Self-Regulatory Organizations; NASDAQ Stock Market, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Rebates and Fees in Penny Pilot, NDX and MNX and Non-Penny Pilot Options, 29014-29017 [2011-12286]

Download as PDF 29014 Federal Register / Vol. 76, No. 97 / Thursday, May 19, 2011 / Notices term.1 An amendment incorporating the changes to Parcel Select & Parcel Return Service Contract 2 accompanies the Notice. Additionally, the Postal Service states that the financial documentation filed in compliance with 39 CFR 3015.5 incorporates changes proposed in Docket No. RM2011–10 currently being reviewed by the Commission.2 Notice at 1. Because the Commission’s review of the proposed methodology is still pending, the notice also provides a financial analysis based upon the current methodology approved by the Commission. Id. The Postal Service includes three attachments in support of its Notice: • Attachment A—a redacted copy of the amendment to the Parcel Select & Parcel Return Service Contract 2; • Attachment B—a certified statement required by 39 CFR 3015.5(c)(2); and • Attachment C—an application for non-public treatment of materials to maintain redacted portions of the contract, related financial information, and customer-identifying information under seal. The current contract’s term expires on May 31, 2011. Id. Attachment A at 3. The amendment will extend its term to May 31, 2012. Id. at 1. The Postal Service intends for the amendment to become effective on the date that the Commission completes its review of the instant filing. Id. II. Notice of Filing Interested persons may submit comments on whether the changes as presented in the Postal Service’s Notice are consistent with the policies of 39 U.S.C. 3632, 3633, or 39 CFR part 3015. Comments are due no later than May 23, 2011. The Postal Service’s Notice can be accessed via the Commission’s Web site (https://www.prc.gov). The Commission appoints Malin G. Moench to serve as Public Representative in the captioned proceeding. jlentini on DSK4TPTVN1PROD with NOTICES III. Ordering Paragraphs It is ordered: 1. The Commission shall review the amendment to Parcel Select & Parcel Return Service Contract 2 in Docket No. CP2009–61 for consideration of matters raised by the Postal Service’s Notice. 2. Comments by interested persons in this proceeding are due no later than May 23, 2011. 1 Notice of United States Postal Service of Change in Prices Pursuant to Amendment to Parcel Select & Parcel Return Service Contract 2, May 11, 2011 (Notice). 2 See Notice of the United States Postal Service of Filing of USPS–RM2011–10/NP1, May 10, 2011 (RM2011–10 Notice). VerDate Mar<15>2010 15:54 May 18, 2011 Jkt 223001 3. Pursuant to 39 U.S.C. 505, Malin G. Moench is appointed to serve as the officer of the Commission (Public Representative) to represent the interests of the general public in this proceeding. 4. The Secretary shall arrange for publication of this order in the Federal Register. By the Commission. Shoshana M. Grove, Secretary. [FR Doc. 2011–12326 Filed 5–18–11; 8:45 am] BILLING CODE 7710–FW–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64494; File No. SR– NASDAQ–2011–066] Self-Regulatory Organizations; NASDAQ Stock Market, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Rebates and Fees in Penny Pilot, NDX and MNX and Non-Penny Pilot Options May 13, 2011. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on May 3, 2011, The NASDAQ Stock Market LLC (‘‘NASDAQ’’ 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 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 modify Rule 7050 governing pricing for NASDAQ members using the NASDAQ Options Market (‘‘NOM’’), NASDAQ’s facility for executing and routing standardized equity and index options. Specifically, NOM proposes to adopt certain Fees for Execution of Contracts for a ‘‘Professional’’ market participant. The text of the proposed rule change is available on the Exchange’s Web site at https://www.nasdaq.cchwallstreet.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. 1 15 2 17 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00067 Fmt 4703 Sfmt 4703 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 NASDAQ is proposing to modify Rule 7050 governing the rebates and fees assessed for options orders entered into NOM. Specifically, NASDAQ is proposing to adopt Professional pricing for Penny Pilot Options, options on the Nasdaq 100 Index traded under the symbol NDX (‘‘NDX’’) and options on the one-tenth value of the Nasdaq 100 Index traded under the symbol MNX (‘‘MNX’’) and All Other Options.3 There is currently NOM pricing for four separate categories of market participants: Customer, Firm, Non-NOM Market maker 4 and NOM Market Maker.5 The Professional category would be an addition to these existing categories. The term ‘‘Professional’’ means any person or entity that (i) is not a broker or dealer in securities, and (ii) places more than 390 orders in listed options per day on average during a calendar month for its own beneficial account(s).6 Today a Professional is assessed and paid Customer fees and rebates, respectively.7 3 All Other Options includes non-Penny Pilot options. 4 Non-NOM Market Makers are registered market makers on another options market that append the market maker designation to orders routed to NOM. 5 NOM Market Makers must be registered as such pursuant to Chapter VII, Section 2 of the Nasdaq Options Rules, and must also remain in good standing pursuant to Chapter VII, Section 4. 6 See Chapter I, Section I (Definitions). See also Securities Exchange Act Release Nos. 63028 (October 1, 2010), 75 FR 62443 (October 8, 2010) (SR–NASDAQ–2010–099); and 63151 (October 21, 2010), 75 FR 66811 (October 29, 2010) (SR– NASDAQ–2010–132). Participants are required to identify Professional orders submitted electronically by indentifying [sic] them in the customer type field. See Securities Exchange Act Release No. 63028 (October 1, 2010) 75 FR 62443 (October 8, 2010) (SR–NASDAQ–2010–099). See NOM Chapter I, Sec.1 (a)(48). 