Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Regarding Fees for the Clearly Erroneous Module, 64769-64771 [2010-26336]
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Federal Register / Vol. 75, No. 202 / Wednesday, October 20, 2010 / Notices
proposed changes will align the
Exchange’s rules with rules of other
market centers that were recently
amended to address the type of sudden
price declines that the market
experienced on the afternoon of May 6,
2010.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change imposes any
burden on competition.
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 written 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, if consistent with the
protection of investors and the public
interest, it has become effective
pursuant to Section 19(b)(3)(A) of the
Act 13 and Rule 19b–4(f)(6)
thereunder.14
The Exchange has requested that the
Commission waive the 30-day operative
delay to permit the Exchange to
commence operations as a national
securities exchange with rules
substantively identical to the equity
trading rules of BATS Exchange. The
Commission finds that waiver of the
operative delay is consistent with the
protection of investors and the public
interest because such waiver will align
the Exchange’s rules with recently
amended rules of BATS Exchange.
Therefore, the Commission designates
the proposal operative upon
commencement of Exchange operation,
which the Exchange anticipates will be
October 15, 2010.15
13 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the self-regulatory organization
to submit to the Commission written notice of its
intent to file the proposed rule change, along with
a brief description and text of the proposed rule
change, at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
15 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
emcdonald on DSK2BSOYB1PROD with NOTICES
14 17
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At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend 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 proposal 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
No. SR–BYX–2010–002 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 No.
SR–BYX–2010–002. 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,16 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 changes 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. Copies of such
filing will also 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
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
16 The text of the proposed rule change is
available on the Commission’s Web site at https://
www.sec.gov/.
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64769
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File No. SR–BYX–2010–
002 and should be submitted on or
before November 10, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–26335 Filed 10–19–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63101; File No. SR–
NASDAQ–2010–130]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Regarding
Fees for the Clearly Erroneous Module
October 14, 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 October
7, 2010, 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. The Commission
is publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
NASDAQ proposes to establish fees
for the Clearly Erroneous Module. The
text of the proposed rule change is
below. Proposed new language is
underlined.
7024. Clearly Erroneous Module
[Reserved]
The Clearly Erroneous Module, which
provides real-time clearly erroneous
surveillance alerts and reports, is
available to subscribers for a fee of $400
per MPID, per month for the first 15
MPIDs subscribed, and for a fee of $100
per MPID, per month for each MPID
subscribed in excess of 15.
*
*
*
*
*
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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64770
Federal Register / Vol. 75, No. 202 / Wednesday, October 20, 2010 / Notices
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
NASDAQ included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below.
NASDAQ has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant aspects of such
statements.
emcdonald on DSK2BSOYB1PROD with NOTICES
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
NASDAQ proposes to offer the Clearly
Erroneous Module, which is currently
available as part of a Regulation
Reconnaissance subscription, as a standalone service with a tiered fee structure.
The Clearly Erroneous Module provides
subscribers with trade alerts of
potentially erroneous trades on
NASDAQ, the ability to electronically
submit clearly erroneous reports with
NASDAQ MarketWatch and to
anonymously negotiate erroneous trades
with contra-parties, real-time erroneous
filing status, and access to the
subscriber’s historical clearly erroneous
data. Access to the Clearly Erroneous
Module will be available as an add-on
to the NASDAQ Workstation and
Weblink ACT 2.0 or the Clearly
Erroneous Viewer.
The Clearly Erroneous Module and
the Reg NMS Module are the core
functions of the Regulation
Reconnaissance service.3 The
Regulation Reconnaissance service is
offered to subscribers at a cost of $1,000
per MPID, per month.4 Certain member
firms that possess many MPIDs have
informed NASDAQ that the current
price structure for subscription to the
Clearly Erroneous Module through the
Regulation Reconnaissance service is
cost prohibitive as it does not provide
a tiered fee schedule based on the
number of MPIDs subscribed. These
member firms require multiple MPIDs
due to the nature of their businesses and
have a need to monitor clearly
erroneous compliance for each MPID. In
addition, certain member firms may not
desire the full functionality of
3 For
a description of the Regulation
Reconnaissance service, see https://
www.nasdaqtrader.com/
TraderP.aspx?id=RegRecon.
