Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend NASDAQ Rules 7014 and 7018, 21778-21782 [2015-08941]
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Federal Register / Vol. 80, No. 75 / Monday, April 20, 2015 / Notices
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 18 and Rule 19b–4(f)(6)(iii)
thereunder.19
A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act 20 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b–4(f)(6)(iii) 21
permits the Commission to designate a
shorter time if such action is consistent
with the protection of investors and the
public interest. The Exchange has asked
the Commission to waive the 30-day
operative delay so that the proposal may
become operative immediately upon
filing. The Exchange believes that
waiving the 30-day operative delay is
consistent with the protection of
investors and the public interest
because it would allow the Exchange to
timely offer investors a new option for
receiving consolidated volume
information. The Exchange further notes
that other exchanges currently offer
similar data products that include
consolidated volume.22 The
Commission believes that waiving the
30-day operative delay is consistent
with the protection of investors and the
public interest. Therefore, the
Commission hereby waives the
operative delay and designates the
proposed rule change operative upon
filing.23
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
18 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6)(iii). As required under
Rule 19b–4(f)(6)(iii), the Exchange provided the
Commission with written notice of its intent to file
the proposed rule change, along with a brief
description and the text of the proposed rule
change, at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission.
20 17 CFR 240.19b–4(f)(6).
21 17 CFR 240.19b–4(f)(6)(iii).
22 See supra note 14 (noting that NYSE BQT and
NLS Plus carry consolidated volume for all listed
equities).
23 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(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:
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.24
Brent J. Fields,
Secretary.
[FR Doc. 2015–08942 Filed 4–17–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
BATS–2015–29 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–BATS–2015–29. 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 (https://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 such
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–BATS–
2015–29, and should be submitted on or
before May 11, 2015.
[Release No. 34–74725; File No. SR–
NASDAQ–2015–032]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend
NASDAQ Rules 7014 and 7018
April 14, 2015.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that, on April 1,
2015, The NASDAQ Stock Market LLC
(‘‘NASDAQ’’ or the ‘‘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.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
NASDAQ is proposing changes to the
Qualified Market Maker (‘‘QMM’’)
Incentive Program under Rule 7014, and
the qualification requirements for
certain fees relating to Market-on-Close
and/or Limit-on-Close orders under
Rule 7018(a).
The text of the proposed rule change
is available at nasdaq.cchwallstreet.com
at NASDAQ’s principal office, and at
the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
NASDAQ included statements
concerning the purpose of, and basis for,
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of those
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
1 15
24 17
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CFR 200.30–3(a)(12).
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U.S.C. 78s(b)(1).
CFR 240.19b–4.
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the most significant parts of such
statements.
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A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
NASDAQ is proposing to amend Rule
7014(d), which provides the
qualification criteria for designation as a
Qualified Market Maker (‘‘QMM’’)
under the QMM incentive program, to
limit qualification to registered
NASDAQ market makers (‘‘Market
Makers’’). Currently, a QMM may be,
but is not required to be, a Market
Maker in any security.3 The QMM
program provides incentives to a
member firm to make a significant
contribution to market quality by
providing liquidity at the NBBO in a
large number of stocks for a significant
portion of the day. In addition, the
member must avoid imposing the
burdens on NASDAQ and its market
participants that may be associated with
excessive rates of entry of orders away
from the inside and/or order
cancellation. The Exchange notes that
the program, to date, has been used very
little by member firms that are not
Market Makers, and only Market Makers
use the program at this time.
Accordingly, the Exchange is proposing
to amend Rule 7014(d)(3) to limit the
program to Market Makers. The
Exchange is also deleting the current
qualification criteria under Rule
7014(d)(3) that requires a member firm
to have liquidity provided in all
securities through one of its NASDAQ
Market Center MPIDs that represent
0.30% of Consolidated Volume during
the month. The Exchange notes that the
Consolidated Volume requirement is
superfluous given that it is adopting
Consolidated Volume eligibility criteria
for the credits under the QMM program,
and is adding an absolute Consolidated
Volume eligibility criteria to receive the
reduced removal rate under the
program, as discussed below.
NASDAQ is amending Rule 7014(e),
which sets forth the criteria required to
receive the benefits of the program, to
move the two credits provided under
subparagraphs (1) and (2) provided for
executions in securities listed on NYSE
(‘‘Tape A’’) and securities listed on
exchanges other than NASDAQ and
NYSE (‘‘Tape B’’) to a table format
directly under Rule 7014(e). NASDAQ is
also modifying the criteria a QMM must
3 Thus, the QMM designation does not by itself
impose a two-sided quotation obligation or convey
any of the benefits associated with being a
registered market maker.
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meet to receive the two tiers of credits
under the rule. Currently, NASDAQ
provides a rebate of $0.0002 per share
executed (in addition to other credits
received under Rule 7018(a)) with
respect to orders that are executed at a
price of $1 or more and (A) displayed
a quantity of at least one round lot at the
time of execution; (B) either established
the NBBO or was the first order posted
on NASDAQ that had the same price as
an order posted at another trading
center with a protected quotation that
established the NBBO; (C) were entered
through a QMM MPID; (D) were for
securities listed on NYSE or securities
listed on exchanges other than
NASDAQ and NYSE and (E) that no
additional rebate will be issued with
respect to Designated Retail Orders (as
defined in Rule 7018). NASDAQ is
proposing to replace these requirements
with a new requirement that a QMM
execute shares of liquidity provided in
all securities through one or more of its
NASDAQ Market Center MPIDs that
represent greater than 0.90% of
Consolidated Volume during the month.
