Self-Regulatory Organizations; NASDAQ OMX PHLX, Inc.; Notice of Filing of Proposed Rule Change To Codify Prices for Co-Location Services, 6426-6428 [2010-2787]
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6426
Federal Register / Vol. 75, No. 26 / Tuesday, February 9, 2010 / Notices
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 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
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The proposed rule change is effective
upon filing pursuant to Section
19(b)(3)(A)(i) of the Exchange Act 6 and
Rule 19b–4(f)(1) thereunder,7 in that it
constitutes a stated policy, practice, or
interpretation with respect to the
meaning, administration, or
enforcement of an existing rule of the
Exchange. At any time within 60 days
of the filing of the proposed rule change,
the Commission may summarily
abrogate the rule change if it appears to
the Commission that the action is
necessary or appropriate in the public
interest, for the protection of investors,
or would otherwise further 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:
Cprice-sewell on DSK2BSOYB1PROD with NOTICES
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–NYSEAmex–2010–06 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–NYSEAmex–2010–06. 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 Web site viewing and
printing 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 NYSE Amex’s principal
office and on its Web site at
www.nyse.com. 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 No. SR–
NYSEAmex–2010–06 and should be
submitted on or before March 2, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.8
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–2739 Filed 2–8–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–61486; File No. SR–Phlx–
2010–18]
Self-Regulatory Organizations;
NASDAQ OMX PHLX, Inc.; Notice of
Filing of Proposed Rule Change To
Codify Prices for Co-Location Services
February 3, 2010.
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 January
29, 2010, NASDAQ OMX PHLX (‘‘Phlx’’
or ‘‘Exchange’’) 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
8 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
6 15
U.S.C. 78s(b)(3)(A)(i).
7 17 CFR 240.19b–4(f)(1).
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substantially prepared by the Exchange.
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 OMX PHLX is filing with
the Securities and Exchange
Commission (‘‘Commission’’) a proposed
rule change to codify pricing for colocation services. The text of the
proposed rule change is available at
https://www.nasdaqtrader.com/
micro.aspx?id=PHLXRulefilings, on the
Commission’s Web site at https://
www.sec.gov, at the Exchange’s
principal office, and at the
Commission’s Public Reference Room.
The Exchange will implement the
proposed rule change on the first day of
the month immediately following
Commission approval (or on the date of
approval, if on the first business day of
a month).
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 IV 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 is proposing to codify
fees for its existing co-location services.
Co-location services are a suite of
hardware, power, telecommunication,
and other ancillary products and
services that allow market participants
and vendors to place their trading and
communications equipment in close
physical proximity to the quoting and
execution facilities of the Exchange.
Phlx provides co-location services and
imposes fees through Nasdaq
Technology Services LLC and pursuant
to agreements with the owner/operator
of its data center where both the
Exchange’s quoting and trading facilities
and co-located customer equipment are
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Federal Register / Vol. 75, No. 26 / Tuesday, February 9, 2010 / Notices
Cprice-sewell on DSK2BSOYB1PROD with NOTICES
housed.3 Users of co-location services
include private extranet providers, data
vendors, as well as the Exchange
members and non-members. The use of
co-location services is entirely
voluntary.
As detailed in the proposed colocation fee schedule, the Exchange
imposes a uniform, non-discriminatory
set of fees for various co-location
services, including: Fees for cabinet
space usage, or options for future space
usage 4; installation and related power
provision for hosted equipment;
connectivity among multiple cabinets
being used by the same customer as well
as customer connectivity to the
Exchange and telecommunications
providers 5; and related maintenance
and consulting services. Fees related to
cabinet and power usage are
incremental, with additional charges
being imposed based on higher levels of
cabinet and/or power usage, the use of
non-standard cabinet sizes or special
cabinet cooling equipment, or the reselling of cabinet space.
Co-location customers are not
provided any separate or superior
means of direct access to the Exchange
quoting and trading facilities. Nor does
the Exchange offer any separate or
superior means of access to the
Exchange quoting and trading facilities
as among co-location customers
themselves within in [sic] the
datacenter. Likewise, the Exchange does
not make available to co-located
customers any market data or data feed
3 Currently, the Exchange provides its current colocation services through data centers located in the
New York City and Mid-Atlantic areas.
