Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish and Adopt Fees for the New BX Pre-Trade Risk Management Service, 53503-53505 [2011-21854]
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emcdonald on DSK2BSOYB1PROD with NOTICES
Federal Register / Vol. 76, No. 166 / Friday, August 26, 2011 / Notices
through a registered securities exchange
or a national securities association in
accordance with a plan submitted to
and approved by the Commission. Plans
have been approved for the American,
Boston, Chicago, New York, Pacific, and
Philadelphia stock exchanges and for
the Financial Industry Regulatory
Authority (‘‘FINRA’’) and the Chicago
Board Options Exchange. Currently, the
bulk of the fingerprints are submitted
through FINRA.
It is estimated that approximately
4,939 respondents submit
approximately 288,000 sets of
fingerprints (consisting of 133,000
electronic fingerprints and 155,000
fingerprint cards) to exchanges or a
national securities association on an
annual basis. The Commission estimates
that it would take approximately
15 minutes to create and submit each
fingerprint card. The total reporting
burden is therefore estimated to be
72,000 hours, or approximately 15 hours
per respondent, annually. In addition,
the exchanges and FINRA charge an
estimated $30.25 fee for processing
fingerprint cards, resulting in a total
annual cost to all 4,939 respondents of
$8,712,000, or $1,764 per respondent
per year.
Because the Federal Bureau of
Investigation will not accept fingerprint
cards directly from submitting
organizations, Commission approval of
plans from certain exchanges and
national securities associations is
essential to the Congressional goal of
fingerprint personnel in the security
industry. The filing of these plans for
review assures users and their personnel
that fingerprint cards will be handled
responsibly and with due care for
confidentiality.
Submission of fingerprint plans under
Rule 17f-2(c) is mandatory for selfregulatory organizations. An agency
may not conduct or sponsor, and a
person is not required to respond to, a
collection of information unless it
displays a currently valid control
number. Background documentation for
this information collection may be
viewed at the following link, https://
www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503
or by sending an e-mail to:
Shagufta_Ahmed@omb.eop.gov; and
Thomas Bayer, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way,
Alexandria, VA 22312 or send an e-mail
VerDate Mar<15>2010
19:37 Aug 25, 2011
Jkt 223001
to: PRA_Mailbox@sec.gov. Comments
must be submitted to OMB within
30 days of this notice.
Dated: August 22, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–21860 Filed 8–25–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Submission for OMB Review;
Comment Request
Upon written request, copies available
from: Securities and Exchange
Commission, Office of Investor
Education and Advocacy,
Washington, DC 20549–0213.
Extension: Form 8–A; OMB Control No.
3235–0056; SEC File No. 270–54.
Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.), the Securities
and Exchange Commission
(‘‘Commission’’) has submitted to the
Office of Management and Budget this
request for extension of the previously
approved collection of information
discussed below.
Form 8–A (17 CFR 249.208a) is a
registration statement used to register a
class of securities under Sections 12(b)
and 12(g) of the Securities Exchange Act
of 1934 (15 U.S.C. 78l(b) and
78l(g))(‘‘Exchange Act’’). Section 12(a)
(15 U.S.C. 78l(a) of the Exchange Act
requires securities traded on a national
exchange to be registered under the
Exchange Act (15 U.S.C. 78a et seq.).
Exchange Act Section 12(b) establishes
the registration procedures. Section
12(g) and Rule 12g–1 (17 CFR 240.12g–
1) under the Exchange Act requires
issuers engaged in interstate commerce
or in a business affecting interstate
commerce, that has total assets of
$10,000,000 or more, and a class of
equity security held of record by 500 or
more persons to register that class of
security. The respondents are
companies offering securities. The
information must be filed with the
Commission on occasion. Form 8–A is
a public document and filing is
mandatory. The form takes
approximately 3 hours to prepare and is
filed by 1,170 respondents for a total of
3,510 annual burden hours.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid
control number.
The public may view the background
documentation for this information
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53503
collection at the following Web site,
https://www.reginfo.gov . Comments
should be directed to: (i) Desk Officer
for the Securities and Exchange
Commission, Office of Information and
Regulatory Affairs, Office of
Management and Budget, Room 10102,
New Executive Office Building,
Washington, DC 20503, or by sending an
e-mail to:
Shagufta_Ahmed@omb.eop.gov; and (ii)
Thomas Bayer, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way,
Alexandria, VA 22312 or send an e-mail
to: PRA_Mailbox@sec.gov. Comments
must be submitted to OMB within 30
days of this notice.