7 The priority of orders designated as Professional on NOM are not impacted in the same manner as E:\FR\FM\19MYN1.SGM 19MYN1 Federal Register / Vol. 76, No. 97 / Thursday, May 19, 2011 / Notices jlentini on DSK4TPTVN1PROD with NOTICES The Exchange is proposing to adopt a $0.29 per contract Rebate to Add Liquidity; 8 and a $0.45 per contract Fee for Removing Liquidity 9 for Professionals transacting Penny Pilot Options.10 The Exchange is proposing to adopt a $0.10 per contract Rebate to Add Liquidity and a $0.50 per contract Fee for Removing Liquidity for Professionals transacting NDX and MNX.11 The Exchange is proposing to adopt a $0.20 per contract Fee for Adding Liquidity, and a $0.45 per contract Fee for Removing Liquidity for Professionals transacting All Other Options. The Exchange proposes to offer no Rebate to Add Liquidity for Professionals transacting All Other Options.12 For purposes of the Opening Cross, a Professional would be assessed the Fee for Removing Liquidity during the Exchange’s Opening Cross similar to Firms, Non-NOM Market Makers and NOM Market Makers.13 Professionals would not receive a Rebate to Add Liquidity during the Exchange’s Opening Cross.14 The Exchange is proposing to add Professional fees to: (i) raise revenue for the Exchange; and (ii) eliminate specialized pricing for Professionals. The Exchange is proposing separate pricing for Professionals to bring additional revenue to the Exchange. The Exchange believes that the increased revenue from the proposal would assist the Exchange to recoup fixed costs. Additionally, the Exchange seeks to address the perceived favorable pricing of Professionals, who today are assessed fees and paid rebates like a Customer. A Professional, unlike a retail Customer, has access to sophisticated trading systems that contain functionality not available to retail Customers.15 on other options exchanges which have a Professional designation because NOM executes orders on a price/time priority basis, regardless of the designation of the market participant submitting the order. 8 An order that adds liquidity is one that is entered into NOM and rests on the NOM book. 9 An order that removes liquidity is one that is entered into NOM and that executes against an order resting on the NOM book. 10 The Exchange is not proposing to amend the Penny Pilot Option rates for other market participants. 11 The Exchange is not proposing to amend NDX and MNX rates for other market participants. 12 The Exchange is not proposing to amend the rates for other market participants in All Other Options. 13 NOM does not have any priority rules for the Opening Cross. 14 Today a Professional receives a Rebate to Add Liquidity during the Exchange’s Opening Cross, unless the contra-side is also a Customer. 15 A Professional, defined as a non broker-dealer who places more than 390 orders in listed options per day on average (or more than one order per VerDate Mar<15>2010 15:54 May 18, 2011 Jkt 223001 2. Statutory Basis NASDAQ believes that the proposed rule changes are consistent with the provisions of Section 6 of the Act,16 in general, and with Section 6(b)(4) of the Act,17 in particular, in that it provides for the equitable allocation of reasonable rebates, dues, fees and other charges among members and issuers and other persons using any facility or system which NASDAQ operates or controls. The Exchange believes it is equitable to assess Professionals fees and offer rebates that are less favorable than or equivalent to Customers but generally more favorable than or equivalent to market markers 18 because it has been established that Professionals have access to more information than a Customer and Professionals do not bear the obligations of a market maker. It can be argued that Professionals have the same technological and informational advantages as broker-dealers trading for their own account. First, a Professional by definition enters 390 orders per day on average over a calendar month which the Exchange believes exceeds the number of retail Customers [sic] in a single day. Second, the Exchange believes that retail Customers are a source of liquidity in the market, and exchanges have provided such Customer [sic] favorable pricing in order to attract such orders.19 The Exchange believes that it would be inequitable to assess higher fees on Customers and offer less rebates to Customers, as compared to other market participants, because they are unable to shoulder the burden of such costs as effectively as other market participants, including a Professional. The Exchange believes that this concept of pricing Professionals differently than Customers exists today on other markets. The International Securities Exchange (‘‘ISE’’) assesses professionals different fees than customers. ISE assesses higher taker fees to professionals as compared to market makers and customers. ISE also provides professionals a lower priority minute on average per day), has access to continuously updated pricing models based on realtime streaming data, access to multiple markets simultaneously, and other risk management tools. 16 15 U.S.C. 78f. 17 15 U.S.C. 78f(b)(4). 18 The Exchange notes that the proposed Professional Rebate to Add Liquidity in Penny Pilot Options is greater than the rebate for a Non-NOM Market Maker but less than the rebate for a NOM Market Maker. This is explained in greater detail below. 19 The Exchange provides Customers such favorable pricing notwithstanding the fact that NOM executes orders on a price/time priority basis, regardless of the designation of the market participant submitting the order. PO 00000 Frm 00068 Fmt 4703 Sfmt 4703 29015 on its market as compared to public customers.20 The Approval Order states that ISE amended its priority rules to attract retail investor order flow to its exchange by leveling the playing field for retail investors over market professionals and provide competitive pricing.21 The Approval Order also noted that professionals are more sophisticated than retail investors.22 While NOM does not have such priority rules because it executes orders according to price-time priority, with no distinctions made with regard to account designation, NOM currently offers Professionals the pricing advantages of a Customer. NOM believes that for the same reasons the Commission permitted ISE to amend its rules so that professional orders would not be granted special priority and would be assessed the same fees as broker-dealer transactions, the Exchange should likewise be permitted to assess different fees for Professionals and Customers.23 While priority is a reason to distinguish Customers and Professionals, the Exchange believes that pricing alone could produce the same unintended advantage to Professionals as noted in the Approval Order.24 The Commission also noted in the Approval Order that the customers who enter more than 390 orders per day on average during a calendar month are using the exchange’s facilities to place approximately 8000 orders, on average one order for every minute of every trading day, over the course of the month and nearly 100,000 orders per year. The Commission found that it was consistent with the Act for ISE to allocate to customers who participate in the market at this level of activity— which enables them to compete with non-Customers who are registered broker-dealers—the same transaction 20 See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE–2006–26) (‘‘Approval Order’’). 