Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Functionality of the Post-Only Order, 31998-32000 [2011-13624]

Download as PDF 31998 Federal Register / Vol. 76, No. 106 / Thursday, June 2, 2011 / Notices OFFICE OF PERSONNEL MANAGEMENT Cancellation of an Optional Form by the Office of Personnel Management U.S. Office of Personnel Management. ACTION: Notice. AGENCY: The U.S. Office of Personnel Management (OPM) is cancelling the Optional Application for Federal Employment. The information contained in the OF 612 is now incorporated in the online Resume Builder on the USAJOBS® Web site. The need to maintain the OF 612 as an alternative means of applying for Federal positions no longer exists as job seekers now have the ability to either build or upload resumes. This action is being taken to facilitate a more seamless employment application process for both Federal agencies and job seekers, consistent with the goals of Federal hiring reform. DATES: Effective June 13, 2011. FOR FURTHER INFORMATION CONTACT: U.S. Office of Personnel Management, Employment Services, USAJOBS, 1900 E. Street, NW., Washington, DC 20415, Attention: USAJOBS, or via electronic mail to patricia.stevens@opm.gov. SUMMARY: U.S. Office of Personnel Management. John Berry, Director. [FR Doc. 2011–13704 Filed 6–1–11; 8:45 am] BILLING CODE 6325–38–P OFFICE OF PERSONNEL MANAGEMENT Illinois, Kentucky, Louisiana, Mississippi, Missouri, Montana, New Mexico, North Dakota, Oklahoma, South Dakota, and Wyoming. South Carolina is designated as a Medically Underserved Area in 2011, but will not be so designated for 2012. Alaska is being added as a Medically Underserved Area for the 2012 calendar year. DATES: Effective Date: January 1, 2012. FOR FURTHER INFORMATION CONTACT: Lynelle T. Frye, 202–606–0004. SUPPLEMENTARY INFORMATION: FEHB law (5 U.S.C. 8902(m)(2)) requires special consideration for enrollees of certain FEHB plans who receive covered health services in States with critical shortages of primary care physicians. This section of the law requires that a State be designated as a Medically Underserved Area if 25 percent or more of the population lives in an area designated by the Department of Health and Human Services (HHS) as a primary medical care manpower shortage area. Such States are designated as Medically Underserved Areas for purposes of the FEHB Program, and the law requires non-HMO FEHB plans to reimburse beneficiaries, subject to their contract terms, for covered services obtained from any licensed provider in these States. FEHB regulations (5 CFR 890.701) require OPM to make an annual determination of the States that qualify as Medically Underserved Areas for the next calendar year by comparing the latest HHS State-by-State population counts on primary medical care manpower shortage areas with U.S. Census figures on State resident populations. Federal Employees Health Benefits Program: Medically Underserved Areas for 2012 U.S. Office of Personnel Management. U.S. Office of Personnel Management. ACTION: Notice. [FR Doc. 2011–13695 Filed 6–1–11; 8:45 am] The U.S. Office of Personnel Management (OPM) has completed its annual determination of the States that qualify as Medically Underserved Areas under the Federal Employees Health Benefits (FEHB) Program for calendar year 2012. This is necessary to comply with a provision of the FEHB law that mandates special consideration for enrollees of certain FEHB plans who receive covered health services in States with critical shortages of primary care physicians. Accordingly, for calendar year 2012, the following 15 states are considered as Medically Underserved Areas under the FEHB Program: Alabama, Alaska, Arizona, Idaho, OFFICE OF PERSONNEL MANAGEMENT AGENCY: emcdonald on DSK2BSOYB1PROD with NOTICES SUMMARY: VerDate Mar<15>2010 16:40 Jun 01, 2011 Jkt 223001 John Berry, Director.. BILLING CODE 6325–63–P Posting of Service Contract Inventory Office of Personnel Management. ACTION: Notice of posting. AGENCY: The Office of Personnel Management has posted on its public Web site an inventory of the services contracts exceeding $25,000 that were awarded by the agency in Fiscal Year (FY) 2010. The inventory was prepared in accordance with Section 743 of Division C of the FY 2010 Consolidated Appropriations Act, Public Law 111– SUMMARY: PO 00000 Frm 00072 Fmt 4703 Sfmt 4703 117, and with a Memorandum from the Office of Federal Procurement Policy dated November 5, 2010. It consists of two parts: (1) A complete listing of all contracts; and (2) A summary by Product or Service Code to show the use of contractors to perform ‘‘special interest functions’’ as well as the services that accounted for the agency’s greatest percentage of spend in FY 2010. Both parts of the inventory can be found at: http://www.opm.gov/doingbusiness/ contract/businessops.aspx. FOR FURTHER INFORMATION CONTACT: William N. Patterson, Director, Contracting Group, Facilities, Security and Contracting, Office of Personnel Management, 1900 E Street, NW., Room 1342, Washington, DC 20415. Phone (202) 606–1984 or e-mail at William.Patterson@opm.gov. U.S. Office of Personnel Management. John Berry, Director. [FR Doc. 2011–13696 Filed 6–1–11; 8:45 am] BILLING CODE 6325–45–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64552; File No. SR– NASDAQ–2011–070] Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify the Functionality of the Post-Only Order May 26, 2011. 