The Exchange is replacing the current
requirements, which provide the QMM
with an incentive to provide displayed
liquidity that sets the NBBO on
NASDAQ, with a new requirement to
provide a significant level Consolidated
Volume in all securities through one or
more of its MPIDs. Consolidated
Volume is defined by Rule 7018(a) as
the total consolidated volume reported
to all consolidated transaction reporting
plans by all exchanges and trade
reporting facilities during a month in
equity securities, excluding executed
orders with a size of less than one round
lot.4 The Exchange believes that tying
the rebate to the provision of greater
overall volume will provide an
increased impact to improving market
quality over the current NBBO-based
criteria.
Similarly, the Exchange is proposing
to modify the requirements to receive a
rebate of $0.0001 per share executed
under Rule 7014(e)(2). Currently, a
QMM will receive the rebate with
respect to all other displayed orders
(other than Designated Retail Orders, as
defined in Rule 7018) in securities
priced at $1 or more per share that
provide liquidity that are entered
through a QMM MPID in Tape A or B
securities. The Exchange is proposing to
now require that a QMM execute shares
4 For purposes of calculating Consolidated
Volume and the extent of a member’s trading
activity, expressed as a percentage of or ratio to
Consolidated Volume, the date of the annual
reconstitution of the Russell Investments Indexes
shall be excluded from both total Consolidated
Volume and the member’s trading activity.
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of liquidity provided in all securities
through one or more of its Nasdaq
Market Center MPIDs that represent
from 0.70% up to and including 0.90%
of Consolidated Volume during the
month. The Exchange believes that tying
the rebate to the provision of greater
overall volume will provide an
increased impact to improving market
quality over the current requirement
that the orders are displayed and
provide liquidity.
As a consequence of moving and
modifying the criteria of Rules
7014(e)(1) and (2), NASDAQ is moving
certain rule text concerning the type of
securities that the rule applies to, and
certain exclusions from the program,
from subparagraphs (1) and (2) to the
first paragraph of Rule 7014(e). As noted
above, NASDAQ is placing the two
credits provided under subparagraphs
(1) and (2) in a table format and,
consequently, is deleting those
subparagraphs. NASDAQ is moving
language, which is repeated in both
subparagraphs, that notes the credits
provided apply to securities priced at $1
or more per share to the new table under
Rule 7014(e) where the two credits are
now located. The Exchange is also
moving text that concerns exclusion of
Designated Retail Orders from
subparagraphs (1) and (2) to directly
above the new table under Rule 7014(e).
NASDAQ is proposing to amend the
criteria under Rule 7014(e)(3) required
to receive the reduced remove rate fee
of $0.00295 per share executed under
the rule in Tape A and B securities
priced at $1 or more for shares executed
via its QMM MPID. Currently, NASDAQ
will charge a fee of $0.0030 per share
executed for orders in securities listed
on NASDAQ (‘‘Tape C’’) priced at $1 or
more per share that access liquidity on
the NASDAQ Market Center and that are
entered through a QMM MPID, and
charges a fee of $0.00295 per share
executed for orders in Tape A or B
securities priced at $1 or more per share
that access liquidity on the NASDAQ
Market Center and that are entered
through a QMM MPID; provided,
however, that after the first month in
which an MPID becomes a QMM MPID,
the QMM’s volume of liquidity added,
provided, and/or routed through the
QMM MPID during the month (as a
percentage of Consolidated Volume)
must not be less than 0.05% lower than
the volume of liquidity added,
provided, and/or routed through such
QMM MPID during the first month in
which the MPID qualified as a QMM
MPID (as a percentage of Consolidated
Volume). NASDAQ is proposing to
eliminate the current Consolidated
Volume requirement, which relates to
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the first month in which an MPID
qualified as a QMM MPID, and now
require that the QMM executes shares of
liquidity provided in all securities
through one or more of its NASDAQ
Market Center MPIDs of 0.80% or more
of Consolidated Volume during the
month. The Exchange believes that the
changes will tie receipt of the reduced
removal fee in Tape A and B securities
to a more meaningful measure of
market-improvement. Decoupling the
measure from the QMM’s first month
QMM Consolidated Volume will ensure
that all QMMs meet a minimum
standard that is uniform. Increasing the
Consolidated Volume required to
receive the fee will provide incentive to
QMMs to provide greater marketimproving participation in return for the
benefit.
The Exchange is also proposing to
increase the level of Consolidated
Volume that a member firm must have
in Market-on-Close and/or Limit-onClose orders during the month in order
to qualify for fees to remove liquidity in
securities executed at or above $1 under
Rule 7018(a)(1), (2) and (3). Currently,
NASDAQ assesses a fee for member
firms that qualify based on their Marketon-Close and/or Limit-on-Close order
participation in the Closing Cross of
$0.0030 per share executed in Tape C
securities under Rule 7018(a)(1), and
fees of $0.00295 per share executed in
Tape A and B securities under Rules
7018(a)(2) and (3), respectively. To
qualify under each of the rules, a
member firm must have Market-onClose and/or Limit-on-Close orders
executed in the NASDAQ Closing Cross,
entered through a single NASDAQ
Market Center market participant
identifier, that represent more than
0.06% of Consolidated Volume during
the month. The Exchange is proposing
to increase the minimum level of
Consolidated Volume required under
each of the rules to 0.15%.