21 See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE–2006–26). 22 See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE–2006–26). 23 See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE–2006–26). Since the Approval Order, ISE has filed additional pricing changes. 24 The Approval Order notes that professionals have access to information and advantages similar to broker-dealers and by both amending the execution rules and fee schedule, professional account holders participate on equal terms with broker-dealer orders and marker maker quotes. See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE– 2006–26). E:\FR\FM\19MYN1.SGM 19MYN1 29016 Federal Register / Vol. 76, No. 97 / Thursday, May 19, 2011 / Notices jlentini on DSK4TPTVN1PROD with NOTICES fees that it charges to such nonCustomers.25 The Exchange is proposing to amend its pricing to attract Customer orders and create a competitive market. The Exchange believes that establishing separate pricing for a Professional, which ranges between that of a Customer and market maker,26 accomplishes this objective. The Exchange believes the role of the retail Customer in the marketplace is distinct from that of the Professional and the Exchange believes that its fee proposal accounts for this distinction and prices each market participant according to their roles and assumes their obligations. A market maker has the obligation to make continuous markets, engage in course of dealings reasonably calculated to contribute to the maintenance of a fair and orderly market, and not make bids or offers or enter into transactions that are inconsistent with course of dealings.27 The Exchange believes that Professionals, who are considered sophisticated algorithmic traders, utilize the advantaged Customer pricing they receive to effectively compete with market makers and broker-dealers 28 without the obligations of either. The Exchange believes Professionals should not be entitled to the same favorable fee treatment as a Customer, which such Professionals rely on as a means to effectively compete with other market participants. This was not the intent of the Exchange in providing Customer favorable pricing. Market makers and broker-dealers provide valuable liquidity to the marketplace without the advantage of Customer pricing. For the reasons described above and the basis provided hereafter, the Exchange believes that the proposed pricing is not unfairly discriminatory because the Exchange is seeking to continue to encourage the participation of Customers, other than those Customers who exceed the threshold requirement of the Professional definition. The Exchange believes that those who meet the Professional 25 See Securities Exchange Act Release No. 59287 (January 23, 2009), 75 FR 62443 (October 1, 2010) (SR–ISE–2006–26) at page 37. 26 The Exchange notes that the proposed Professional Rebate to Add Liquidity in Penny Pilot Options is greater than the rebate for a Non-NOM Market Maker but less than the rebate for a NOM Market Maker. This is explained in greater detail below. 27 See NOM Chapter VII, Sections 5, 6, 9 and 10. 28 Broker-dealers pay registration and membership fees in self-regulatory organizations (‘‘SRO’’) and incur costs to comply and assure that their associated persons comply with the Act and SRO rules. A broker-dealer on NOM is classified as a Firm. VerDate Mar<15>2010 15:54 May 18, 2011 Jkt 223001 definition have certain technological and informational advantages over retail Customers which combined with favorable pricing allows them to compete with market makers and broker-dealers and for this reason the proposed pricing is not unfairly discriminatory. The Exchange believes that the proposed NOM Professional fees and rebates are equitable in that the Exchange currently differentiates between options classes and categories of market participants for purposes of pricing. The existing differentiation recognizes the differing contributions made to the liquidity and trading environment on the Exchange, as well as the differing mix of orders entered. For example, the Exchange assesses different fees for Penny Pilot transactions and non-Penny Pilot transactions. In addition, some market participants, such as market makers, have obligations pursuant to Exchange rules which the Exchange recognizes in its pricing. The Exchange believes that the proposed Professional rebates and fees are both equitable and reasonable for the reasons outlined below. With respect to Penny Pilot options, the Exchange is assessing the same Fee for Removing Liquidity as other market participants. The Exchange believes that the proposed fee is reasonable and equitable because all market participants are equally assessed a Fee for Removing Liquidity in Penny Pilot options. There is no change to the Professional Fee for Removing Liquidity; the fee is the same as that assessed today. With respect to the Rebate to Add Liquidity in Penny Pilot options, the Exchange believes the proposed rate is reasonable because the proposed rate is less than that paid to Customers and NOM Market Makers, which is similar in concept to the rebates offered at NASDAQ OMX PHLX LLC (‘‘Phlx’’).29 In addition, Chicago Board Options Exchange Incorporated (‘‘CBOE’’) assesses Professionals more than Customers, who incur no fee.30 Further, the Exchange believes the proposed rebate is equitable because providing Customers and NOM Market Makers with higher rebates will continue to bolster liquidity, and attract more order flow to the Exchange, which benefits all 29 See Phlx’s Fee Schedule. The professional executing a single contra-side order on Phlx receives a lower rebate to add liquidity as compared a Phlx market maker (defined as a directed participant, specialist, ROT, SQT or RSQT). Also, the professional executing a complex order receives no rebate to add liquidity, while a customer receives a rebate of $0.24/$0.25 respectively. 