Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to Short Interest Reports, 70600-70604 [2014-28026]
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Federal Register / Vol. 79, No. 228 / Wednesday, November 26, 2014 / Notices
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
10:00 a.m. and 3:00 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 Number SR–
NYSEArca–2014–125, and should be
submitted on or before December 17,
2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–27976 Filed 11–25–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73662; File No. SR–
NASDAQ–2014–106]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change Relating to
Short Interest Reports
November 20, 2014.
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 November
12, 2014, The NASDAQ Stock Market
LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (‘‘SEC’’ or ‘‘Commission’’)
the proposed rule change as described
in Items I, II, and III, below, which Items
have been prepared by the Exchange.
The Commission is publishing this
notice to solicit comments on the
proposed rule change from interested
persons.
I. Self-Regulatory Organization’s
Statement of the Terms of the Substance
of the Proposed Rule Change
The Exchange proposes to change the
model of pricing for Short Interest
Reports under the category of Historical
Research and Administrative Reports
under NASDAQ Rule 7022. Specifically,
NASDAQ proposes to replace the
current subscriber-based model with a
fee based on internal or external
distribution of the reports. Although the
proposed rule is effective upon filing,
NASDAQ plans to implement the fee on
January 1, 2015.
The text of the proposed rule change
is below; proposed new language is
italicized; proposed deletions are in
brackets.
*
*
*
*
*
7022. Historical Research and
Administrative Reports
(a) No Change.
(b) The charge to be paid by the
purchaser of an Historical Research
Report regarding a Nasdaq security that
wishes to obtain a license to redistribute
the information contained in the report
to subscribers shall be determined in
accordance with the following schedule:
NUMBER OF SUBSCRIBERS
1–500
A. Market Summary Statistics:
More often than once a month .....................................
Once a month, quarter, or year ....................................
B. Reserved.
C. Nasdaq Issues Summary Statistics:
More often than once a month .....................................
Internal Distribution ................................................
External Distribution ..............................................
Once a month, quarter, or year ....................................
Aggregation of data on an annual basis ......................
D. Intra-Day Quote and Intra-Day Time and Sales Data:
For a security and/or a market participant for a day ....
For all market participants for a day or for all securities for a day .............................................................
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(c) No change.
(d) No change.
*
*
*
*
*
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
501–999
CFR 200.30–3(a)(12).
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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.
1 15
5,000–9,999
$250
125
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
18 17
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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
pricing model for historical research
and administrative reports categorized
as Nasdaq Issues Summary Statistics
under subsection C of NASDAQ Rule
7022(b). The current pricing schedule
for Nasdaq Issues Summary Statistics
2 17
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CFR 240.19b–4.
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reports currently includes only short
interest information.3 The fee schedule
is currently divided into two tranches
depending upon whether the report is
distributed once per month or less, or
more than once monthly. Within each
tranche, the fee depends upon how
many subscribers receive the report
from a given Distributor. This proposal
affects only the tranches of reports that
are distributed more than once per
month, meaning it will apply only to
Short Interest Reports.
For this category only, NASDAQ has
determined to replace the subscriberbased tiers with a fee based on internal
versus external distribution, a model
already utilized by NASDAQ for
multiple products. Internal distribution
is defined as distribution of NASDAQ
data by a given firm or other entity that
receives data from NASDAQ only to
recipients within that firm or entity.
Conversely, external distribution is
defined as distribution of NASDAQ data
by a given firm or other entity that
receives data from NASDAQ to
recipients either outside of the entity or
both within and outside of that firm or
entity. Replacing the per-subscriber fee
with a Distributor fee will reduce the
administrative burden on firms by
eliminating the requirement to control
and/or count the number of recipients of
the report. In addition, external
distributors will continue to be
permitted to use the Information
internally without additional charges.
NASDAQ has determined to assess a
monthly per Distributor fee of $1,000 for
internal distribution and $2,500 for
external distribution. NASDAQ
determined to assess higher fees for
external Distributors based on historical
experience that external distributors
offer wider distribution than internal
Distributors, and they therefore derive
higher value than internal Distributors
while typically maintaining a lower fee
per unit.
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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)(4) and
6(b)(5) of the Act,5 in particular, in that
it provides an equitable allocation of
reasonable fees among Subscribers and
recipients of NASDAQ data and is not
3 In 2013, NASDAQ moved the Daily List and
Fundamental Data formerly covered by this rule
into new NASDAQ Rule 7022(d). See Exchange Act
Release No. 68636 (Jan. 11, 2013). In the future, this
category may include other information that
properly falls within the category of Nasdaq Issues
Summary Statistics.
4 15 U.S.C. 78f.
5 15 U.S.C. 78f(b)(4) and (5).
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designed to permit unfair
discrimination between them. In
adopting Regulation NMS, the
Commission granted self-regulatory
organizations and broker-dealers
increased authority and flexibility to
offer new and unique market data to the
public.