Dated: August 22, 2011.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–21859 Filed 8–25–11; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–65175; File No. SR–BX–
2011–057]
Self-Regulatory Organizations;
NASDAQ OMX BX, Inc.; Notice of Filing
and Immediate Effectiveness of
Proposed Rule Change To Establish
and Adopt Fees for the New BX PreTrade Risk Management Service
August 19, 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 August
16, 2011, NASDAQ OMX BX, Inc. (the
‘‘Exchange’’) 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 proposes to establish
and adopt fees for the new BX Pre-Trade
Risk Management service (‘‘PRM’’). The
Exchange will implement the fee
effective September 1, 2011.
The text of the proposed rule change
is below. Proposed new language is in
1 15
2 17
E:\FR\FM\26AUN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
26AUN1
53504
Federal Register / Vol. 76, No. 166 / Friday, August 26, 2011 / Notices
7016. [Reserved] BX Pre-Trade Risk
Management
(a) Users of BX Pre-trade Risk Management
(‘‘PRM’’) will be assessed a monthly fee
italics; proposed deletions are in
brackets.
*
*
*
*
*
Port tiers
Tier
Tier
Tier
Tier
1
2
3
4
Number of PRM-enabled ports
..............................................................................
..............................................................................
..............................................................................
..............................................................................
(b) Users of PRM services specified below
will be assessed the following charges in
*
*
*
*
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
The Exchange is proposing to adopt
BX Pre-trade Risk Management under
Rule 7016. PRM provides member firms
with the ability to set a wide range of
parameters for orders to facilitate pretrade protection by creating a PRM
module defined to represent checks
desired. Using PRM, member firms can
increase controls on their trading
activity and the trading activity of their
clients and customers at the order level,
including the opportunity to prevent
potentially erroneous transactions. PRM
validates orders entered on PRMenabled ports prior to allowing those
orders into its matching engine and,
using parameters set by the subscriber,
determines if the order should be sent
for fulfillment. If PRM rejects an order,
it alerts the member firm and provides
it with clearly-defined reasons for the
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19:37 Aug 25, 2011
Jkt 223001
Monthly fee
50 or more .....................................................................
20 to 49 .........................................................................
5 to 19 ...........................................................................
1 to 4 .............................................................................
$400
$500
$550
$600
per
per
per
per
port,
port,
port,
port,
per
per
per
per
month.
month.
month.
month.
addition to the applicable PRM-enabled port
charges:
PRM Modules ...........................................................................................
Aggregate Total Checks ...........................................................................
PRM Workstation Add-ons to an existing Workstation or WeblinkACT
2.0.
*
based on the following table, and such fees
will not exceed $25,000 per member firm,
per month:
No charge.
No charge.
$100 per each PRM Workstation Add-on per month.
rejection.3 These alerts are sent on
Execution and Order/Message DROP
copy lines/reports. The Exchange
believes that PRM will be a useful tool
to assist members in complying with the
Commission’s new market access rule 4
and related Exchange requirements.
PRM users may choose to set PRM
Order Checks, Aggregate Total Checks
within a PRM Module, and subscribe to
PRM Workstation Add-ons to an
existing Workstation or WeblinkACT
2.0. PRM manages risk by checking each
order, before it is accepted into the
system, against certain parameters prespecified by the user within a module,
such as maximum order size or value,
order type restrictions, market session
restrictions (pre/post market), security
restrictions, including per-security
limits, restricted stock list, and certain
other criteria. These checks are in
addition to the Fat Finger Check, which
is available for all orders submitted
through a RASH/FIX PRM-enabled
port.5 In order for a member firm to
subscribe, at least one PRM Module per
market participant ID (‘‘MPID’’) is
required, but a user may have multiple
PRM Module subscriptions per MPID,
depending on the type and number of
ports designated as PRM ports.6 A PRM
3 For example, PRM provides a ‘‘Fat Finger
Check,’’ which allows a user to compare price
instructions on incoming orders against the current
displayed size and price in the market. If the order
is not in line with the displayed price and size, the
order will be rejected before it can execute. Users
can set order limits at several levels to ensure that
clearly erroneous orders never execute.
4 17 CFR 240.15c3–5. See Securities Exchange Act
Release No. 63241 (November 3, 2010), 75 FR 69792
(November 15, 2010).
