83 FR 2261 - Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Exchange Rule 7037

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 10 (January 16, 2018)

Page Range		2261-2265
FR Document		2018-00524

Federal Register, Volume 83 Issue 10 (Tuesday, January 16, 2018)

[Federal Register Volume 83, Number 10 (Tuesday, January 16, 2018)]
[Notices]
[Pages 2261-2265]
From the Federal Register Online [www.thefederalregister.org]
[FR Doc No: 2018-00524]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82467; File No. SR-NASDAQ-2017-134]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend Exchange Rule 7037

January 9, 2018.
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 December 26, 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 Exchange Rule 7037 to reflect
substantial enhancements to the data feeds underlying FilterView since
the current fees were set in 2006. Specifically, the Exchange proposes
to modify the monthly subscription fee for FilterView from $500 to $750
per month per subset of data. The proposal is described further below.
While these amendments are effective upon filing, the Exchange has
designated the proposed amendments to be operative on January 1, 2018.
The text of the proposed rule change is available on the Exchange's
website 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 adjust the fee schedule for FilterView to
reflect substantial enhancements to its underlying data feeds since the
current fee was set in 2006.\3\ Specifically, the Exchange proposes to
change the monthly subscription fee for FilterView from $500 to $750
per month per subset of data.
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\3\ See Securities Exchange Act Release No. 54286 (August 8,
2006), 71 FR 46955 (August 15, 2006) (SR-NASDAQ-2006-028).
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FilterView
FilterView allows market data Distributors to receive a subset of
any other real-time data feed offered by the Exchange, allowing
Distributors to control information processing costs by lowering the
bandwidth required to process Exchange data. FilterView is commonly
purchased in two types: NLS FilterView and Nasdaq NOIView. NLS
FilterView separates Nasdaq Last Sale (``NLS'') \4\ data into two
distinct data

[[Page 2262]]