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2. Statutory Basis
NASDAQ believes that the proposed
rule change is consistent with the
provisions of Section 6 of the Act,5 in
general, and with Sections 6(b)(4) and
6(b)(5) of the Act,6 in particular, in that
it provides for the equitable allocation
of reasonable dues, fees and other
charges among members and issuers and
other persons using any facility or
system which NASDAQ operates or
controls, and is not designed to permit
unfair discrimination between
customers, issuers, brokers, or dealers.
5 15
6 15
U.S.C. 78f.
U.S.C. 78f(b)(4) and (5).
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NASDAQ believes that the proposed
changes to the QMM program in
NASDAQ Rule 7014(d)(3) is [sic]
reasonable and will not discriminate
unfairly because they refine the program
to focus on market participants who
currently use the program. As discussed
above, Market Makers have provided the
vast majority of participation in the
program and are currently the only
market participant utilizing the
program. Accordingly, restricting the
program to Market Makers will not
result in a material change in who
participates in the program.
Additionally, Market Makers have both
obligations to the market and regulatory
requirements that normally do not apply
to other market participants. As such,
the Exchange believes that providing
additional incentives to Market Makers
to provide liquidity for the benefit of all
investors and other market participants
is reasonable and not unfairly
discriminatory. The proposed
modifications to the QMM program
recognize the benefits of increased
Market Maker participation and the
Exchange believes that this proposal
will improve displayed liquidity, and
thus the execution quality overall on the
Exchange. Moreover, the Exchange
believes that eliminating the current
Consolidated Volume requirement is
reasonable and not unfairly
discriminatory because it will become
superfluous in light of additional
requirements based on Consolidated
Volume that are also being proposed
herein. For the same reasons noted
above, limiting eligibility in the program
to Market Makers and eliminating the
Consolidated Volume requirement
under Rule 7014(d)(3) is an equitable
allocation of the fees and credits
provided by the program. In this regard,
no current participants in the program
will be excluded from being eligible to
participate after the proposed change is
effective, and applying the current
Consolidated Volume criteria will have
no significance in light of the proposed
changes to the specific fees and credits
under the program.
The Exchange believes that the
proposed changes to Rule 7014(e) are
reasonable and not unfairly
discriminatory because they impose
stricter requirements on Market Makers
to receive the benefits of the program,
which will be applied uniformly to all
Market Makers that are eligible to
participate in the QMM program. With
regard to the $0.0002 rebate provided in
Tape A and B securities, the Exchange
is eliminating the NBBO-based criteria
and tying the rebate to greater overall
volume, which the Exchange believes
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will provide a greater impact to
improving overall market quality
because the economic benefits provided
to the Market Maker are more certain
and therefore provide the Market Maker
a means to more aggressively provide
displayed liquidity to the Exchange for
the benefit of all market participants. In
this regard, the Exchange notes that
Market Makers must provide more than
0.90% of Consolidated Volume during
the month, which is a significant level
participation in the market. Similarly,
NASDAQ is proposing a significant
level of Consolidated Volume to receive
the $0.0001 rebate under the rule, which
currently only requires that the QMM
participant provide displayed liquidity.
The Exchange believes that it is
reasonable and not unfairly
discriminatory to impose stricter criteria
designed to improve market quality in
return for the credit NASDAQ elects to
provide. NASDAQ also believes that the
proposed changes to the eligibility
requirements for the reduced removal
fee in Tape A and B securities of
$0.00295 per share executed are
reasonable and not unfairly
discriminatory because they increase
the level of Consolidated Volume
required, which will be an absolute
requirement and not tied to historical
levels of Consolidated Volume, thereby
increasing the level of market
improvement necessary to receive the
reduced rate. As an absolute
requirement, the Consolidated Volume
requirement will apply uniformly to all
Market Makers eligible to participate in
the program. The Exchange believes that
the proposed changes to the eligibility
requirements under Rule 7014(e) are an
equitable allocation because NASDAQ
will provide the same rebates and fees
to all Market Makers that qualify under
the rule.
Lastly, NASDAQ notes that Market
Makers serve an important role on the
Exchange with regard to order
interaction and provide continuous,
passive liquidity in the marketplace.
Additionally, Market Makers incur costs
unlike the majority of other market
participants including, but not limited
to, their own infrastructure and other
technology costs associated with market
making activities. Consequently, the
proposed differentiation between
Market Makers and other market
participants recognizes the differing
contributions made to the quality of the
market on the Exchange by Market
Makers and the heightened regulatory
requirements and costs associated with
being a Market Maker. In brief, the
Exchange believes that the proposed
changes to the QMM program further
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incentives registered Market Makers to
provide liquidity improves market
qualify [sic], furthers the price discovery
process and benefits investors.
