Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Regarding Step-Outs and Transfers of Sales Fees, 71176-71178 [E7-24201]

Download as PDF 71176 Federal Register / Vol. 72, No. 240 / Friday, December 14, 2007 / Notices adjusted rate; (4) provide the range maximum rate used to compute retained rate adjustments is the normal range maximum rate (including any locality adjustment or special rate supplement); and (5) provide when a frozen retained rate for an employee with a rating of record below Successful falls below the applicable adjusted rate for the normal grade maximum, the retained rate will be terminated and the employee’s pay will be set at an adjusted rate equal to the retained rate). Chapter 75, section 7512(4): Adverse actions (only to the extent necessary to provide that adverse actions do not apply to reductions in rates of basic pay to offset a locality pay or special rate supplement increase as a result of receiving a rating of record below Successful). rmajette on PROD1PC64 with NOTICES Note: If any of the provisions of title 5, United States Code, listed above are amended during the period this demonstration project is in effect, U.S. Department of Education/ Federal Student Aid may choose to terminate the waiver of one or more such provisions with respect to employees participating in the project, without formally modifying the project itself. U.S. Department of Education/ Federal Student Aid must notify OPM when any such waiver is terminated. B. Title 5, Code of Federal Regulations Part 359, subpart G, section 359.705: saved pay for former members of the Senior Executive Service (only to the extent necessary to (1) bar employees with a rating of record below Successful from receiving a saved rate increase under 5 CFR 359.705(d)(1); and (2) apply rules parallel to those governing adjustment and termination of retained rates under 5 U.S.C. part 536, as modified under this plan). Part 430, subpart B, section 430.203: Definitions (only to the extent necessary to allow an additional rating of record to support a pay decision under sections III.C.3 or 4 of this project plan). Part 530, section 530.304: Establishing or increasing special rates (only to the extent necessary to (1) provide that if the U.S. Department of Education/ Federal Student Aid extends the maximum rate of a rate range by 5 percent above the normal maximum for Outstanding performers, a special rate may not exceed the rate for EX–IV, plus 5 percent) for employees in that range extension; (2) to interpret the references to the minimum and maximum rates of a grade as references to the normal minimum and maximum rates of a grade under this plan; and (3) apply an ‘‘effective’’ special rate supplement percentage for employees in the upper range extension under circumstances described in this plan. VerDate Aug<31>2005 15:31 Dec 13, 2007 Jkt 214001 Part 531, subpart B: Determining Rate of Basic Pay. Part 531, subpart D: Within-Grade Increases. Part 531, subpart E: Quality Step Increases. Part 531, section 531.604: Determining an employee’s locality rate (only to the extent necessary to apply an ‘‘effective’’ locality pay percentage for employees in the upper range extension under circumstances described in this plan). Part 531, section 531.606: Maximum limits on locality rates (only to the extent necessary to provide that if the U.S. Department of Education/Federal Student Aid extends the maximum rate of a rate range by 5 percent above the normal maximum for Outstanding performers, a locality rate may not exceed the rate for EX–IV, plus 5 percent) for employees in that range extension. Part 536, subpart C: Pay Retention (only to the extent necessary to (1) bar employees with a less than Successful rating of record from receiving retained rate increases under 5 CFR 536.305; (2) provide that if the U.S. Department of Education/Federal Student Aid extends the maximum rate of a rate range by 5 percent above the normal maximum for Outstanding performers, a retained rate may not exceed the rate for EX–IV, plus 5 percent; (3) provide the pay (including any locality adjustment or special rate supplement) of an employee in the upper range extension who is rated below Outstanding will be converted to a retained rate before processing any other actions; (4) provide a retained rate that is less than the maximum rate (including any locality adjustment or special rate supplement) of the upper range extension for an employee who receives a rating of record of Outstanding will be terminated and converted to an equal adjusted rate; (5) provide the