42
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation80 FR 8744 

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