4 NASDAQ OMX PHLX is implementing a
Cabinet Proximity Option program where, for a
monthly a fee, customers can obtain an option for
future use on available currently-unused cabinet
floor space in proximity to their existing
equipment. Under the program, customers can
reserve up to maximum of 20 cabinets which the
Exchange will endeavor to provide as close as
reasonably possible to the customer’s existing
cabinet space, taking into consideration power
availability within segments of the datacenter and
the overall efficiency of use of datacenter resources
as determined by the Exchange. Should reserved
datacenter space be needed for use, the reserving
customer will have three business days to formally
contract with the Exchange for full payment for the
reserved cabinet space in contention or it will be
reassigned. In making determinations to require
exercise or relinquishment of reserved space as
among numerous customers, the Exchange will take
into consideration several factors, including:
Proximity between available reserved cabinet space
and the existing space of a customer seeking
additional space for actual cabinet usage; a
customer’s ratio of cabinets in use to those reserved;
the length of time that a particular reservation(s)
has been in place; and any other factor that the
Exchange deems relevant to ensure overall
efficiency in use of the datacenter space.
5 These fees are for telecommunications
connectivity only. Market Data fees are charged
independently by NASDAQ OMX PHLX and other
exchanges.
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14:39 Feb 08, 2010
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product or service for data going into, or
out of, the Exchange systems that is not
likewise available to all the Exchange
members.6 Finally, all orders sent to the
Exchange market enter the marketplace
through [sic] same central system quote
and order gateway regardless of whether
the sender is co-located in the Exchange
data center or not. In short, the
Exchange has created no special market
technology or programming that is
available only to co-located customers
and the Exchange has organized its
systems to minimize, to the greatest
extent possible, any advantage for one
customer versus another.
Co-location services are generally
available to all qualified market
participants who desire them. With the
exception of customers participating in
the Cabinet Proximity Option program,
the Exchange allocates cabinets and
power on a first-come/first-serve basis.
Should available cabinet inventory
shrink to 40 cabinets or less, the
Exchange will limit new cabinet orders
to a maximum of 4 cabinets each, and
all new cabinets will be limited to a
maximum power level of 5kW. Should
available cabinet inventory shrink to
zero, the Exchange will place firms
seeking services on a waiting list based
on that the Exchange receives signed
orders for the services from the firm. In
order to be placed on the waiting list,
a firm must have utilized all existing
cabinets they already have in the
datacenter. Once on the list, the firms,
on a rolling basis, will allocated a single
5kW cabinet each time one becomes
available. After receiving a cabinet, the
firm will move to the bottom of the
waiting list.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
the provisions of Section 6 of the Act,7
in general, and with Section 6(b)(5) of
the Act,8 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
6 Currently,
the Exchange makes available to colocated customers a 10Gb fiber connection. The
Exchange will likewise make available a 10Gb fiber
connection to other customers in the first quarter
of 2010. The Exchange has not received any
requests for 10Gb fiber connections from firms that
are not co-located.
7 15 U.S.C. 78f.
8 15 U.S.C. 78f(b)(5).
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6427
open market and a national market
system, and, in general, to protect
investors and the public interest. In
particular, the filing codifies and makes
transparent the uniform fees imposed by
the Exchange’s technology subsidiary
for co-location services.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act, as amended.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
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, as amended, is consistent with
the Act. Comments may be submitted by
any of the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–Phlx–2010–18 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
Station Place, 100 F Street, NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–Phlx–2010–18. This file
number should be included on the
E:\FR\FM\09FEN1.SGM
09FEN1
6428
Federal Register / Vol. 75, No. 26 / Tuesday, February 9, 2010 / Notices
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 Web site viewing and
printing 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 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
available publicly. All submissions
should refer to File Number SR–Phlx–
2010–18 and should be submitted on or
before March 2, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.9
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–2787 Filed 2–8–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–61480; File No. SR–Phlx–
2010–14]
Self-Regulatory Organizations; Notice
of Filing and Immediate Effectiveness
of Proposed Rule Change by NASDAQ
OMX PHLX, Inc. Relating to
Transaction Fees and Rebates for
Options
Cprice-sewell on DSK2BSOYB1PROD with NOTICES
February 3, 2010.
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 January
26, 2010, NASDAQ OMX PHLX, Inc.
(‘‘Phlx’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
9 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
VerDate Nov<24>2008
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Jkt 220001
(‘‘SEC’’ or ‘‘Commission’’) the proposed
rule change as described in Items I, II,
and III, below, which Items have been
prepared by the Exchange. 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
The Exchange proposes to amend the
Exchange’s Fee Schedule by adopting,
on a pilot basis, per contract transaction
fees for options overlying the
PowerShares QQQ Trust (‘‘QQQQ’’)®;
Ishares Russell 2000 (‘‘IWM’’) and
Citigroup Inc. (‘‘C’’). The fees would
apply to: (i) Transaction sides that
remove liquidity from the Exchange’s
disseminated market, and (ii) Firm and
broker-dealer quotes and orders that are
included in the Exchange’s
disseminated market.
Additionally, the Exchange proposes
to offer a transaction rebate to certain
liquidity providers, as described more
fully below.
