Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Fees for the Nasdaq Information Exchange Protocol, 7987-7988 [E5-634]
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Federal Register / Vol. 70, No. 31 / Wednesday, February 16, 2005 / Notices
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–51171; File No. SR–NASD–
2005–016]
Self-Regulatory Organizations;
National Association of Securities
Dealers, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Modify Fees for the
Nasdaq Information Exchange
Protocol
February 9, 2005.
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 January
31, 2005, the National Association of
Securities Dealers, Inc. (‘‘NASD’’),
through its subsidiary, The Nasdaq
Stock Market, Inc. (‘‘Nasdaq’’), filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by Nasdaq.
Pursuant to Section 19(b)(3)(A) of the
Act 3 and Rule 19b–4(f)(2) thereunder,4
Nasdaq has designated this proposal as
one establishing or changing a due, fee,
or other charge of a self-regulatory
organization, which renders the
proposed rule change effective
immediately upon filing. 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 proposes to modify its fees for
the Nasdaq Information Exchange
protocol. Nasdaq will implement the
proposed rule change on February 1,
2005.
The text of the proposed rule change
is available on the NASD’s Web site
(https://www.nasd.com), at the NASD’s
Office of the Secretary, 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 these statements
may be examined at the places specified
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
4 17 CFR 240.19b–4(f)(2).
12:44 Feb 15, 2005
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
Nasdaq recently submitted a proposed
rule change to establish fees for the
Nasdaq Information Exchange, or
‘‘QIX,’’ a new proprietary messaging
protocol that, unlike the current
application programming interface
(‘‘API’’) protocol, does not require use of
an service delivery platform (‘‘SDP’’) at
the premises of the subscriber.5 Nasdaq
has concluded that it underestimated its
costs of providing the new protocol
when it initially established these fees,
and is now revising the fees
accordingly. The fee for a QIX port pair
(including an ECN direct connection
port pair) is being increased from $1,000
to $1,200 per month, and the fee for an
unsolicited message port is being
increased from $750 to $1,000 per
month. Despite these fee increases,
Nasdaq believes that the
implementation of QIX will still result
in significant cost savings to subscribers
in comparison to the current SDP/API
protocol.
2. Statutory Basis
Nasdaq believes that the proposed
rule change is consistent with the
provisions of Section 15A of the Act,6 in
general, and section 15A(b)(5) 7 of the
Act, 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 the
NASD operates or controls. Even with
the fee increases reflected in the
proposed rule change, the new QIX
protocol will offer substantial cost
savings in comparison with the current
SDP/API protocol. Fees for access
services are equitably allocated based on
the level of message traffic between
Nasdaq and each firm.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
Nasdaq does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act.
5 See Securities Exchange Act Release No. 51170
(February 9, 2005) (File No. NASD–2005–002).
6 15 U.S.C. 78o–3.
7 15 U.S.C. 78o–3(5).
2 17
VerDate jul<14>2003
in Item IV below. Nasdaq has prepared
summaries, set forth in Sections A, B,
and C below, of the most significant
aspects of such statements.
Jkt 205001
PO 00000
Frm 00066
Fmt 4703
Sfmt 4703
7987
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)
of the Act 8 and subparagraph (f)(2) of
Rule 19b–4 thereunder, because it
establishes or changes a due, fee, or
other charge.9 At any time within 60
days of the filing of the proposed rule
change, the Commission may summarily
abrogate 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.
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 e-mail to rulecomments@sec.gov. Please include File
Number SR–NASD–2005–016 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Jonathan G. Katz, Secretary,
Securities and Exchange Commission,
450 Fifth Street, NW., Washington, DC
20549–0609.
All submissions should refer to File
Number SR–NASD–2005–016. This file
number should be included on the
subject line if e-mail 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
8 15
9 17
E:\FR\FM\16FEN1.SGM
U.S.C. 78s(b)(3)(a).
CFR 240.19b–4(f)(2).
16FEN1
7988
Federal Register / Vol. 70, No. 31 / Wednesday, February 16, 2005 / Notices
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 inspection and copying in
the Commission’s Public Reference
Section, 450 Fifth Street, NW.,
Washington, DC 20549. Copies of such
filing also will be available for
inspection and copying at the principal
office of the NASD. 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–NASD–
2005–016 and should be submitted on
or before March 9, 2005.