4 See Rule 7041(a).
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17:17 Oct 19, 2010
Jkt 223001
Regulation Reconnaissance, yet
currently must pay for a full
subscription. To make the service more
cost effective for all member firms,
including those that possess a large
number of MPIDs, NASDAQ is
proposing to offer the Clearly Erroneous
Module as a stand-alone service for a fee
of $400 per MPID per month for any
member firm that subscribes 15 or fewer
MPIDs and for a fee of $100 per MPID
per month for each MPID subscribed in
excess of 15.
2. Statutory Basis
NASDAQ believes that the proposed
rule change is consistent with the
provisions of Section 6 of the Act,5 in
general, and with Section 6(b)(5) of the
Act,6 in particular, because it 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
facilitating transactions in securities,
and to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system. The Clearly Erroneous Module
is designed to assist firms with
monitoring their clearly erroneous
compliance and, as such, is an
important tool that members may use to
help maintain the regulatory integrity of
the markets. NASDAQ believes that
offering the module as a stand-alone
service at a reduced fee will encourage
wider use of this regulatory tool that is
otherwise cost-prohibitive to member
firms, particularly those that possess a
large number of MPIDs.
NASDAQ also believes that the
proposed rule change is consistent with
Section 6(b)(4) of the Act 7 in that it
provides for the equitable allocation of
reasonable dues, fees and other charges
among members and issuers and other
persons using any facility or system
which the NASDAQ operates or
controls, and it does not unfairly
discriminate between customers,
issuers, brokers or dealers. NASDAQ is
offering the Clearly Erroneous Module
at a rate lower than the Regulation
Reconnaissance service, which includes
both the Clearly Erroneous Module and
the Reg NMS Module. As such, member
firms are provided an option to pay for
only the service they desire at a
discounted rate. Use of Clearly
Erroneous Module is voluntary, and
member firms will continue to have
access to the Clearly Erroneous Module
5 15
U.S.C. 78f.
U.S.C. 78f(b)(5).
7 15 U.S.C. 78f(b)(4).
6 15
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Fmt 4703
Sfmt 4703
through a Regulation Reconnaissance
subscription if they so choose.
NASDAQ believes that offering the
Clearly Erroneous Module at a further
discounted rate applicable to each MPID
subscribed in excess of 15 is consistent
with Section 6(b)(4) of the Act.8 As
noted, use of the Clearly Erroneous
Module is voluntary and the
subscription fees will be imposed on all
purchasers equally based on the number
of MPIDs subscribed. In this regard, the
proposed reduced per MPID fee is
available to any member that subscribes
more than 15 MPIDs, with the reduced
fee applying only to each MPID in
excess of 15. The Clearly Erroneous
Module it [sic] is a useful regulatory tool
that, because it is bundled with
Regulation Reconnaissance, is cost
prohibitive to member firms that
possess many MPIDs due to the nature
of their businesses. As such, offering the
service at a discounted rate to members
that subscribe many MPIDs will allow
these members to receive the benefit of
the service that, under a non-tiered fee
structure, only firms with fewer MPIDs
could justify. Further, NASDAQ
receives greater incremental benefits,
both tangible and intangible, from
providing multiple subscriptions to its
members notwithstanding the reduced
fee. NASDAQ notes that it currently
provides other services with a tiered fee
structure based on the on the number of
users or subscribers.9
The proposed fees will cover the costs
associated with separately offering the
service, responding to customer
requests, configuring NASDAQ’s
systems, programming to user
specifications, and administering the
service, among other things, and may
provide NASDAQ with a profit to the
extent costs are covered. NASDAQ
believes that the proposed fee structure
strikes a balance between covering these
costs, and making this useful regulatory
tool cost effective for all member firms.
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 Id.
9 For example, NASDAQ’s InterACT service is
offered for subscription fee of $300 per month, per
user, for the first three users, and $100 per month,
per user, for each additional user, with a maximum
fee of $1,500 per month, per member firm. See Rule
7049.