5 Id.
6 A member firm using FIX or Rash ports can
configure its PRM Module to pre-trade-manage a
subscriber’s order flow for a specified MPID and
PRM-enabled port, or for an account within an
MPID. A member using OUCH ports can configure
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Fmt 4703
Sfmt 4703
Module is created to validate individual
orders against pre-specified parameters.
Aggregate Total Checks allow users to
limit overall daily trading activity based
on Buy, Sell, and/or Net trading limits.
These daily trading activity limits may
be established at an aggregate limit and/
or security specific limit per PRM
Module. Member firms may subscribe to
the PRM Workstation Add-on to an
existing Workstation or WeblinkACT 2.0
for a fee.
The Exchange is proposing to assess
a per-port fee for PRM under Rule
7016(a). This monthly port-based fee is
tiered, decreasing as the number of
PRM-enabled ports subscribed increase
and the next tier is reached. The
Exchange is also proposing to limit the
fees assessed a member firm under the
tiered fee structure to a total of $25,000
per month. Rule 7016(b) sets forth fees
assessed for PRM Modules and
Aggregate Total Check, which will be
available to subscribers at no cost, and
a monthly fee of $100 per each PRM
Workstation Add-on to an existing
Workstation or WeblinkACT 2.0 per
month.
The NASDAQ Stock Market
(‘‘NASDAQ’’) has offered Pre-trade Risk
Management to its members for many
years, and the Exchange is now
proposing to offer member firms the
identical service offered at the same fee
levels.7 A member firm that is an
existing subscriber of NASDAQ PRM,
however, must subscribe separately to
BX PRM to receive the service for its
Exchange order flow.
its PRM Module to pre-trade-manage a subscriber’s
order flow for a specified port.
7 The Exchange notes that NASDAQ recently
amended the fees assessed for PRM and its services.
See Securities Exchange Act Release No. 65020
(August 3, 2011), 76 FR 48193 (August 8, 2011)
(SR–NASDAQ–2011–099).
E:\FR\FM\26AUN1.SGM
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Federal Register / Vol. 76, No. 166 / Friday, August 26, 2011 / Notices
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b)(4) of the Act 8 in that it
provides for the equitable allocation of
reasonable dues, fees and other charges
among members and issuers and other
persons using any facility or system
which the Exchange operates or
controls, and it does not unfairly
discriminate between customers,
issuers, brokers or dealers. The new
PRM fee schedule applies to all
subscribers equally based on the
number of ports subscribed. The
proposed fees will cover the costs
associated with separately offering the
service, responding to customer
requests, configuring Exchange systems,
programming to user specifications, and
administering the service, among other
things, and may provide the Exchange
with a profit to the extent costs are
covered.
The Exchange also believes that the
proposed rule change is consistent with
the provisions of Section 6(b)(5) of the
Act 9 because it is designed to prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in facilitating transactions in securities,
and to remove impediments to and
perfect the mechanism of a free and
open market and a national market
system. PRM is designed to assist
member firms in avoiding entry of
erroneous orders by screening out those
that exceed pre-determined limits,
which otherwise may harm both the
member firm and the quality of the
markets. As such, PRM is an important
compliance tool that members may use
to help maintain the regulatory integrity
of the markets.
emcdonald on DSK2BSOYB1PROD with NOTICES
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act, as amended.
Written comments were neither
solicited nor received.
8 15
9 15
U.S.C. 78f(b)(4).
U.S.C. 78f(b)(5).
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19:37 Aug 25, 2011
Jkt 223001
Because the foregoing proposed rule
change does not significantly affect the
protection of investors or the public
interest, does not impose any significant
burden on competition, and, by its
terms, does not become operative for 30
days from the date on which it was
filed, or such shorter time as the
Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A) of the Act 10 and Rule 19b–
4(f)(6) thereunder.11
The Exchange has requested that the
Commission waive the 30-day operative
delay. The Commission believes that
waiver of the operative delay is
consistent with the protection of
investors and the public interest. Such
a waiver will allow the Exchange to
offer the PRM service, which a member
may use as a tool that could assist
compliance with certain regulatory
obligations and enhance market
integrity, as soon as possible.
Accordingly, the Commission
designates the proposal operative upon
filing.12
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
B. Self-Regulatory Organization’s
Statement on Burden on Competition
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
• 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
53505
Number SR–BX–2011–057 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–BX–2011–057. This file
number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of
10 a.m. and 3 p.m. Copies of 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–BX–
2011–057 and should be submitted on
or before September 16, 2011.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Elizabeth M. Murphy,
Secretary.