For the Commission, by the Division of
Market Regulation, pursuant to delegated
authority.10
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5–634 Filed 2–15–05; 8:45 am]
BILLING CODE 8010–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–51170; File No. SR–NASD–
2005–002]
Self-Regulatory Organizations;
National Association of Securities
Dealers, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change and Amendment No. 1
Thereto To Establish Fees for
Connectivity to the Nasdaq Market
Center
February 9, 2005.
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 January 7,
2005, the National Association of
Securities Dealers, Inc. (‘‘NASD’’),
through its subsidiary, The Nasdaq
Stock Market, Inc. (‘‘Nasdaq’’), filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by Nasdaq. On
January 28, 2005, Nasdaq filed
Amendment No. 1 to the proposed rule
change.3 Pursuant to Section 19(b)(3)(A)
10 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 In Amendment No. 1, Nasdaq added
representations with respect to monitoring usage
traffic on dedicated and non-dedicated FIX servers
and steps it would take to provide a high level of
support across all other FIX servers, and replaced
the text of the original filing in its entirety.
1 15
VerDate jul<14>2003
17:44 Feb 15, 2005
Jkt 205001
of the Act 4 and Rule 19b–4(f)(1), (2),
and (5) thereunder,5 Nasdaq has
designated this proposal in part as
constituting a stated policy, practice, or
interpretation with respect to the
meaning, administration, or
enforcement of an existing rule, in part
as establishing or changing a due, fee, or
other charge, and in part as a proposal
effecting a change in an existing orderentry or trading system of a selfregulatory organization, which renders
the proposed rule change effective
immediately upon filing. 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 proposes to amend NASD
Rule 7010 to establish fees for new
options for connecting to the Nasdaq
Market Center and is filing a related
Member Alert and Head Trader Alert.
Nasdaq will implement the proposed
rule change immediately.
The text of the proposed rule change,
and the texts of the related Member
Alert and Head Trader Alert, that were
attached as exhibits to the proposal, are
available on the NASD’s Web site
(https://www.nasd.com), at the NASD’s
Office of the Secretary, 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 these statements
may be examined at the places specified
in Item IV below. Nasdaq 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
Nasdaq Information Exchange
Nasdaq offers market participants and
other Nasdaq subscribers a choice of
messaging protocols for communicating
with Nasdaq systems, with the goal of
allowing firms to select the connectivity
options that best suit their needs. The
PO 00000
4 15
5 17
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(1), (2), and (5).
Frm 00067
Fmt 4703
Sfmt 4703
protocol options currently available to
firms include the Financial Information
Exchange (‘‘FIX’’) protocol, the
computer-to-computer interface
(‘‘CTCI’’) protocol, and an application
programming interface (‘‘API’’) protocol
that requires the use of a Service
Delivery Platform (‘‘SDP’’), a hardware
unit located at the subscriber’s
premises. Although the SDP/API
protocol has offered distinct advantages
in terms of functional support for
quoting market participants and other
firms with high volumes of message
traffic, the need for firms to install and
maintain one or more SDPs has resulted
in comparatively higher
communications and infrastructure
costs for firms using SDP/API. As a
result, Nasdaq has developed the
Nasdaq Information Exchange or ‘‘QIX,’’
a new proprietary protocol that does not
require use of an SDP. Nasdaq believes
that QIX will offer the benefits of the
current API protocol but at a
significantly reduced cost to its users.
The QIX protocol is being made
available for use in production
immediately. During a period of
approximately ten months thereafter,
Nasdaq will work with users of the SDP/
API protocol to transition them to QIX,
FIX, and/or CTCI. Nasdaq intends to
sunset the SDP/API protocol and
connectivity by the end of October 2005
(or such later date as Nasdaq may
announce to market participants); all
users of that protocol will be required to
transition by that time. The sunset of
SDP/API will not affect the operation of
any of the rules governing trading
through the Nasdaq Market Center (e.g.,
the 4700 Series of the NASD Rules).
In contrast to the SDP/API protocol,
which requires market participants to
use, and pay Nasdaq for the use of, a
telecommunications network supplied
by MCI pursuant to an agreement with
Nasdaq, QIX will offer market
participants choice in the establishment
of connections to Nasdaq. As is
currently the case for FIX, market
participants may use a range of thirdparty communications providers, may
establish connections to service bureaus
that in turn connect to Nasdaq, or may
take advantage of additional modes of
telecommunications that may become
available to the financial sector in the
future. As a result, member firms will
benefit from the forces of competition,
choice, and innovation when selecting
telecommunications services for the
purpose of connecting to Nasdaq’s
facilities through QIX and FIX, rather
than receiving connectivity as a
vertically integrated component of
Nasdaq’s facilities.