The Exchange believes that the
proposed changes to the level of
Consolidated Volume in Market-onClose and/or Limit-on-Close order
participation in the Closing Cross
required to receive the fees for orders
that remove liquidity under Rules
7018(a)(1), (2), and (3) are reasonable
and not unfairly discriminatory because
they represent an increase in the level
of market-improving Consolidated
Volume contributed to the Closing
Cross. NASDAQ provides discounted
fees in Market-on-Close and/or Limiton-Close orders in Tape A and B
securities to provide incentives to
member firms to provide liquidity in the
closing process. NASDAQ is increasing
the Consolidated Volume requirement
to better align the discounted remove
fees with members that use the closing
cross process more regulatory [sic] over
alternatives and also access liquidity
more frequently on the Exchange as
opposed to other members. Nonetheless,
NASDAQ believes that it is reasonable
and not unfairly discriminatory to
change the eligibility criteria so that it
mirrors the eligibility criteria of the
related fees under Rules 7018(a)(2) and
(3). Lastly, the Exchange believes that
the proposed changes to the rules are an
equitable allocation of the fees because
the fee is provided uniformly to all
member firms that qualify for the fees
and all member firms have an equal
opportunity to earn the discounted fee
for accessing liquidity.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
NASDAQ does not believe that the
proposed rule changes will result in any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act, as amended.7
NASDAQ notes that it operates in a
highly competitive market in which
market participants can readily favor
competing venues if they deem fee
levels at a particular venue to be
excessive, or rebate opportunities
available at other venues to be more
favorable. In such an environment,
NASDAQ must continually adjust its
fees to remain competitive with other
exchanges and with alternative trading
systems that have been exempted from
compliance with the statutory standards
applicable to exchanges. Because
competitors are free to modify their own
fees in response, and because market
participants may readily adjust their
7 15
U.S.C. 78f(b)(8).
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17:56 Apr 17, 2015
order routing practices, NASDAQ
believes that the degree to which fee
changes in this market may impose any
burden on competition is extremely
limited or even non-existent. In this
instance, the changes to eligibility
criteria required to receive credits and
reduced fees under the QMM program
do not impose a burden on competition
because the incentive program remains
in place, still offers economically
advantageous credits and reduced fees,
and is reflective of the need for
exchanges to offer, and to let, the
financial incentives to attract order flow
evolve. While the Exchange does not
believe that the proposed changes to the
QMM program will result in any burden
on competition, if the changes proposed
herein are unattractive to market
participants it is likely that NASDAQ
will lose market share as a result.
Similarly, the proposed changes to the
eligibility criteria for remove fees under
Rule 7018(a) based on Market-on-Close
and/or Limit-on-Close order
participation in the Closing Cross are
designed to increase participation in the
Closing Cross by setting the minimum
level of Consolidated Volume eligibility
criteria higher, thereby improving the
market at the market close. To the extent
the qualification criteria is too onerous
or unattractive to market participants,
NASDAQ will likely lose order flow and
participation in the Closing Cross as a
result.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act.8 At any time
within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act. If the Commission
takes such action, the Commission shall
institute proceedings to determine
whether the proposed rule should be
approved or disapproved.
8 15
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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
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NASDAQ–2015–032 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2015–032. 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 (https://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
a.m. and 3 p.m. Copies of such 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–2015–032, and should be
submitted on or before May 8, 2015.
U.S.C. 78s(b)(3)(A)(ii).
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Federal Register / Vol. 80, No. 75 / Monday, April 20, 2015 / Notices
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Brent J. Fields,
Secretary.
[FR Doc. 2015–08941 Filed 4–17–15; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–74723; File No. SR–BYX–
2015–22]
Self-Regulatory Organizations; BATS
Y-Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change To Amend the Content of
the BATS One Feed Under Rule 11.22(i)
To Include Consolidated Volume for All
Listed Equity Securities
April 14, 2015.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on April 1,
2015, BATS Y-Exchange, Inc. (the
‘‘Exchange’’ or ‘‘BYX’’) 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 Exchange has
designated this proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(6)(iii)
thereunder,4 which renders it effective
upon filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
mstockstill on DSK4VPTVN1PROD with NOTICES
The Exchange amend [sic] the content
of the BATS One Feed under Rule
11.22(i) to include consolidated volume
for all listed equity securities. The text
of the proposed rule change is available
at the Exchange’s Web site at
www.batstrading.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
9 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(6)(iii).
1 15
VerDate Sep<11>2014
17:56 Apr 17, 2015
Jkt 235001
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 parts 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 amend the
content of the BATS One Feed under
Rule 11.22(i) to include consolidated
volume for all listed equity securities.
The Exchange also proposes to make a
ministerial change to Rule 11.22(i). The
Commission recently approved a
proposed rule change by the Exchange
to establish a new market data product
called the BATS One Feed.5 The BATS
One Feed is a data feed that
disseminates, on a real-time basis, the
aggregate best bid and offer (‘‘BBO’’) of
all displayed orders for securities traded
on BYX and its affiliated exchanges 6
and for which the BATS Exchanges
reports quotes under the Consolidated
Tape Association (‘‘CTA’’) Plan or the
Nasdaq/UTP Plan.7
Consolidated Volume
The last sale information
disseminated as part of the BATS One
Feed includes the price, size, time of
execution, and individual BATS
5 See Securities Exchange Act Release No. 73918
(December 23, 2014), 79 FR 78920 (December 31,
2014) (File Nos. SR–EDGX–2014–25; SR–EDGA–
2014–25; SR–BATS–2014–055; SR–BYX–2014–030)
(Notice of Amendments No. 2 and Order Granting
Accelerated Approval to Proposed Rule Changes, as
Modified by Amendments Nos. 1 and 2, to Establish
a New Market Data Product called the BATS One
Feed) (‘‘BATS One Approval Order’’).