streams: (i) NLS data from the Nasdaq execution system, and (ii) NLS
data from the FINRA/Nasdaq Trade Trade [sic] Reporting Facility
(``TRF'') system. Nasdaq NOIView distributes order imbalance
information from Nasdaq TotalView \5\ in the minutes leading up to the
Nasdaq Opening and Closing Crosses. This includes an indicative
clearing price and net order imbalance in the Nasdaq execution system.
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\4\ NLS is a market data product that contains real-time last
sale information for trades executed on the Exchange or reported to
the FINRA/Nasdaq Trade Reporting Facility.
\5\ TotalView is the Exchange's complete Depth-of-Book data feed
for Nasdaq-listed securities as well as securities listed by other
exchanges, and provides every eligible order at each price level for
all Nasdaq members. TotalView includes the Net Order Imbalance
Indicator (``NOII''), which provides data relating to buy and sell
interest at the open and close of the trading day, in the context of
an Initial Public Offering, and after a trading halt.
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Proposed Change
As a result of substantial enhancements to the data feeds
underlying FilterView since the current fee was set in 2006, the
Exchange proposes to change its monthly subscription fee from $500 to
$750 per month per subset of data.
The value of Nasdaq FilterView, a subset of other market data
feeds, is inextricably connected to trade execution: Market data feeds
require trade orders to provide useful information, and investors
utilize such data to make trading decisions. Over the eleven years that
have elapsed since the current distribution fees were set,\6\ the
Exchange has invested in an array of upgrades to both its trade
execution and market information services, increasing the overall value
of these services, including FilterView.\7\ These upgrades include:
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\6\ See Securities Exchange Act Release No. 54286 (August 8,
2006), 71 FR 46955 (August 15, 2006) (SR-NASDAQ-2006-028).
\7\ Many of these upgrades are common to several Nasdaq-
affiliated exchanges, as improvements to the products and services
of one exchange are reproduced in other exchanges.
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Enhanced Services. In 2013 [sic], the Exchange enhanced
its data feeds by: (i) Converting to binary codes to make more
efficient use of bandwidth and to provide greater timestamp
granularity; (ii) adding a symbol directory message to identify a
security and its key characteristics; (iii) adding a new IPO message
for Nasdaq-listed securities for quotation release time and IPO price;
and (iv) adding the Market Wide Circuit Breaker (``MWCB'') Decline
Level message to inform recipients of the setting for MWCB breach
points for the trading day, and an MWCB Status Level Message to inform
data recipients when an MWCB has breached an established level.\8\
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\8\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2013-45 and http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2013-33.
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Exchange Traded Managed Funds (``ETMFs''). In 2015, the
Exchange modified its data feeds to accommodate ETMFs, a type of
investment vehicle that combines the features of an open-end mutual
funds [sic] and an Exchange Traded Fund (``ETF'') to support an
actively managed-investment strategy.\9\ ETF [sic] trading differs from
other types of equity trading in that it uses a trading protocol called
``Net Asset Value-Based Trading,'' in which all bids, offers, and
execution prices are expressed as a premium or discount to the ETMF's
next-determined Net Asset Value (``NAV''). This distinct pricing format
requires an entirely new set of data fields in which to distribute
information related to prices and trades, and the Exchange modified
Nasdaq Basic to accommodate that format.\10\
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\9\ See Securities Exchange Act Release No. 73562 (November 7,
2014), 79 FR 68309 (November 14, 2014) (SR-NASDAQ-2014-020)
(approving the listing and trading of Exchange-Traded Managed Fund
Shares).
\10\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2015-7.
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Nanosecond Granularity. In 2016, Nasdaq introduced a new
version of QBBO [sic] which allows for timestamp granularity to the
nanosecond.\11\
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\11\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2016-03.
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Geographic Diversity. In 2015, all of the Nasdaq Exchanges
moved their Disaster Recover [sic] (``DR'') center from Ashburn,
Virginia, to Chicago Illinois. As a result, customers can both receive
market data and send orders through the Chicago facility, potentially
reducing overall networking costs. Adding such geographic diversity
helps protect the market in the event of a catastrophic event impacting
the entire East Coast.\12\
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\12\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2015-17.
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Chicago ``B'' Feeds. In 2017, all of the Nasdaq exchanges
added a multicast IP address for proprietary equity and options data
feeds in Chicago, allowing firms the choice of having additional
redundancy to ensure data continuity.\13\
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\13\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2017-02.
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Adjusted Closing Price. In 2013, Nasdaq introduced the
adjusted closing price as a field to reflect a security's previous day
official closing price, adjusted for corporate actions. For Nasdaq-
listed securities, the Nasdaq Official Closing Price is used,\14\ and
the consolidated close from the security's listing exchange is used for
non-Nasdaq securities.\15\
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\14\ Nasdaq's closing cross process produces a tradable closing
price that represents either the closing cross or the best available
price at the time of the transaction.
\15\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2013-25.
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New System Event Messages. In 2013, Nasdaq began
disseminating event messages to indicate the start and end of system
hours.\16\
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\16\ See http://www.nasdaqtrader.com/TraderNews.aspx?id=dtn2013-20.
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While these many changes were in the process of implementation,
fees for Nasdaq FilterView were falling in real terms. Indeed, the
proposed increase from $500 to $750 per month is at least partially
offset by inflation,\17\ and represents only an approximately 3.75
percent annual increase over the course of the eleven years that
elapsed between 2006 and 2017. The Exchange believes that the remaining
increase is more than justified by the substantial upgrades described
above.
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\17\ The Consumer Price Index increased by approximately 21
percent between August 2006 and November 2017. See https://data.bls.gov/cgi-bin/cpicalc.pl
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As a result of these upgrades, the Exchange proposes to change the
monthly subscription fee for FilterView from $500 to $750 per month per
subset of data. Given these specific enhancements to the data feeds
underlying FilterView, and to the Exchange's systems generally, and
given the fact that the Exchange has not increased the subscription fee
since 2006, the Exchange believes that the proposed fee increase is
appropriate.
Nasdaq FilterView is optional in that the Exchange is not required
to offer it and broker-dealers are not required to purchase it. Firms
can discontinue use at any time and for any reason, including an
assessment of the fees charged.
The proposed change does not change the cost of any other Exchange
product.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\18\ in general, and furthers the objectives of
Sections 6(b)(4) and 6(b)(5) of the Act,\19\ 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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\18\ 15 U.S.C. 78f(b).
\19\ 15 U.S.C. 78f(b)(4) and (5).
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The Commission and the courts have repeatedly expressed their
preference for competition over regulatory