E:\FR\FM\16FEN1.SGM
16FEN1
]]>Agencies
[Federal Register Volume 70, Number 31 (Wednesday, February 16, 2005)]
[Notices]
[Pages 7987-7988]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-634]
[[Page 7987]]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-51171; File No. SR-NASD-2005-016]
Self-Regulatory Organizations; National Association of Securities
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Modify Fees for the Nasdaq Information Exchange Protocol
February 9, 2005.
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 January 31, 2005, the National Association of Securities Dealers,
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc.
(``Nasdaq''), filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by Nasdaq. Pursuant to
Section 19(b)(3)(A) of the Act \3\ and Rule 19b-4(f)(2) thereunder,\4\
Nasdaq has designated this proposal as one establishing or changing a
due, fee, or other charge of a self-regulatory organization, which
renders the proposed rule change effective immediately upon filing. 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.
\3\ 15 U.S.C. 78s(b)(3)(A).
\4\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
Nasdaq proposes to modify its fees for the Nasdaq Information
Exchange protocol. Nasdaq will implement the proposed rule change on
February 1, 2005.
The text of the proposed rule change is available on the NASD's Web
site (https://www.nasd.com), at the NASD's Office of the Secretary, 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 these statements may be examined at the places specified in
Item IV below. Nasdaq 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
Nasdaq recently submitted a proposed rule change to establish fees
for the Nasdaq Information Exchange, or ``QIX,'' a new proprietary
messaging protocol that, unlike the current application programming
interface (``API'') protocol, does not require use of an service
delivery platform (``SDP'') at the premises of the subscriber.\5\
Nasdaq has concluded that it underestimated its costs of providing the
new protocol when it initially established these fees, and is now
revising the fees accordingly. The fee for a QIX port pair (including
an ECN direct connection port pair) is being increased from $1,000 to
$1,200 per month, and the fee for an unsolicited message port is being
increased from $750 to $1,000 per month. Despite these fee increases,
Nasdaq believes that the implementation of QIX will still result in
significant cost savings to subscribers in comparison to the current
SDP/API protocol.
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 51170 (February 9,
2005) (File No. NASD-2005-002).
---------------------------------------------------------------------------
2. Statutory Basis
Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 15A of the Act,\6\ in general, and section
15A(b)(5) \7\ of the Act, 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 the NASD operates or controls. Even with the fee increases
reflected in the proposed rule change, the new QIX protocol will offer
substantial cost savings in comparison with the current SDP/API
protocol. Fees for access services are equitably allocated based on the
level of message traffic between Nasdaq and each firm.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78o-3.
\7\ 15 U.S.C. 78o-3(5).
---------------------------------------------------------------------------
B. Self-Regulatory Organization's Statement on Burden on Competition
Nasdaq does not believe that the proposed rule change will result
in any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
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) of the Act \8\ and subparagraph (f)(2) of Rule 19b-4
thereunder, because it establishes or changes a due, fee, or other
charge.\9\ At any time within 60 days of the filing of the proposed
rule change, the Commission may summarily abrogate 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.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78s(b)(3)(a).
\9\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
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 e-mail to rule-comments@sec.gov. Please include
File Number SR-NASD-2005-016 on the subject line.
Paper Comments
Send paper comments in triplicate to Jonathan G. Katz,
Secretary, Securities and Exchange Commission, 450 Fifth Street, NW.,
Washington, DC 20549-0609.
All submissions should refer to File Number SR-NASD-2005-016. This
file number should be included on the subject line if e-mail 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
[[Page 7988]]
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 inspection and copying in the Commission's Public
Reference Section, 450 Fifth Street, NW., Washington, DC 20549. Copies
of such filing also will be available for inspection and copying at the
principal office of the NASD. 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-NASD-2005-016 and should be submitted on or before March
9, 2005.
For the Commission, by the Division of Market Regulation,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------
\10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. E5-634 Filed 2-15-05; 8:45 am]
BILLING CODE 8010-01-P
