Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Regarding the Pricing Schedule for NASD Members Using the Nasdaq Market Center and Nasdaq's Brut and INET Facilities, 42696-42698 [E6-11982]

Download as PDF 42696 Federal Register / Vol. 71, No. 144 / Thursday, July 27, 2006 / Notices organization.9 Specifically, the Commission believes that the proposed rule change, as amended, is consistent with Section 15A(b)(5) of the Act,10 which requires that the rules of the selfElectronic Comments regulatory organization provide for the equitable allocation of reasonable dues, • Use the Commission’s Internet fees, and other charges among members comment form (https://www.sec.gov/ and issuers and other persons using any rules/sro.shtml); or facilities or system which it operates or • Send an e-mail to rulecontrols. comments@sec.gov. Please include File Number SR–NASD–2006–058 on the The Commission notes that this subject line. proposal would retroactively modify pricing for non-NASD members using Paper Comments the Nasdaq Market Center and Nasdaq’s Brut and INET Facilities that would • Send paper comments in triplicate permit the schedule for non-NASD to Nancy M. Morris, Secretary, members to mirror the schedule Securities and Exchange Commission, applicable to NASD members that 100 F Street, NE, Washington, DC 20549–1090. became effective May 1, 2006, pursuant to SR–NASD–2006–057. All submissions should refer to File The Commission finds good cause for Number SR–NASD–2006–058. This file approving the proposed rule change, as number should be included on the subject line if e-mail is used. To help the amended, prior to the 30th day of the date of publication of the notice thereof Commission process and review your in the Federal Register. The comments more efficiently, please use only one method. The Commission will Commission notes that the proposed post all comments on the Commission’s fees for non-NASD members are Internet Web site (https://www.sec.gov/ identical to those in SR–NASD–2006– rules/sro.shtml). Copies of the 057, which implemented those fees for submission, all subsequent NASD members and which became amendments, all written statements effective as of May 1, 2006. The with respect to the proposed rule Commission notes that this change will change that are filed with the promote consistency in Nasdaq’s fee Commission, and all written schedule by applying the same pricing communications relating to the schedule with the same date of proposed rule change between the effectiveness for both NASD members Commission and any person, other than and non-NASD members. Therefore, the those that may be withheld from the Commission finds that there is good public in accordance with the cause, consistent with Section 19(b)(2) provisions of 5 U.S.C. 552, will be of the Act,11 to approve the proposed available for inspection and copying in rule change, as amended, on an the Commission’s Public Reference accelerated basis. Section, 100 F Street, NE, Washington, DC 20549. Copies of such filing also will V. Conclusion be available for inspection and copying It is therefore ordered, pursuant to at the principal office of the NASD. All Section 19(b)(2) of the Act,12 that the comments received will be posted proposed rule change, as amended, (File without change; the Commission does No. SR–NASD–2006–058) is approved not edit personal identifying information from submissions. You on an accelerated basis. should submit only information that For the Commission, by the Division of you wish to make available publicly. All Market Regulation, pursuant to delegated submissions should refer to File authority.13 Number SR–NASD–2006–058 and Jill M. Peterson, should be submitted on or before Assistant Secretary. August 17, 2006. including whether the proposed rule change, as amended, is consistent with the Act. Comments may be submitted by any of the following methods: rwilkins on PROD1PC63 with NOTICES IV. Commission’s Findings and Order Granting Accelerated Approval of Proposed Rule Change The Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a self-regulatory VerDate Aug<31>2005 16:46 Jul 26, 2006 Jkt 208001 [FR Doc. E6–11981 Filed 7–26–06; 8:45 am] BILLING CODE 8010–01–P 9 The Commission has considered the proposed rule’s impact on efficiency, competition and capital formation. 15 U.S.C. 78c(f). 10 15 U.S.C. 78o–3(b)(5). 11 15 U.S.C. 78s(b)(2). 12 Id. 13 17 CFR 200.30–3(a)(12). PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–54160; File No. SR–NASD– 2006–057] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change and Amendment No. 1 Thereto Regarding the Pricing Schedule for NASD Members Using the Nasdaq Market Center and Nasdaq’s Brut and INET Facilities July 17, 2006. 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 May 1, 2006, 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 June 12, 2006, Nasdaq filed Amendment No. 1 to the proposed rule change.3 Pursuant to Section 19(b)(3)(A)(ii) of the Act 4 and Rule 19b–4(f)(2) thereunder,5 Nasdaq has designated this proposal as establishing or changing a due, fee, or other charge, which renders the proposed rule change effective immediately upon filing. The Commission is publishing this notice, as amended, to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change Nasdaq proposes to modify the pricing for NASD members using the Nasdaq Market Center and Nasdaq’s Brut and INET Facilities (the ‘‘Nasdaq Facilities’’). Nasdaq implemented the proposed rule change on May 1, 2006. The text of the proposed rule change, as amended, is available on the NASD’s 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 In Amendment No. 1, Nasdaq amended proposed Rule 7010(i)(7) to indicate that when a market participant enters an order into Nasdaq’s Brut or INET systems that is sent to a Nasdaq Market Center market participant that charges an access fee to Brut or INET, the market participant entering the order shall be charged (i) the applicable execution fee of the Nasdaq Facilities, or (ii) in the case of executions against Quotes/Orders at less than $1.00 per share, a pass-through of the access fee charged to Brut or INET. Nasdaq also made conforming changes to the description of the proposed rule change. 