Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing of Proposed Rule Change Related to Supplemental Market Participant Identifiers, 6229-6230 [E8-1835]

Download as PDF Federal Register / Vol. 73, No. 22 / Friday, February 1, 2008 / 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 Number SR–NASDAQ–2007–096 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. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–57212; File No. SR– NASDAQ–2008–004] Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing of Proposed Rule Change Related to Supplemental Market Participant Identifiers January 28, 2008. mstockstill on PROD1PC66 with NOTICES Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 2 thereunder, notice is hereby given that on January 9, 2008, The NASDAQ Stock Market LLC (‘‘Nasdaq’’) filed with the Securities and All submissions should refer to File Exchange Commission (‘‘Commission’’) Number SR–NASDAQ–2007–096. This the proposed rule change as described file number should be included on the in Items I, II, and III below, which Items subject line if e-mail is used. To help the have been substantially prepared by Commission process and review your Nasdaq. The Commission is publishing comments more efficiently, please use this notice to solicit comments on the only one method. The Commission will proposed rule change from interested post all comments on the Commission’s persons. Internet Web site (http://www.sec.gov/ I. Self-Regulatory Organization’s rules/sro.shtml). Copies of the Statement of the Terms of Substance of submission, all subsequent the Proposed Rule Change amendments, all written statements Nasdaq proposes to make permanent with respect to the proposed rule the pilot program that allows market change that are filed with the makers and Electronic Communications Commission, and all written Networks (‘‘ECNs’’) to obtain communications relating to the supplemental market participant proposed rule change between the identifiers (‘‘MPIDs’’). Nasdaq also Commission and any person, other than proposes to remove any restrictions on those that may be withheld from the the number of MPIDs market public in accordance with the participants can request. The text of the provisions of 5 U.S.C. 552, will be proposed rule change is available at available for inspection and copying in Nasdaq, the Commission’s Public the Commission’s Public Reference Reference Room and Room on official business days between nasdaq.complinet.com. the hours of 10 a.m. and 3 p.m. Copies II. Self-Regulatory Organization’s of such filing also will be available for Statement of the Purpose of, and inspection and copying at the principal Statutory Basis for, the Proposed Rule office of Nasdaq. All comments received Change will be posted without change; the In its filing with the Commission, Commission does not edit personal Nasdaq included statements concerning identifying information from the purpose of, and basis, for the submissions. You should submit only proposed rule change. The text of these information that you wish to make statements may be examined at the available publicly. All submissions places specified in Item IV below. should refer to File Number SR– Nasdaq has prepared summaries, set NASDAQ–2007–096 and should be forth in Sections A, B, and C below, of submitted on or before February 22, the most significant aspects of such 2008. statements. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.7 Florence E. Harmon, Deputy Secretary. [FR Doc. E8–1832 Filed 1–31–08; 8:45 am] BILLING CODE 8011–01–P A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose Nasdaq proposes to make permanent the pilot program incorporated in 1 15 7 17 CFR 200.30–3(a)(12). VerDate Aug<31>2005 18:22 Jan 31, 2008 2 17 Jkt 214001 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00121 Fmt 4703 Sfmt 4703 6229 Nasdaq Rule 4613(a)(2) (‘‘Rule’’) that allows market makers and ECNs to obtain supplemental MPIDs. The pilot inadvertently was permitted to lapse on November 30, 2006. The Rule has operated as a temporary pilot since it was first adopted in June 2003 and although the pilot lapsed, Nasdaq continued to apply the procedures set forth in the Rule and the related interpretive material.3 The purpose of providing supplemental MPIDs is to provide quoting market participants a better ability to organize and manage diverse order flows from their customers and to route orders and quotes to Nasdaq’s listed trading facilities from different units/desks. To the extent that this flexibility provides increased incentives to provide liquidity to Nasdaq systems, Nasdaq believes that all market participants benefit. Because the Rule has benefited market makers and ECNs and has not had any negative impact on the Nasdaq market in the more than four years that it has been in place, Nasdaq believes the Rule should become permanent. Nasdaq also proposes to remove the current restriction in the Rule that limits the number of supplemental MPIDs that market makers and ECNs can request for displaying attributable quotes or orders. In accordance with the pilot program, market makers and ECNs may be issued a maximum of nine supplemental MPIDs. The reason for this restriction was a technological limitation that existed