82 FR 32904 - Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Increase the Trading Rights Fee

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 136 (July 18, 2017)

Page Range		32904-32905
FR Document		2017-14986
Federal Register, Volume 82 Issue 136 (Tuesday, July 18, 2017)
[Federal Register Volume 82, Number 136 (Tuesday, July 18, 2017)]
[Notices]
[Pages 32904-32905]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-14986]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81133; File No. SR-NASDAQ-2017-065]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Increase the Trading Rights Fee

July 12, 2017.
    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 June 29, 2017, 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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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's trading rights fee at 
Rule 7001(a) to increase the fee from $1,000 per month to $1,250 per 
month, as described further below. While these amendments are effective 
upon filing, the Exchange has designated the proposed amendments to be 
operative on July 1, 2017.
    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 purpose of the proposed rule change is to increase its monthly 
trading rights fee under Rule 7001(a). The trading rights fee is 
assessed on all Nasdaq members and helps defray the cost of regulating 
the Nasdaq market. The Exchange last increased the fee in 2012,\3\ 
increasing the fee from $500 per month to $1,000 per month, while the 
cost of regulation has increased since that time. In proposing the 
change, the Exchange is more closely aligning the fee assessed with the 
benefit provided by allowing members to trade on a well-regulated 
market, the cost of which is incurred by the Exchange in the systems 
and people that support oversight of the market. Nasdaq believes that 
even with the fee increase, the cost of Nasdaq membership will continue 
to be generally lower than the cost of membership in other SROs.\4\
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    \3\ See Securities Exchange Act Release No. 66905 (May 2, 2012), 
77 FR 27105 (May 8, 2012) (SR-NASDAQ-2012-056).
    \4\ For example, the Exchange believes that the New York Stock 
Exchange (``NYSE'') Trading License Fee is analogous to membership 
fees of NASDAQ as they both provide access to the trading facilities 
of their respective exchanges. In this regard, NYSE assesses an 
annual fee of $50,000 for the first license held by a member 
organization. See https://www.nyse.com/publicdocs/nyse/markets/nyse/NYSE_Price_List.pdf. By contrast, NASDAQ would assess the proposed a 
[sic] monthly trading rights fee of $1,250 ($15,000 annually), 
together with an annual membership fee of $3,000, and a monthly 
market participant identifier fee of $550 per MPID ($6,600 
annually). See Rule 7001.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\5\ in general, and furthers the objectives of 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, and is 
not designed to permit unfair discrimination between customers, 
issuers, brokers, or dealers.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4) and (5).
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    Nasdaq believes that the fee change is reasonable because the 
increased fee continues to be less than the analogous fees of other 
markets. For example, the Exchange's membership fees will continue to 
remain substantially lower than the analogous fees assessed by the New 
York Stock Exchange for membership, which assesses an annual fee of 
$50,000 for the first license held by a member organization. The 
Exchange believes that the proposed fee increase is an equitable 
allocation and is not unfairly discriminatory because the Exchange must 
adjust fees from time to time so that it can continue to cover costs 
and to make a profit on the products and services it offers. The 
proposed increased fee will apply to all members and it will allow the 
Exchange to cover the costs of providing its members with a well-
regulated market. These costs include investing in the systems and 
people that support oversight of the market

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

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. In terms of inter-market 
competition, the Exchange 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

[[Page 32905]]

