Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Fees for Members Using the NASDAQ Options Market, 57776-57778 [2011-23722]
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57776
Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Notices
quotation requirements. The Exchange
believes that the proposed optional
functionality to assist Exchange Market
Makers in maintaining continuous, twosided quotations in the securities in
which they are registered will encourage
Market Makers to remain registered with
and trade on the Exchange, thus
providing valuable liquidity to the
Exchange. At the same time, the
Exchange believes that the proposed
functionality will keep Exchangegenerated quotations within reasonable
reach of the NBBO. In addition, the
proposed addition of Rule 11.21(a)(1) to
the Exchange’s MRVP will give the
Exchange the ability to promptly impose
a meaningful financial penalty for such
violations before there is a need for
more serious enforcement action.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The proposed rule change does not
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
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
members or other interested parties.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
mstockstill on DSK4VPTVN1PROD with NOTICES
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period (i)
As the Commission may designate up to
90 days of such date if it finds such
longer period to be appropriate and
publishes its reasons for so finding or
(ii) as to which the self-regulatory
organization consents, the Commission
will:
(a) By order approve or disapprove
such proposed rule change; or
(b) institute proceedings to determine
whether the proposed rule change
should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
VerDate Mar<15>2010
16:26 Sep 15, 2011
Jkt 223001
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
No. SR–EDGX–2011–28 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.
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–65318; File No. SR–
NASDAQ–2011–124]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Modify Fees
for Members Using the NASDAQ
Options Market
September 12, 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
September 6, 2011, The NASDAQ Stock
All submissions should refer to File
Market LLC (‘‘NASDAQ’’ or the
Number SR–EDGX–2011–28. This file
‘‘Exchange’’) filed with the Securities
number should be included on the
and Exchange Commission
subject line if e-mail is used. To help the (‘‘Commission’’) the proposed rule
Commission process and review your
change as described in Items I, II, and
comments more efficiently, please use
III below, which Items have been
only one method. The Commission will prepared by NASDAQ. The Commission
post all comments on the Commissions
is publishing this notice to solicit
Internet Web site (https://www.sec.gov/
comments on the proposed rule change
rules/sro.shtml). Copies of the
from interested persons.
submission, all subsequent
I. Self-Regulatory Organization’s
amendments, all written statements
Statement of the Terms of the Substance
with respect to the proposed rule
of the Proposed Rule Change
change that are filed with the
NASDAQ proposes to modify pricing
Commission, and all written
for NASDAQ members using the
communications relating to the
NASDAQ Market Center. NASDAQ will
proposed rule change between the
implement the proposed change on
Commission and any person, other than September 6, 2011. The text of the
those that may be withheld from the
proposed rule change is available at
public in accordance with the
https://nasdaq.cchwallstreet.com/, at
provisions of 5 U.S.C. 552, will be
NASDAQ’s principal office, and at the
available for Web site viewing and
Commission’s Public Reference Room.
printing in the Commission’s Public
II. Self-Regulatory Organization’s
Reference Room. Copies of such filing
also will be available for inspection and Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
copying at the principal office of the
Change
Exchange. All comments received will
In its filing with the Commission,
be posted without change; the
NASDAQ included statements
Commission does not edit personal
concerning the purpose of and basis for
identifying information from
the proposed rule change and discussed
submissions. You should submit only
any comments it received on the
information that you wish to make
proposed rule change. The text of these
available publicly. All submissions
statements may be examined at the
should refer to File Number SR–EDGX–
places specified in Item IV below.
2011–28 and should be submitted by
NASDAQ has prepared summaries, set
October 7, 2011.
forth in Sections A, B, and C below, of
For the Commission, by the Division of
the most significant aspects of such
Trading and Markets, pursuant to delegated
statements.
authority.15
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–23772 Filed 9–15–11; 8:45 am]
BILLING CODE 8011–01–P
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
1 15
15 17
PO 00000
CFR 200.30–3(a)(12).
Frm 00065
Fmt 4703
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2 17
E:\FR\FM\16SEN1.SGM
U.S.C. 78s(b)(1).
CFR 240.19b–4.
