Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Establish an Exchange Direct Order for the NASDAQ Options Market, 8597-8599 [E9-4037]
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Federal Register / Vol. 74, No. 36 / Wednesday, February 25, 2009 / Notices
thus providing investors additional
opportunities to hedge their positions.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition 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
The Exchange has neither solicited
nor received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not: (i) Significantly affect
the protection of investors or the public
interest; (ii) impose any significant
burden on competition; and (iii) become
operative for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 7 and Rule 19b–
4(f)(6) thereunder.8
A proposed rule change filed
pursuant to Rule 19b-4(f)(6) under the
Act 9 normally does not become
operative for 30 days after the date of its
filing. However, Rule 19b-4(f)(6) 10
permits the Commission to designate a
shorter time if such action is consistent
with the protection of investors and the
public interest. The Exchange requests
that the Commission waive the 30-day
operative delay. The Commission notes
that this proposed rule change is
substantially identical to a proposed
rule change that was approved by the
Commission after an opportunity for
public comment,11 and does not raise
any new substantive issues. The
Exchange requests the waiver of the 30day operative delay so that the proposed
rule change may become effective and
7 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
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. The Exchange has satisfied this
requirement.
9 17 CFR 240.19b–4(f)(6).
10 Id.
11 The Exchange’s proposed rule change is
substantially identical to a proposed rule change by
the Chicago Board Options Exchange (‘‘CBOE’’)
recently approved by the Commission. See
Securities Exchange Act Release No. 59336
(February 2, 2009), 74 FR 6332 (February 6, 2009)
(SR–CBOE–2008–127).
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8597
operative immediately and allow BOX
to remain competitive with other
exchanges. For these reasons, the
Commission believes that waiving the
30-day operative delay 12 is consistent
with the protection of investors and the
public interest and designates the
proposal operative upon filing.
At any time within 60 days of the
filing of the proposed rule change, the
Commission may summarily abrogate
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act.
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 the Exchange. 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 publicly available. All
submissions should refer to File
Number SR–BX–2009–011 and should
be submitted on or before March 18,
2009.
IV. Solicitation of Comments
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–3978 Filed 2–24–09; 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:
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–BX–2009–011 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–BX–2009–011. 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
12 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. See 15 U.S.C. 78c(f).
PO 00000
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BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59420; File No. SR–
NASDAQ–2009–011]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change to Establish an
Exchange Direct Order for the
NASDAQ Options Market
February 19, 2009.
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 February
17, 2009, 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
by Nasdaq. Nasdaq has filed this
proposal pursuant to Exchange Act Rule
19b–4(f)(6) 3 and has provided the
Commission with the notice required by
Rule 19b–4(f)(6)(iii).4 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 Substance of
the Proposed Rule Change
Nasdaq proposes to establish a new
order type for the NASDAQ Options
13 17
CFR 200.30-3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 17 CFR 240.19b–4(f)(6).
4 17 CFR 240.19b–4(f)(6)(iii).
1 15
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Federal Register / Vol. 74, No. 36 / Wednesday, February 25, 2009 / Notices
Market (‘‘NOM’’) that will allow users to
direct orders to be delivered by the
system to another exchange without first
checking the NOM book.
The text of the proposed rule change
is below. Proposed new language is
italicized; proposed deletions are in
brackets.5
Options Rules
Chapter VI Trading System
*
*
Sec. 1
*
*
*
Definitions
(a)–(d) No change.
(e) The term ‘‘Order Type’’ shall mean
the unique processing prescribed for
designated orders that are eligible for
entry into the System, and shall include:
(1)–(6) No change.
(7) ‘‘Exchange Direct Orders’’ are
orders that are directed to an exchange
other than NOM as directed by the
entering party without checking the
NOM book. If unexecuted, the order (or
unexecuted portion thereof) shall be
returned to the entering party. This
order type may only be used for orders
with time-in-force parameters of IOC.
Directed Orders may not be directed
to a facility of an exchange that is an
affiliate of Nasdaq.