4 15 U.S.C. 78s(b)(3)(A)(ii). 5 17 CFR 240.19b–4(f)(2). 2 17 E:\FR\FM\27JYN1.SGM 27JYN1 Federal Register / Vol. 71, No. 144 / Thursday, July 27, 2006 / Notices 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. rwilkins on PROD1PC63 with NOTICES A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose Nasdaq is proposing to reduce its fees for routing orders from its three trading platforms—the Nasdaq Market Center, Brut, and INET—to the American Stock Exchange (‘‘Amex’’). Specifically, whereas Nasdaq now charges $0.01 per share executed for routing such orders, the fee will be reduced to $0.003 per share executed. However, an additional fee of $0.01 would be charged in cases where the Amex specialist charges a fee to execute the order (which generally occurs when the order remains on the specialist book for more than a certain amount of time before being executed). Nasdaq is also broadening the conditions under which a member may qualify for a reduced fee of $0.0028 per share executed to access liquidity and route orders in Nasdaq-listed securities and exchange-traded funds. Currently, members qualify for the $0.0028 fee (a reduction from the otherwise applicable fee of $0.003 per share executed) if they (i) provide an daily average of more than 30 million shares of liquidity during a month and (ii) access and/or route a daily average of more than 50 million shares of liquidity during a month. With the proposed rule change, the reduced fee would also be available to members that (i) provide a daily average of more than 20 million shares of liquidity during a month and (ii) access and/or route a daily average of more than 60 million shares of liquidity during a month. Thus, the change will broaden the availability of the reduced fee to members that provide comparatively less liquidity but access and/or route comparatively more liquidity. Nasdaq is also adding rule text to clarify the fee to be charged with respect VerDate Aug<31>2005 18:18 Jul 26, 2006 Jkt 208001 to orders that are entered into Brut or INET and then sent to a Nasdaq Market Center participant that charges an access fee to Brut or INET. When the execution price of the stock is greater than $1.00, Nasdaq charges its usual order execution fee of $0.0028 or $0.003, which will generally approximate the access fee charged to Brut or INET. In the case of stocks price at $1.00 or less, Nasdaq’s order execution fee of 0.1% of the total transaction cost would not allow it to recoup the access fee charged to Brut or INET. Accordingly, in those cases, Nasdaq passes through the ECN access fee to the market participant that entered the order into Brut or INET. 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 with Section 15A(b)(5) of the Act,7 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. ‘‘The proposed rule change reduces fees for routing to Amex in most cases, broadens the availability of a reduced fee to access liquidity and route orders, and clarifies the fee charged with respect to orders entered into Brut or INET and sent for execution to a Nasdaq Market Center participant that charges an access fee.’’ 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, as amended. 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 and subparagraph (f)(2) of Rule 19b–4 thereunder.9 At any time within 60 days of the filing of the proposed rule change, the Commission could have summarily abrogated such rule change if it PO 00000 6 15 U.S.C. 78o–3. U.S.C. 78o–3(b)(5). 8 15 U.S.C. 78s(b)(3)(a)(ii). 9 17 CFR 240.19b–4(f)(2). 7 15 Frm 00073 Fmt 4703 Sfmt 4703 42697 appeared to the Commission that such action was necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.10 IV. Solicitation of Comments Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change, as amended, 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–2006–057 on the subject line. Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File Number SR–NASD–2006–057. 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 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, 100 F Street, NE., 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 10 The effective date of the original proposed rule change is May 1, 2006 and the effective date of the amendment is June 12, 2006. For purposes of calculating the 60-day period within which the Commission may summarily abrogate the proposed rule change, as amended, under Section 19(b)(3)(C) of the Act, the Commission considers the period to commence on June 12, 2006, the date on which the NASD submitted Amendment No. 1. See 15 U.S.C. 78s(b)(3)(C). E:\FR\FM\27JYN1.SGM 27JYN1 42698 Federal Register / Vol. 71, No. 144 / Thursday, July 27, 2006 / Notices 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–2006–057 and should be submitted on or before August 17, 2006. For the Commission, by the Division of Market Regulation, pursuant to delegated authority.11 Jill M. Peterson, Assistant Secretary. [FR Doc. E6–11982 Filed 7–26–06; 8:45 am] BILLING CODE 8010–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–54186; File No. SR–NASD– 2006–081] Self-Regulatory Organizations; National Association of Securities Dealers, Inc.; Notice of Filing of Proposed Rule Change To Adopt New NASD Rule 5150 Relating to TradeThroughs July 20, 2006. 