16SEN1
Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Notices
assessed for option orders entered into
NOM. Specifically, NASDAQ is
proposing to modify pricing for the
Customer Rebate to Add Liquidity in
Penny Options by adding an additional
volume achievement to earn an
enhanced rebate. The Exchange
currently pays a Customer Rebate to
Add Liquidity in Penny Options based
on six volume tiers as follows:
Rebate to add
liquidity
Monthly volume
Tier
Tier
Tier
Tier
Tier
1
2
3
4
5
........................................
........................................
........................................
........................................
........................................
Tier 6 ........................................
Participant adds Customer liquidity of up to 24,999 contracts per day in a month ...................
Participant adds Customer liquidity of 25,000—59,999 contracts per day in a month ..............
Participant adds Customer liquidity of 60,000–124,999 contracts per day in a month .............
Participant adds Customer liquidity of 125,000 or more contracts per day in a month .............
Participant adds (1) Customer liquidity of 60,000 or more contracts per day in a month, and
(2) NOM Market Maker liquidity of 60,000 or more contracts per day in a month.
Participant adds Customer liquidity of 25,000 or more contracts per day in a month, and (2)
the Participant simultaneously qualifies for credit under the Investor Support Program set
forth in Rule 7014.
To further encourage firms that route
Customer orders to increase Customer
order flow to the Exchange, the
Exchange is proposing to modify the
Customer Rebates to Add Liquidity in
Penny Pilot by adding a monthly
volume target for NOM Participants that
qualify for Tiers 2 and 6. Specifically,
firms that qualify for Tier 2 by adding
Customer Liquidity in Penny Options of
25,000 to 59,999 contracts per day for
the month, can receive an additional
$0.02 rebate by contributing 750,000
contracts of Customer Liquidity in
Penny Options between September 6
and September 30, 2011. Also, firms
that qualify for Tier 6 by adding
Customer Liquidity in Penny Options of
25,000 or more contracts per day for the
month and also qualifying for a credit
under NASDAQ’s Investor Support
Program (set forth in Rule 7014),3 can
receive an additional $0.02 rebate by
contributing 750,000 contracts of
Customer Liquidity in Penny Options
between September 6 and September 30,
2011. NOM Participants that qualify for
these two new tiers will receive an
additional $0.02 rebate only for
executions occurring between
September 6 and September 30, 2011;
volume executed on September 1, 2011
and September 2, 2011 will not be
eligible.
mstockstill on DSK4VPTVN1PROD with NOTICES
2. Statutory Basis
NASDAQ believes that the proposed
rule changes are consistent with the
provisions of Section 6 of the Act,4 in
3 For a detailed description of the Investor
Support Program, see Securities Exchange Act
Release No. 63270 (November 8, 2010), 75 FR 69489
(November 12, 2010) (NASDAQ–2010–141) (notice
of filing and immediate effectiveness) (the ‘‘ISP
Filing’’). See also Securities Exchange Act Release
Nos. 63414 (December 2, 2010), 75 FR 76505
(December 8, 2010) (NASDAQ–2010–153) (notice of
filing and immediate effectiveness); and 63628
(January 3, 2011), 76 FR 1201 (January 7, 2011)
(NASDAQ–2010–154) (notice of filing and
immediate effectiveness).
4 15 U.S.C. 78f.
VerDate Mar<15>2010
16:26 Sep 15, 2011
57777
Jkt 223001
general, and with Section 6(b)(4) of the
Act,5 in particular, 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
NASDAQ operates or controls.
The Exchange believes that the
proposed new pricing tiers are
equitable, reasonable and not unfairly
discriminatory because they continue an
existing program to encourage brokerdealers acting as agent for Customer
orders to select the Exchange as a venue
to post Customer orders. The Exchange
believes that its success at attracting
Customer order flow benefits all market
participants by improving the quality of
order interaction and executions at the
Exchange.
The Exchange further believes that
limiting the new tiers to firms already
qualifying for Tiers 2 and 6 (and not
those that qualify for Tier 3, 4 and 5) is
equitable and not unfairly
discriminatory because NOM
Participants in Tiers 3, 4, and 5 already
earn a higher rebate. For example, a
NOM Participant that qualify [sic] for
the new tiers will receive a rebate of
either $0.36 or $0.37 per contract,
whereas NOM Participants that qualify
for Tiers 3, 4 and 5 receive a $0.38 per
contract rebate.