*
*
*
*
*
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Sec. 6 Acceptance of Quotes and
Orders
All bids or offers made and accepted
on NOM in accordance with the NOM
Rules shall constitute binding contracts,
subject to applicable requirements of the
Rules of the Exchange and the Rules of
the Clearing Corporation.
(a) General—A System order is an
order that is entered into the System for
display and/or execution as appropriate.
Such orders are executable against
marketable contra-side orders in the
System.
(1) All System Orders shall indicate
limit price and whether they are a call
or put and buy or sell. Systems Orders
can be designated as Immediate or
Cancel (‘‘IOC’’), Good-till-Cancelled
(‘‘GTC’’), Day (‘‘DAY’’), or Expire Time
(‘‘EXPR’’).
(2) A System order may also be
designated as a Reserve Order, a Limit
Order, a Minimum Quantity Order, a
Discretionary Order, a Market Order,
[or] a Price Improving Order, or an
Exchange Direct Order.
(b) No change.
*
*
*
*
*
5 Changes are marked to the rule text that appears
in the electronic manual of Nasdaq found at
https://nasdaq.cchwallstreet.com.
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18:09 Feb 24, 2009
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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 proposes to implement a new
order type—the Exchange Direct
Order—that is well-established for
equities trading but will now be
available for use by Options
Participants.6 Exchange Direct Orders
will be entered by an Options
Participant and sent to an options
market other than NOM without first
checking the NOM book. Upon entry,
the Options Participant will select the
options market to receive the order. If
unexecuted, the order (or unexecuted
portion thereof) shall be returned to the
entering party. The Exchange Direct
Order will be available only for orders
with time-in-force parameters of
Immediate Or Cancel (IOC).
The Exchange Direct Order type is
similar to the ‘‘Directed Order’’ in use
by Nasdaq for cash equities trading
which permits members of Nasdaq to
route orders directly to other equity
markets without first checking the
Nasdaq book.7 Similar to the processing
of Directed Orders for equities trading,
when NOM’s execution system receives
an Exchange Direct Order, NOM’s
system will pass that order to NASDAQ
Options Services, LLC, the Nasdaq
facility providing routing for NOM.
NASDAQ Options Services has
connectivity to route to all of the other
options markets. NASDAQ Option
Services will accept orders only from
NOM, which in turn accepts orders only
from Nasdaq members.
This order will provide additional
flexibility and functionality to Options
Participants and promote market
6 Pursuant to Chapter I, Section 1(a)(40) of the
NOM Rules, the term ‘‘Options Participant’’ means
a firm, or organization that is registered with
Nasdaq for purposes of participating in options
trading on NOM as a ‘‘Nasdaq Options Order Entry
Firm’’ or ‘‘Nasdaq Options Market Maker’’.
7 See Nasdaq Equities Rule 4751(f)(9).
PO 00000
Frm 00103
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Sfmt 4703
efficiency by providing them the ability
to better control their access to other
options markets. In addition, the order
may promote the entry of new
participants to the options markets by
facilitating access to multiple markets.
Exchange Direct Orders will enhance
the value of a connection to NOM for
Nasdaq members who are Options
Participants and at times want to access
liquidity at the National Best Bid and
Offer (NBBO) but do not have
connections to all other options
markets. These participants will be able
to control the liquidity they access, the
sequence in which the liquidity is
accessed and the manner in which they
access the liquidity.
Options Participants that enter
Exchange Direct Orders on NOM will be
subject to applicable routing fees.
However, at this time Options
Participants will not be charged a
separate fee for using this order
designation.
2. Statutory Basis
Nasdaq believes that the proposed
rule change is consistent with the
provisions of Section 6 of the Act,8 in
general, and with Section 6(b)(5) of the
Act,9 in particular, in that the proposal
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. The proposed rule
change would provide additional
functionality to Nasdaq members using
NOM and promote the entry of new
participants to the options markets by
facilitating access to multiple markets.