[[Page 2263]]

intervention in determining prices, products, and services in the
securities markets. In Regulation NMS, while adopting a series of steps
to improve the current market model, the Commission highlighted the
importance of market forces in determining prices and SRO revenues and,
also, recognized that current regulation of the market system ``has
been remarkably successful in promoting market competition in its
broader forms that are most important to investors and listed
companies.'' \20\
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\20\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
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Likewise, in NetCoalition v. Securities and Exchange Commission
\21\ (``NetCoalition'') the D.C. Circuit upheld the Commission's use of
a market-based approach in evaluating the fairness of market data fees
against a challenge claiming that Congress mandated a cost-based
approach.\22\ As the court emphasized, the Commission ``intended in
Regulation NMS that `market forces, rather than regulatory
requirements' play a role in determining the market data . . . to be
made available to investors and at what cost.'' \23\
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\21\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
\22\ See NetCoalition, at 534-535.
\23\ Id. at 537.
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Further, ``[n]o one disputes that competition for order flow is
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution'; [and] `no exchange can afford to
take its market share percentages for granted' because `no exchange
possesses a monopoly, regulatory or otherwise, in the execution of
order flow from broker dealers'. . . .'' \24\
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\24\ Id. at 539 (quoting Securities Exchange Act Release No.
59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008)
(SR-NYSEArca-2006-21)).
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The Exchange proposes to change the monthly subscription fee for
FilterView from $500 to $750 per month per subset of data. The Exchange
believes that the proposed fee increase is reasonable. While the
Exchange has not increased such fees since 2006, the Exchange has added
a number of enhancements to the data feeds underlying FilterView, as
well as to the Exchange systems in general supporting FilterView. These
enhancements, which are described in greater detail above,
correspondingly enhance the value of FilterView. The proposed fee
increase is therefore reflective of, and closely aligned to, these
enhancements and the correspondingly increased value of the data feed.
The proposed changes are equitable allocations of reasonable dues, fees
and other charges because all recipients will be charged the same fee
for the same service. The proposed changes do not permit unfair
discrimination between customers, issuers, brokers, or dealers because
this service will be available on a non-discriminatory basis to all
similarly-situated recipients.
In adopting Regulation NMS, the Commission granted self-regulatory
organizations (``SROs'') and broker-dealers (``BDs'') increased
authority and flexibility to offer new and unique market data to the
public. It was believed that this authority would expand the amount of
data available to consumers, and also spur innovation and competition
for the provision of market data. The Commission concluded that
Regulation NMS--by deregulating the market in proprietary data--would
itself further the Act's goals of facilitating efficiency and
competition:
[E]fficiency is promoted when broker-dealers who do not need the
data beyond the prices, sizes, market center identifications of the
NBBO and consolidated last sale information are not required to receive
(and pay for) such data. The Commission also believes that efficiency
is promoted when broker-dealers may choose to receive (and pay for)
additional market data based on their own internal analysis of the need
for such data.\25\
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\25\ See Securities Exchange Act Release No. 51808 (June 9,
2005), 70 FR 37496 (June 29, 2005) (``Regulation NMS Adopting
Release'').