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 July 11, 2006, the National Association of Securities Dealers, Inc. (‘‘NASD’’) 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 the NASD. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. rwilkins on PROD1PC63 with NOTICES I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The NASD is proposing to adopt, in anticipation of The NASDAQ Stock Market LLC (the ‘‘Nasdaq Exchange’’) beginning to trade non-Nasdaq exchange-listed securities on an unlisted trading privileges (‘‘UTP’’) basis, new NASD Rule 5150 to require an NASD member that is registered as a market maker with the Nasdaq Exchange in a non-Nasdaq exchangelisted security to comply with the provisions of NASD Rule 5262 relating to trade-throughs with respect to that security for trades reported to the NASD. Below is the text of the proposed 11 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 VerDate Aug<31>2005 16:46 Jul 26, 2006 Jkt 208001 rule change. Proposed new language is in italics. * * * * * 5000. Other Nasdaq and NASD Markets * * * * * 5150. Applicability of Trade-Through Rule to Nasdaq Market Makers An NASD member shall comply with the provisions of Rule 5262 (TradeThroughs), as if it were an ITS/CAES market maker, for purposes of transactions that are reported to NASD in any ITS Security, as that term is defined in Rule 5210(c), in which such member is registered as a market maker with The NASDAQ Stock Market LLC. For purposes of this Rule 5150, the term ‘‘Block Transaction’’ under Rule 5262(a)(7)(B) shall mean any trade that involves 10,000 or more shares of an ITS security or a quantity of any such security having a market value of $200,000 or more. * * * * * 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 NASD 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 NASD has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The proposed rule change is filed in anticipation of the Nasdaq Exchange operating as a national securities exchange for purposes of trading nonNasdaq exchange-listed securities on a UTP basis. The NASD is proposing a new rule to require an NASD member that is registered as a market maker with the Nasdaq Exchange in an ITS Security, as defined Rule 5210(c), to comply with the provisions of NASD Rule 5262 (Trade-Throughs) with respect to that security for trades reported to the NASD. Background On July 11, 2005, the NASD filed with the Commission proposed rule change SR–NASD–2005–087, which, among other things, proposed amendments to PO 00000 Frm 00074 Fmt 4703 Sfmt 4703 the Plan of Allocation and Delegation of Functions by the NASD to Subsidiaries, NASD By-Laws and NASD rules to reflect The Nasdaq Stock Market, Inc.’s (‘‘Nasdaq’’) separation from the NASD upon the Nasdaq Exchange’s operation as a national securities exchange.3 On June 15, 2006, the NASD filed Amendment No. 1 to SR–NASD–2005– 087, which, among other things, proposed the NASD’s and Nasdaq’s implementation strategy for Nasdaq’s operation as a national securities exchange. On June 30, 2006, the Commission approved SR–NASD–2005– 087, as amended, the effective date of which will be the date upon which the Nasdaq Exchange operates as an exchange for Nasdaq-listed securities.4 The NASD intends to file a second proposed rule change proposing an NASD facility for over-the-counter quoting and trading of non-Nasdaq exchange-listed securities, to be made available when the Nasdaq Exchange begins to trade such securities on a UTP basis. Currently, NASD Rule 5262, also known as the Trade-Through Rule, restricts a member registered as an NASD ITS/CAES Market Maker 5 in an ITS/CAES security 6 from purchasing or selling such security, whether as principal or agent, at a price that is lower than the bid or higher than the offer displayed from an ITS Participant Exchange or ITS/CAES Market Maker. Current NASD Rule 5262 applies to all over-the-counter trading by NASD ITS/ CAES Market Makers in that security, including trades executed outside of CAES and reported to the NASD. The Nasdaq Exchange established a substantially similar rule, Nasdaq Rule 5262, which, by its terms, would apply to market makers registered with the Nasdaq Exchange (‘‘Nasdaq market 3 The Commission approved the Nasdaq Exchange application on January 13, 2006. See Securities Exchange Act Release No. 53128 (January 13, 2006), 71 FR 3550 (January 23, 2006). 4 See Securities Exchange Act Release No. 54084 (June 30, 2006), 71 FR 38935 (July 10, 2006). 5 For purposes of NASD Rule 5262, ‘‘ITS/CAES Market Maker’’ is defined in NASD Rule 5210(e) as a member that is registered as a market maker for the purposes of participating in the Intermarket Trading System (‘‘ITS’’) through the Computer Assisted Execution System (‘‘CAES’’) with respect to one or more specified ITS securities in which the member is then actively registered. The term also includes members that meet the definition of electronic communications network or alternative trading network. CAES is an automated system that is currently operated by The Nasdaq Stock Market, Inc. NASD members can direct agency and principal orders in exchange-listed securities to CAES for automated execution in the third market. 6 The term ‘‘ITS Security’’ is defined in NASD Rule 5210(c) as ‘‘any security which may be traded through the [ITS] System by an ITS/CAES Market Maker.’’ E:\FR\FM\27JYN1.SGM 27JYN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 71, Number 144 (Thursday, July 27, 2006)]
[Notices]
[Pages 42696-42698]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-11982]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54160; File No. SR-NASD-2006-057]


Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change and Amendment No. 1 Thereto Regarding the Pricing Schedule 
for NASD Members Using the Nasdaq Market Center and Nasdaq's Brut and 
INET Facilities

July 17, 2006.
    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 May 1, 2006, 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 June 12, 
2006, Nasdaq filed Amendment No. 1 to the proposed rule change.\3\ 
Pursuant to Section 19(b)(3)(A)(ii) of the Act \4\ and Rule 19b-4(f)(2) 
thereunder,\5\ Nasdaq has designated this proposal as establishing or 
changing a due, fee, or other charge, which renders the proposed rule 
change effective immediately upon filing. The Commission is publishing 
this notice, as amended, 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\ In Amendment No. 1, Nasdaq amended proposed Rule 7010(i)(7) 
to indicate that when a market participant enters an order into 
Nasdaq's Brut or INET systems that is sent to a Nasdaq Market Center 
market participant that charges an access fee to Brut or INET, the 
market participant entering the order shall be charged (i) the 
applicable execution fee of the Nasdaq Facilities, or (ii) in the 
case of executions against Quotes/Orders at less than $1.00 per 
share, a pass-through of the access fee charged to Brut or INET. 
Nasdaq also made conforming changes to the description of the 
proposed rule change.
    \4\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \5\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to modify the pricing for NASD members using the 
Nasdaq Market Center and Nasdaq's Brut and INET Facilities (the 
``Nasdaq Facilities''). Nasdaq implemented the proposed rule change on 
May 1, 2006.
    The text of the proposed rule change, as amended, is available on 
the NASD's