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Federal Register / Vol. 75, No. 202 / Wednesday, October 20, 2010 / 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
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act.10 At any time
within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
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. If the Commission
takes such action, the Commission shall
institute proceedings to determine
whether the proposed rule should be
approved or 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:
emcdonald 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
No. SR–NASDAQ–2010–130 on the
subject line.
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
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 No. SR–NASDAQ–
2010–130 and should be submitted on
or before November 10, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–26336 Filed 10–19–10; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–63113; File No. 4–616]
Self-Regulatory Organizations; Order
Approving Minor Rule Violation Plan
for BATS Y–Exchange, Inc.
October 15, 2010.
On September 10, 2010, BATS Y–
Exchange, Inc. (‘‘BATS Y–Exchange’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
Paper Comments
‘‘Commission’’) a proposed minor rule
• Send paper comments in triplicate
violation plan (‘‘MRVP’’) pursuant to
to Elizabeth M. Murphy, Secretary,
Section 19(d)(1) of the Securities
Securities and Exchange Commission,
Exchange Act of 1934 (the ‘‘Act’’) 1 and
100 F Street, NE., Washington, DC
Rule 19d–1(c)(2) thereunder.2 The
20549–1090.
proposed MRVP was published for
All submissions should refer to File No. public comment on September 23,
SR–NASDAQ–2010–130. This file
2010.3 The Commission received no
number should be included on the
comments on the proposal. This order
subject line if e-mail is used. To help the approves BATS Y–Exchange’s proposed
Commission process and review your
MRVP.
comments more efficiently, please use
BATS Y–Exchange’s MRVP specifies
only one method. The Commission will those uncontested minor rule violations
post all comments on the Commission’s with sanctions not exceeding $2,500
Web site (https://www.sec.gov/rules/
which would not be subject to the
sro.shtml). Copies of the submission, all provisions of Rule 19d–1(c)(1) of the
subsequent amendments, all written
11 17 CFR 200.30–3(a)(12).
statements with respect to the proposed
1 15 U.S.C. 78s(d)(1).
rule change that are filed with the
2 17 CFR 240.19d–1(c)(2).
Commission, and all written
3 See Securities Exchange Act Release No. 62924
communications relating to the
(September 16, 2010), 75 FR 58011. The notice was
proposed rule change between the
published under File No. 10–198 used for BATS Y–
10 15
Exchange’s Form 1 application, however the order
will be published under File No. 4–616.
U.S.C. 78s(b)(3)(a)(ii).
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17:17 Oct 19, 2010
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64771
Act 4 requiring that a self-regulatory
organization promptly file notice with
the Commission of any final
disciplinary action taken with respect to
any person or organization.5 In
accordance with Rule 19d–1(c)(2) under
the Act, the Exchange proposed to
designate certain specified rule
violations as minor rule violations, and
requested that it be relieved of the
reporting requirements regarding such
violations, provided it gives notice of
such violations to the Commission on a
quarterly basis. BATS Y–Exchange
included in its proposed MRVP the
policies and procedures currently
included in BATS Y–Exchange Rule
8.15 (‘‘Imposition of Fines for Minor
Violation(s) of Rules’’) and the rule
violations included in BATS Y–
Exchange Rule 8.15.01.6
Pursuant to the Exchange’s proposed
MRVP, under Rule 8.15, the Exchange
may impose a fine (not to exceed
$2,500) on a member or an associated
person of a member, or a registered or
non-registered employee of a member
with respect to any rule listed in Rule
8.15.01. The Exchange shall serve the
person against whom a fine is imposed
with a written statement setting forth
the rule or rules violated, the act or
omission constituting each such
violation, the fine imposed, and the date
by which such determination becomes
final or by which such determination
4 17
CFR 240.19d–1(c)(1).