The Commission was speaking to the question of whether BDs should be
subject to a regulatory requirement to purchase data, such as depth-of-
book data, that is in excess of the data provided through the
consolidated tape feeds, and the Commission concluded that the choice
should be left to them. Accordingly, Regulation NMS removed unnecessary
regulatory restrictions on the ability of exchanges to sell their own
data, thereby advancing the goals of the Act and the principles
reflected in its legislative history. If the free market should
determine whether proprietary data is sold to BDs at all, it follows
that the price at which such data is sold should be set by the market
as well. Accordingly, ``the existence of significant competition
provides a substantial basis for finding that the terms of an
exchange's fee proposal are equitable, fair, reasonable, and not
unreasonably or unfairly discriminatory.'' \26\
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\26\ Id. [sic]
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The proposed fees, like all market data fees, are constrained by
the Exchange's need to compete for order flow, as discussed below, and
are subject to competition from other exchanges and among broker-
dealers for customers. If Nasdaq is incorrect in its assessment of
price, it will lose market share as a result.

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 rebate opportunities available at other venues to be more
favorable. In such an environment, the Exchange 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,
the Exchange believes that the degree to which fee changes in this
market may impose any burden on competition is extremely limited.
As noted above, Nasdaq FilterView most commonly includes elements
of NLS and TotalView, which are both types of ``non-core'' data that
provide subsets of the ``core'' quotation and last sale data provided
by securities information processors under the CTA Plan and the Nasdaq
UTP Plan. In 2016, an Administrative Law Judge in an application for
review by the Securities Industry and Financial Markets Association of
actions taken by Self-Regulatory Organizations examined whether another
``non-core'' product, Depth-of-Book data, is constrained by competitive
forces.\27\ After a four-day hearing and presentation of substantial
evidence, the administrative law judge stated that ``competition plays
a significant role in restraining exchange pricing of depth-of-book
products'' \28\

[[Page 2264]]

