Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Concerning the Exchange's Options Regulatory Fee (ORF) Methodology Until July 1, 2026

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<title>Federal Register, Volume 91 Issue 1 (Friday, January 2, 2026)</title>
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[Federal Register Volume 91, Number 1 (Friday, January 2, 2026)]
[Notices]
[Pages 179-181]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-24133]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-104519; File No. SR-NASDAQ-2025-108]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change
Concerning the Exchange's Options Regulatory Fee (ORF) Methodology
Until July 1, 2026

December 29, 2025.
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 19, 2025, The Nasdaq Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II 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 Nasdaq Options Market LLC
(``NOM'') Pricing Schedule at Options 7, Section 5, NOM Options
Regulatory Fee, to delay the implementation of the new Options
Regulatory Fee (``ORF'') and methodology proposed in SR-NASDAQ-2025-
054.\3\ Specifically, the Exchange proposes to delay NOM's new ORF and
methodology therein, which was to be implemented on January 2, 2026,
until July 1, 2026 and remove the sunset provision. Additionally,
effective January 2, 2026, the Exchange proposes to maintain its
current ORF methodology and temporarily increase from $0.00005 to
$0.0006 per contract side while the industry transitions to the new
model.
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\3\ See Securities Exchange Act Release No. 103619 (August 1,
2025), 90 FR 37931 (August 6, 2025) (SR-NASDAQ-2025-054) (SR-NASDAQ-
2025-054).
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While the changes proposed herein are effective upon filing, the
Exchange has designated the proposed rule change to be operative on
January 2, 2026.
The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings">https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings</a>, and at the principal office of the Exchange.

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
NOM previously filed a proposed amendment to its ORF, effective as
of January 2, 2026,\4\ to amend its methodology of collection to
continue to assess ORF for options transactions cleared by OCC in the
Customer range, however ORF would be assessed to each NOM Participant
for executions that occur on NOM. At this time, NOM proposes to: (1)
delay the implementation of SR-NASDAQ-2025-054, with respect to the new
ORF and methodology therein to be effective on January 2, 2026, so that
it would now be implemented on July 1, 2026; and (2) maintain its
current ORF methodology and temporarily increase from $0.00005 to
$0.0006 per contract side while the industry transitions to the new
model.
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\4\ See id.
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Delay of Implementation
In light of industry feedback from Clearing Members regarding
readiness to implement changes to accommodate the new ORF model and its
methodology of collection, the Exchange proposes to delay the
implementation of SR-NASDAQ-2025-054, with respect to the new ORF and
methodology therein, until July 1, 2026. This delay would provide
market participants additional time to implement the new ORF model and
to design, test and implement changes to the ORF. Additionally, the
Exchange proposes to remove the February 1, 2026 sunset date that would
have allowed the Exchange to revert back to the prior ORF methodology
and rate of $0.0005 per contract side. The Exchange has issued an
Options Trader Alert to notify Participants of the delay at least 30
calendar days prior to the anticipated change.\5\
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\5\ See Options Trader Alert #2025-03.
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Amended ORF
In light of the unanticipated delay of implementation of its
January 2, 2026 amendments to its ORF and methodology in SR-NASDAQ-
2025-054 to accommodate the industry's timeline, NOM proposes to
maintain its current ORF methodology and temporarily increase from
$0.00005 to $0.0006 per contract side while the industry transitions to
the new model. The Exchange has issued an Options Trader Alert to
notify Participants of the modification to the current ORF at least 30
calendar days prior to the anticipated change.\6\
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\6\ See id.
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NOM reduced the amount of ORF collected on August 1, 2025 from
$0.0014 to $0.0005 per contract side in SR-NASDAQ-2025-050.\7\ This
amendment substantially reduced NOM's ORF to account for a reduction in
cost due to an amendment to NOM's FINRA Regulatory Services Agreement
(``RSA''). Thereafter, NOM reduced the amount of ORF collected on
October 1, 2025 from $0.0005 to $0.00005 per contract side in SR-
NASDAQ-2025-070.\8\ This reduction accounted for certain fines. By
lowering its ORF both times, NOM was able to ensure that revenue
collected from the ORF, in combination with its other regulatory fees
and fines, did not exceed Options Regulatory Costs.\9\ NOM presumed it
would be adopting its new ORF and methodology in SR-NASDAQ-2025-054 on
January 2, 2026, which would have implemented a new ORF rate. NOM notes
that it announced its new ORF and methodology on July 22, 2025 \10\ to
provide the industry ample time to implement changes to accommodate the
new ORF and its methodology. Despite announcing in July 2025, industry
participants did not prepare for the implementation. At this time, NOM
proposes to maintain its current ORF methodology and temporarily
increase from $0.00005 to $0.0006 per contract side while the industry
transitions to the new model.