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 May 19, 2011, The NASDAQ Stock Market LLC (the ‘‘Exchange’’ or ‘‘NASDAQ’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I and II 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 is filing this proposed rule change to modify the functionality of its Post-Only Order. NASDAQ proposes to implement the rule change thirty days after the date of filing or as soon thereafter as practicable. The text of the proposed rule change is available 1 15 2 17 E:\FR\FM\02JNN1.SGM U.S.C. 78s(b)(1). CFR 240.19b–4. 02JNN1 Federal Register / Vol. 76, No. 106 / Thursday, June 2, 2011 / Notices at http://nasdaq.cchwallstreet.com/, at NASDAQ’s principal office, 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 emcdonald on DSK2BSOYB1PROD with NOTICES 1. Purpose NASDAQ proposes to modify the functionality associated with its existing Post-Only Order. Currently, if a PostOnly Order would lock an order on the NASDAQ System at the time of entry, the order is re-priced and displayed by the System to one minimum price increment (i.e., $0.01 or $0.0001) below the current low offer (for bids) or above the current best bid (for offers). Thus, if the best bid and best offer on the NASDAQ book were $10.00 × $10.05, and a market participant entered a PostOnly Order to buy at $10.05, the order would be re-priced and displayed at $10.04. This aspect of the functionality of the order is not changing. In addition, if a Post-Only Order would cross an order on the System, the order will be repriced as described above unless the value of price improvement associated with executing against a resting order equals or exceeds the sum of fees charged for such execution and the value of any rebate that would be provided if the order posted to the book and subsequently provided liquidity, in which case the order will execute. As provided by Rule 4757, price improvement accrues to the party entering the order. Thus, if a sell order is on the book at $10 and a Post-Only Order to buy at $10.01 is entered, the order will execute at $10. This aspect of the order’s functionality is also not changing.3 3 The functionality was described in the original filing to establish the Post-Only Order but was not fully reflected in the text of Rule 4751. See Securities Exchange Act Release No. 59392 (February 11, 2009), 74 FR 7943 (February 20, 2009) (SR–NASDAQ–2009–006). Accordingly, the rule is VerDate Mar<15>2010 16:40 Jun 01, 2011 Jkt 223001 At present, however, the order is repriced in a similar manner if the order would lock or cross a protected quotation of another market center. Thus, if the national best offer of $10.05 is being displayed on another market center but not on NASDAQ, at present an order to buy at $10.05 would be repriced and displayed at $10.04. Under the changed functionality that NASDAQ is proposing, if the order locks or crosses the other market center, the order will be accepted at the locking price (i.e., the current low offer (for bids) or to the current best bid (for offers)) and displayed by the System to one minimum price increment (i.e., $0.01 or $0.0001) below the current low offer (for bids) or above the current best bid (for offers). Thus, if the national best bid and offer, as displayed on another market center, was $10 x $10.05, an order to buy at $10.05 or higher would be accepted at the locking price of $10.05, but would be displayed at $10.04. Subsequently, an incoming order to sell at $10.05 or lower would be matched against the Post-Only buy order. In this case, the incoming sell order would receive price improvement. As a result of the change, the order will resemble more closely NASDAQ’s Price to Comply order, which uses a similar logic of retaining a locking price but displaying at a non-locking price. The modified Post-Only Order will serve to allow the market participant entering the order to post its order at its desired price, unless the price would lock or cross the NASDAQ book, in which case the order will execute or be repriced, as is currently the case, to avoid the internal lock/cross. The revised order type is designed to provide market participants with better control over their execution costs and to provide them with a means to offer price improvement opportunities to other market participants. 2. Statutory Basis NASDAQ believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,4 in general, and with Section 6(b)(5) of the Act,5 in particular, in that the proposal is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and being amended to provide a complete description of the order’s current behavior when crossing an existing order on the System. 4 15 U.S.C. 78f. 5 15 U.S.C. 78f(b)(5). PO 00000 Frm 00073 Fmt 4703 Sfmt 4703 31999 facilitating transactions in securities, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, to protect investors and the public interest. NASDAQ also believes that the modified order is consistent with Rule 610(d) under Regulation NMS.6 Rule 610(d) requires exchanges to establish, maintain, and enforce rules that require members reasonably to avoid ‘‘[d]isplaying quotations that lock or cross any protected quotation in an NMS stock.’’ Such rules must be ‘‘reasonably designed to assure the reconciliation of locked or crossed quotations in an NMS stock,’’ and must ‘‘prohibit * * * members from engaging in a pattern or practice of displaying quotations that lock or cross any quotation in an NMS stock.’’ Rule 600 under Regulation NMS 7 defines a ‘‘quotation’’ as a ‘‘bid or offer,’’ and in turn defines ‘‘bid or offer’’ to mean ‘‘the bid price or the offer price communicated by a member * * * to any broker or dealer, or to any customer, at which it is willing to buy or sell one or more round lots of an NMS security * * *.’’ Thus, the hidden price of the Post-Only Order is not a quotation under Regulation NMS, and is therefore covered neither by the provisions of Rule 610 pertaining to displayed quotations nor by the provision requiring rules to assure reconciliation of locked or crossed quotations. In this respect, the order is similar to NASDAQ’s existing Price to Comply order, which uses a hidden locking price and a displayed non-locking price to ensure compliance with this rule. It is also similar to the Post Only Order of the BATS Exchange and the BATS–Y Exchange, as described in BATS Exchange Rule 11.9(c)(4) and (6) and BATS–Y Exchange Rule 11.9(c)(4) and (6), and the Post Only Order of the EDGA Exchange and EDGX Exchange, as described in EDGA Exchange Rule 11.5(c)(4) and (5) and EDGX Exchange Rule 11.5(c)(4) and (5). 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. Rather, the change will promote greater competition by allowing NASDAQ to adopt functionality already in use at competing national securities exchanges. 6 17 7 17 E:\FR\FM\02JNN1.SGM CFR 242.610(d). CFR 242.600. 02JNN1 32000 Federal Register / Vol. 76, No. 106 / Thursday, June 2, 2011 / 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 Because the foregoing proposed rule change: (1) Does not significantly affect the protection of investors or the public interest; (2) does not impose any significant burden on competition; and (3) by its terms does not become operative for 30 days after the date of this filing, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 8 and Rule 19b–4(f)(6) thereunder.9 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: Electronic Comments • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an e-mail to rulecomments@sec.gov. Please include File Number SR–NASDAQ–2011–070 on the subject line. emcdonald on DSK2BSOYB1PROD with NOTICES 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–2011–070. This 8 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) requires a self-regulatory organization to provide the Commission with 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 fulfilled this requirement. 9 17 VerDate Mar<15>2010 16:40 Jun 01, 2011 Jkt 223001 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 (http://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 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–2011–070 and should be submitted on or before June 23, 2011. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.10 Cathy H. Ahn, Deputy Secretary. [FR Doc. 2011–13624 Filed 6–1–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–64551; File No. SR–CBOE– 2011–026] Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Order Granting Approval of Proposed Rule Change and Notice of Filing and Order Granting Accelerated Approval to Amendment No. 1 Thereto To Trade Options on Certain Individual Stock Based Volatility Indexes and ExchangeTraded Fund Based Volatility Indexes Securities and Exchange Commission (the ‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to trade options on certain individual stock based and exchange-traded fund (‘‘ETF’’) based volatility indexes. The proposed rule change was published for comment in the Federal Register on April 13, 2011.3 The Commission received no comments in response to the Notice. On May 16, 2011, the Exchange submitted Amendment No. 1 to the proposed rule change, as described in Items I and II below, which items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on Amendment No. 1 from interested persons and is approving the proposed rule change, as modified by Amendment No. 1, on an accelerated basis. I. Self-Regulatory Organization’s Statement of the Terms of Substance of Amendment No. 1 to the Proposed Rule Change CBOE proposes to amend its rules to list and trade options on certain individual stock based volatility indexes and ETF based volatility indexes. The proposed options will be cash-settled and will have European-style exercise. The text of the rule proposal is available on the Exchange’s Web site (http:// www.cboe.org/legal), at the Exchange’s Office of the Secretary 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 self-regulatory organization 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 those 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 parts of such statements. May 26, 2011. On March 29, 2011, Chicago Board Options Exchange, Incorporated (the ‘‘Exchange’’ or ‘‘CBOE’’) filed with the 10 17 PO 00000 CFR 200.30–3(a)(12). Frm 00074 Fmt 4703 Sfmt 4703 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 See Securities Exchange Act Release No. 64245 (April 7, 2011), 76 FR 20784 (‘‘Notice’’). 2 17 E:\FR\FM\02JNN1.SGM 02JNN1