at the time the Rule was adopted, but this limitation no longer exists. Therefore, Nasdaq proposes to remove the restriction. In addition, Nasdaq proposes to remove IM–4613, which sets forth the procedures for allocating supplemental MPIDs. The removal of Nasdaq’s technological limitation on the number of MPIDs for a given security makes the procedures unnecessary. The decision to remove any restriction on the number of supplemental MPIDs must be balanced against the need to protect the integrity of the Nasdaq market. Accordingly, market makers and ECNs would be prohibited from using a supplemental MPID to accomplish indirectly what they are prohibited from doing directly through a single MPID. For example, members would not be permitted to use a supplemental MPID to avoid their Manning obligations under IM–2110–2, best execution obligations under Nasdaq Rule 2320, or their obligations under the 3 See Securities Exchange Act Release No. 47954 (May 30, 2003), 68 FR 34017 (June 6, 2003). See also IM–4613—Procedures for Allocation of Second Displayable MPIDs. E:\FR\FM\01FEN1.SGM 01FEN1 6230 Federal Register / Vol. 73, No. 22 / Friday, February 1, 2008 / Notices Commission’s Order Handling Rules. Members would be required to continue to comply with the firm quote rule, the OATS rules, and the Commission’s order routing and execution quality disclosure rules. If it were determined that a supplemental MPID was being used improperly, Nasdaq would withdraw its grant of the supplemental MPID for all purposes for all securities. In addition, if a market maker or ECN were no longer to fulfill the conditions appurtenant to its primary MPID (e.g., by being placed into an unexcused withdrawal), it would not be permitted to use any supplemental MPID for any purpose in that security. 2. Statutory Basis Nasdaq believes that the proposed rule change is consistent with the provisions of Section 6(b) of the Act,4 in general and with Section 6(b)(5) of the Act,5 in particular, in that it is designed 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. There no longer remains any market or technological need to restrict the number of MPIDs market participants can request. 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. mstockstill on PROD1PC66 with NOTICES 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 Within 35 days of the date of publication of this notice in the Federal Register or within such longer period (i) as the Commission may designate up to 90 days of such date if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory 4 15 5 15 U.S.C. 78f(b). U.S.C. 78f(b)(5). VerDate Aug<31>2005 18:22 Jan 31, 2008 Jkt 214001 organization consents, the Commission will: (A) By order approve such proposed rule change or (B) Institute proceedings to determine whether the proposed rule change should be disapproved. IV. Solicitation of Comments should be submitted on or before February 22, 2008. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.6 Florence E. Harmon, Deputy Secretary. [FR Doc. E8–1835 Filed 1–31–08; 8:45 am] 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: BILLING CODE 8011–01–P 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 Number SR–NASDAQ–2008–004 on the subject line. Self-Regulatory Organizations; American Stock Exchange LLC; Order Approving a Proposed Rule Change as Modified by Amendment No. 1 Thereto To Include Volume Executed by Remote Quoting Towards the Earning of Remote Quoting Rights Paper Comments January 22, 2008. • 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–NASDAQ–2008–004. 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 at (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, 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 Nasdaq. 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–2008–004 and PO 00000 Frm 00122 Fmt 4703 Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–57181; File No. SR–Amex– 2007–132] On November 30, 2007, the American Stock Exchange LLC (‘‘Amex’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to amend Amex Rule 994–ANTE to include the volume executed remotely by specialists and registered options traders (‘‘ROTs) towards the earning of remote quoting rights in the Exchange’s remote registered options trader (‘‘RROT’’) program (‘‘RROT Program’’). On December 13, 2007, Amex filed Amendment No. 1 to the proposed rule change. The proposed rule change, as amended, was published for comment in the Federal Register on December 21, 2007.3 The Commission received no comments on the proposal. This order approves the proposed rule change, as amended. The Exchange’s RROT Program currently allows members or member organizations designated by the Exchange to be awarded remote quoting rights to enter bids and offers electronically from locations other than the trading crowd where the applicable options class is traded on the Exchange’s physical trading floor.4 ROTs and specialists are currently awarded remote quoting rights based on 6 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 56974 (December 17, 2007), 72 FR 72803. 4 See Securities Exchange Act Release No. 53652 (April 13, 2006), 71 FR 20422 (April 20, 2006) (approving the Exchange’s RROT Program). 1 15 E:\FR\FM\01FEN1.SGM 01FEN1