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The Exchange notes that the proposed new rate of $0.0006 is not the
rate that was in effect prior to SR-NASDAQ-2025-070, that rate was
$0.0005 per contract side. The Exchange notes that its reduction on
October 1, 2025 to $0.00005 per contract side was a drastic reduction
that nearly eliminated an ORF for NOM. Given the two drastic decreases
on NOM since August 1, 2025, which entailed estimating market share and
options volume on NOM for nearly 6 months, the Exchange believes that a
new rate of $0.0006 per contract side represents a temporary modest
increase to the rate in effect prior to the second decrease in October
2025, in light of current options volumes, until it is able to
implement the new ORF and methodology on July 1, 2026. This new ORF
rate reflects what the Exchange believes is an appropriate rate that
account for the drastic cuts ($0.0014 per contract side on August 1,
2025 to its current rate of $0.00005 per contract side) since August 1,
2025.
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\7\ See Securities Exchange Act Release No. 103392 (July 7,
2025), 90 FR 30710 (July 10, 2025) (SR-NASDAQ-2025-050) (Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change to
Lower the Options Regulatory Fee (ORF)).
\8\ See Securities Exchange Act Release No. 103993 (September
17, 2025), 90 FR 45438 (September 22, 2025) (SR-NASDAQ-2025-070)
(Notice of Filing and Immediate Effectiveness of a Proposed Rule
Change To Lower the Options Regulatory Fee (ORF)).
\9\ The regulatory costs for options comprise a subset of the
Exchange's regulatory budget that is specifically related to options
regulatory expenses and encompasses the cost to regulate all
Participants' options activity (``Options Regulatory Cost'').
\10\ See Options Trader Alert #2025-33.
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2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\11\ Specifically, the
Exchange believes the proposed rule change is consistent with Section
6(b)(4) of the Act,\12\ which provides that Exchange rules may provide
for the equitable allocation of reasonable dues, fees, and other
charges among its members, and other persons using its facilities.
Additionally, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \13\ requirement that the rules of
an exchange not be designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(4).
\13\ 15 U.S.C. 78f(b)(5).
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Delay of Implementation
The Exchange's proposal to delay the implementation of SR-NASDAQ-
2025-054, with respect to the new ORF and methodology, which was to be
effective on January 2, 2026, until July 1, 2026 and to remove the
February 1, 2026 sunset date that would have allowed the Exchange to
revert back to the prior ORF methodology and rate is consistent with
the Act because it will provide market participants additional time to
design, test and implement the new ORF and its methodology. The
proposal to remove the sunset date is also consistent with the Act
given the delay and anticipated industry commitment to implement the
changes.
Amended ORF
The Exchange's proposal to maintain its current ORF methodology and
temporarily increase from $0.00005 to $0.0006 per contract side while
the industry transitions to the new model is consistent with the Act
because it will allow NOM to collect rates under its current ORF with
an adjusted rate given the Exchange is unable to proceed with the
implementation of its new ORF and its methodology until July 1, 2026.
Also, it will allow NOM to offset a material portion of its Regulatory
Cost under its existing methodology until the new ORF is implemented on
July 1, 2026. As noted herein, SR-NASDAQ-2025-050, reduced the amount
of ORF collected by the Exchange from $0.0014 to $0.0005 per contract
side effective August 1, 2026. This amendment substantially reduced
NOM's ORF to account for a reduction in cost due to an amendment to
NOM's FINRA Regulatory Services Agreement. Thereafter, NOM further
reduced the amount of ORF collected on October 1, 2025 from $0.0005 per
contract side to $0.00005 per contract side in SR-NASDAQ-2025-070. This
reduction accounted for certain fines. By lowering its ORF both times,
NOM was able to ensure that revenue collected from the ORF, in
combination with its other regulatory fees and fines, did not exceed
Options Regulatory Costs. On January 2, 2026, NOM's ORF would have been
amended once again as noted in SR-NASDAQ-2025-054 implementing a new
rate. The Exchange did not plan to delay the implementation and would
otherwise have been collecting under the January 2, 2026 ORF rate if it
were not for the delay. At this time, NOM proposes to temporarily
increase its ORF from $0.00005 to $0.0006 per contract side while the
industry transitions to the new model. The Exchange notes that the
proposed new rate of $0.0006 is not the rate that was in effect prior
to SR-NASDAQ-2025-070, that rate was $0.0005 per contract side. The
Exchange notes that its reduction on October 1, 2025 to $0.00005 per
contract side was a drastic reduction that nearly eliminated an ORF for
NOM. Given the two drastic decreases on NOM since August 1, 2025, which
entailed estimating market share and options volume on NOM for nearly 6
months, the Exchange believes that a new rate of $0.0006 per contract
side represents a temporary modest increase to the rate in effect prior
to the second decrease in October 2025. This new ORF rate reflects what
the Exchange believes is an appropriate rate that account for the
drastic cuts ($0.0014 per contract side on August 1, 2025 to its
current rate of $0.00005 per contract side) since August 1, 2025.