30 See CBOE’s Fees Schedule. PO 00000 Frm 00069 Fmt 4703 Sfmt 4703 market participants, including Professionals. The Exchange stated above that it proposes to assess Professionals fees and offer rebates that are less favorable than or equivalent to Customers but generally more favorable than or equivalent to market markers. The one exception in this proposal is with respect to the Professional Rebate to Add Liquidity in Penny Pilot Options. The Exchange has explained above why it believes that providing a Professional a greater rebate as compared to the NonNOM Market maker is equitable. With respect to the NOM Market Maker, the Exchange proposes a lower rebate, by $0.01 per contract, as compared to a Professional because the Exchange seeks to continue to incentivize the NOM Market Maker. The Exchange believes that this rebate is equitable because the NOM Market Maker has obligations that the Professional does not bear. With respect to the NDX and MNX the Exchange is proposing to assess Professionals the same fees that are assessed Customers and pay Professionals the same rebate that are paid to Customers today. The Exchange believes that this is both reasonable and equitable because, other than NOM Market Makers, all market participants are assessed the same fees and paid the same rebates in NDX and MNX. With respect to NDX and MNX there is no fee change to the Professional as compared to the rebates received and fees paid today. The Exchange believes that the Fee for Removing Liquidity for a Professional in All Other Options is both equitable because it is the same rate for all market participants.31 There is no change to the Professional Fee for Removing Liquidity; the fee is the same as that assessed today. The Exchange believes that the proposed Fee for Adding Liquidity is equitable because Professionals engage in trading activity similar to that conducted by market makers. For example, Professionals continue to join bids and offers on the Exchange and thus compete for incoming order flow. Professionals do so in direct competition with the Exchange’s market makers, but with the distinct advantage of generally receiving fees and rebates akin to Customers. Currently, on NOM Professionals enjoy a higher rebate than NOM Market Makers, who have quoting obligations to the market. The Exchange believes it is not only equitable but reasonable to provide Fees and Rebates 31 All market participants are assessed $0.45 per contract as a Fee for Removing Liquidity in All Other Options. E:\FR\FM\19MYN1.SGM 19MYN1 jlentini on DSK4TPTVN1PROD with NOTICES Federal Register / Vol. 76, No. 97 / Thursday, May 19, 2011 / Notices for Adding Liquidity to Professionals that are within the range of non-NOM Market Makers and NOM Market Makers. This concept is similar in approach to NYSE Amex, Inc. (’’NYSE Amex’’) CBOE, Phlx and ISE. On each of these venues, the fees paid by professionals and rebates received by professionals are generally in between Customers, Market Makers and other brokerdealers.32 The Exchange believes that assessing a Professional a higher Fee for Adding Liquidity than a Customer, but lower than all other broker-dealers would put the Professional on a more equal footing with market makers and other broker-dealers regarding fees paid for transacting on the Exchange. The Exchange assesses all market participants the same Fee for Removing Liquidity, only differentiated by Penny Pilot, Non-Penny Pilot, NDX and MNX. The Exchange believes that the proposed Fee for Adding Liquidity is reasonable because it is similar to the transaction fee assessed by NYSE Amex for an electronic Professional transaction.33 With respect to the Rebate to Add Liquidity in All Other Options, the Exchange believes that the rebate is equitable because only Customers receive a rebate. The Professional, similar to all other market participants, would receive no rebate. The Exchange believes that offering a rebate to Customers only would attract more order flow to the Exchange for the benefit [sic] all market participants. For this same reason, the Exchange believes that it is reasonable to not pay a Professional a Rebate to Add Liquidity during the Exchange’s Opening Cross and to assess a Professional a Fee for Removing Liquidity during the Exchange’s Opening Cross. The Exchange believes that a Professional would benefit, similar to other market participants, from the Customer order flow. In addition, this proposal would allow a Customer to receive a Rebate to Add Liquidity during the Exchange’s Opening Cross if a Professional was on the contra-side of the transaction. The Exchange operates in a highly competitive market comprised of nine U.S. options exchanges in which sophisticated and knowledgeable market participants, including Professionals, can readily, and do, send order flow to competing exchanges if they deem fee levels at a particular exchange to be excessive or rebates paid 32 See NYSE Amex’s Fee Schedule, CBOE’s Fees Schedule, Phlx’s Fee Schedule and ISE’s Fee Schedule, respectively. 33 See NYSE Amex’s Fee Schedule. VerDate Mar<15>2010 15:54 May 18, 2011 Jkt 223001 to be inadequate. The Exchange believes that the proposed rebates and fees are competitive, fair and similar with rebates and fees in place on other exchanges for Professionals. The Exchange believes that this competitive marketplace impacts the rebates and fees present on the Exchange today and substantially influences the proposals set forth above. 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 either solicited or 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 34 and paragraph (f)(2) of Rule 19b–4 35 thereunder. 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 proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: 29017 All submissions should refer to File Number SR–NASDAQ–2011–066. 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,36 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 the 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– NASDAQ–2011–066 and should be submitted on or before June 9, 2011. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.37 Cathy H. Ahn, Deputy Secretary. [FR Doc. 2011–12286 Filed 5–18–11; 8:45 am] BILLING CODE 8011–01–P 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–2011–066 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. 34 15 35 17 PO 00000 U.S.C. 78s(b)(3)(A)(ii). CFR 240.19b–4(f)(2). Frm 00070 Fmt 4703 Sfmt 9990 36 The text of the proposed rule change is available on Exchange’s Web site at https:// www.nasdaq.cchwallstreet.com, on the Commission’s Web site at https://www.sec.gov, at NASDAQ, and at the Commission’s Public Reference Room. 37 17 CFR 200.30–3(a)(12). E:\FR\FM\19MYN1.SGM 19MYN1