The Commission has already
determined that this functionality is
consistent with the Act for use in
equities trading.
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.
8 15
9 15
E:\FR\FM\25FEN1.SGM
U.S.C. 78f.
U.S.C. 78f(b)(5).
25FEN1
Federal Register / Vol. 74, No. 36 / Wednesday, February 25, 2009 / Notices
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C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 10 and Rule 19b–4(f)(6) 11
thereunder in that it effects a change
that: (i) Does not significantly affect the
protection of investors or the public
interest; (ii) does not impose any
significant burden on competition; and
(iii) by its terms, does not become
operative for 30 days after the date of
the filing, or such shorter time as the
Commission may designate if consistent
with the protection of investors and the
public interest.
In its recent guidance on the proposed
rules of Self-Regulatory Organizations
(‘‘SROs’’),12 the Commission concluded
that filings based on the rules of another
SRO already approved by the
Commission are eligible for immediate
effectiveness under Rule 19b–4(f)(6).
The Commission noted that ‘‘a proposed
rule change appropriately may be filed
as an immediately effective rule so long
as it is based on and similar to another
SRO’s rule and each policy issue raised
by the proposed rule (i) has been
considered previously by the
Commission when the Commission
approved another exchange’s rule (that
was subject to notice and comment),
and (ii) the rule change resolves such
policy issue in a manner consistent with
such prior approval.’’ 13 Nasdaq believes
that the proposed rule change is ‘‘based
on and similar to’’ existing order types
in use for cash equities trading,
including Equities Rule 4751(f)(9) of
Nasdaq (‘‘Directed Order’’), Equities
Rule 7.31(x)(iii) of NYSE Arca (‘‘PO+
Order’’) and Rule 11.9(c)(11) of BATS
(‘‘Modified Destination Specific
Order’’). The proposed Exchange Direct
Order for NOM is based on the same
functionality currently in use and is
intended to operate in a manner similar
to these existing order types.
This rule proposal, which is effective
upon filing with the Commission, shall
become operative 30 days after the date
of the filing.
At any time within 60 days of the
filing of the proposed rule change, the
10 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
12 Securities Exchange Act Release No. 58092
(July 3, 2008), 73 FR 40144 (July 11, 2008).
13 Id. at 40149.
11 17
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18:09 Feb 24, 2009
Jkt 217001
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, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
8599
should be submitted on or before March
18, 2009.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Florence E. Harmon,
Deputy Secretary.
[FR Doc. E9–4037 Filed 2–24–09; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–59421; File No. SR–
NASDAQ–2009–005]
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–NASDAQ–2009–011 on the
subject line.
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Order
Granting Accelerated Approval of
Proposed Rule Change as Modified by
Amendment No. 1 Thereto To Reduce
Certain Order Exposure Periods on the
NASDAQ Options Market From Three
Seconds to One Second
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2009–011. 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
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 the 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–2009–011 and
February 19, 2009.
PO 00000
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I. Introduction
On January 23, 2009, 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 reduce certain order exposure
periods on the NASDAQ Options
Market (‘‘NOM’’) from three seconds to
one second. NASDAQ filed Amendment
1 to the proposed rule change on
January 27, 2009. The proposed rule
change, as modified by Amendment No.
1, was published for comment in the
Federal Register on February 3, 2009.3
The Commission received no comments
on the proposal. This order approves the
proposed rule change, as modified by
Amendment No. 1, on an accelerated
basis.
II. Description of the Proposal
The purpose of the proposed rule
change is to reduce the exposure time
during which Options Participants 4
may not execute as principal against
orders they represent as agent from
three seconds to one second.
Specifically, NASDAQ proposes to
14 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. 59310
(January 28, 2009), 74 FR 5952.
4 Pursuant to Chapter I, Section 1(a)(40) of the
NOM Rules, the term ‘‘Options Participant’’ means
a firm, or organization that is registered with the
Exchange for purposes of participating in options
trading on NOM as a ‘‘Nasdaq Options Order Entry
Firm’’ or ‘‘Nasdaq Options Market Maker’’.