rebate opportunities available at other venues to be more favorable. In 
such an environment, the Exchange must carefully consider any increases 
to its fees, balancing its desire to remain competitive with other 
exchanges and with alternative trading systems that have been exempted 
from compliance with the statutory standards applicable to exchanges, 
while also considering its need to cover the costs associated with 
providing a well-regulated market. Because competitors are free to 
modify their own fees in response, and because members are not 
compelled to be members of the Exchange and may trade on numerous other 
exchanges and other alternative trading systems, 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 proposed changes to the trading rights fee 
does [sic] not impose a burden on competition because membership in, 
and use of, the Exchange is wholly voluntary and the Exchange is 
subject to significant competition from other exchanges and other 
trading venues. If the proposed fee increase is unattractive to 
members, it is likely that the Exchange will lose membership and market 
share as a result. Moreover, the Exchange must increase fees to cover 
the costs associated with maintaining and enhancing its regulatory 
programs to ensure that the Exchange remains a well-regulated trading 
venue. Thus, to the extent that the fee does represent a burden on 
competition, such burden is necessary to further purposes of the Act. 
Accordingly, the Exchange does not believe that the proposed changes 
will impair the ability of members or competing order execution venues 
to maintain their competitive standing in the financial markets.

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.\7\
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    \7\ 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-2017-065 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-2017-065. 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-2017-065 and should 
be submitted on or before August 8, 2017.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2017-14986 Filed 7-17-17; 8:45 am]
 BILLING CODE 8011-01-P
32904 Federal Register / Vol. 82, No. 136 / Tuesday, July 18, 2017 / Notices

the MIAX Options market, RFR Commission is publishing this notice to generally lower than the cost of
responses, and the Initiating Member’s solicit comments on the proposed rule membership in other SROs.4
submission. Thus, a complex order change from interested persons.
2. Statutory Basis
entered into a cPRIME Auction would
I. Self-Regulatory Organization’s The Exchange believes that its
receive an execution at the best price Statement of the Terms of Substance of
available at the conclusion of the proposal is consistent with Section 6(b)
the Proposed Rule Change of the Act,5 in general, and furthers the
Auction and, at a minimum, would be
executed in full at the improved net The Exchange proposes to amend the objectives of Sections 6(b)(4) and 6(b)(5)
price. In addition, if an improved net Exchange’s trading rights fee at Rule of the Act,6 in particular, in that it
price for a complex order entered in a 7001(a) to increase the fee from $1,000 provides for the equitable allocation of
cPRIME Auction could be achieved per month to $1,250 per month, as reasonable dues, fees and other charges
from bids and offers for the individual described further below. While these among members and issuers and other
legs of the complex order in the MIAX amendments are effective upon filing, persons using any facility, and is not
Options market, the complex order the Exchange has designated the designed to permit unfair
would be executed at the better net proposed amendments to be operative discrimination between customers,
price. The Commission further notes on July 1, 2017. issuers, brokers, or dealers.
that other exchanges have previously The text of the proposed rule change Nasdaq believes that the fee change is
adopted similar rules to permit the entry is available on the Exchange’s Web site reasonable because the increased fee
of complex orders into a price at http://nasdaq.cchwallstreet.com, at continues to be less than the analogous
improvement mechanism.54 the principal office of the Exchange, and fees of other markets. For example, the
For the foregoing reasons, the at the Commission’s Public Reference Exchange’s membership fees will
Commission finds that the proposed Room. continue to remain substantially lower
rule change is consistent with Sections than the analogous fees assessed by the
II. Self-Regulatory Organization’s
6(b)(5) and 6(b)(8) of the Act.55 New York Stock Exchange for
Statement of the Purpose of, and
membership, which assesses an annual
IV. Conclusion Statutory Basis for, the Proposed Rule
fee of $50,000 for the first license held
Change
It is therefore ordered, pursuant to by a member organization. The
Section 19(b)(2) of the Act,56 that the In its filing with the Commission, the Exchange believes that the proposed fee
proposed rule change (SR–MIAX–2017– Exchange included statements increase is an equitable allocation and is
19), be and hereby is approved. concerning the purpose of and basis for not unfairly discriminatory because the
the proposed rule change and discussed Exchange must adjust fees from time to
For the Commission, by the Division of any comments it received on the time so that it can continue to cover
Trading and Markets, pursuant to delegated
authority.57
proposed rule change. The text of these costs and to make a profit on the
statements may be examined at the products and services it offers. The
Jill M. Peterson,
places specified in Item IV below. The proposed increased fee will apply to all
Assistant Secretary. Exchange has prepared summaries, set members and it will allow the Exchange
[FR Doc. 2017–14984 Filed 7–17–17; 8:45 am] forth in sections A, B, and C below, of to cover the costs of providing its
BILLING CODE 8011–01–P the most significant aspects of such members with a well-regulated market.
statements. These costs include investing in the
systems and people that support
SECURITIES AND EXCHANGE A. Self-Regulatory Organization’s
oversight of the market
COMMISSION Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule B. Self-Regulatory Organization’s
[Release No. 34–81133; File No. SR– Statement on Burden on Competition
Change
NASDAQ–2017–065]
1. Purpose The Exchange does not believe that
Self-Regulatory Organizations; The the proposed rule change will impose
The purpose of the proposed rule
NASDAQ Stock Market LLC; Notice of any burden on competition not
change is to increase its monthly trading
Filing and Immediate Effectiveness of necessary or appropriate in furtherance
rights fee under Rule 7001(a). The
Proposed Rule Change To Increase the of the purposes of the Act. In terms of
trading rights fee is assessed on all
Trading Rights Fee inter-market competition, the Exchange
Nasdaq members and helps defray the notes that it operates in a highly
July 12, 2017. cost of regulating the Nasdaq market. competitive market in which market
Pursuant to Section 19(b)(1) of the The Exchange last increased the fee in participants can readily favor competing
Securities Exchange Act of 1934 2012,3 increasing the fee from $500 per venues if they deem fee levels at a
(‘‘Act’’),1 and Rule 19b–4 thereunder,2 month to $1,000 per month, while the particular venue to be excessive, or
notice is hereby given that on June 29, cost of regulation has increased since
2017, The NASDAQ Stock Market LLC that time. In proposing the change, the 4 For example, the Exchange believes that the