Agencies

[Federal Register Volume 76, Number 97 (Thursday, May 19, 2011)]
[Notices]
[Pages 29014-29017]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-12286]


=======================================================================
-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64494; File No. SR-NASDAQ-2011-066]


Self-Regulatory Organizations; NASDAQ Stock Market, LLC; Notice 
of Filing and Immediate Effectiveness of Proposed Rule Change Relating 
to Rebates and Fees in Penny Pilot, NDX and MNX and Non-Penny Pilot 
Options

May 13, 2011.

    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on May 3, 2011, The NASDAQ Stock Market LLC (``NASDAQ'' 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 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to modify Rule 7050 governing pricing for 
NASDAQ members using the NASDAQ Options Market (``NOM''), NASDAQ's 
facility for executing and routing standardized equity and index 
options. Specifically, NOM proposes to adopt certain Fees for Execution 
of Contracts for a ``Professional'' market participant. The text of the 
proposed rule change is available on the Exchange's Web site at https://www.nasdaq.cchwallstreet.com, at the principal office of the Exchange, 
and at the Commission's Public Reference Room.

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
    NASDAQ is proposing to modify Rule 7050 governing the rebates and 
fees assessed for options orders entered into NOM. Specifically, NASDAQ 
is proposing to adopt Professional pricing for Penny Pilot Options, 
options on the Nasdaq 100 Index traded under the symbol NDX (``NDX'') 
and options on the one-tenth value of the Nasdaq 100 Index traded under 
the symbol MNX (``MNX'') and All Other Options.\3\
---------------------------------------------------------------------------

    \3\ All Other Options includes non-Penny Pilot options.
---------------------------------------------------------------------------

    There is currently NOM pricing for four separate categories of 
market participants: Customer, Firm, Non-NOM Market maker \4\ and NOM 
Market Maker.\5\ The Professional category would be an addition to 
these existing categories. The term ``Professional'' means any person 
or entity that (i) is not a broker or dealer in securities, and (ii) 
places more than 390 orders in listed options per day on average during 
a calendar month for its own beneficial account(s).\6\ Today a 
Professional is assessed and paid Customer fees and rebates, 
respectively.\7\
---------------------------------------------------------------------------

    \4\ Non-NOM Market Makers are registered market makers on 
another options market that append the market maker designation to 
orders routed to NOM.
    \5\ NOM Market Makers must be registered as such pursuant to 
Chapter VII, Section 2 of the Nasdaq Options Rules, and must also 
remain in good standing pursuant to Chapter VII, Section 4.
    \6\ See Chapter I, Section I (Definitions). See also Securities 
Exchange Act Release Nos. 63028 (October 1, 2010), 75 FR 62443 
(October 8, 2010) (SR-NASDAQ-2010-099); and 63151 (October 21, 
2010), 75 FR 66811 (October 29, 2010) (SR-NASDAQ-2010-132). 
Participants are required to identify Professional orders submitted 
electronically by indentifying [sic] them in the customer type 
field. See Securities Exchange Act Release No. 63028 (October 1, 
2010) 75 FR 62443 (October 8, 2010) (SR-NASDAQ-2010-099). See NOM 
Chapter I, Sec.1 (a)(48).
    \7\ The priority of orders designated as Professional on NOM are 
not impacted in the same manner as on other options exchanges which 
have a Professional designation because NOM executes orders on a 
price/time priority basis, regardless of the designation of the 
market participant submitting the order.

---------------------------------------------------------------------------

[[Page 29015]]

    The Exchange is proposing to adopt a $0.29 per contract Rebate to 
Add Liquidity; \8\ and a $0.45 per contract Fee for Removing Liquidity 
\9\ for Professionals transacting Penny Pilot Options.\10\ The Exchange 
is proposing to adopt a $0.10 per contract Rebate to Add Liquidity and 
a $0.50 per contract Fee for Removing Liquidity for Professionals 
transacting NDX and MNX.\11\ The Exchange is proposing to adopt a $0.20 
per contract Fee for Adding Liquidity, and a $0.45 per contract Fee for 
Removing Liquidity for Professionals transacting All Other Options. The 
Exchange proposes to offer no Rebate to Add Liquidity for Professionals 
transacting All Other Options.\12\
---------------------------------------------------------------------------

    \8\ An order that adds liquidity is one that is entered into NOM 
and rests on the NOM book.
    \9\ An order that removes liquidity is one that is entered into 
NOM and that executes against an order resting on the NOM book.
    \10\ The Exchange is not proposing to amend the Penny Pilot 
Option rates for other market participants.
    \11\ The Exchange is not proposing to amend NDX and MNX rates 
for other market participants.
    \12\ The Exchange is not proposing to amend the rates for other 
market participants in All Other Options.
---------------------------------------------------------------------------

    For purposes of the Opening Cross, a Professional would be assessed 
the Fee for Removing Liquidity during the Exchange's Opening Cross 
similar to Firms, Non-NOM Market Makers and NOM Market Makers.\13\ 
Professionals would not receive a Rebate to Add Liquidity during the 
Exchange's Opening Cross.\14\
---------------------------------------------------------------------------