because ``depth-of-book products from different exchanges function as
substitutes for each other,'' \29\ and, as such, ``the threat of
substitution from depth-of-book customers constrains their depth-of-
book prices.'' \30\ As a result, ``[s]hifts in order flow and threats
of shifting order flow provide a significant competitive force in the
pricing of . . . depth-of-book data.'' \31\ The judge concluded that
``[u]nder the standards articulated by the Commission and DC Circuit,
the Exchanges have shown that they are subject to significant
competitive forces in setting fees for depth-of-book data: The
availability of alternatives to the Exchanges' depth-of-book products,
and the Exchanges' need to attract order flow from market participants
constrains prices.'' \32\ In addition, the administrative law judge
stated that ``[s]hifts in order flow and threats of shifting order flow
provide a significant competitive force in the pricing of . . . depth-
of-book data.'' \33\ As such, Nasdaq's depth-of-book fees are
``constrained by significant competitive forces.'' \34\
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\27\ See Securities Industry and Financial Markets Association,
Initial Decision Release No. 1015, 2016 SEC LEXIS 2278 (A.L.J. June
1, 2016).
\28\ Id. at *92.
\29\ Id.
\30\ Id. at *93
\31\ Id. at *104.
\32\ Id. at *86.
\33\ Id. at *37. [sic]
\34\ Id. at *43. [sic]
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Market forces constrain the price of Nasdaq FilterView, just as
they do other market data fees, in the competition among exchanges and
other entities to attract order flow and in the competition among
Distributors for customers. Order flow is the ``life blood'' of the
exchanges. Broker-dealers currently have numerous alternative venues
for their order flow, including self-regulatory organization (``SRO'')
markets, as well as internalizing BDs and various forms of alternative
trading systems (``ATSs''), including dark pools and electronic
communication networks (``ECNs''). Each SRO market competes to produce
transaction reports via trade executions, and two FINRA-regulated TRFs
compete to attract internalized transaction reports. The existence of
fierce competition for order flow implies a high degree of price
sensitivity on the part of BDs, which may readily reduce costs by
directing orders toward the lowest-cost trading venues.
Transaction execution and proprietary data products are
complementary in that market data is both an input and a byproduct of
the execution service. In fact, market data and trade execution are a
paradigmatic example of joint products with joint costs. The decision
whether and on which platform to post an order will depend on the
attributes of the platform where the order can be posted, including the
execution fees, data quality and price, and distribution of its data
products. Without trade executions, exchange data products cannot
exist. Moreover, data products are valuable to many end users only
insofar as they provide information that end users expect will assist
them or their customers in making trading decisions.
The costs of producing market data include not only the costs of
the data distribution infrastructure, but also the costs of designing,
maintaining, and operating the exchange's transaction execution
platform and the cost of regulating the exchange to ensure its fair
operation and maintain investor confidence. The total return that a
trading platform earns reflects the revenues it receives from both
products and the joint costs it incurs.
Moreover, the operation of the exchange is characterized by high
fixed costs and low marginal costs. This cost structure is common in
content and content distribution industries such as software, where
developing new software typically requires a large initial investment
(and continuing large investments to upgrade the software), but once
the software is developed, the incremental cost of providing that
software to an additional user is typically small, or even zero (e.g.,
if the software can be downloaded over the internet after being
purchased).\35\
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\35\ See William J. Baumol and Daniel G. Swanson, ``The New
Economy and Ubiquitous Competitive Price Discrimination: Identifying
Defensible Criteria of Market Power,'' Antitrust Law Journal, Vol.
70, No. 3 (2003).
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In Nasdaq's case, it is costly to build and maintain a trading
platform, but the incremental cost of trading each additional share on