Agencies

[Federal Register Volume 73, Number 22 (Friday, February 1, 2008)]
[Notices]
[Pages 6229-6230]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-1835]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57212; File No. SR-NASDAQ-2008-004]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing of Proposed Rule Change Related to Supplemental Market 
Participant Identifiers

January 28, 2008.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on January 9, 2008, 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 substantially prepared by Nasdaq. 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.
---------------------------------------------------------------------------

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

    Nasdaq proposes to make permanent the pilot program that allows 
market makers and Electronic Communications Networks (``ECNs'') to 
obtain supplemental market participant identifiers (``MPIDs''). Nasdaq 
also proposes to remove any restrictions on the number of MPIDs market 
participants can request. The text of the proposed rule change is 
available at Nasdaq, the Commission's Public Reference Room and 
nasdaq.complinet.com.

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. 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 the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    Nasdaq proposes to make permanent the pilot program incorporated in 
Nasdaq Rule 4613(a)(2) (``Rule'') that allows market makers and ECNs to 
obtain supplemental MPIDs. The pilot inadvertently was permitted to 
lapse on November 30, 2006. The Rule has operated as a temporary pilot 
since it was first adopted in June 2003 and although the pilot lapsed, 
Nasdaq continued to apply the procedures set forth in the Rule and the 
related interpretive material.\3\ The purpose of providing supplemental 
MPIDs is to provide quoting market participants a better ability to 
organize and manage diverse order flows from their customers and to 
route orders and quotes to Nasdaq's listed trading facilities from 
different units/desks. To the extent that this flexibility provides 
increased incentives to provide liquidity to Nasdaq systems, Nasdaq 
believes that all market participants benefit. Because the Rule has 
benefited market makers and ECNs and has not had any negative impact on 
the Nasdaq market in the more than four years that it has been in 
place, Nasdaq believes the Rule should become permanent.
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release No. 47954 (May 30, 
2003), 68 FR 34017 (June 6, 2003). See also IM-4613--Procedures for 
Allocation of Second Displayable MPIDs.
---------------------------------------------------------------------------

    Nasdaq also proposes to remove the current restriction in the Rule 
that limits the number of supplemental MPIDs that market makers and 
ECNs can request for displaying attributable quotes or orders. In 
accordance with the pilot program, market makers and ECNs may be issued 
a maximum of nine supplemental MPIDs. The reason for this restriction 
was a technological limitation that existed at the time the Rule was 
adopted, but this limitation no longer exists. Therefore, Nasdaq 
proposes to remove the restriction.
    In addition, Nasdaq proposes to remove IM-4613, which sets forth 
the procedures for allocating supplemental MPIDs. The removal of 
Nasdaq's technological limitation on the number of MPIDs for a given 
security makes the procedures unnecessary.
    The decision to remove any restriction on the number of 
supplemental MPIDs must be balanced against the need to protect the 
integrity of the Nasdaq market. Accordingly, market makers and ECNs 
would be prohibited from using a supplemental MPID to accomplish 
indirectly what they are prohibited from doing directly through a 
single MPID. For example, members would not be permitted to use a 
supplemental MPID to avoid their Manning obligations under IM-2110-2, 
best execution obligations under Nasdaq Rule 2320, or their obligations 
under the

[[Page 6230]]

Commission's Order Handling Rules. Members would be required to 
continue to comply with the firm quote rule, the OATS rules, and the 
Commission's order routing and execution quality disclosure rules.
    If it were determined that a supplemental MPID was being used 
improperly, Nasdaq would withdraw its grant of the supplemental MPID 
for all purposes for all securities. In addition, if a market maker or 
ECN were no longer to fulfill the conditions appurtenant to its primary 
MPID (e.g., by being placed into an unexcused withdrawal), it would not 
be permitted to use any supplemental MPID for any purpose in that 
security.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of Section 6(b) of the Act,\4\ in general and with 
Section 6(b)(5) of the Act,\5\ in particular, in that it is designed 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. There no 
longer remains any market or technological need to restrict the number 
of MPIDs market participants can request.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f(b).
    \5\ 15 U.S.C. 78f(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.

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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve such proposed rule change or
    (B) Institute proceedings to determine whether the proposed rule 
change should be disapproved.

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 Number SR-NASDAQ-2008-004 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-NASDAQ-2008-004. 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 at (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, 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 Nasdaq. 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-2008-004 and 
should be submitted on or before February 22, 2008.
---------------------------------------------------------------------------

    \6\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\6\
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E8-1835 Filed 1-31-08; 8:45 am]
BILLING CODE 8011-01-P