The Commission concluded that
Regulation NMS—by deregulating the
market in proprietary data—would itself
further the Act’s goals of facilitating
efficiency and competition:
[E]fficiency is promoted when broker-dealers
who do not need the data beyond the prices,
sizes, market center identifications of the
NBBO and consolidated last sale information
are not required to receive (and pay for) such
data. The Commission also believes that
efficiency is promoted when broker-dealers
may choose to receive (and pay for)
additional market data based on their own
internal analysis of the need for such data.6
By removing ‘‘unnecessary regulatory
restrictions’’ on the ability of exchanges
to sell their own data, Regulation NMS
advanced the goals of the Act and the
principles reflected in its legislative
history. If the free market should
determine whether proprietary data is
sold to broker-dealers at all, it follows
that the price at which such data is sold
should be set by the market as well.
On July 21, 2010, President Barack
Obama signed into law H.R. 4173, the
Dodd-Frank Wall Street Reform and
Consumer Protection Act of 2010
(‘‘Dodd-Frank Act’’), which amended
Section 19 of the Act. Among other
things, Section 916 of the Dodd-Frank
Act amended paragraph (A) of Section
19(b)(3) of the Act by inserting the
phrase ‘‘on any person, whether or not
the person is a member of the selfregulatory organization’’ after ‘‘due, fee
or other charge imposed by the selfregulatory organization.’’ As a result, all
self-regulatory organization (‘‘SRO’’)
rule proposals establishing or changing
dues, fees, or other charges are
immediately effective upon filing
regardless of whether such dues, fees, or
other charges are imposed on members
of the SRO, non-members, or both.
Section 916 further amended paragraph
(C) of Section 19(b)(3) of the Act to read,
in pertinent part, ‘‘At any time within
the 60-day period beginning on the date
of filing of such a proposed rule change
in accordance with the provisions of
paragraph (1) [of Section 19(b)], the
Commission summarily may
temporarily suspend the change in the
rules of the self-regulatory organization
made thereby, if it appears to the
Commission that such action is
6 Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496 (June 29, 2005).
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70601
necessary or appropriate in the public
interest, for the protection of investors,
or otherwise in furtherance of the
purposes of this title. If the Commission
takes such action, the Commission shall
institute proceedings under paragraph
(2)(B) [of Section 19(b)] to determine
whether the proposed rule should be
approved or disapproved.’’
The decision of the United States
Court of Appeals for the District of
Columbia Circuit in NetCoalition v.
SEC, No. 09–1042 (D.C. Cir. 2010),
although reviewing a Commission
decision made prior to the effective date
of the Dodd-Frank Act, upheld the
Commission’s reliance upon
competitive markets to set reasonable
and equitably allocated fees for market
data. ‘‘In fact, the legislative history
indicates that the Congress intended
that the market system ‘evolve through
the interplay of competitive forces as
unnecessary regulatory restrictions are
removed’ and that the SEC wield its
regulatory power ‘in those situations
where competition may not be
sufficient,’ such as in the creation of a
‘consolidated transactional reporting
system.’ ’’ NetCoalition, at 15 (quoting
H.R. Rep. No. 94–229, at 92 (1975), as
reprinted in 1975 U.S.C.C.A.N. 321,
323).
For the reasons stated above,
NASDAQ believes that the allocation of
the proposed fee is fair and equitable in
accordance with Section 6(b)(4) of the
Act, and not unreasonably
discriminatory in accordance with
Section 6(b)(5) of the Act. As described
above, the proposed fee is based on
pricing conventions and distinctions
that exist in NASDAQ’s current fee
schedule. These distinctions are each
based on principles of fairness and
equity that have helped for many years
to maintain fair, equitable, and not
unreasonably discriminatory fees, and
that apply with equal or greater force to
the current proposal.
NASDAQ believes that the $1,000 and
$2,500 Distributor fees for the short
interest report are fair and equitable and
not unreasonably discriminatory. The
Internal Distributor Fee represents an
increase of no more than $500 per
month, with many Distributors paying a
smaller increase or no increase at all.
The higher External Distributor Fee is
fair and equitable because External
Distributors derive higher value from
the report and, therefore, should bear a
higher burden than internal
Distributors. In addition, all Distributors
benefit from the reduced administrative
burden of counting subscribers.
NASDAQ further believes that the
distinction between internal and
external distribution is fair and
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equitable and not unreasonably
discriminatory because external
distributors have the potential to, and
generally do, distribute to a larger
number of subscribers. As noted earlier,
NASDAQ and other exchanges have
utilize this pricing model for many
years.
As described in greater detail below,
if NASDAQ has calculated improperly
and the market deems the proposed fees
to be unfair, inequitable, or
unreasonably discriminatory, firms can
discontinue the use of their data
because the proposed product is entirely
optional to all parties. Firms are not
required to purchase data and NASDAQ
is not required to make data available or
to offer specific pricing alternatives for
potential purchases. NASDAQ can
discontinue offering a pricing
alternative (as it has in the past) and
firms can discontinue their use at any
time and for any reason (as they often
do), including due to their assessment of
the reasonableness of fees charged.