Commission adopted amendments to
paragraph (c) of Rule 19d–1 to allow self-regulatory
organizations (‘‘SROs’’) to submit for Commission
approval plans for the abbreviated reporting of
minor disciplinary infractions. See Securities
Exchange Act Release No. 21013 (June 1, 1984), 49
FR 23828 (June 8, 1984). Any disciplinary action
taken by an SRO against any person for violation
of a rule of the SRO which has been designated as
a minor rule violation pursuant to such a plan filed
with the Commission shall not be considered ‘‘final’’
for purposes of Section 19(d)(1) of the Act if the
sanction imposed consists of a fine not exceeding
$2,500 and the sanctioned person has not sought an
adjudication, including a hearing, or otherwise
exhausted his administrative remedies.
6 On August 13, 2010, the Exchange’s application
for registration as a national securities exchange,
including the rules governing the BATS Y–
Exchange, was approved. See Securities Exchange
Act Release No. 62716 (August 13, 2010), 75 FR
51295 (August 19, 2010) (File No. 10–198). In the
approval order, the Commission noted that BATS
Y–Exchange Rule 8.15 provides for the imposition
of fines for minor rule violations pursuant to a
minor rule violation plan. Accordingly, the
Commission noted that as a condition to the
operation of BATS Y–Exchange, the Exchange must
file a minor rule violation plan with the
Commission. BATS Y–Exchange represented that
modifications may be made to Rule 8.15.01 in the
future. BATS Y–Exchange proposed that, when
amendments to Rule 8.15.01 are made pursuant to
a rule filing submitted pursuant to Rule 19b–4
under the Act, such filing would automatically be
deemed a request by BATS Y–Exchange for
Commission approval of a modification to its
MRVP.
5 The
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]]>Agencies
[Federal Register Volume 75, Number 202 (Wednesday, October 20, 2010)]
[Notices]
[Pages 64769-64771]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-26336]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-63101; File No. SR-NASDAQ-2010-130]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Regarding Fees for the Clearly Erroneous Module
October 14, 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 October 7, 2010, 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. 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 proposes to establish fees for the Clearly Erroneous Module.
The text of the proposed rule change is below. Proposed new language is
underlined.
7024. Clearly Erroneous Module [Reserved]
The Clearly Erroneous Module, which provides real-time clearly
erroneous surveillance alerts and reports, is available to subscribers
for a fee of $400 per MPID, per month for the first 15 MPIDs
subscribed, and for a fee of $100 per MPID, per month for each MPID
subscribed in excess of 15.
* * * * *
[[Page 64770]]
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 offer the Clearly Erroneous Module, which is
currently available as part of a Regulation Reconnaissance
subscription, as a stand-alone service with a tiered fee structure. The
Clearly Erroneous Module provides subscribers with trade alerts of
potentially erroneous trades on NASDAQ, the ability to electronically
submit clearly erroneous reports with NASDAQ MarketWatch and to
anonymously negotiate erroneous trades with contra-parties, real-time
erroneous filing status, and access to the subscriber's historical
clearly erroneous data. Access to the Clearly Erroneous Module will be
available as an add-on to the NASDAQ Workstation and Weblink ACT 2.0 or
the Clearly Erroneous Viewer.
The Clearly Erroneous Module and the Reg NMS Module are the core
functions of the Regulation Reconnaissance service.\3\ The Regulation
Reconnaissance service is offered to subscribers at a cost of $1,000
per MPID, per month.\4\ Certain member firms that possess many MPIDs
have informed NASDAQ that the current price structure for subscription
to the Clearly Erroneous Module through the Regulation Reconnaissance
service is cost prohibitive as it does not provide a tiered fee
schedule based on the number of MPIDs subscribed. These member firms
require multiple MPIDs due to the nature of their businesses and have a
need to monitor clearly erroneous compliance for each MPID. In
addition, certain member firms may not desire the full functionality of
Regulation Reconnaissance, yet currently must pay for a full
subscription. To make the service more cost effective for all member
firms, including those that possess a large number of MPIDs, NASDAQ is
proposing to offer the Clearly Erroneous Module as a stand-alone
service for a fee of $400 per MPID per month for any member firm that
subscribes 15 or fewer MPIDs and for a fee of $100 per MPID per month
for each MPID subscribed in excess of 15.