an existing platform, or distributing an additional instance of data,
is very low. Market information and executions are each produced
jointly (in the sense that the activities of trading and placing orders
are the source of the information that is distributed) and are each
subject to significant scale economies. In such cases, marginal cost
pricing is not feasible because if all sales were priced at the margin,
Nasdaq would be unable to defray its platform costs of providing the
joint products.
An exchange's BD customers view the costs of transaction executions
and of data as a unified cost of doing business with the exchange. A BD
will disfavor a particular exchange if the expected revenues from
executing trades on the exchange do not exceed net transaction
execution costs and the cost of data that the BD chooses to buy to
support its trading decisions (or those of its customers). The choice
of data products is, in turn, a product of the value of the products in
making profitable trading decisions. If the cost of the product exceeds
its expected value, the BD will choose not to buy it. Moreover, as a BD
chooses to direct fewer orders to a particular exchange, the value of
the product to that BD decreases, for two reasons. First, the product
will contain less information, because executions of the BD's trading
activity will not be reflected in it. Second, and perhaps more
important, the product will be less valuable to that BD because it does
not provide information about the venue to which it is directing its
orders. Data from the competing venue to which the BD is directing more
orders will become correspondingly more valuable.
Competition among trading platforms can be expected to constrain
the aggregate return each platform earns from the sale of its joint
products, but different platforms may choose from a range of possible,
and equally reasonable, pricing strategies as the means of recovering
total costs. Nasdaq pays rebates to attract orders, charges relatively
low prices for market information and charges relatively high prices
for accessing posted liquidity. Other platforms may choose a strategy
of paying lower liquidity rebates to attract orders, setting relatively
low prices for accessing posted liquidity, and setting relatively high
prices for market information. Still others may provide most data free
of charge and rely exclusively on transaction fees to recover their
costs. Finally, some platforms may incentivize use by providing
opportunities for equity ownership, which may allow them to charge
lower direct fees for executions and data.
In this environment, there is no economic basis for regulating
maximum prices for one of the joint products in an industry in which
suppliers face competitive constraints with regard to the joint
offering. Such regulation is unnecessary because an ``excessive'' price
for one of the joint products will ultimately have to be reflected in
lower prices for other products sold by the firm, or otherwise the firm
will experience a loss in the volume of its sales that will be adverse
to its overall profitability. In other words, an increase in the price
of data will ultimately have to be accompanied by a decrease in the
cost of executions, or the volume of both data and executions will
fall.\36\
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\36\ Moreover, the level of competition and contestability in
the market is evident in the numerous alternative venues that
compete for order flow, including SRO markets, internalizing BDs and
various forms of alternative trading systems (``ATSs''), including
dark pools and electronic communication networks (``ECNs''). Each
SRO market competes to produce transaction reports via trade
executions, and two FINRA-regulated TRFs compete to attract
internalized transaction reports. It is common for BDs to further
and exploit this competition by sending their order flow and
transaction reports to multiple markets, rather than providing them
all to a single market. Competitive markets for order flow,
executions, and transaction reports provide pricing discipline for
the inputs of proprietary data products. The large number of SROs,
TRFs, BDs, and ATSs that currently produce proprietary data or are
currently capable of producing it provides further pricing
discipline for proprietary data products. Each SRO, TRF, ATS, and BD
is currently permitted to produce proprietary data products, and
many currently do or have announced plans to do so, including
Nasdaq, NYSE, NYSE MKT, NYSE Arca, IEX, and BATS/Direct Edge.