[[Page 42697]]

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 is proposing to reduce its fees for routing orders from its 
three trading platforms--the Nasdaq Market Center, Brut, and INET--to 
the American Stock Exchange (``Amex''). Specifically, whereas Nasdaq 
now charges $0.01 per share executed for routing such orders, the fee 
will be reduced to $0.003 per share executed. However, an additional 
fee of $0.01 would be charged in cases where the Amex specialist 
charges a fee to execute the order (which generally occurs when the 
order remains on the specialist book for more than a certain amount of 
time before being executed).
    Nasdaq is also broadening the conditions under which a member may 
qualify for a reduced fee of $0.0028 per share executed to access 
liquidity and route orders in Nasdaq-listed securities and exchange-
traded funds. Currently, members qualify for the $0.0028 fee (a 
reduction from the otherwise applicable fee of $0.003 per share 
executed) if they (i) provide an daily average of more than 30 million 
shares of liquidity during a month and (ii) access and/or route a daily 
average of more than 50 million shares of liquidity during a month. 
With the proposed rule change, the reduced fee would also be available 
to members that (i) provide a daily average of more than 20 million 
shares of liquidity during a month and (ii) access and/or route a daily 
average of more than 60 million shares of liquidity during a month. 
Thus, the change will broaden the availability of the reduced fee to 
members that provide comparatively less liquidity but access and/or 
route comparatively more liquidity.
    Nasdaq is also adding rule text to clarify the fee to be charged 
with respect to orders that are entered into Brut or INET and then sent 
to a Nasdaq Market Center participant that charges an access fee to 
Brut or INET. When the execution price of the stock is greater than 
$1.00, Nasdaq charges its usual order execution fee of $0.0028 or 
$0.003, which will generally approximate the access fee charged to Brut 
or INET. In the case of stocks price at $1.00 or less, Nasdaq's order 
execution fee of 0.1% of the total transaction cost would not allow it 
to recoup the access fee charged to Brut or INET. Accordingly, in those 
cases, Nasdaq passes through the ECN access fee to the market 
participant that entered the order into Brut or INET.
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 with 
Section 15A(b)(5) of the Act,\7\ 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. ``The proposed rule change 
reduces fees for routing to Amex in most cases, broadens the 
availability of a reduced fee to access liquidity and route orders, and 
clarifies the fee charged with respect to orders entered into Brut or 
INET and sent for execution to a Nasdaq Market Center participant that 
charges an access fee.''
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78o-3.
    \7\ 15 U.S.C. 78o-3(b)(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, as amended.

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\ and subparagraph (f)(2) of Rule 19b-4 
thereunder.\9\ At any time within 60 days of the filing of the proposed 
rule change, the Commission could have summarily abrogated such rule 
change if it appeared to the Commission that such action was necessary 
or appropriate in the public interest, for the protection of investors, 
or otherwise in furtherance of the purposes of the Act.\10\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(a)(ii).
    \9\ 17 CFR 240.19b-4(f)(2).
    \10\ The effective date of the original proposed rule change is 
May 1, 2006 and the effective date of the amendment is June 12, 
2006. For purposes of calculating the 60-day period within which the 
Commission may summarily abrogate the proposed rule change, as 
amended, under Section 19(b)(3)(C) of the Act, the Commission 
considers the period to commence on June 12, 2006, the date on which 
the NASD submitted Amendment No. 1.  See 15 U.S.C. 78s(b)(3)(C).
---------------------------------------------------------------------------

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change, as amended, 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-2006-057 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASD-2006-057. 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 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, 100 F Street, 
NE., 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

[[Page 42698]]

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-2006-057 and should be 
submitted on or before August 17, 2006.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
---------------------------------------------------------------------------

    \11\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Jill M. Peterson,
Assistant Secretary.
 [FR Doc. E6-11982 Filed 7-26-06; 8:45 am]
BILLING CODE 8010-01-P

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