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 intra-market competition not necessary or
appropriate in furtherance of the purposes of the Act. Rather than
reverting to its October 1, 2025 rate, the Exchange would assess an ORF
rate that represents a temporary modest increase to the rate in effect
prior to the second decrease in October 2025, in light of current
options volumes, until it is able to implement the new ORF and
methodology on July 1, 2026. No Participant would be subject to the new
ORF and methodology until July 1, 2026. The Exchange is not
substantively amending the proposed ORF by delaying its implementation.
The Exchange does not believe that the proposed modified rate
reversion will impose any burden on intra-market competition not
necessary or appropriate in furtherance of the purposes of the Act as
the modified ORF rate for January 2, 2026 is intended to represent a
temporary modest increase to the rate in effect prior to the second
decrease in October 2025, given the two drastic decreases on NOM since
August 1, 2025 which entailed estimating market share and options
volume on NOM for nearly 6 months, until it is able to implement the
new ORF and methodology on July 1, 2026. The Exchange does not believe
that the proposed rate reversion will impose any burden on inter-market
competition not necessary or appropriate in furtherance of the purposes
of the Act as other options markets may amend their respective ORFs.

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) of the Act \14\ and paragraph (f) of Rule 19b-4 \15\
thereunder. At any time within 60 days of the filing of the proposed
rule

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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. If the Commission
takes such action, the Commission will institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f).
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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

<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#5e2c2b323b733d3133333b302a2d1e2d3b3d70393128"><span class="__cf_email__" data-cfemail="7e0c0b121b531d1113131b100a0d3e0d1b1d50191108">[email&#160;protected]</span></a>. Please include
file number SR-NASDAQ-2025-108 on the subject line.

Paper Comments

<bullet> 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-2025-108. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-NASDAQ-2025-108 and should be submitted
on or before January 23, 2026.

For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-24133 Filed 12-31-25; 8:45 am]
BILLING CODE 8011-01-P

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Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Concerning the Exchange's Options Regulatory Fee (ORF) Methodology Until July 1, 2026

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