10 15
[FR Doc. 2011–21854 Filed 8–25–11; 8:45 am]
11 17
BILLING CODE 8011–01–P
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6)(iii) requires the Exchange to give the
Commission written notice of the Exchange’s intent
to file the proposed rule change, along with a brief
description and text of the proposed rule change,
at least five business days prior to the date of filing
of the proposed rule change, or such shorter time
as designated by the Commission. The Exchange
has satisfied this requirement.
12 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule’s impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
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13 17
E:\FR\FM\26AUN1.SGM
CFR 200.30–3(a)(12).
26AUN1
Agencies
[Federal Register Volume 76, Number 166 (Friday, August 26, 2011)]
[Notices]
[Pages 53503-53505]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-21854]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-65175; File No. SR-BX-2011-057]
Self-Regulatory Organizations; NASDAQ OMX BX, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Establish
and Adopt Fees for the New BX Pre-Trade Risk Management Service
August 19, 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 August 16, 2011, NASDAQ OMX BX, Inc. (the ``Exchange'') 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 proposes to establish and adopt fees for the new BX
Pre-Trade Risk Management service (``PRM''). The Exchange will
implement the fee effective September 1, 2011.
The text of the proposed rule change is below. Proposed new
language is in
[[Page 53504]]
italics; proposed deletions are in brackets.
* * * * *
7016. [Reserved] BX Pre-Trade Risk Management
(a) Users of BX Pre-trade Risk Management (``PRM'') will be assessed
a monthly fee based on the following table, and such fees will not
exceed $25,000 per member firm, per month:
----------------------------------------------------------------------------------------------------------------
Number of PRM-enabled
Port tiers ports Monthly fee
----------------------------------------------------------------------------------------------------------------
Tier 1................................ 50 or more............... $400 per port, per month.
Tier 2................................ 20 to 49................. $500 per port, per month.
Tier 3................................ 5 to 19.................. $550 per port, per month.
Tier 4................................ 1 to 4................... $600 per port, per month.
----------------------------------------------------------------------------------------------------------------
(b) Users of PRM services specified below will be assessed the
following charges in addition to the applicable PRM-enabled port
charges:
------------------------------------------------------------------------
------------------------------------------------------------------------
PRM Modules............................ No charge.
Aggregate Total Checks................. No charge.
PRM Workstation Add-ons to an existing $100 per each PRM Workstation
Workstation or WeblinkACT 2.0. Add-on per month.
------------------------------------------------------------------------
* * * * *
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
Sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange is proposing to adopt BX Pre-trade Risk Management
under Rule 7016. PRM provides member firms with the ability to set a
wide range of parameters for orders to facilitate pre-trade protection
by creating a PRM module defined to represent checks desired. Using
PRM, member firms can increase controls on their trading activity and
the trading activity of their clients and customers at the order level,
including the opportunity to prevent potentially erroneous
transactions. PRM validates orders entered on PRM-enabled ports prior
to allowing those orders into its matching engine and, using parameters
set by the subscriber, determines if the order should be sent for
fulfillment. If PRM rejects an order, it alerts the member firm and
provides it with clearly-defined reasons for the rejection.\3\ These
alerts are sent on Execution and Order/Message DROP copy lines/reports.
The Exchange believes that PRM will be a useful tool to assist members
in complying with the Commission's new market access rule \4\ and
related Exchange requirements.
---------------------------------------------------------------------------
\3\ For example, PRM provides a ``Fat Finger Check,'' which
allows a user to compare price instructions on incoming orders
against the current displayed size and price in the market. If the
order is not in line with the displayed price and size, the order
will be rejected before it can execute. Users can set order limits
at several levels to ensure that clearly erroneous orders never
execute.
\4\ 17 CFR 240.15c3-5. See Securities Exchange Act Release No.
63241 (November 3, 2010), 75 FR 69792 (November 15, 2010).
---------------------------------------------------------------------------
PRM users may choose to set PRM Order Checks, Aggregate Total
Checks within a PRM Module, and subscribe to PRM Workstation Add-ons to
an existing Workstation or WeblinkACT 2.0. PRM manages risk by checking
each order, before it is accepted into the system, against certain
parameters pre-specified by the user within a module, such as maximum
order size or value, order type restrictions, market session
restrictions (pre/post market), security restrictions, including per-
security limits, restricted stock list, and certain other criteria.