1 15
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]]>Agencies
[Federal Register Volume 74, Number 36 (Wednesday, February 25, 2009)]
[Notices]
[Pages 8597-8599]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-4037]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-59420; File No. SR-NASDAQ-2009-011]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change to
Establish an Exchange Direct Order for the NASDAQ Options Market
February 19, 2009.
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 February 17, 2009, 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 by Nasdaq. Nasdaq has filed this proposal
pursuant to Exchange Act Rule 19b-4(f)(6) \3\ and has provided the
Commission with the notice required by Rule 19b-4(f)(6)(iii).\4\ 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\ 17 CFR 240.19b-4(f)(6).
\4\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Nasdaq proposes to establish a new order type for the NASDAQ
Options
[[Page 8598]]
Market (``NOM'') that will allow users to direct orders to be delivered
by the system to another exchange without first checking the NOM book.
The text of the proposed rule change is below. Proposed new
language is italicized; proposed deletions are in brackets.\5\
---------------------------------------------------------------------------
\5\ Changes are marked to the rule text that appears in the
electronic manual of Nasdaq found at https://
nasdaq.cchwallstreet.com.
---------------------------------------------------------------------------
Options Rules
Chapter VI Trading System
* * * * *
Sec. 1 Definitions
(a)-(d) No change.
(e) The term ``Order Type'' shall mean the unique processing
prescribed for designated orders that are eligible for entry into the
System, and shall include:
(1)-(6) No change.
(7) ``Exchange Direct Orders'' are orders that are directed to an
exchange other than NOM as directed by the entering party without
checking the NOM book. If unexecuted, the order (or unexecuted portion
thereof) shall be returned to the entering party. This order type may
only be used for orders with time-in-force parameters of IOC.
Directed Orders may not be directed to a facility of an exchange
that is an affiliate of Nasdaq.
* * * * *
Sec. 6 Acceptance of Quotes and Orders
All bids or offers made and accepted on NOM in accordance with the
NOM Rules shall constitute binding contracts, subject to applicable
requirements of the Rules of the Exchange and the Rules of the Clearing
Corporation.
(a) General--A System order is an order that is entered into the
System for display and/or execution as appropriate. Such orders are
executable against marketable contra-side orders in the System.
(1) All System Orders shall indicate limit price and whether they
are a call or put and buy or sell. Systems Orders can be designated as
Immediate or Cancel (``IOC''), Good-till-Cancelled (``GTC''), Day
(``DAY''), or Expire Time (``EXPR'').
(2) A System order may also be designated as a Reserve Order, a
Limit Order, a Minimum Quantity Order, a Discretionary Order, a Market
Order, [or] a Price Improving Order, or an Exchange Direct Order.
(b) No change.
* * * * *
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 proposes to implement a new order type--the Exchange Direct
Order--that is well-established for equities trading but will now be
available for use by Options Participants.\6\ Exchange Direct Orders
will be entered by an Options Participant and sent to an options market
other than NOM without first checking the NOM book. Upon entry, the
Options Participant will select the options market to receive the
order. If unexecuted, the order (or unexecuted portion thereof) shall
be returned to the entering party. The Exchange Direct Order will be
available only for orders with time-in-force parameters of Immediate Or
Cancel (IOC).
---------------------------------------------------------------------------
\6\ Pursuant to Chapter I, Section 1(a)(40) of the NOM Rules,
the term ``Options Participant'' means a firm, or organization that
is registered with Nasdaq for purposes of participating in options
trading on NOM as a ``Nasdaq Options Order Entry Firm'' or ``Nasdaq
Options Market Maker''.