Agencies

[Federal Register Volume 76, Number 106 (Thursday, June 2, 2011)]
[Notices]
[Pages 31998-32000]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-13624]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-64552; File No. SR-NASDAQ-2011-070]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Modify the Functionality of the Post-Only Order

May 26, 2011.
    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 May 19, 2011, The NASDAQ Stock Market LLC (the ``Exchange'' or 
``NASDAQ'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II 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 is filing this proposed rule change to modify the 
functionality of its Post-Only Order. NASDAQ proposes to implement the 
rule change thirty days after the date of filing or as soon thereafter 
as practicable. The text of the proposed rule change is available

[[Page 31999]]

at http://nasdaq.cchwallstreet.com/, at NASDAQ's principal office, 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 proposes to modify the functionality associated with its 
existing Post-Only Order. Currently, if a Post-Only Order would lock an 
order on the NASDAQ System at the time of entry, the order is re-priced 
and displayed by the System to one minimum price increment (i.e., $0.01 
or $0.0001) below the current low offer (for bids) or above the current 
best bid (for offers). Thus, if the best bid and best offer on the 
NASDAQ book were $10.00 x $10.05, and a market participant entered a 
Post-Only Order to buy at $10.05, the order would be re-priced and 
displayed at $10.04. This aspect of the functionality of the order is 
not changing. In addition, if a Post-Only Order would cross an order on 
the System, the order will be repriced as described above unless the 
value of price improvement associated with executing against a resting 
order equals or exceeds the sum of fees charged for such execution and 
the value of any rebate that would be provided if the order posted to 
the book and subsequently provided liquidity, in which case the order 
will execute. As provided by Rule 4757, price improvement accrues to 
the party entering the order. Thus, if a sell order is on the book at 
$10 and a Post-Only Order to buy at $10.01 is entered, the order will 
execute at $10. This aspect of the order's functionality is also not 
changing.\3\
---------------------------------------------------------------------------

    \3\ The functionality was described in the original filing to 
establish the Post-Only Order but was not fully reflected in the 
text of Rule 4751. See Securities Exchange Act Release No. 59392 
(February 11, 2009), 74 FR 7943 (February 20, 2009) (SR-NASDAQ-2009-
006). Accordingly, the rule is being amended to provide a complete 
description of the order's current behavior when crossing an 
existing order on the System.
---------------------------------------------------------------------------

