81 FR 4691 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Subsection (a)(7) of Rule 7003, Registration and Processing Fees

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 17 (January 27, 2016)

[Federal Register Volume 81, Number 17 (Wednesday, January 27, 2016)]
[Notices]
[Pages 4691-4693]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-01530]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76946; File No. SR-NASDAQ-2016-006]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Subsection (a)(7) of Rule 7003, Registration and Processing Fees

January 21, 2016.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that, on January 13, 2016, The NASDAQ Stock Market LLC (``NASDAQ'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.

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[[Page 4692]]

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend subsection (a)(7) of Rule 7003, 
Registration and Processing Fees.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaq.cchwallstreet.com, at the principal office of 
the Exchange, and at the Commission's Public Reference Room.

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

    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.

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

1. Purpose
    The Exchange proposes to make changes to the continuing education 
fees section of Rule 7003 to provide that the continuing education 
session fee will be $55 if the session is conducted via Web delivery. 
The continuing education session fee will remain $100 if the session is 
conducted at a testing center. The Exchange is also eliminating the $60 
session fee for the S501 continuing education Regulatory Element, which 
FINRA eliminated as of January 4, 2016.\3\
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    \3\ Currently, Rule 7003(a) provides that certain fees will be 
collected and retained by FINRA via the Web CRD registration system 
for the registration of associated persons of Nasdaq members that 
are not also FINRA members. Under Rule 7003(a)(7), FINRA collects 
and retains a $100 session fee for each individual who is required 
to complete the Regulatory Element of the Continuing Education 
Requirements pursuant to Nasdaq Rule 1120 (S101 and S201) and a $60 
session fee for each individual who is required to complete the 
Proprietary Trader Regulatory Element (S501).
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    On August 8, 2015, the Commission approved SR-FINRA-2015-015 
amending FINRA Rule 1250 to provide a Web-based delivery method for 
completing the Regulatory Element of the continuing education 
requirements.\4\ Pursuant to the rule change, effective October 1, 
2015, the Regulatory Element of the Continuing Education Programs for 
the S201 for Registered Principals and Supervisors is now administered 
through Web-based delivery or such other technological manner and 
format as specified by FINRA. FINRA launched Web-based delivery of the 
S101 Regulatory Element program on January 4, 2016.\5\
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    \4\ See Securities Exchange Act Release No. 75581 (July 31, 
2015), 80 FR 47018 (August 6, 2015) (Order Approving a Proposed Rule 
Change to Provide a Web-based Delivery Method for Completing the 
Regulatory Element of the Continuing Education Requirements) (SR-
FINRA-2015-015).
    \5\ The Regulatory Element of the S101 and S201 Continuing 
Education Programs will continue to be offered at testing centers 
until no later than six months after January 4, 2016. Test-center 
delivery of the Regulatory Element will be phased out by no later 
than six months after January 4, 2016. See Securities Exchange Act 
Release No. 75581 (July 31, 2015), 80 FR 47018 (August 6, 2015) 
(Order Approving a Proposed Rule Change To Provide a Web-Based 
Delivery Method for Completing the Regulatory Element of the 
Continuing Education) (SR-FINRA-2015-015).
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    Pursuant to the approval order for SR-FINRA-2015-015, the fee for 
test-center delivery of the Regulatory Elements of the S101 and S201 
Continuing Education programs will continue to be $100 per session 
through no later than six months after January 4, 2016 when the 
programs will no longer be offered at testing centers. However, under 
the SR-FINRA-2015-015 approval order the fee for Web-based delivery of 
the Regulatory Elements of the S101 and the S201 Continuing Education 
programs is now $55.
    The Exchange currently utilizes FINRA's Continuing Education 
programs for its own continuing education requirements which include 
the S101 and S201 programs. Consistent with SR-FINRA-2015-015, the 
Exchange recently filed a separate proposed rule change relating to 
continuing education.\6\ In that filing, the Exchange proposed to 
follow the changes set forth in SR-FINRA-2015-015 with respect to Web-
based delivery of the Regulatory Element of the Continuing Education 
programs for the S101 and the S201. Consistent with SR-FINRA-2015-015 
this proposed rule change would amend Rule 7003 to provide that the 
following fees will be collected and retained by FINRA for the 
registration of associated persons of Nasdaq members that are not also 
FINRA members: A $100 session fee ($55 if the Continuing Education is 
Web-based) for each individual who is required to complete the 
Regulatory Element of the Continuing Education Requirements pursuant to 
Nasdaq Rule 1120 (S101 and S201). The proposal will eliminate the $60 
session fee for each individual who is required to complete the 
Proprietary Trader Regulatory Element (S501).\7\
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    \6\ See SR-NASDAQ-2015-167 filed December 30, 2015.
    \7\ As noted above, the S501 Proprietary Trader Regulatory 
Element was discontinued by FINRA as of January 4, 2016. The 
Exchange anticipates filing a subsequent rule change to eliminate 
the reference to the $100 session fee when the test center option is 
eliminated for the S101 and S201 Regulatory Elements.
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 2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with 
the Act and the rules and regulations thereunder applicable to the 
Exchange and, in particular, the requirements of Section 6(b) of the 
Act.\8\ Specifically, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \9\ 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) \10\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \8\ 15 U.S.C. 78f(b).
    \9\ 15 U.S.C. 78f(b)(5).
    \10\ Id.
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    Web-based delivery will remove time parameters that exist with 
respect to taking continuing education at testing centers. Having 
additional time to take continuing education may result in better 
learning outcomes, which should enhance investor protection. In 
addition, the option to have Web-based delivery of the Regulatory 
Element of the Continuing Education program at a reduced cost removes 
impediments to a free and open market and national market system by 
making it easier and less costly for registrants to participate in the 
market. Accordingly, the Exchange believes that Web-based delivery of 
the Regulatory Element of the Continuing Education Program and reducing 
the costs of continuing education in general are goals that are 
consistent with the Act.

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

    The Exchange does not believe that the proposed rule change will 
impose

[[Page 4693]]

any burden on competition not necessary or appropriate in furtherance 
of the purposes of the Act. As FINRA has stated, the proposed rule 
change is specifically intended to reduce the burdens of continuing 
education on market participants while preserving the integrity of the 
Continuing Education program.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act.\11\
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    \11\ 15 U.S.C. 78s(b)(3)(A)(ii).
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    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: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings to determine whether the 
proposed rule should be approved or disapproved.

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-2016-006 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2016-006. 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, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office 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-2016-006 and should 
be submitted on or before February 17, 2016.
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    \12\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\12\
Brent J. Fields,
Secretary.
[FR Doc. 2016-01530 Filed 1-26-16; 8:45 am]
 BILLING CODE 8011-01-P