range maximum rate used to compute retained rate adjustments is the normal range maximum rate (including any applicable locality adjustment or special rate supplement); and (6) provide when a frozen retained rate for an employee with a rating of record below Successful falls below the applicable adjusted rate for the normal grade maximum, the retained rate will be terminated and the employee’s pay will be set at an adjusted rate equal to the retained rate). Part 752, section 752.401(a)(4): Adverse actions (only to the extent necessary to provide that adverse action provisions do not apply to reductions in rates of basic pay to offset a locality pay or special rate supplement increase as a PO 00000 Frm 00065 Fmt 4703 Sfmt 4703 result of receiving a rating of record below Successful). Note: If any of the provisions of title 5, Code of Federal Regulations, listed above are revised during the period this demonstration project is in effect, U.S. Department of Education/Federal Student Aid may choose to terminate the waiver of one or more such provisions with respect to employees participating in the project, without formally modifying the project itself. U.S. Department of Education/Federal Student Aid must notify OPM when any such waiver is terminated. [FR Doc. E7–24259 Filed 12–13–07; 8:45 am] BILLING CODE 6325–43–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–56929; File No. SR– NASDAQ–2007–086] Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Regarding Step-Outs and Transfers of Sales Fees December 7, 2007. 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 October 31, 2007, The NASDAQ Stock Market LLC (‘‘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 primarily by Nasdaq. Nasdaq has filed the proposal pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(6) thereunder,4 so that the proposal was 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 Nasdaq proposes to: (i) Offer, for a fee, a match/compare service for Nasdaq members to process step-outs between themselves and (ii) allow the transfer of Rule 7002 Sales Fees and similar fees of other self-regulatory organizations (‘‘SROs’’) without an agreement between the transferring Nasdaq members when such transfers are accompanied by a transfer of the underlying shares. 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)(6). 2 17 E:\FR\FM\14DEN1.SGM 14DEN1 Federal Register / Vol. 72, No. 240 / Friday, December 14, 2007 / Notices 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. rmajette on PROD1PC64 with NOTICES A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change Nasdaq Rule 7038 enables Nasdaq members to utilize Nasdaq’s Automated Confirmation Transaction Service (‘‘ACT’’) to transfer all or a portion of the member’s obligation to pay a NASD Rule 7002 sale fee or similar fee of another SRO (‘‘sales fees’’).5 In addition, Nasdaq members may also use ACT to process step-outs.6 Under the rule change, Nasdaq will modify Nasdaq Rule 7038(c) to specify that when members use ACT to transfer sales fees but do not also transfer the underlying shares, the clearing firms for the trades in question must be party to an agreement authorizing such transfers between themselves or the firms on whose behalf they clear trades.7 Nasdaq is also adding new paragraph (f) to Nasdaq Rule 7038 that will enable Nasdaq members to use ACT’s ‘‘match/ compare’’ functionality to process stepouts without an agreement between the transferring Nasdaq members when such transfers are accompanied by a 5 Nasdaq Rule 7038(a). Rule 7002 fees are designed to defray the costs that Nasdaq pays to the Commission under Section 31(b) of the Act. 15 U.S.C. 78ee(b). 6 Nasdaq Rule 7038(b). A ‘‘step-out’’ is a mechanism for transferring a broker’s position in a security in a manner that does not constitute a trade. In one form of a step-out, a party to a previously executed trade transfers its position in the trade to one or more other parties. For example, a broker that buys a large block of stock on behalf of several broker-dealer customers may ‘‘step-out’’ of the trade in order to transfer and allocate its position to its broker-dealer customers. Thus, under this form of a step-out, there is a single trade on a securities market coupled with an arrangement between one of the trade counterparties and one or more additional parties to shift the settlement obligations for the trade to the additional parties. In another form of step-out, a broker uses a clearingonly report to transfer its position from at one clearing broker’s account to another clearing broker’s account. 