    At present, however, the order is repriced in a similar manner if 
the order would lock or cross a protected quotation of another market 
center. Thus, if the national best offer of $10.05 is being displayed 
on another market center but not on NASDAQ, at present an order to buy 
at $10.05 would be repriced and displayed at $10.04. Under the changed 
functionality that NASDAQ is proposing, if the order locks or crosses 
the other market center, the order will be accepted at the locking 
price (i.e., the current low offer (for bids) or to the current best 
bid (for offers)) and displayed by the System to one minimum price 
increment (i.e., $0.01 or $0.0001) below the current low offer (for 
bids) or above the current best bid (for offers). Thus, if the national 
best bid and offer, as displayed on another market center, was $10 x 
$10.05, an order to buy at $10.05 or higher would be accepted at the 
locking price of $10.05, but would be displayed at $10.04. 
Subsequently, an incoming order to sell at $10.05 or lower would be 
matched against the Post-Only buy order. In this case, the incoming 
sell order would receive price improvement.
    As a result of the change, the order will resemble more closely 
NASDAQ's Price to Comply order, which uses a similar logic of retaining 
a locking price but displaying at a non-locking price. The modified 
Post-Only Order will serve to allow the market participant entering the 
order to post its order at its desired price, unless the price would 
lock or cross the NASDAQ book, in which case the order will execute or 
be repriced, as is currently the case, to avoid the internal lock/
cross. The revised order type is designed to provide market 
participants with better control over their execution costs and to 
provide them with a means to offer price improvement opportunities to 
other market participants.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\4\ in general, and with Section 
6(b)(5) of the Act,\5\ in particular, in that the proposal is designed 
to prevent fraudulent and manipulative acts and practices, to promote 
just and equitable principles of trade, to foster cooperation and 
coordination with persons engaged in regulating, clearing, settling, 
processing information with respect to, and facilitating transactions 
in securities, to remove impediments to and perfect the mechanism of a 
free and open market and a national market system, and, in general, to 
protect investors and the public interest. NASDAQ also believes that 
the modified order is consistent with Rule 610(d) under Regulation 
NMS.\6\ Rule 610(d) requires exchanges to establish, maintain, and 
enforce rules that require members reasonably to avoid ``[d]isplaying 
quotations that lock or cross any protected quotation in an NMS 
stock.'' Such rules must be ``reasonably designed to assure the 
reconciliation of locked or crossed quotations in an NMS stock,'' and 
must ``prohibit * * * members from engaging in a pattern or practice of 
displaying quotations that lock or cross any quotation in an NMS 
stock.'' Rule 600 under Regulation NMS \7\ defines a ``quotation'' as a 
``bid or offer,'' and in turn defines ``bid or offer'' to mean ``the 
bid price or the offer price communicated by a member * * * to any 
broker or dealer, or to any customer, at which it is willing to buy or 
sell one or more round lots of an NMS security * * *.'' Thus, the 
hidden price of the Post-Only Order is not a quotation under Regulation 
NMS, and is therefore covered neither by the provisions of Rule 610 
pertaining to displayed quotations nor by the provision requiring rules 
to assure reconciliation of locked or crossed quotations. In this 
respect, the order is similar to NASDAQ's existing Price to Comply 
order, which uses a hidden locking price and a displayed non-locking 
price to ensure compliance with this rule. It is also similar to the 
Post Only Order of the BATS Exchange and the BATS-Y Exchange, as 
described in BATS Exchange Rule 11.9(c)(4) and (6) and BATS-Y Exchange 
Rule 11.9(c)(4) and (6), and the Post Only Order of the EDGA Exchange 
and EDGX Exchange, as described in EDGA Exchange Rule 11.5(c)(4) and 
(5) and EDGX Exchange Rule 11.5(c)(4) and (5).
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78f.
    \5\ 15 U.S.C. 78f(b)(5).
    \6\ 17 CFR 242.610(d).
    \7\ 17 CFR 242.600.
---------------------------------------------------------------------------

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. Rather, the change 
will promote greater competition by allowing NASDAQ to adopt 
functionality already in use at competing national securities 
exchanges.

[[Page 32000]]

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

    Because the foregoing proposed rule change: (1) Does not 
significantly affect the protection of investors or the public 
interest; (2) does not impose any significant burden on competition; 
and (3) by its terms does not become operative for 30 days after the 
date of this filing, or such shorter time as the Commission may 
designate if consistent with the protection of investors and the public 
interest, the proposed rule change has become effective pursuant to 
Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) thereunder.\9\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to provide the Commission 
with 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 fulfilled this requirement.
---------------------------------------------------------------------------

    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:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an e-mail to rule-comments@sec.gov. Please include 
File Number SR-NASDAQ-2011-070 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-2011-070. 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 (http://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 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-2011-070 and should be submitted on or before June 23, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Cathy H. Ahn,
Deputy Secretary.
[FR Doc. 2011-13624 Filed 6-1-11; 8:45 am]
BILLING CODE 8011-01-P