While changes to the Exchange’s fee
schedule pursuant to this proposal are
effective upon filing, the Exchange has
designated this proposal to be operative
for trades settling on or after February
1, 2010. The proposed changes to the fee
schedule will be effective on a pilot
basis, scheduled to expire March 2,
2010.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://
nasdaqomxphlx.cchwallstreet.com/
NASDAQOMXPHLX/Filings/, at the
principal office of the Exchange, at the
Commission’s Public Reference Room,
and on the Commission’s Web site at
https://www.sec.gov.
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 IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
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A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The purpose of the proposed rule
change is to increase liquidity and to
attract order flow in QQQQ, IWM and
C options on the Exchange.
Transaction Charges for Removing
Liquidity
The Exchange proposes to assess a
per-contract transaction charge in
QQQQ, IWM and C options on six
different categories of market
participants that submit orders and/or
quotes that remove, or ‘‘take,’’ liquidity
from the Exchange. The per-contract
transaction charge would depend on the
category of market participant
submitting an order or quote to the
Exchange that removes liquidity.
The proposed amendments to the
Exchange’s Fee Schedule would break
down market participants by the
following six categories: (i) Specialists,
Registered Options Traders (‘‘ROTs’’) 3
that do not submit electronic quotations
(‘‘Non-Streaming ROTs’’),4 Streaming
Quote Traders (‘‘SQTs’’),5 and Remote
Streaming Quote Traders (‘‘RSQTs’’),6
(ii) customers that submit orders that are
not Directed Orders 7 (‘‘Non-Directed
Customers’’); (iii) customers that submit
Directed Orders (‘‘Directed
Customers’’); 8 (iv) specialists, SQTs and
3 An ROT is a regular member or a foreign
currency options participant of the Exchange
located on the trading floor who has received
permission from the Exchange to trade in options
for his own account.
4 In addition to the fees for QQQQ, IWN and C
options, Non-Streaming ROTs will be assessed the
fees applicable to Standard and Poor’s Depositary
Receipts/SPDRs (‘‘SPY’’). See SR–Phlx–2009–116.
5 An SQT is an Exchange Registered Options
Trader (‘‘ROT’’) who has received permission from
the Exchange to generate and submit option
quotations electronically through an electronic
interface with AUTOM via an Exchange approved
proprietary electronic quoting device in eligible
options to which such SQT is assigned. See
Exchange Rule 1014(b)(ii)(A).
6 An RSQT is an ROT that is a member or member
organization with no physical trading floor
presence who has received permission from the
Exchange to generate and submit option quotations
electronically through AUTOM in eligible options
to which such RSQT has been assigned. An RSQT
may only submit such quotations electronically
from off the floor of the Exchange. See Exchange
Rule 1014(b)(ii)(B).
7 ‘‘Directed Order’’ means any customer order
(other than a stop or stop-limit order as defined in
Rule 1066) to buy or sell which has been directed
to a particular specialist, RSQT, or SQT by an Order
Flow Provider, as defined below. To qualify as a
Directed Order, an order must be delivered to the
Exchange via AUTOM.
8 For the purposes of this fee, a Directed Customer
is an order from a customer directed to a Directed
Participant for execution. A Directed Participant is
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]]>Agencies
[Federal Register Volume 75, Number 26 (Tuesday, February 9, 2010)]
[Notices]
[Pages 6426-6428]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-2787]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-61486; File No. SR-Phlx-2010-18]
Self-Regulatory Organizations; NASDAQ OMX PHLX, Inc.; Notice of
Filing of Proposed Rule Change To Codify Prices for Co-Location
Services
February 3, 2010.
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 January 29, 2010, NASDAQ OMX PHLX (``Phlx'' or ``Exchange'') 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 the Exchange. 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 the
Substance of the Proposed Rule Change
NASDAQ OMX PHLX is filing with the Securities and Exchange
Commission (``Commission'') a proposed rule change to codify pricing
for co-location services. The text of the proposed rule change is
available at https://www.nasdaqtrader.com/micro.aspx?id=PHLXRulefilings,
on the Commission's Web site at https://www.sec.gov, at the Exchange's
principal office, and at the Commission's Public Reference Room. The
Exchange will implement the proposed rule change on the first day of
the month immediately following Commission approval (or on the date of
approval, if on the first business day of a month).
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 IV 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 is proposing to codify fees for its existing co-
location services. Co-location services are a suite of hardware, power,
telecommunication, and other ancillary products and services that allow
market participants and vendors to place their trading and
communications equipment in close physical proximity to the quoting and
execution facilities of the Exchange. Phlx provides co-location
services and imposes fees through Nasdaq Technology Services LLC and
pursuant to agreements with the owner/operator of its data center where
both the Exchange's quoting and trading facilities and co-located
customer equipment are
[[Page 6427]]
housed.\3\ Users of co-location services include private extranet
providers, data vendors, as well as the Exchange members and non-
members. The use of co-location services is entirely voluntary.