    \13\ NOM does not have any priority rules for the Opening Cross.
    \14\ Today a Professional receives a Rebate to Add Liquidity 
during the Exchange's Opening Cross, unless the contra-side is also 
a Customer.
---------------------------------------------------------------------------

    The Exchange is proposing to add Professional fees to: (i) raise 
revenue for the Exchange; and (ii) eliminate specialized pricing for 
Professionals. The Exchange is proposing separate pricing for 
Professionals to bring additional revenue to the Exchange. The Exchange 
believes that the increased revenue from the proposal would assist the 
Exchange to recoup fixed costs. Additionally, the Exchange seeks to 
address the perceived favorable pricing of Professionals, who today are 
assessed fees and paid rebates like a Customer. A Professional, unlike 
a retail Customer, has access to sophisticated trading systems that 
contain functionality not available to retail Customers.\15\
---------------------------------------------------------------------------

    \15\ A Professional, defined as a non broker-dealer who places 
more than 390 orders in listed options per day on average (or more 
than one order per minute on average per day), has access to 
continuously updated pricing models based on real-time streaming 
data, access to multiple markets simultaneously, and other risk 
management tools.
---------------------------------------------------------------------------

2. Statutory Basis
    NASDAQ believes that the proposed rule changes are consistent with 
the provisions of Section 6 of the Act,\16\ in general, and with 
Section 6(b)(4) of the Act,\17\ in particular, in that it provides for 
the equitable allocation of reasonable rebates, dues, fees and other 
charges among members and issuers and other persons using any facility 
or system which NASDAQ operates or controls.
---------------------------------------------------------------------------

    \16\ 15 U.S.C. 78f.
    \17\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------

    The Exchange believes it is equitable to assess Professionals fees 
and offer rebates that are less favorable than or equivalent to 
Customers but generally more favorable than or equivalent to market 
markers \18\ because it has been established that Professionals have 
access to more information than a Customer and Professionals do not 
bear the obligations of a market maker. It can be argued that 
Professionals have the same technological and informational advantages 
as broker-dealers trading for their own account. First, a Professional 
by definition enters 390 orders per day on average over a calendar 
month which the Exchange believes exceeds the number of retail 
Customers [sic] in a single day. Second, the Exchange believes that 
retail Customers are a source of liquidity in the market, and exchanges 
have provided such Customer [sic] favorable pricing in order to attract 
such orders.\19\ The Exchange believes that it would be inequitable to 
assess higher fees on Customers and offer less rebates to Customers, as 
compared to other market participants, because they are unable to 
shoulder the burden of such costs as effectively as other market 
participants, including a Professional.
---------------------------------------------------------------------------

    \18\ The Exchange notes that the proposed Professional Rebate to 
Add Liquidity in Penny Pilot Options is greater than the rebate for 
a Non-NOM Market Maker but less than the rebate for a NOM Market 
Maker. This is explained in greater detail below.
    \19\ The Exchange provides Customers such favorable pricing 
notwithstanding the fact that NOM executes orders on a price/time 
priority basis, regardless of the designation of the market 
participant submitting the order.
---------------------------------------------------------------------------

    The Exchange believes that this concept of pricing Professionals 
differently than Customers exists today on other markets. The 
International Securities Exchange (``ISE'') assesses professionals 
different fees than customers. ISE assesses higher taker fees to 
professionals as compared to market makers and customers. ISE also 
provides professionals a lower priority on its market as compared to 
public customers.\20\ The Approval Order states that ISE amended its 
priority rules to attract retail investor order flow to its exchange by 
leveling the playing field for retail investors over market 
professionals and provide competitive pricing.\21\ The Approval Order 
also noted that professionals are more sophisticated than retail 
investors.\22\ While NOM does not have such priority rules because it 
executes orders according to price-time priority, with no distinctions 
made with regard to account designation, NOM currently offers 
Professionals the pricing advantages of a Customer. NOM believes that 
for the same reasons the Commission permitted ISE to amend its rules so 
that professional orders would not be granted special priority and 
would be assessed the same fees as broker-dealer transactions, the 
Exchange should likewise be permitted to assess different fees for 
Professionals and Customers.\23\ While priority is a reason to 
distinguish Customers and Professionals, the Exchange believes that 
pricing alone could produce the same unintended advantage to 
Professionals as noted in the Approval Order.\24\ The Commission also 
noted in the Approval Order that the customers who enter more than 390 
orders per day on average during a calendar month are using the 
exchange's facilities to place approximately 8000 orders, on average 
one order for every minute of every trading day, over the course of the 
month and nearly 100,000 orders per year. The Commission found that it 
was consistent with the Act for ISE to allocate to customers who 
participate in the market at this level of activity--which enables them 
to compete with non-Customers who are registered broker-dealers--the 
same transaction

[[Page 29016]]

fees that it charges to such non-Customers.\25\
---------------------------------------------------------------------------