7 Examples of such an agreement include a Nasdaq ‘‘Attachment 2’’ or the Financial Industry Regulatory Authority’s (‘‘FINRA’’) new Uniform Trade Reporting Facility Service Bureau/Executing Broker Agreement. VerDate Aug<31>2005 15:31 Dec 13, 2007 Jkt 214001 transfer of the underlying shares. Nasdaq will assess a fee for this service whereby each party to a matched/ compared transfer will be assessed $0.0144 per 100 shares with a minimum of 400 shares up to maximum of 7,500 shares except in cases where the same participant is on both sides of a transfer in which case the applicable per side fee will be assessed once rather than twice. Nasdaq states that it believes that the proposed rule change is consistent with the provisions of Section 6 of the Act 8 and specifically with Sections 6(b)(4) and (5) of the Act 9 because the proposal 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 designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and in general to protect investors and the public interest. Nasdaq believes that offering match/compare functionality in connection with step-outs and reducing paperwork requirements for Sales Fee transfers benefits its members by enhancing the efficiency of their posttrade operations and that its proposed fees are reasonable and comparable to similar Financial Industry Regulatory Authority (‘‘FINRA’’) fees for comparison services.10 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 Nasdaq did not solicit or receive written comments on the proposed rule change. 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) 8 15 U.S.C. 78f. U.S.C. 78f(b)(4) and (5). 10 See NASD Rule 7002B. 9 15 PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 71177 of the Act 11 and Rule 19b–4(f)(6) thereunder12 because it does not: (1) Significantly affect the protection of investors or the public interest; (2) impose any significant burden on competition; and (3) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate. Nasdaq has requested that the Commission waive the 30-day operative delay pursuant to the Commission’s authority under Rule 19b–4(f)(6)(iii) 13 to designate a shorter time when such action is consistent with the protection of investors and the public interest. The Commission hereby grants the request.14 The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest in light of a FINRA rule, which became effective two business days after Nasdaq filed its proposed rule change that requires all shares that underlie a step-out transaction have been previously trade-reported to FINRA-only facilities.15 In order to ensure that firms can use the same method to conduct step-out trades, it is appropriate for Nasdaq to be able to implement its match/compare functionality on an accelerated basis so that it can be in place for firms that wish to do step-outs through the match and compare functionality for shares that were not exclusively reported over-thecounter before the FINRA restriction became effective. Moreover, the Commission notes that the match/ compare functionality has long existed at Nasdaq and that the modifications made by this rule change do not raise any novel legal or policy concerns. Accordingly, the Commission designates the proposed rule change to be operative upon filing with the Commission. Rule 19b–4(f)(6)(iii) requires Nasdaq to notify the Commission of its intent to file the proposed rule change, along with a brief description and 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. Nasdaq has requested that the Commission designate a shorter 11 15 U.S.C. 78s(b)(3)(A). C.F.R. 240.19b–4(f)(6). 13 17 C.F.R. 240.19b–4(f)(6)(iii). 14 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. 15 U.S.C. 78c(f). 15 Securities Exchange Act Release No. 55962 (Jun. 26, 2007), 72 FR 36536 (Jul. 3, 2007) [SR– NASD–2007–040]. See also FINRA Regulatory Notice 07–38 (Aug. 2007), available online at http://www.finra.org/web/groups/rules_regs/ documents/notice_to_members/p036643.pdf. 12 17 E:\FR\FM\14DEN1.SGM 14DEN1 71178 Federal Register / Vol. 72, No. 240 / Friday, December 14, 2007 / Notices notification time. The Commission hereby waives the five-day notice period. As explained above, it was necessary for Nasdaq to file its proposed rule change expeditiously so as to avoid any disruption in service to its members. At any time within 60 days of the filing of such 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: copying at Nasdaq’s principal office and on Nasdaq’s Web site at http:// nasdaq.complinet.com/nasdaq/display/ display.html?rbid=1705&element_id=4. 