The Exchange believes that the
proposed new pricing tiers for Customer
Rebates to Add Liquidity in Penny
Options is equitable and not unfairly
discriminatory because the Exchange
will uniformly pay a Rebate to Add
Liquidity to Customers executing Penny
Options based on the 750,000 volume
target and monthly tiers proposed and
discussed herein.
The Exchange operates in a highly
competitive market comprised of nine
U.S. options exchanges in which
sophisticated and knowledgeable
market participants can and do send
5 15
PO 00000
U.S.C. 78f(b)(4).
Frm 00066
Fmt 4703
$0.35
order flow to competing exchanges if
they deem fee levels at a particular
exchange to be excessive or rebate
opportunities to be inadequate. The
Exchange believes that the proposed
rebate scheme is competitive and
similar to other rebates and tiers
opportunities in place on other
exchanges. The Exchange believes that
this competitive marketplace materially
impacts the rebates present on the
Exchange today and substantially
influenced the proposal set forth above.
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.
Because the market for order execution
is extremely competitive, members may
readily opt to disfavor NASDAQ’s
execution services if they believe that
alternatives offer them better value. For
this reason and the reasons discussed in
connection with the statutory basis for
the proposed rule change, the Exchange
does not believe that the proposed
changes will impair the ability of
members or competing order execution
venues to maintain their competitive
standing in the financial markets.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants or Others
Written comments were neither
solicited nor received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act.6 At any time
6 15
Sfmt 4703
$0.26
$0.34
$0.38
$0.40
$0.40
E:\FR\FM\16SEN1.SGM
U.S.C. 78s(b)(3)(a)(ii).
16SEN1
57778
Federal Register / Vol. 76, No. 180 / Friday, September 16, 2011 / Notices
within 60 days of the filing of the
proposed rule change, the Commission
summarily may temporarily suspend
such rule change if it appears to the
Commission that such action is
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of the Act. If the Commission
takes such action, the Commission shall
institute proceedings to determine
whether the proposed rule should be
approved or disapproved.
Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File No. SR–NASDAQ–
2011–124 and should be submitted on
or before October 7, 2011.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.7
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011–23722 Filed 9–15–11; 8:45 am]
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–2011–124 on the
subject line.
mstockstill on DSK4VPTVN1PROD with NOTICES
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:
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Modify Fees
for Members Using the NASDAQ
Options Market
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–2011–124. This
file number should be included on the
subject line if e-mail is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
Internet Web site (https://www.sec.gov/
rules/sro/shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of such filing
also will be available for inspection and
copying at the principal office of the
Exchange. All comments received will
be posted without change; the
VerDate Mar<15>2010
16:26 Sep 15, 2011
Jkt 223001
BILLING CODE 8011–01–P
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below.
NASDAQ has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–65317; File No. SR–
NASDAQ–2011–127]
NASDAQ is proposing to modify Rule
7050 governing the rebates and fees
assessed for option orders entered into
NOM. Specifically, NASDAQ is
proposing to modify pricing for the
Customer Rebate to Add Liquidity in
Penny Options to revising [sic] existing
monthly volume tiers. The Exchange
currently pays a Customer Rebate to
Add Liquidity in Penny Options based
on four volume tiers as follows:
Monthly volume
September 12, 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
September 1, 2011, The NASDAQ Stock
Market LLC (‘‘NASDAQ’’ or the
‘‘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 NASDAQ. The Commission
is publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
NASDAQ proposes to modify pricing
for NASDAQ members using the
NASDAQ Market Center. NASDAQ will
implement the proposed change on
September 1, 2011. The text of the
proposed rule change is available at
https://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,
NASDAQ included statements
7 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00067
Fmt 4703
Sfmt 4703
Tier 1 .....
Tier 2 .....
Tier 3 .....
Tier 4 .....
Rebate to add
liquidity
0–499,999 ........
500,000–
799,999.
800,000–
1,199,999.
1,200,000 and
up.
$0.26
0.32
0.36
0.38
By way of example, the Exchange
currently pays a Rebate to Add
Liquidity of $0.36 per contract to a
NOM Participant that executed 900,000
Customer contracts that added liquidity
in Penny Options in a given month. If
the NOM Participant executed 1,500,000
Customer contracts that added liquidity
in Penny Options in a given month, the
Exchange currently would pay a Rebate
to Add Liquidity of $0.38 per contract.