---------------------------------------------------------------------------
\3\ For a description of the Regulation Reconnaissance service,
see https://www.nasdaqtrader.com/TraderP.aspx?id=RegRecon.
\4\ See Rule 7041(a).
---------------------------------------------------------------------------
2. Statutory Basis
NASDAQ believes that the proposed rule change is consistent with
the provisions of Section 6 of the Act,\5\ in general, and with Section
6(b)(5) of the Act,\6\ in particular, because it 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 facilitating transactions in securities, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system. The Clearly Erroneous Module is
designed to assist firms with monitoring their clearly erroneous
compliance and, as such, is an important tool that members may use to
help maintain the regulatory integrity of the markets. NASDAQ believes
that offering the module as a stand-alone service at a reduced fee will
encourage wider use of this regulatory tool that is otherwise cost-
prohibitive to member firms, particularly those that possess a large
number of MPIDs.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78f.
\6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
NASDAQ also believes that the proposed rule change is consistent
with Section 6(b)(4) of the Act \7\ in that it provides for the
equitable allocation of reasonable dues, fees and other charges among
members and issuers and other persons using any facility or system
which the NASDAQ operates or controls, and it does not unfairly
discriminate between customers, issuers, brokers or dealers. NASDAQ is
offering the Clearly Erroneous Module at a rate lower than the
Regulation Reconnaissance service, which includes both the Clearly
Erroneous Module and the Reg NMS Module. As such, member firms are
provided an option to pay for only the service they desire at a
discounted rate. Use of Clearly Erroneous Module is voluntary, and
member firms will continue to have access to the Clearly Erroneous
Module through a Regulation Reconnaissance subscription if they so
choose.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
NASDAQ believes that offering the Clearly Erroneous Module at a
further discounted rate applicable to each MPID subscribed in excess of
15 is consistent with Section 6(b)(4) of the Act.\8\ As noted, use of
the Clearly Erroneous Module is voluntary and the subscription fees
will be imposed on all purchasers equally based on the number of MPIDs
subscribed. In this regard, the proposed reduced per MPID fee is
available to any member that subscribes more than 15 MPIDs, with the
reduced fee applying only to each MPID in excess of 15. The Clearly
Erroneous Module it [sic] is a useful regulatory tool that, because it
is bundled with Regulation Reconnaissance, is cost prohibitive to
member firms that possess many MPIDs due to the nature of their
businesses. As such, offering the service at a discounted rate to
members that subscribe many MPIDs will allow these members to receive
the benefit of the service that, under a non-tiered fee structure, only
firms with fewer MPIDs could justify. Further, NASDAQ receives greater
incremental benefits, both tangible and intangible, from providing
multiple subscriptions to its members notwithstanding the reduced fee.
NASDAQ notes that it currently provides other services with a tiered
fee structure based on the on the number of users or subscribers.\9\
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\8\ Id.
\9\ For example, NASDAQ's InterACT service is offered for
subscription fee of $300 per month, per user, for the first three
users, and $100 per month, per user, for each additional user, with
a maximum fee of $1,500 per month, per member firm. See Rule 7049.
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The proposed fees will cover the costs associated with separately
offering the service, responding to customer requests, configuring
NASDAQ's systems, programming to user specifications, and administering
the service, among other things, and may provide NASDAQ with a profit
to the extent costs are covered. NASDAQ believes that the proposed fee
structure strikes a balance between covering these costs, and making
this useful regulatory tool cost effective for all member firms.
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 64771]]
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)(ii) of the Act.\10\ At any time within 60 days of the
filing of the proposed rule change, the Commission summarily may
temporarily suspend 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. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
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\10\ 15 U.S.C. 78s(b)(3)(a)(ii).
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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 (https://www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File No. SR-NASDAQ-2010-130 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 No. SR-NASDAQ-2010-130. 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 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 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 No. SR-NASDAQ-2010-130 and should be submitted on
or before November 10, 2010.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-26336 Filed 10-19-10; 8:45 am]
BILLING CODE 8011-01-P