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 submission should refer to File No. SR– NASDAQ–2007–086 and should be submitted on or before January 4, 2008. For the Commission by the Division of Trading and Markets pursuant to delegated authority.16 Florence E. Harmon, Deputy Secretary. [FR Doc. E7–24201 Filed 12–12–07; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION rmajette on PROD1PC64 with NOTICES Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File No. SR–NASDAQ–2007–086 on the subject line. [Release No. 34–56932; File No. SR– NYSEArca–2007–112] Paper Comments • Send paper comments in triplicate to Nancy M. Morris, Secretary, Securities and Exchange Commission, Station Place, 100 F Street, NE., Washington, DC 20549–1090. All submissions should refer to File No. NASDAQ–2007–086. 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 (http://www.sec.gov/ rules/sro.shtml). Copies of the submission, all subsequent amendments, all written statements with respect to the proposed rule change that are filed with the Commission, and all written communications relating to the proposed rule change between the Commission and any person, other than those that may be withheld from the public in accordance with the provisions of 5 U.S.C 552, will be available for inspection and copying in the Commission’s Public Reference Room, 450 Fifth Street, NW., 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 December 7, 2007 VerDate Aug<31>2005 15:31 Dec 13, 2007 Jkt 214001 Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Order Granting Accelerated Approval of a Proposed Rule Change to List and Trade Shares of the iShares S&P GSCI Commodity-Indexed Trust Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on December 7, 2007, NYSE Arca, Inc. (‘‘NYSE Arca’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been substantially prepared by the Exchange. This order provides notice of the proposed rule change, and approves the proposed rule change on an accelerated basis. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change NYSE Arca, through its wholly owned subsidiary NYSE Arca Equities, Inc. (‘‘NYSE Arca Equities’’), proposes to list and trade under NYSE Arca Equities Rule 8.203 shares (‘‘Shares’’) of the iShares S&P GSCITM CommodityIndexed Trust (‘‘Trust’’).3 The Trust 16 17 CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 iShares is a registered trademark of Barclays Global Investors, N.A. ‘‘S&P GSCI’’ is a trademark of Standard & Poor’s (‘‘S&P’’ or ‘‘Index Sponsor’’), a division of The McGraw-Hill Companies, Inc. PO 00000 Frm 00067 Fmt 4703 Sfmt 4703 issues units of beneficial interest (i.e., the Shares) representing fractional undivided beneficial interests in the net assets of the Trust. The text of the proposed rule change is available on the Exchange’s Web site at http:// www.nyse.com, at the Exchange’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, the Exchange included statements concerning the purpose of, and basis for, the proposed rule change, and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item III below. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange proposes to list and trade the Shares under NYSE Arca Equities Rule 8.203. The objective of the Trust is for the performance of the Shares to correspond generally to the performance of the S&P GSCITM Total Return Index, before payment of the Trust’s and the Investing Pool’s (as described below) expenses and liabilities (the ‘‘Total Return Index’’). The Trust is currently listed on the New York Stock Exchange LLC (‘‘NYSE’’) and trades on NYSE Arca pursuant to unlisted trading privileges. Following Commission approval of this proposed rule change, the Trust will transfer listing from NYSE to NYSE Arca,4 and will not trade on NYSE. The Exchange represents that the Shares satisfy the requirements of NYSE Arca Equities Rule 8.203 and thereby qualify for listing on the Exchange. The commodity component of the Total Return Index is comprised of a group of commodities included in the S&P GSCITM Commodity Index (‘‘S&P GSCITM’’ or ‘‘Index’’), which is a production-weighted index of the prices 4 See Securities Exchange Act Release No. 54013 (June 16, 2006), 71 FR 36372 (June 26, 2006) (SR– NYSE–2006–17) (‘‘NYSE Order’’) (approving listing and trading of the Shares on NYSE); Securities Exchange Act Release No. 54025 (June 21, 2006), 71 FR 36856 (June 28, 2006) (SR–NYSEArca–2006–12) (approving, among other things, the trading of the Shares on NYSE Arca pursuant to unlisted trading privileges). E:\FR\FM\14DEN1.SGM 14DEN1