---------------------------------------------------------------------------
\3\ Currently, the Exchange provides its current co-location
services through data centers located in the New York City and Mid-
Atlantic areas.
---------------------------------------------------------------------------
As detailed in the proposed co-location fee schedule, the Exchange
imposes a uniform, non-discriminatory set of fees for various co-
location services, including: Fees for cabinet space usage, or options
for future space usage \4\; installation and related power provision
for hosted equipment; connectivity among multiple cabinets being used
by the same customer as well as customer connectivity to the Exchange
and telecommunications providers \5\; and related maintenance and
consulting services. Fees related to cabinet and power usage are
incremental, with additional charges being imposed based on higher
levels of cabinet and/or power usage, the use of non-standard cabinet
sizes or special cabinet cooling equipment, or the re-selling of
cabinet space.
---------------------------------------------------------------------------
\4\ NASDAQ OMX PHLX is implementing a Cabinet Proximity Option
program where, for a monthly a fee, customers can obtain an option
for future use on available currently-unused cabinet floor space in
proximity to their existing equipment. Under the program, customers
can reserve up to maximum of 20 cabinets which the Exchange will
endeavor to provide as close as reasonably possible to the
customer's existing cabinet space, taking into consideration power
availability within segments of the datacenter and the overall
efficiency of use of datacenter resources as determined by the
Exchange. Should reserved datacenter space be needed for use, the
reserving customer will have three business days to formally
contract with the Exchange for full payment for the reserved cabinet
space in contention or it will be reassigned. In making
determinations to require exercise or relinquishment of reserved
space as among numerous customers, the Exchange will take into
consideration several factors, including: Proximity between
available reserved cabinet space and the existing space of a
customer seeking additional space for actual cabinet usage; a
customer's ratio of cabinets in use to those reserved; the length of
time that a particular reservation(s) has been in place; and any
other factor that the Exchange deems relevant to ensure overall
efficiency in use of the datacenter space.
\5\ These fees are for telecommunications connectivity only.
Market Data fees are charged independently by NASDAQ OMX PHLX and
other exchanges.
---------------------------------------------------------------------------
Co-location customers are not provided any separate or superior
means of direct access to the Exchange quoting and trading facilities.
Nor does the Exchange offer any separate or superior means of access to
the Exchange quoting and trading facilities as among co-location
customers themselves within in [sic] the datacenter. Likewise, the
Exchange does not make available to co-located customers any market
data or data feed product or service for data going into, or out of,
the Exchange systems that is not likewise available to all the Exchange
members.\6\ Finally, all orders sent to the Exchange market enter the
marketplace through [sic] same central system quote and order gateway
regardless of whether the sender is co-located in the Exchange data
center or not. In short, the Exchange has created no special market
technology or programming that is available only to co-located
customers and the Exchange has organized its systems to minimize, to
the greatest extent possible, any advantage for one customer versus
another.
---------------------------------------------------------------------------
\6\ Currently, the Exchange makes available to co-located
customers a 10Gb fiber connection. The Exchange will likewise make
available a 10Gb fiber connection to other customers in the first
quarter of 2010. The Exchange has not received any requests for 10Gb
fiber connections from firms that are not co-located.
---------------------------------------------------------------------------
Co-location services are generally available to all qualified
market participants who desire them. With the exception of customers
participating in the Cabinet Proximity Option program, the Exchange
allocates cabinets and power on a first-come/first-serve basis. Should
available cabinet inventory shrink to 40 cabinets or less, the Exchange
will limit new cabinet orders to a maximum of 4 cabinets each, and all
new cabinets will be limited to a maximum power level of 5kW. Should
available cabinet inventory shrink to zero, the Exchange will place
firms seeking services on a waiting list based on that the Exchange
receives signed orders for the services from the firm. In order to be
placed on the waiting list, a firm must have utilized all existing
cabinets they already have in the datacenter. Once on the list, the
firms, on a rolling basis, will allocated a single 5kW cabinet each
time one becomes available. After receiving a cabinet, the firm will
move to the bottom of the waiting list.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Act,\7\ in general, and with
Section 6(b)(5) of the Act,\8\ 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. In
particular, the filing codifies and makes transparent the uniform fees
imposed by the Exchange's technology subsidiary for co-location
services.
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\7\ 15 U.S.C. 78f.
\8\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
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, 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-Phlx-2010-18 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, Station Place, 100 F
Street, NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-Phlx-2010-18. This file
number should be included on the
[[Page 6428]]
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 Web site viewing and printing 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 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 available publicly. All submissions should refer to
File Number SR-Phlx-2010-18 and should be submitted on or before March
2, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-2787 Filed 2-8-10; 8:45 am]
BILLING CODE 8011-01-P