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[[Page 2265]]

The proposed change is to increase the monthly subscription fee for
FilterView from $500 to $750 per month per subset of data. The proposal
will not impose any burden on competition because it is simply a price
change that will not alter the overall market structure. Because the
proposed fees will become one aspect of the total cost of interacting
with the Exchange, the Exchange will lose revenue if these total costs
prove to be excessive. 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.

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.\37\
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\37\ 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-2017-134 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-2017-134. 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 website (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 website 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. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2017-134 and should be submitted
on or before February 6, 2018.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\38\
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\38\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-00524 Filed 1-12-18; 8:45 am]
BILLING CODE 8011-01-P

Federal Register / Vol. 83, No. 10 / Tuesday, January 16, 2018 / Notices 2265

The proposed change is to increase IV. Solicitation of Comments For the Commission, by the Division of
the monthly subscription fee for Trading and Markets, pursuant to delegated
FilterView from $500 to $750 per month Interested persons are invited to authority.38
per subset of data. The proposal will not submit written data, views, and Eduardo A. Aleman,
impose any burden on competition arguments concerning the foregoing, Assistant Secretary.
because it is simply a price change that including whether the proposed rule [FR Doc. 2018–00524 Filed 1–12–18; 8:45 am]
will not alter the overall market change is consistent with the Act. BILLING CODE 8011–01–P
structure. Because the proposed fees Comments may be submitted by any of
will become one aspect of the total cost the following methods:
of interacting with the Exchange, the SECURITIES AND EXCHANGE
Electronic Comments COMMISSION
Exchange will lose revenue if these total
costs prove to be excessive. • Use the Commission’s internet
Accordingly, the Exchange does not comment form (http://www.sec.gov/ [Release No. 34–82472; File No. SR–ISE–
believe that the proposed changes will rules/sro.shtml); or 2018–03]
impair the ability of members or • Send an email to rule-comments@ Self-Regulatory Organizations; Nasdaq
competing order execution venues to sec.gov. Please include File Number SR– ISE, LLC; Notice of Filing and
maintain their competitive standing in NASDAQ–2017–134 on the subject line. Immediate Effectiveness of Proposed
the financial markets. Rule Change To Amend the Price Level
Paper Comments
Self-Regulatory Organization’s Protection Rule
Statement on Comments on the • Send paper comments in triplicate January 9, 2018.
Proposed Rule Change Received From to Secretary, Securities and Exchange Pursuant to Section 19(b)(1) of the
Members, Participants, or Others Commission, 100 F Street NE, Securities Exchange Act of 1934
Washington, DC 20549–1090. (‘‘Act’’),1 and Rule 19b–4 thereunder,2
No written comments were either
solicited or received. All submissions should refer to File notice is hereby given that on January 2,
Number SR–NASDAQ–2017–134. This 2018, Nasdaq ISE, LLC (‘‘ISE’’ or
III. Date of Effectiveness of the file number should be included on the ‘‘Exchange’’) filed with the Securities
Proposed Rule Change and Timing for subject line if email is used. To help the and Exchange Commission
Commission Action Commission process and review your (‘‘Commission’’) the proposed rule
comments more efficiently, please use change as described in Items I and II
The foregoing rule change has become below, which Items have been prepared
effective pursuant to Section only one method. The Commission will
by the Exchange. The Commission is
19(b)(3)(A)(ii) of the Act.37 post all comments on the Commission’s
publishing this notice to solicit
internet website (http://www.sec.gov/
At any time within 60 days of the comments on the proposed rule change
rules/sro.shtml). Copies of the
filing of the proposed rule change, the from interested persons.
submission, all subsequent
Commission summarily may I. Self-Regulatory Organization’s
amendments, all written statements
temporarily suspend such rule change if Statement of the Terms of Substance of
with respect to the proposed rule
it appears to the Commission that such the Proposed Rule Change
change that are filed with the
action is: (i) Necessary or appropriate in
the public interest; (ii) for the protection Commission, and all written The Exchange proposes to amend
of investors; or (iii) otherwise in communications relating to the Rule 714(b)(4) (Price Level Protection)
furtherance of the purposes of the Act. proposed rule change between the to clarify the operation of the Price
If the Commission takes such action, the Commission and any person, other than Level Protection.
Commission shall institute proceedings those that may be withheld from the The text of the proposed rule change
to determine whether the proposed rule public in accordance with the is available on the Exchange’s website at
should be approved or disapproved. provisions of 5 U.S.C. 552, will be http://ise.cchwallstreet.com/, at the
available for website viewing and principal office of the Exchange, and at
printing in the Commission’s Public the Commission’s Public Reference
numerous alternative venues that compete for order
flow, including SRO markets, internalizing BDs and Reference Room, 100 F Street NE, Room.
various forms of alternative trading systems Washington, DC 20549, on official
(‘‘ATSs’’), including dark pools and electronic
II. Self-Regulatory Organization’s
communication networks (‘‘ECNs’’). Each SRO
business days between the hours of Statement of the Purpose of, and
market competes to produce transaction reports via 10:00 a.m. and 3:00 p.m. Copies of the Statutory Basis for, the Proposed Rule
trade executions, and two FINRA-regulated TRFs filing also will be available for Change
compete to attract internalized transaction reports. inspection and copying at the principal
It is common for BDs to further and exploit this In its filing with the Commission, the
competition by sending their order flow and office of the Exchange. All comments Exchange included statements
transaction reports to multiple markets, rather than received will be posted without change. concerning the purpose of and basis for
providing them all to a single market. Competitive Persons submitting comments are
markets for order flow, executions, and transaction the proposed rule change and discussed
reports provide pricing discipline for the inputs of cautioned that we do not redact or edit any comments it received on the
proprietary data products. The large number of personal identifying information from proposed rule change. The text of these
SROs, TRFs, BDs, and ATSs that currently produce comment submissions. You should statements may be examined at the
daltland on DSKBBV9HB2PROD with NOTICES

proprietary data or are currently capable of
producing it provides further pricing discipline for
submit only information that you wish places specified in Item IV below. The
proprietary data products. Each SRO, TRF, ATS, to make available publicly. All Exchange has prepared summaries, set
and BD is currently permitted to produce submissions should refer to File forth in sections A, B, and C below, of
proprietary data products, and many currently do Number SR–NASDAQ–2017–134 and
or have announced plans to do so, including
Nasdaq, NYSE, NYSE MKT, NYSE Arca, IEX, and should be submitted on or before 38 17 CFR 200.30–3(a)(12).
BATS/Direct Edge. February 6, 2018. 1 15 U.S.C. 78s(b)(1).
37 15 U.S.C. 78s(b)(3)(A)(ii). 2 17 CFR 240.19b–4.

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Document Created: 2018-01-13 02:02:20
Document Modified: 2018-01-13 02:02:20

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		83 FR 2261