Agencies

[Federal Register Volume 72, Number 240 (Friday, December 14, 2007)]
[Notices]
[Pages 71176-71178]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-24201]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-56929; File No. SR-NASDAQ-2007-086]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
Regarding Step-Outs and Transfers of Sales Fees

December 7, 2007.
    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 October 31, 2007, The NASDAQ Stock Market LLC (``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 primarily by Nasdaq. Nasdaq has filed the 
proposal pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 19b-
4(f)(6) thereunder,\4\ so that the proposal was effective upon filing 
with the Commission. 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)(6).
---------------------------------------------------------------------------

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

    Nasdaq proposes to: (i) Offer, for a fee, a match/compare service 
for Nasdaq members to process step-outs between themselves and (ii) 
allow the transfer of Rule 7002 Sales Fees and similar fees of other 
self-regulatory organizations (``SROs'') without an agreement between 
the transferring Nasdaq members when such transfers are accompanied by 
a transfer of the underlying shares.

[[Page 71177]]

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

    Nasdaq Rule 7038 enables Nasdaq members to utilize Nasdaq's 
Automated Confirmation Transaction Service (``ACT'') to transfer all or 
a portion of the member's obligation to pay a NASD Rule 7002 sale fee 
or similar fee of another SRO (``sales fees'').\5\ In addition, Nasdaq 
members may also use ACT to process step-outs.\6\
---------------------------------------------------------------------------

    \5\ Nasdaq Rule 7038(a). Rule 7002 fees are designed to defray 
the costs that Nasdaq pays to the Commission under Section 31(b) of 
the Act. 15 U.S.C. 78ee(b).
    \6\ Nasdaq Rule 7038(b). A ``step-out'' is a mechanism for 
transferring a broker's position in a security in a manner that does 
not constitute a trade. In one form of a step-out, a party to a 
previously executed trade transfers its position in the trade to one 
or more other parties. For example, a broker that buys a large block 
of stock on behalf of several broker-dealer customers may ``step-
out'' of the trade in order to transfer and allocate its position to 
its broker-dealer customers. Thus, under this form of a step-out, 
there is a single trade on a securities market coupled with an 
arrangement between one of the trade counterparties and one or more 
additional parties to shift the settlement obligations for the trade 
to the additional parties. In another form of step-out, a broker 
uses a clearing-only report to transfer its position from at one 
clearing broker's account to another clearing broker's account.
---------------------------------------------------------------------------

    Under the rule change, Nasdaq will modify Nasdaq Rule 7038(c) to 
specify that when members use ACT to transfer sales fees but do not 
also transfer the underlying shares, the clearing firms for the trades 
in question must be party to an agreement authorizing such transfers 
between themselves or the firms on whose behalf they clear trades.\7\
---------------------------------------------------------------------------

    \7\ Examples of such an agreement include a Nasdaq ``Attachment 
2'' or the Financial Industry Regulatory Authority's (``FINRA'') new 
Uniform Trade Reporting Facility Service Bureau/Executing Broker 
Agreement.
---------------------------------------------------------------------------

    Nasdaq is also adding new paragraph (f) to Nasdaq Rule 7038 that 
will enable Nasdaq members to use ACT's ``match/compare'' functionality 
to process step-outs without an agreement between the transferring 
Nasdaq members when such transfers are accompanied by a transfer of the 
underlying shares. Nasdaq will assess a fee for this service whereby 
each party to a matched/compared transfer will be assessed $0.0144 per 
100 shares with a minimum of 400 shares up to maximum of 7,500 shares 
except in cases where the same participant is on both sides of a 
transfer in which case the applicable per side fee will be assessed 
once rather than twice.
    Nasdaq states that it believes that the proposed rule change is 
consistent with the provisions of Section 6 of the Act \8\ and 
specifically with Sections 6(b)(4) and (5) of the Act \9\ because the 
proposal 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 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation 
and coordination with persons engaged in regulating, clearing, 
settling, processing information with respect to, and facilitating 
transactions in securities, to remove impediments to and perfect the 
mechanism of a free and open market and a national market system, and 
in general to protect investors and the public interest. Nasdaq 
believes that offering match/compare functionality in connection with 
step-outs and reducing paperwork requirements for Sales Fee transfers 
benefits its members by enhancing the efficiency of their post-trade 
operations and that its proposed fees are reasonable and comparable to 
similar Financial Industry Regulatory Authority (``FINRA'') fees for 
comparison services.\10\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78f.
    \9\ 15 U.S.C. 78f(b)(4) and (5).
    \10\ See NASD Rule 7002B.
---------------------------------------------------------------------------

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

    Nasdaq did not solicit or receive written comments on the proposed 
rule change.