6 BYX’s affiliated exchanges are the BATS
Exchange, Inc. (‘‘BZX’’), the EDGA Exchange, Inc.
(‘‘EDGA’’), and the EDGX Exchange, Inc. (‘‘EDGX’’,
together with EDGA, BZX, and BYX, the ‘‘BATS
Exchanges’’). On January 23, 2014, BATS Global
Markets, Inc. (‘‘BGMI’’), the former parent company
of the Exchange and BZX, completed its business
combination with Direct Edge Holdings LLC, the
parent company of EDGA and EDGX. See Securities
Exchange Act Release No. 71375 (January 23, 2014),
79 FR 4771 (January 29, 2014) (SR–BATS–2013–
059; SR–BYX–2013–039). Upon completion of the
business combination, DE Holdings and BGMI each
became intermediate holding companies, held
under a single new holding company. The new
holding company, formerly named ‘‘BATS Global
Markets Holdings, Inc.,’’ changed its name to
‘‘BATS Global Markets, Inc.’’ and BGMI changed its
name to ‘‘BATS Global Markets Holdings, Inc.’’
7 The Exchange understands that each of the
BATS Exchanges will separately file substantially
similar proposed rule changes with the Commission
to implement fees for the BATS One Feed.
PO 00000
Frm 00079
Fmt 4703
Sfmt 4703
Exchange on which the trade was
executed. The last sale information also
includes the cumulative number of
shares executed on all BATS Exchanges
for that trading day.8 The Exchange now
proposes to expand the last sale
information to include consolidated
volume for all listed equity securities
regardless of where the transaction was
executed. The Exchange would obtain
the consolidated volume directly from
the securities information processors
and then distribute in a manner
consistent with the requirements for
redistributing such data as set forth in
the CTA Plan and Nasdaq UTP Plan.9
Ministerial Change
The Exchange also proposes to delete
from Rule 11.22(i) language indicating
that the Retail Liquidity Identifier is
disseminated on behalf of the Exchange,
‘‘an affiliated exchange of the
Exchange’’. The Retail Liquidity
Identifier indicator message is
disseminated via the BATS One Feed on
behalf of the Exchange pursuant to the
Exchange’s Retail Price Improvement
(‘‘RPI’’) Program.10 For purposes of BYX
Rule 11.22(i), the Exchange believes it is
unnecessary to include the phrase ‘‘an
affiliated exchange of the Exchange’’
and could lead to potential investor
confusion.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
8 The BATS One Feed also contains optional
functionality which enables recipients to receive
aggregated two-sided quotations from the BATS
Exchanges for up to five (5) price levels for all
securities that are traded on the BATS Exchanges
in addition to the BATS One Summary Feed
(‘‘BATS One Premium Feed’’). For each price level
on one of the BATS Exchanges, the BATS One
Premium Feed includes a two-sided quote and the
number of shares available to buy and sell at that
particular price level.
9 See CTA Consolidated Volume Display Policy
available at https://www.ctaplan.com (dated March
2015). The CTA Consolidated Volume Display
Policy requires that, ‘‘[i]f a Customer calculates the
CTA Consolidated Volume and displays that
alongside last sale prices or bid-asked quotes that
are not consolidated prices or quotes under the CTA
Plan or the CQ Plan, then the Customer must
incorporate into its display the following statement:
‘‘Realtime quote and/or trade prices are not sourced
from all markets.’’ Customer must also assure that
any person included in the redistribution chain
starting with the Customer conspicuously places
such a statement in any such display that it
provides.’’ Id.
10 For a description of BYX’s RPI Program, see
BYX Rule 11.24. See also Securities Exchange Act
Release No. 68303 (November 27, 2012), 77 FR
71652 (December 3, 2012) (SR–BYX–2012–019)
(Order Granting Approval of Proposed Rule Change,
as Modified by Amendment No. 2, to Adopt a Retail
Price Improvement Program); Securities Exchange
Act Release No. 67734 (August 27, 2012), 77 FR
53242 (August 31, 2012) (SR–BYX–2012–019)
(Notice of Filing of Proposed Rule Change to Adopt
a Retail Price Improvement Program).
E:\FR\FM\20APN1.SGM
20APN1
]]>Agencies
[Federal Register Volume 80, Number 75 (Monday, April 20, 2015)]
[Notices]
[Pages 21778-21782]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-08941]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-74725; File No. SR-NASDAQ-2015-032]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend NASDAQ Rules 7014 and 7018
April 14, 2015.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that, on April 1, 2015, The NASDAQ Stock Market LLC (``NASDAQ'' or the
``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.
---------------------------------------------------------------------------
\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 the
Substance of the Proposed Rule Change
NASDAQ is proposing changes to the Qualified Market Maker (``QMM'')
Incentive Program under Rule 7014, and the qualification requirements
for certain fees relating to Market-on-Close and/or Limit-on-Close
orders under Rule 7018(a).