    \20\ See Securities Exchange Act Release No. 59287 (January 23, 
2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26) (``Approval 
Order'').
    \21\ See Securities Exchange Act Release No. 59287 (January 23, 
2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26).
    \22\ See Securities Exchange Act Release No. 59287 (January 23, 
2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26).
    \23\ See Securities Exchange Act Release No. 59287 (January 23, 
2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26). Since the 
Approval Order, ISE has filed additional pricing changes.
    \24\ The Approval Order notes that professionals have access to 
information and advantages similar to broker-dealers and by both 
amending the execution rules and fee schedule, professional account 
holders participate on equal terms with broker-dealer orders and 
marker maker quotes. See Securities Exchange Act Release No. 59287 
(January 23, 2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26).
    \25\ See Securities Exchange Act Release No. 59287 (January 23, 
2009), 75 FR 62443 (October 1, 2010) (SR-ISE-2006-26) at page 37.
---------------------------------------------------------------------------

    The Exchange is proposing to amend its pricing to attract Customer 
orders and create a competitive market. The Exchange believes that 
establishing separate pricing for a Professional, which ranges between 
that of a Customer and market maker,\26\ accomplishes this objective. 
The Exchange believes the role of the retail Customer in the 
marketplace is distinct from that of the Professional and the Exchange 
believes that its fee proposal accounts for this distinction and prices 
each market participant according to their roles and assumes their 
obligations. A market maker has the obligation to make continuous 
markets, engage in course of dealings reasonably calculated to 
contribute to the maintenance of a fair and orderly market, and not 
make bids or offers or enter into transactions that are inconsistent 
with course of dealings.\27\
---------------------------------------------------------------------------

    \26\ The Exchange notes that the proposed Professional Rebate to 
Add Liquidity in Penny Pilot Options is greater than the rebate for 
a Non-NOM Market Maker but less than the rebate for a NOM Market 
Maker. This is explained in greater detail below.
    \27\ See NOM Chapter VII, Sections 5, 6, 9 and 10.
---------------------------------------------------------------------------

    The Exchange believes that Professionals, who are considered 
sophisticated algorithmic traders, utilize the advantaged Customer 
pricing they receive to effectively compete with market makers and 
broker-dealers \28\ without the obligations of either. The Exchange 
believes Professionals should not be entitled to the same favorable fee 
treatment as a Customer, which such Professionals rely on as a means to 
effectively compete with other market participants. This was not the 
intent of the Exchange in providing Customer favorable pricing. Market 
makers and broker-dealers provide valuable liquidity to the marketplace 
without the advantage of Customer pricing.
---------------------------------------------------------------------------

    \28\ Broker-dealers pay registration and membership fees in 
self-regulatory organizations (``SRO'') and incur costs to comply 
and assure that their associated persons comply with the Act and SRO 
rules. A broker-dealer on NOM is classified as a Firm.
---------------------------------------------------------------------------

    For the reasons described above and the basis provided hereafter, 
the Exchange believes that the proposed pricing is not unfairly 
discriminatory because the Exchange is seeking to continue to encourage 
the participation of Customers, other than those Customers who exceed 
the threshold requirement of the Professional definition. The Exchange 
believes that those who meet the Professional definition have certain 
technological and informational advantages over retail Customers which 
combined with favorable pricing allows them to compete with market 
makers and broker-dealers and for this reason the proposed pricing is 
not unfairly discriminatory.
    The Exchange believes that the proposed NOM Professional fees and 
rebates are equitable in that the Exchange currently differentiates 
between options classes and categories of market participants for 
purposes of pricing. The existing differentiation recognizes the 
differing contributions made to the liquidity and trading environment 
on the Exchange, as well as the differing mix of orders entered. For 
example, the Exchange assesses different fees for Penny Pilot 
transactions and non-Penny Pilot transactions. In addition, some market 
participants, such as market makers, have obligations pursuant to 
Exchange rules which the Exchange recognizes in its pricing.
    The Exchange believes that the proposed Professional rebates and 
fees are both equitable and reasonable for the reasons outlined below. 
With respect to Penny Pilot options, the Exchange is assessing the same 
Fee for Removing Liquidity as other market participants. The Exchange 
believes that the proposed fee is reasonable and equitable because all 
market participants are equally assessed a Fee for Removing Liquidity 
in Penny Pilot options. There is no change to the Professional Fee for 
Removing Liquidity; the fee is the same as that assessed today.
    With respect to the Rebate to Add Liquidity in Penny Pilot options, 
the Exchange believes the proposed rate is reasonable because the 
proposed rate is less than that paid to Customers and NOM Market 
Makers, which is similar in concept to the rebates offered at NASDAQ 
OMX PHLX LLC (``Phlx'').\29\ In addition, Chicago Board Options 
Exchange Incorporated (``CBOE'') assesses Professionals more than 
Customers, who incur no fee.\30\ Further, the Exchange believes the 
proposed rebate is equitable because providing Customers and NOM Market 
Makers with higher rebates will continue to bolster liquidity, and 
attract more order flow to the Exchange, which benefits all market 
participants, including Professionals.
---------------------------------------------------------------------------

    \29\ See Phlx's Fee Schedule. The professional executing a 
single contra-side order on Phlx receives a lower rebate to add 
liquidity as compared a Phlx market maker (defined as a directed 
participant, specialist, ROT, SQT or RSQT). Also, the professional 
executing a complex order receives no rebate to add liquidity, while 
a customer receives a rebate of $0.24/$0.25 respectively.
    \30\ See CBOE's Fees Schedule.
---------------------------------------------------------------------------

