Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Order Approving Proposed Rule Change as Modified by Amendment No. 1 Thereto To Remove From the Nasdaq Rules Fee Provisions Relating to Nasdaq's Mutual Fund Quotation Service, 50382 [E8-19784]

Agencies

• SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 73, Number 166 (Tuesday, August 26, 2008)]
[Notices]
[Page 50382]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-19784]



[[Page 50382]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-58392; File No. SR-NASDAQ-2008-019]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Order 
Approving Proposed Rule Change as Modified by Amendment No. 1 Thereto 
To Remove From the Nasdaq Rules Fee Provisions Relating to Nasdaq's 
Mutual Fund Quotation Service

August 20, 2008.
    On March 12, 2008, The NASDAQ Stock Market LLC (``Nasdaq'') 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 remove from 
the Nasdaq rulebook references to the fees charged by Nasdaq in 
connection with its Mutual Fund Quotation Service (``MFQS''). On July 
3, 2008, Nasdaq filed Amendment No. 1 to the proposed rule change. The 
proposed rule change, as amended, was published for comment in the 
Federal Register on July 14, 2008.\3\ The Commission received no 
comments regarding the proposal. This order approves the proposed rule 
change, as modified by Amendment No. 1.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 58102 (July 3, 
2008), 73 FR 40410.
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    Through the MFQS, Nasdaq collects price data for mutual funds, 
money market funds, and unit investment trusts.\4\ This price data 
includes information such as net asset value, offer/market price, and 
capital gains distributions.\5\ Price data may be submitted to Nasdaq 
by either the fund itself, or by a third-party service facilitator, 
such as a pricing agent.\6\ This pricing data is then transmitted to 
print media and/or market data vendors, depending on the level of 
service for which the fund qualifies.\7\ The data interface for the 
MFQS is separate from the Nasdaq trading system interface.\8\
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    \4\ See MFQS User Guide at www.nasdaqtrader.com.
    \5\ Id.
    \6\ Id.
    \7\ Id.
    \8\ See e-mail from Alex Kogan, Associate General Counsel, 
Nasdaq, to Andrew Madar, Attorney-Advisor, Commission, dated August 
15, 2008.
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    Nasdaq Rule 7033 (a) through (d) sets forth the fees that Nasdaq 
charges money market funds, mutual funds, and unit investment trusts 
for participating in the MFQS. Nasdaq Rules 7019(b) and 7033(e) set 
forth the distribution and access fees that Nasdaq charges for MFQS 
information, which is transmitted via the Mutual Funds Dissemination 
Service (``MFDS''). Nasdaq proposes to delete Rule 7033 in its entirety 
from its rulebook, and the portion of Rule 7019(b) that relates to MFQS 
fees.
    The Commission has carefully reviewed the proposed rule change and 
finds that the proposed rule change is consistent with the requirements 
of the Act and the rules and regulations thereunder applicable to a 
national securities exchange.\9\ The Commission believes that it is 
reasonable for Nasdaq to delete the portion of Rule 7019(b) that 
relates to MFQS fees, and Rule 7033 in its entirety as, based on 
representations made by Nasdaq, neither the MFQS nor the MFDS appear to 
be facilities of a national securities exchange within the meaning of 
the Act. Removing these provisions is thus consistent with the 
requirements of Section 6(b) of the Act,\10\ as the fees charged by 
Nasdaq in connection with the MFQS do not fall within the scope of the 
rules that must be filed with the Commission pursuant to Section 
19(b)(1) of the Act \11\ and Rule 19b-4 thereunder.\12\
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    \9\ In approving this proposed rule change, 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. 78f(b).
    \11\ 15 U.S.C. 78s(b)(1).
    \12\ 17 CFR 240.19b-4.
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    If, however, Nasdaq were to propose to tie pricing for the MFQS or 
the MFDS to an exchange activity, or otherwise modify the MFQS or MFDS 
such that they fall within the definition of facility of an exchange in 
the Act,\13\ Nasdaq would have to file a proposed rule change with the 
Commission.
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    \13\ See 15 U.S.C. 78c(a)(2).
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    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that the proposed rule change (SR-NASDAQ-2008-019), as modified by 
Amendment No. 1, be, and it hereby is, approved.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-19784 Filed 8-25-08; 8:45 am]
BILLING CODE 8010-01-P