These checks are in addition to the Fat Finger Check, which is
available for all orders submitted through a RASH/FIX PRM-enabled
port.\5\ In order for a member firm to subscribe, at least one PRM
Module per market participant ID (``MPID'') is required, but a user may
have multiple PRM Module subscriptions per MPID, depending on the type
and number of ports designated as PRM ports.\6\ A PRM Module is created
to validate individual orders against pre-specified parameters.
Aggregate Total Checks allow users to limit overall daily trading
activity based on Buy, Sell, and/or Net trading limits. These daily
trading activity limits may be established at an aggregate limit and/or
security specific limit per PRM Module. Member firms may subscribe to
the PRM Workstation Add-on to an existing Workstation or WeblinkACT 2.0
for a fee.
---------------------------------------------------------------------------
\5\ Id.
\6\ A member firm using FIX or Rash ports can configure its PRM
Module to pre-trade-manage a subscriber's order flow for a specified
MPID and PRM-enabled port, or for an account within an MPID. A
member using OUCH ports can configure its PRM Module to pre-trade-
manage a subscriber's order flow for a specified port.
---------------------------------------------------------------------------
The Exchange is proposing to assess a per-port fee for PRM under
Rule 7016(a). This monthly port-based fee is tiered, decreasing as the
number of PRM-enabled ports subscribed increase and the next tier is
reached. The Exchange is also proposing to limit the fees assessed a
member firm under the tiered fee structure to a total of $25,000 per
month. Rule 7016(b) sets forth fees assessed for PRM Modules and
Aggregate Total Check, which will be available to subscribers at no
cost, and a monthly fee of $100 per each PRM Workstation Add-on to an
existing Workstation or WeblinkACT 2.0 per month.
The NASDAQ Stock Market (``NASDAQ'') has offered Pre-trade Risk
Management to its members for many years, and the Exchange is now
proposing to offer member firms the identical service offered at the
same fee levels.\7\ A member firm that is an existing subscriber of
NASDAQ PRM, however, must subscribe separately to BX PRM to receive the
service for its Exchange order flow.
---------------------------------------------------------------------------
\7\ The Exchange notes that NASDAQ recently amended the fees
assessed for PRM and its services. See Securities Exchange Act
Release No. 65020 (August 3, 2011), 76 FR 48193 (August 8, 2011)
(SR-NASDAQ-2011-099).
---------------------------------------------------------------------------
[[Page 53505]]
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b)(4) of the Act \8\ in that it provides for the
equitable allocation of reasonable dues, fees and other charges among
members and issuers and other persons using any facility or system
which the Exchange operates or controls, and it does not unfairly
discriminate between customers, issuers, brokers or dealers. The new
PRM fee schedule applies to all subscribers equally based on the number
of ports subscribed. The proposed fees will cover the costs associated
with separately offering the service, responding to customer requests,
configuring Exchange systems, programming to user specifications, and
administering the service, among other things, and may provide the
Exchange with a profit to the extent costs are covered.
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\8\ 15 U.S.C. 78f(b)(4).
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The Exchange also believes that the proposed rule change is
consistent with the provisions of Section 6(b)(5) of the Act \9\
because it is designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in facilitating
transactions in securities, and to remove impediments to and perfect
the mechanism of a free and open market and a national market system.
PRM is designed to assist member firms in avoiding entry of erroneous
orders by screening out those that exceed pre-determined limits, which
otherwise may harm both the member firm and the quality of the markets.
As such, PRM is an important compliance tool that members may use to
help maintain the regulatory integrity of the markets.
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\9\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act, as amended.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not significantly
affect the protection of investors or the public interest, does not
impose any significant burden on competition, and, by its terms, does
not become operative for 30 days from the date on which it was filed,
or such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \10\ and Rule 19b-
4(f)(6) thereunder.\11\
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's intent to file the proposed rule change, along with a
brief description and text of the proposed rule change, at least
five business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
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The Exchange has requested that the Commission waive the 30-day
operative delay. The Commission believes that waiver of the operative
delay is consistent with the protection of investors and the public
interest. Such a waiver will allow the Exchange to offer the PRM
service, which a member may use as a tool that could assist compliance
with certain regulatory obligations and enhance market integrity, as
soon as possible. Accordingly, the Commission designates the proposal
operative upon filing.\12\
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\12\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the 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-BX-2011-057 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-BX-2011-057. This file
number should be included on the subject line if e-mail is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's Internet Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of 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-BX-2011-057 and should be
submitted on or before September 16, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-21854 Filed 8-25-11; 8:45 am]
BILLING CODE 8011-01-P