The Exchange believes the existing
monthly volume thresholds have
incentivized firms that route Customer
orders to the Exchange to increase
Customer order flow to the Exchange.
To further encourage firms that route
Customer orders to increase Customer
order flow to the Exchange, the
Exchange is proposing to modify the
Customer Rebates to Add Liquidity in
Penny Pilot Options in several ways.
First, the Exchange is converting all tier
measurements to average daily volumes
from aggregate monthly volumes. This
change is not, in and of itself, a material
change.
Second, based on its experience with
the existing volume tiers, the Exchange
is modifying the volume required to
E:\FR\FM\16SEN1.SGM
16SEN1
]]>Agencies
[Federal Register Volume 76, Number 180 (Friday, September 16, 2011)]
[Notices]
[Pages 57776-57778]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-23722]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-65318; File No. SR-NASDAQ-2011-124]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify Fees for Members Using the NASDAQ Options Market
September 12, 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 September 6, 2011, The NASDAQ Stock Market LLC (``NASDAQ'' or the
``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 NASDAQ. The Commission
is publishing this notice to solicit comments on the proposed rule
change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
NASDAQ proposes to modify pricing for NASDAQ members using the
NASDAQ Market Center. NASDAQ will implement the proposed change on
September 6, 2011. The text of the proposed rule change is available at
https://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, NASDAQ included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. NASDAQ has prepared summaries, set forth in Sections A,
B, and C below, of the most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
NASDAQ is proposing to modify Rule 7050 governing the rebates and
fees
[[Page 57777]]
assessed for option orders entered into NOM. Specifically, NASDAQ is
proposing to modify pricing for the Customer Rebate to Add Liquidity in
Penny Options by adding an additional volume achievement to earn an
enhanced rebate. The Exchange currently pays a Customer Rebate to Add
Liquidity in Penny Options based on six volume tiers as follows:
----------------------------------------------------------------------------------------------------------------
Rebate to add
Monthly volume liquidity
----------------------------------------------------------------------------------------------------------------
Tier 1........................................ Participant adds Customer liquidity of up to $0.26
24,999 contracts per day in a month.
Tier 2........................................ Participant adds Customer liquidity of 25,000-- $0.34
59,999 contracts per day in a month.
Tier 3........................................ Participant adds Customer liquidity of 60,000- $0.38
124,999 contracts per day in a month.
Tier 4........................................ Participant adds Customer liquidity of 125,000 $0.40
or more contracts per day in a month.
Tier 5........................................ Participant adds (1) Customer liquidity of $0.40
60,000 or more contracts per day in a month,
and (2) NOM Market Maker liquidity of 60,000
or more contracts per day in a month.
Tier 6........................................ Participant adds Customer liquidity of 25,000 $0.35
or more contracts per day in a month, and (2)
the Participant simultaneously qualifies for
credit under the Investor Support Program set
forth in Rule 7014.
----------------------------------------------------------------------------------------------------------------
To further encourage firms that route Customer orders to increase
Customer order flow to the Exchange, the Exchange is proposing to
modify the Customer Rebates to Add Liquidity in Penny Pilot by adding a
monthly volume target for NOM Participants that qualify for Tiers 2 and
6. Specifically, firms that qualify for Tier 2 by adding Customer
Liquidity in Penny Options of 25,000 to 59,999 contracts per day for
the month, can receive an additional $0.02 rebate by contributing
750,000 contracts of Customer Liquidity in Penny Options between
September 6 and September 30, 2011. Also, firms that qualify for Tier 6
by adding Customer Liquidity in Penny Options of 25,000 or more
contracts per day for the month and also qualifying for a credit under
NASDAQ's Investor Support Program (set forth in Rule 7014),\3\ can
receive an additional $0.02 rebate by contributing 750,000 contracts of
Customer Liquidity in Penny Options between September 6 and September
30, 2011. NOM Participants that qualify for these two new tiers will
receive an additional $0.02 rebate only for executions occurring
between September 6 and September 30, 2011; volume executed on
September 1, 2011 and September 2, 2011 will not be eligible.