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 \11\ and Rule 19b-4(f)(6) thereunder\12\ because 
it does not: (1) Significantly affect the protection of investors or 
the public interest; (2) impose any significant burden on competition; 
and (3) become operative for 30 days from the date on which it was 
filed, or such shorter time as the Commission may designate.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 C.F.R. 240.19b-4(f)(6).
---------------------------------------------------------------------------

    Nasdaq has requested that the Commission waive the 30-day operative 
delay pursuant to the Commission's authority under Rule 19b-
4(f)(6)(iii) \13\ to designate a shorter time when such action is 
consistent with the protection of investors and the public interest. 
The Commission hereby grants the request.\14\ The Commission believes 
that waiving the 30-day operative delay is consistent with the 
protection of investors and the public interest in light of a FINRA 
rule, which became effective two business days after Nasdaq filed its 
proposed rule change that requires all shares that underlie a step-out 
transaction have been previously trade-reported to FINRA-only 
facilities.\15\ In order to ensure that firms can use the same method 
to conduct step-out trades, it is appropriate for Nasdaq to be able to 
implement its match/compare functionality on an accelerated basis so 
that it can be in place for firms that wish to do step-outs through the 
match and compare functionality for shares that were not exclusively 
reported over-the-counter before the FINRA restriction became 
effective. Moreover, the Commission notes that the match/compare 
functionality has long existed at Nasdaq and that the modifications 
made by this rule change do not raise any novel legal or policy 
concerns. Accordingly, the Commission designates the proposed rule 
change to be operative upon filing with the Commission.
---------------------------------------------------------------------------

    \13\ 17 C.F.R. 240.19b-4(f)(6)(iii).
    \14\ 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. 15 U.S.C. 78c(f).
    \15\ Securities Exchange Act Release No. 55962 (Jun. 26, 2007), 
72 FR 36536 (Jul. 3, 2007) [SR-NASD-2007-040]. See also FINRA 
Regulatory Notice 07-38 (Aug. 2007), available online at  http://
www.finra.org/web/groups/rules_regs/documents/notice_to_members/
p036643.pdf.
---------------------------------------------------------------------------

    Rule 19b-4(f)(6)(iii) requires Nasdaq to notify the Commission of 
its intent to file the proposed rule change, along with a brief 
description and 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. Nasdaq has 
requested that the Commission designate a shorter

[[Page 71178]]

notification time. The Commission hereby waives the five-day notice 
period. As explained above, it was necessary for Nasdaq to file its 
proposed rule change expeditiously so as to avoid any disruption in 
service to its members.
    At any time within 60 days of the filing of such 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 (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File No. SR-NASDAQ-2007-086 on the subject line.

Paper Comments

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

All submissions should refer to File No. NASDAQ-2007-086. 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 (http://www.sec.gov/rules/
sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C 552, will be available for inspection and copying 
in the Commission's Public Reference Room, 450 Fifth Street, NW., 
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 Nasdaq's principal office and on Nasdaq's Web 
site at http://nasdaq.complinet.com/nasdaq/display/
display.html?rbid=1705&element_id=4. 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 submission 
should refer to File No. SR-NASDAQ-2007-086 and should be submitted on 
or before January 4, 2008.

    For the Commission by the Division of Trading and Markets 
pursuant to delegated authority.\16\
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    \16\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E7-24201 Filed 12-12-07; 8:45 am]
BILLING CODE 8011-01-P