    The Exchange stated above that it proposes to assess Professionals 
fees and offer rebates that are less favorable than or equivalent to 
Customers but generally more favorable than or equivalent to market 
markers. The one exception in this proposal is with respect to the 
Professional Rebate to Add Liquidity in Penny Pilot Options. The 
Exchange has explained above why it believes that providing a 
Professional a greater rebate as compared to the Non-NOM Market maker 
is equitable. With respect to the NOM Market Maker, the Exchange 
proposes a lower rebate, by $0.01 per contract, as compared to a 
Professional because the Exchange seeks to continue to incentivize the 
NOM Market Maker. The Exchange believes that this rebate is equitable 
because the NOM Market Maker has obligations that the Professional does 
not bear.
    With respect to the NDX and MNX the Exchange is proposing to assess 
Professionals the same fees that are assessed Customers and pay 
Professionals the same rebate that are paid to Customers today. The 
Exchange believes that this is both reasonable and equitable because, 
other than NOM Market Makers, all market participants are assessed the 
same fees and paid the same rebates in NDX and MNX. With respect to NDX 
and MNX there is no fee change to the Professional as compared to the 
rebates received and fees paid today.
    The Exchange believes that the Fee for Removing Liquidity for a 
Professional in All Other Options is both equitable because it is the 
same rate for all market participants.\31\ There is no change to the 
Professional Fee for Removing Liquidity; the fee is the same as that 
assessed today.
---------------------------------------------------------------------------

    \31\ All market participants are assessed $0.45 per contract as 
a Fee for Removing Liquidity in All Other Options.
---------------------------------------------------------------------------

    The Exchange believes that the proposed Fee for Adding Liquidity is 
equitable because Professionals engage in trading activity similar to 
that conducted by market makers. For example, Professionals continue to 
join bids and offers on the Exchange and thus compete for incoming 
order flow. Professionals do so in direct competition with the 
Exchange's market makers, but with the distinct advantage of generally 
receiving fees and rebates akin to Customers. Currently, on NOM 
Professionals enjoy a higher rebate than NOM Market Makers, who have 
quoting obligations to the market. The Exchange believes it is not only 
equitable but reasonable to provide Fees and Rebates

[[Page 29017]]

for Adding Liquidity to Professionals that are within the range of non-
NOM Market Makers and NOM Market Makers.
    This concept is similar in approach to NYSE Amex, Inc. (''NYSE 
Amex'') CBOE, Phlx and ISE. On each of these venues, the fees paid by 
professionals and rebates received by professionals are generally in 
between Customers, Market Makers and other broker-dealers.\32\ The 
Exchange believes that assessing a Professional a higher Fee for Adding 
Liquidity than a Customer, but lower than all other broker-dealers 
would put the Professional on a more equal footing with market makers 
and other broker-dealers regarding fees paid for transacting on the 
Exchange.
---------------------------------------------------------------------------

    \32\ See NYSE Amex's Fee Schedule, CBOE's Fees Schedule, Phlx's 
Fee Schedule and ISE's Fee Schedule, respectively.
---------------------------------------------------------------------------

    The Exchange assesses all market participants the same Fee for 
Removing Liquidity, only differentiated by Penny Pilot, Non-Penny 
Pilot, NDX and MNX. The Exchange believes that the proposed Fee for 
Adding Liquidity is reasonable because it is similar to the transaction 
fee assessed by NYSE Amex for an electronic Professional 
transaction.\33\
---------------------------------------------------------------------------

    \33\ See NYSE Amex's Fee Schedule.
---------------------------------------------------------------------------

    With respect to the Rebate to Add Liquidity in All Other Options, 
the Exchange believes that the rebate is equitable because only 
Customers receive a rebate. The Professional, similar to all other 
market participants, would receive no rebate. The Exchange believes 
that offering a rebate to Customers only would attract more order flow 
to the Exchange for the benefit [sic] all market participants. For this 
same reason, the Exchange believes that it is reasonable to not pay a 
Professional a Rebate to Add Liquidity during the Exchange's Opening 
Cross and to assess a Professional a Fee for Removing Liquidity during 
the Exchange's Opening Cross. The Exchange believes that a Professional 
would benefit, similar to other market participants, from the Customer 
order flow. In addition, this proposal would allow a Customer to 
receive a Rebate to Add Liquidity during the Exchange's Opening Cross 
if a Professional was on the contra-side of the transaction.
    The Exchange operates in a highly competitive market comprised of 
nine U.S. options exchanges in which sophisticated and knowledgeable 
market participants, including Professionals, can readily, and do, send 
order flow to competing exchanges if they deem fee levels at a 
particular exchange to be excessive or rebates paid to be inadequate. 
The Exchange believes that the proposed rebates and fees are 
competitive, fair and similar with rebates and fees in place on other 
exchanges for Professionals. The Exchange believes that this 
competitive marketplace impacts the rebates and fees present on the 
Exchange today and substantially influences the proposals set forth 
above.

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 either solicited or 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 \34\ and paragraph (f)(2) of Rule 19b-4 \35\ 
thereunder. 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.
---------------------------------------------------------------------------

    \34\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \35\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------

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 Number SR-NASDAQ-2011-066 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-2011-066. 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,\36\ 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 the 
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-NASDAQ-2011-066 and should be submitted on or before 
June 9, 2011.
---------------------------------------------------------------------------

    \36\ The text of the proposed rule change is available on 
Exchange's Web site at https://www.nasdaq.cchwallstreet.com, on the 
Commission's Web site at https://www.sec.gov, at NASDAQ, and at the 
Commission's Public Reference Room.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\37\
---------------------------------------------------------------------------

    \37\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-12286 Filed 5-18-11; 8:45 am]
BILLING CODE 8011-01-P
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.