---------------------------------------------------------------------------
\3\ For a detailed description of the Investor Support Program,
see Securities Exchange Act Release No. 63270 (November 8, 2010), 75
FR 69489 (November 12, 2010) (NASDAQ-2010-141) (notice of filing and
immediate effectiveness) (the ``ISP Filing''). See also Securities
Exchange Act Release Nos. 63414 (December 2, 2010), 75 FR 76505
(December 8, 2010) (NASDAQ-2010-153) (notice of filing and immediate
effectiveness); and 63628 (January 3, 2011), 76 FR 1201 (January 7,
2011) (NASDAQ-2010-154) (notice of filing and immediate
effectiveness).
---------------------------------------------------------------------------
2. Statutory Basis
NASDAQ believes that the proposed rule changes are consistent with
the provisions of Section 6 of the Act,\4\ in general, and with Section
6(b)(4) of the Act,\5\ in particular, 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 NASDAQ operates or controls.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78f.
\5\ 15 U.S.C. 78f(b)(4).
---------------------------------------------------------------------------
The Exchange believes that the proposed new pricing tiers are
equitable, reasonable and not unfairly discriminatory because they
continue an existing program to encourage broker-dealers acting as
agent for Customer orders to select the Exchange as a venue to post
Customer orders. The Exchange believes that its success at attracting
Customer order flow benefits all market participants by improving the
quality of order interaction and executions at the Exchange.
The Exchange further believes that limiting the new tiers to firms
already qualifying for Tiers 2 and 6 (and not those that qualify for
Tier 3, 4 and 5) is equitable and not unfairly discriminatory because
NOM Participants in Tiers 3, 4, and 5 already earn a higher rebate. For
example, a NOM Participant that qualify [sic] for the new tiers will
receive a rebate of either $0.36 or $0.37 per contract, whereas NOM
Participants that qualify for Tiers 3, 4 and 5 receive a $0.38 per
contract rebate.
The Exchange believes that the proposed new pricing tiers for
Customer Rebates to Add Liquidity in Penny Options is equitable and not
unfairly discriminatory because the Exchange will uniformly pay a
Rebate to Add Liquidity to Customers executing Penny Options based on
the 750,000 volume target and monthly tiers proposed and discussed
herein.
The Exchange operates in a highly competitive market comprised of
nine U.S. options exchanges in which sophisticated and knowledgeable
market participants can and do send order flow to competing exchanges
if they deem fee levels at a particular exchange to be excessive or
rebate opportunities to be inadequate. The Exchange believes that the
proposed rebate scheme is competitive and similar to other rebates and
tiers opportunities in place on other exchanges. The Exchange believes
that this competitive marketplace materially impacts the rebates
present on the Exchange today and substantially influenced the proposal
set forth above.
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. Because the market
for order execution is extremely competitive, members may readily opt
to disfavor NASDAQ's execution services if they believe that
alternatives offer them better value. For this reason and the reasons
discussed in connection with the statutory basis for the proposed rule
change, the Exchange does not believe that the proposed changes will
impair the ability of members or competing order execution venues to
maintain their competitive standing in the financial markets.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\6\ At any time
[[Page 57778]]
within 60 days of the filing of the proposed rule change, the
Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act. If the Commission takes such
action, the Commission shall institute proceedings to determine whether
the proposed rule should be approved or disapproved.
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\6\ 15 U.S.C. 78s(b)(3)(a)(ii).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2011-124 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-2011-124. This
file number should be included on the subject line if e-mail is used.
To help the Commission process and review your comments more
efficiently, please use only one method. The Commission will post all
comments on the Commission's Internet Web site (https://www.sec.gov/rules/sro/shtml). Copies of the submission, all subsequent amendments,
all written statements with respect to the proposed rule change that
are filed with the Commission, and all written communications relating
to the proposed rule change between the Commission and any person,
other than those that may be withheld from the public in accordance
with the provisions of 5 U.S.C. 552, will be available for Web site
viewing and printing in the Commission's Public Reference Room, 100 F
Street, NE., Washington, DC 20549, on official business days between
the hours of 10 a.m. and 3 p.m. Copies of such filing also will be
available for inspection and copying at 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 No. SR-NASDAQ-
2011-124 and should be submitted on or before October 7, 2011.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\7\
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\7\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-23722 Filed 9-15-11; 8:45 am]
BILLING CODE 8011-01-P