The text of the proposed rule change is available at
nasdaq.cchwallstreet.com at NASDAQ's principal office, and at the
Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, NASDAQ included statements
concerning the purpose of, and basis for, the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of those statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of
[[Page 21779]]
the most significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
NASDAQ is proposing to amend Rule 7014(d), which provides the
qualification criteria for designation as a Qualified Market Maker
(``QMM'') under the QMM incentive program, to limit qualification to
registered NASDAQ market makers (``Market Makers''). Currently, a QMM
may be, but is not required to be, a Market Maker in any security.\3\
The QMM program provides incentives to a member firm to make a
significant contribution to market quality by providing liquidity at
the NBBO in a large number of stocks for a significant portion of the
day. In addition, the member must avoid imposing the burdens on NASDAQ
and its market participants that may be associated with excessive rates
of entry of orders away from the inside and/or order cancellation. The
Exchange notes that the program, to date, has been used very little by
member firms that are not Market Makers, and only Market Makers use the
program at this time. Accordingly, the Exchange is proposing to amend
Rule 7014(d)(3) to limit the program to Market Makers. The Exchange is
also deleting the current qualification criteria under Rule 7014(d)(3)
that requires a member firm to have liquidity provided in all
securities through one of its NASDAQ Market Center MPIDs that represent
0.30% of Consolidated Volume during the month. The Exchange notes that
the Consolidated Volume requirement is superfluous given that it is
adopting Consolidated Volume eligibility criteria for the credits under
the QMM program, and is adding an absolute Consolidated Volume
eligibility criteria to receive the reduced removal rate under the
program, as discussed below.
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\3\ Thus, the QMM designation does not by itself impose a two-
sided quotation obligation or convey any of the benefits associated
with being a registered market maker.
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NASDAQ is amending Rule 7014(e), which sets forth the criteria
required to receive the benefits of the program, to move the two
credits provided under subparagraphs (1) and (2) provided for
executions in securities listed on NYSE (``Tape A'') and securities
listed on exchanges other than NASDAQ and NYSE (``Tape B'') to a table
format directly under Rule 7014(e). NASDAQ is also modifying the
criteria a QMM must meet to receive the two tiers of credits under the
rule. Currently, NASDAQ provides a rebate of $0.0002 per share executed
(in addition to other credits received under Rule 7018(a)) with respect
to orders that are executed at a price of $1 or more and (A) displayed
a quantity of at least one round lot at the time of execution; (B)
either established the NBBO or was the first order posted on NASDAQ
that had the same price as an order posted at another trading center
with a protected quotation that established the NBBO; (C) were entered
through a QMM MPID; (D) were for securities listed on NYSE or
securities listed on exchanges other than NASDAQ and NYSE and (E) that
no additional rebate will be issued with respect to Designated Retail
Orders (as defined in Rule 7018). NASDAQ is proposing to replace these
requirements with a new requirement that a QMM execute shares of
liquidity provided in all securities through one or more of its NASDAQ
Market Center MPIDs that represent greater than 0.90% of Consolidated
Volume during the month. The Exchange is replacing the current
requirements, which provide the QMM with an incentive to provide
displayed liquidity that sets the NBBO on NASDAQ, with a new
requirement to provide a significant level Consolidated Volume in all
securities through one or more of its MPIDs. Consolidated Volume is
defined by Rule 7018(a) as the total consolidated volume reported to
all consolidated transaction reporting plans by all exchanges and trade
reporting facilities during a month in equity securities, excluding
executed orders with a size of less than one round lot.\4\ The Exchange
believes that tying the rebate to the provision of greater overall
volume will provide an increased impact to improving market quality
over the current NBBO-based criteria.
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\4\ For purposes of calculating Consolidated Volume and the
extent of a member's trading activity, expressed as a percentage of
or ratio to Consolidated Volume, the date of the annual
reconstitution of the Russell Investments Indexes shall be excluded
from both total Consolidated Volume and the member's trading
activity.
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Similarly, the Exchange is proposing to modify the requirements to
receive a rebate of $0.0001 per share executed under Rule 7014(e)(2).
Currently, a QMM will receive the rebate with respect to all other
displayed orders (other than Designated Retail Orders, as defined in
Rule 7018) in securities priced at $1 or more per share that provide
liquidity that are entered through a QMM MPID in Tape A or B
securities. The Exchange is proposing to now require that a QMM execute
shares of liquidity provided in all securities through one or more of
its Nasdaq Market Center MPIDs that represent from 0.70% up to and
including 0.90% of Consolidated Volume during the month. The Exchange
believes that tying the rebate to the provision of greater overall
volume will provide an increased impact to improving market quality
over the current requirement that the orders are displayed and provide
liquidity.
As a consequence of moving and modifying the criteria of Rules
7014(e)(1) and (2), NASDAQ is moving certain rule text concerning the
type of securities that the rule applies to, and certain exclusions
from the program, from subparagraphs (1) and (2) to the first paragraph
of Rule 7014(e). As noted above, NASDAQ is placing the two credits
provided under subparagraphs (1) and (2) in a table format and,
consequently, is deleting those subparagraphs. NASDAQ is moving
language, which is repeated in both subparagraphs, that notes the
credits provided apply to securities priced at $1 or more per share to
the new table under Rule 7014(e) where the two credits are now located.
The Exchange is also moving text that concerns exclusion of Designated
Retail Orders from subparagraphs (1) and (2) to directly above the new
table under Rule 7014(e).