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the Exchange is more closely aligning the New York Stock Exchange (‘‘NYSE’’) Trading
Securities and Exchange Commission fee assessed with the benefit provided License Fee is analogous to membership fees of
by allowing members to trade on a well- NASDAQ as they both provide access to the trading
(‘‘SEC’’ or ‘‘Commission’’) the proposed facilities of their respective exchanges. In this
rule change as described in Items I, II, regulated market, the cost of which is regard, NYSE assesses an annual fee of $50,000 for
and III below, which Items have been incurred by the Exchange in the systems the first license held by a member organization. See
sradovich on DSK3GMQ082PROD with NOTICES

prepared by the Exchange. The and people that support oversight of the https://www.nyse.com/publicdocs/nyse/markets/
market. Nasdaq believes that even with nyse/NYSE_Price_List.pdf. By contrast, NASDAQ
would assess the proposed a [sic] monthly trading
54 See,e.g., Phlx Rule 1080(n). the fee increase, the cost of Nasdaq rights fee of $1,250 ($15,000 annually), together
55 15 U.S.C. 78f(b)(5), (b)(8). membership will continue to be with an annual membership fee of $3,000, and a
56 15 U.S.C. 78s(b)(2).
monthly market participant identifier fee of $550
57 17 CFR 200.30–3(a)(12). 3 See Securities Exchange Act Release No. 66905 per MPID ($6,600 annually). See Rule 7001.
1 15 U.S.C. 78s(b)(1). 5 15 U.S.C. 78f(b).
(May 2, 2012), 77 FR 27105 (May 8, 2012) (SR–
2 17 CFR 240.19b–4. NASDAQ–2012–056). 6 15 U.S.C. 78f(b)(4) and (5).

VerDate Sep<11>2014 17:47 Jul 17, 2017 Jkt 241001 PO 00000 Frm 00120 Fmt 4703 Sfmt 4703 E:\FR\FM\18JYN1.SGM 18JYN1
Document Created: 2018-10-24 11:26:29
Document Modified: 2018-10-24 11:26:29
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		82 FR 32904