---------------------------------------------------------------------------
The Exchange Direct Order type is similar to the ``Directed Order''
in use by Nasdaq for cash equities trading which permits members of
Nasdaq to route orders directly to other equity markets without first
checking the Nasdaq book.\7\ Similar to the processing of Directed
Orders for equities trading, when NOM's execution system receives an
Exchange Direct Order, NOM's system will pass that order to NASDAQ
Options Services, LLC, the Nasdaq facility providing routing for NOM.
NASDAQ Options Services has connectivity to route to all of the other
options markets. NASDAQ Option Services will accept orders only from
NOM, which in turn accepts orders only from Nasdaq members.
---------------------------------------------------------------------------
\7\ See Nasdaq Equities Rule 4751(f)(9).
---------------------------------------------------------------------------
This order will provide additional flexibility and functionality to
Options Participants and promote market efficiency by providing them
the ability to better control their access to other options markets. In
addition, the order may promote the entry of new participants to the
options markets by facilitating access to multiple markets. Exchange
Direct Orders will enhance the value of a connection to NOM for Nasdaq
members who are Options Participants and at times want to access
liquidity at the National Best Bid and Offer (NBBO) but do not have
connections to all other options markets. These participants will be
able to control the liquidity they access, the sequence in which the
liquidity is accessed and the manner in which they access the
liquidity.
Options Participants that enter Exchange Direct Orders on NOM will
be subject to applicable routing fees. However, at this time Options
Participants will not be charged a separate fee for using this order
designation.
2. Statutory Basis
Nasdaq believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\8\ in general, and with Section
6(b)(5) of the Act,\9\ in particular, in that the proposal 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. The proposed rule change
would provide additional functionality to Nasdaq members using NOM and
promote the entry of new participants to the options markets by
facilitating access to multiple markets. The Commission has already
determined that this functionality is consistent with the Act for use
in equities trading.
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\8\ 15 U.S.C. 78f.
\9\ 15 U.S.C. 78f(b)(5).
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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.
[[Page 8599]]
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \10\ and Rule 19b-4(f)(6) \11\ thereunder in
that it effects a change that: (i) Does not significantly affect the
protection of investors or the public interest; (ii) does not impose
any significant burden on competition; and (iii) by its terms, does not
become operative for 30 days after the date of the filing, or such
shorter time as the Commission may designate if consistent with the
protection of investors and the public interest.
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6).
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In its recent guidance on the proposed rules of Self-Regulatory
Organizations (``SROs''),\12\ the Commission concluded that filings
based on the rules of another SRO already approved by the Commission
are eligible for immediate effectiveness under Rule 19b-4(f)(6). The
Commission noted that ``a proposed rule change appropriately may be
filed as an immediately effective rule so long as it is based on and
similar to another SRO's rule and each policy issue raised by the
proposed rule (i) has been considered previously by the Commission when
the Commission approved another exchange's rule (that was subject to
notice and comment), and (ii) the rule change resolves such policy
issue in a manner consistent with such prior approval.'' \13\ Nasdaq
believes that the proposed rule change is ``based on and similar to''
existing order types in use for cash equities trading, including
Equities Rule 4751(f)(9) of Nasdaq (``Directed Order''), Equities Rule
7.31(x)(iii) of NYSE Arca (``PO+ Order'') and Rule 11.9(c)(11) of BATS
(``Modified Destination Specific Order''). The proposed Exchange Direct
Order for NOM is based on the same functionality currently in use and
is intended to operate in a manner similar to these existing order
types.
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\12\ Securities Exchange Act Release No. 58092 (July 3, 2008),
73 FR 40144 (July 11, 2008).
\13\ Id. at 40149.
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This rule proposal, which is effective upon filing with the
Commission, shall become operative 30 days after the date of the
filing.
At any time within 60 days of the filing of the proposed rule
change, the Commission may summarily abrogate such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change, 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-NASDAQ-2009-011 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASDAQ-2009-011. 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 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 the 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-2009-011 and should
be submitted on or before March 18, 2009.
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,
Deputy Secretary.
[FR Doc. E9-4037 Filed 2-24-09; 8:45 am]
BILLING CODE 8011-01-P