NASDAQ is proposing to amend the criteria under Rule 7014(e)(3)
required to receive the reduced remove rate fee of $0.00295 per share
executed under the rule in Tape A and B securities priced at $1 or more
for shares executed via its QMM MPID. Currently, NASDAQ will charge a
fee of $0.0030 per share executed for orders in securities listed on
NASDAQ (``Tape C'') priced at $1 or more per share that access
liquidity on the NASDAQ Market Center and that are entered through a
QMM MPID, and charges a fee of $0.00295 per share executed for orders
in Tape A or B securities priced at $1 or more per share that access
liquidity on the NASDAQ Market Center and that are entered through a
QMM MPID; provided, however, that after the first month in which an
MPID becomes a QMM MPID, the QMM's volume of liquidity added, provided,
and/or routed through the QMM MPID during the month (as a percentage of
Consolidated Volume) must not be less than 0.05% lower than the volume
of liquidity added, provided, and/or routed through such QMM MPID
during the first month in which the MPID qualified as a QMM MPID (as a
percentage of Consolidated Volume). NASDAQ is proposing to eliminate
the current Consolidated Volume requirement, which relates to
[[Page 21780]]
the first month in which an MPID qualified as a QMM MPID, and now
require that the QMM executes shares of liquidity provided in all
securities through one or more of its NASDAQ Market Center MPIDs of
0.80% or more of Consolidated Volume during the month. The Exchange
believes that the changes will tie receipt of the reduced removal fee
in Tape A and B securities to a more meaningful measure of market-
improvement. Decoupling the measure from the QMM's first month QMM
Consolidated Volume will ensure that all QMMs meet a minimum standard
that is uniform. Increasing the Consolidated Volume required to receive
the fee will provide incentive to QMMs to provide greater market-
improving participation in return for the benefit.
The Exchange is also proposing to increase the level of
Consolidated Volume that a member firm must have in Market-on-Close
and/or Limit-on-Close orders during the month in order to qualify for
fees to remove liquidity in securities executed at or above $1 under
Rule 7018(a)(1), (2) and (3). Currently, NASDAQ assesses a fee for
member firms that qualify based on their Market-on-Close and/or Limit-
on-Close order participation in the Closing Cross of $0.0030 per share
executed in Tape C securities under Rule 7018(a)(1), and fees of
$0.00295 per share executed in Tape A and B securities under Rules
7018(a)(2) and (3), respectively. To qualify under each of the rules, a
member firm must have Market-on-Close and/or Limit-on-Close orders
executed in the NASDAQ Closing Cross, entered through a single NASDAQ
Market Center market participant identifier, that represent more than
0.06% of Consolidated Volume during the month. The Exchange is
proposing to increase the minimum level of Consolidated Volume required
under each of the rules to 0.15%.
2. Statutory Basis
NASDAQ believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\5\ in general, and with
Sections 6(b)(4) and 6(b)(5) of the Act,\6\ in particular, in that it
provides for the equitable allocation of reasonable dues, fees and
other charges among members and issuers and other persons using any
facility or system which NASDAQ operates or controls, and is not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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\5\ 15 U.S.C. 78f.
\6\ 15 U.S.C. 78f(b)(4) and (5).
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NASDAQ believes that the proposed changes to the QMM program in
NASDAQ Rule 7014(d)(3) is [sic] reasonable and will not discriminate
unfairly because they refine the program to focus on market
participants who currently use the program. As discussed above, Market
Makers have provided the vast majority of participation in the program
and are currently the only market participant utilizing the program.
Accordingly, restricting the program to Market Makers will not result
in a material change in who participates in the program. Additionally,
Market Makers have both obligations to the market and regulatory
requirements that normally do not apply to other market participants.
As such, the Exchange believes that providing additional incentives to
Market Makers to provide liquidity for the benefit of all investors and
other market participants is reasonable and not unfairly
discriminatory. The proposed modifications to the QMM program recognize
the benefits of increased Market Maker participation and the Exchange
believes that this proposal will improve displayed liquidity, and thus
the execution quality overall on the Exchange. Moreover, the Exchange
believes that eliminating the current Consolidated Volume requirement
is reasonable and not unfairly discriminatory because it will become
superfluous in light of additional requirements based on Consolidated
Volume that are also being proposed herein. For the same reasons noted
above, limiting eligibility in the program to Market Makers and
eliminating the Consolidated Volume requirement under Rule 7014(d)(3)
is an equitable allocation of the fees and credits provided by the
program. In this regard, no current participants in the program will be
excluded from being eligible to participate after the proposed change
is effective, and applying the current Consolidated Volume criteria
will have no significance in light of the proposed changes to the
specific fees and credits under the program.
The Exchange believes that the proposed changes to Rule 7014(e) are
reasonable and not unfairly discriminatory because they impose stricter
requirements on Market Makers to receive the benefits of the program,
which will be applied uniformly to all Market Makers that are eligible
to participate in the QMM program. With regard to the $0.0002 rebate
provided in Tape A and B securities, the Exchange is eliminating the
NBBO-based criteria and tying the rebate to greater overall volume,
which the Exchange believes will provide a greater impact to improving
overall market quality because the economic benefits provided to the
Market Maker are more certain and therefore provide the Market Maker a
means to more aggressively provide displayed liquidity to the Exchange
for the benefit of all market participants. In this regard, the
Exchange notes that Market Makers must provide more than 0.90% of
Consolidated Volume during the month, which is a significant level
participation in the market. Similarly, NASDAQ is proposing a
significant level of Consolidated Volume to receive the $0.0001 rebate
under the rule, which currently only requires that the QMM participant
provide displayed liquidity. The Exchange believes that it is
reasonable and not unfairly discriminatory to impose stricter criteria
designed to improve market quality in return for the credit NASDAQ
elects to provide. NASDAQ also believes that the proposed changes to
the eligibility requirements for the reduced removal fee in Tape A and
B securities of $0.00295 per share executed are reasonable and not
unfairly discriminatory because they increase the level of Consolidated
Volume required, which will be an absolute requirement and not tied to
historical levels of Consolidated Volume, thereby increasing the level
of market improvement necessary to receive the reduced rate. As an
absolute requirement, the Consolidated Volume requirement will apply
uniformly to all Market Makers eligible to participate in the program.
The Exchange believes that the proposed changes to the eligibility
requirements under Rule 7014(e) are an equitable allocation because
NASDAQ will provide the same rebates and fees to all Market Makers that
qualify under the rule.
Lastly, NASDAQ notes that Market Makers serve an important role on
the Exchange with regard to order interaction and provide continuous,
passive liquidity in the marketplace. Additionally, Market Makers incur
costs unlike the majority of other market participants including, but
not limited to, their own infrastructure and other technology costs
associated with market making activities. Consequently, the proposed
differentiation between Market Makers and other market participants
recognizes the differing contributions made to the quality of the
market on the Exchange by Market Makers and the heightened regulatory
requirements and costs associated with being a Market Maker. In brief,
the Exchange believes that the proposed changes to the QMM program
further
[[Page 21781]]
incentives registered Market Makers to provide liquidity improves
market qualify [sic], furthers the price discovery process and benefits
investors.
The Exchange believes that the proposed changes to the level of
Consolidated Volume in Market-on-Close and/or Limit-on-Close order
participation in the Closing Cross required to receive the fees for
orders that remove liquidity under Rules 7018(a)(1), (2), and (3) are
reasonable and not unfairly discriminatory because they represent an
increase in the level of market-improving Consolidated Volume
contributed to the Closing Cross. NASDAQ provides discounted fees in
Market-on-Close and/or Limit-on-Close orders in Tape A and B securities
to provide incentives to member firms to provide liquidity in the
closing process. NASDAQ is increasing the Consolidated Volume
requirement to better align the discounted remove fees with members
that use the closing cross process more regulatory [sic] over
alternatives and also access liquidity more frequently on the Exchange
as opposed to other members. Nonetheless, NASDAQ believes that it is
reasonable and not unfairly discriminatory to change the eligibility
criteria so that it mirrors the eligibility criteria of the related
fees under Rules 7018(a)(2) and (3). Lastly, the Exchange believes that
the proposed changes to the rules are an equitable allocation of the
fees because the fee is provided uniformly to all member firms that
qualify for the fees and all member firms have an equal opportunity to
earn the discounted fee for accessing liquidity.
B. Self-Regulatory Organization's Statement on Burden on Competition
NASDAQ does not believe that the proposed rule changes will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act, as amended.\7\ NASDAQ notes
that it operates in a highly competitive market in which market
participants can readily favor competing venues if they deem fee levels
at a particular venue to be excessive, or rebate opportunities
available at other venues to be more favorable. In such an environment,
NASDAQ must continually adjust its fees to remain competitive with
other exchanges and with alternative trading systems that have been
exempted from compliance with the statutory standards applicable to
exchanges. Because competitors are free to modify their own fees in
response, and because market participants may readily adjust their
order routing practices, NASDAQ believes that the degree to which fee
changes in this market may impose any burden on competition is
extremely limited or even non-existent. In this instance, the changes
to eligibility criteria required to receive credits and reduced fees
under the QMM program do not impose a burden on competition because the
incentive program remains in place, still offers economically
advantageous credits and reduced fees, and is reflective of the need
for exchanges to offer, and to let, the financial incentives to attract
order flow evolve. While the Exchange does not believe that the
proposed changes to the QMM program will result in any burden on
competition, if the changes proposed herein are unattractive to market
participants it is likely that NASDAQ will lose market share as a
result. Similarly, the proposed changes to the eligibility criteria for
remove fees under Rule 7018(a) based on Market-on-Close and/or Limit-
on-Close order participation in the Closing Cross are designed to
increase participation in the Closing Cross by setting the minimum
level of Consolidated Volume eligibility criteria higher, thereby
improving the market at the market close. To the extent the
qualification criteria is too onerous or unattractive to market
participants, NASDAQ will likely lose order flow and participation in
the Closing Cross as a result.
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\7\ 15 U.S.C. 78f(b)(8).
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C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\8\ At any time within 60 days of the filing
of the proposed rule change, the Commission summarily may temporarily
suspend such rule change if it appears to the Commission that such
action is necessary or appropriate in the public interest, for the
protection of investors, or otherwise in furtherance of the purposes of
the Act. If the Commission takes such action, the Commission shall
institute proceedings to determine whether the proposed rule should be
approved or disapproved.
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\8\ 15 U.S.C. 78s(b)(3)(A)(ii).
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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
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2015-032 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASDAQ-2015-032. 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 (https://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
a.m. and 3 p.m. Copies of such 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-2015-032, and should
be submitted on or before May 8, 2015.
[[Page 21782]]
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-08941 Filed 4-17-15; 8:45 am]
BILLING CODE 8011-01-P