NASDAQ continues to establish and
revise pricing policies aimed at
increasing fairness and equitable
allocation of fees among Subscribers.
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.
Notwithstanding its determination that
the Commission may rely upon
competition to establish fair and
equitably allocated fees for market data,
the NetCoalition court found that the
Commission had not, in that case,
compiled a record that adequately
supported its conclusion that the market
for the data at issue in the case was
competitive. NASDAQ believes that a
record may readily be established to
demonstrate the competitive nature of
the market in question.
There is intense competition between
trading platforms that provide
transaction execution and routing
services and proprietary data products.
Transaction execution and proprietary
data products are complementary in that
market data is both an input and a
byproduct of the execution service. In
fact, market data and trade execution are
a paradigmatic example of joint
products with joint costs. Data products
are valuable to many end Subscribers
only insofar as they provide information
that end Subscribers expect will assist
them or their customers in making
trading decisions.
The costs of producing market data
include not only the costs of the data
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distribution infrastructure, but also the
costs of designing, maintaining, and
operating the exchange’s transaction
execution platform and the cost of
regulating the exchange to ensure its fair
operation and maintain investor
confidence. The total return that a
trading platform earns reflects the
revenues it receives from both products
and the joint costs it incurs. Moreover,
an exchange’s customers view the costs
of transaction executions and of data as
a unified cost of doing business with the
exchange. A broker-dealer will direct
orders to a particular exchange only if
the expected revenues from executing
trades on the exchange exceed net
transaction execution costs and the cost
of data that the broker-dealer chooses to
buy to support its trading decisions (or
those of its customers). The choice of
data products is, in turn, a product of
the value of the products in making
profitable trading decisions. If the cost
of the product exceeds its expected
value, the broker-dealer will choose not
to buy it. Moreover, as a broker-dealer
chooses to direct fewer orders to a
particular exchange, the value of the
product to that broker-dealer decreases,
for two reasons. First, the product will
contain less information, because
executions of the broker-dealer’s orders
will not be reflected in it. Second, and
perhaps more important, the product
will be less valuable to that brokerdealer because it does not provide
information about the venue to which it
is directing its orders. Data from the
competing venue to which the brokerdealer is directing orders will become
correspondingly more valuable.
Thus, an increase in the fees charged
for either transactions or data has the
potential to impair revenues from both
products. ‘‘No one disputes that
competition for order flow is ‘fierce’.’’
NetCoalition at 24. However, the
existence of fierce competition for order
flow implies a high degree of price
sensitivity on the part of broker-dealers
with order flow, since they may readily
reduce costs by directing orders toward
the lowest-cost trading venues. A
broker-dealer that shifted its order flow
from one platform to another in
response to order execution price
differentials would both reduce the
value of that platform’s market data and
reduce its own need to consume data
from the disfavored platform. Similarly,
if a platform increases its market data
fees, the change will affect the overall
cost of doing business with the
platform, and affected broker-dealers
will assess whether they can lower their
trading costs by directing orders
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elsewhere and thereby lessening the
need for the more expensive data.
Analyzing the cost of market data
distribution in isolation from the cost of
all of the inputs supporting the creation
of market data will inevitably
underestimate the cost of the data. Thus,
because it is impossible to create data
without a fast, technologically robust,
and well-regulated execution system,
system costs and regulatory costs affect
the price of market data. It would be
equally misleading, however, to
attribute all of the exchange’s costs to
the market data portion of an exchange’s
joint product. Rather, all of the
exchange’s costs are incurred for the
unified purposes of attracting order
flow, executing and/or routing orders,
and generating and selling data about
market activity. The total return that an
exchange earns reflects the revenues it
receives from the joint products and the
total costs of the joint products.
Competition among trading platforms
can be expected to constrain the
aggregate return each platform earns
from the sale of its joint products, but
different platforms may choose from a
range of possible, and equally
reasonable, pricing strategies as the
means of recovering total costs. For
example, some platforms may choose to
pay rebates to attract orders, charge
relatively low prices for market
information (or provide information free
of charge) and charge relatively high
prices for accessing posted liquidity.
Other platforms may choose a strategy
of paying lower rebates (or no rebates)
to attract orders, setting relatively high
prices for market information, and
setting relatively low prices for
accessing posted liquidity. In this
environment, there is no economic basis
for regulating maximum prices for one
of the joint products in an industry in
which suppliers face competitive
constraints with regard to the joint
offering. This would be akin to strictly
regulating the price that an automobile
manufacturer can charge for car sound
systems despite the existence of a highly
competitive market for cars and the
availability of after-market alternatives
to the manufacturer-supplied system.
The market for market data products
is competitive and inherently
contestable because there is fierce
competition for the inputs necessary to
the creation of proprietary data and
strict pricing discipline for the
proprietary products themselves.
Numerous exchanges compete with
each other for listings, trades, and
market data itself, providing virtually
limitless opportunities for entrepreneurs
who wish to produce and distribute
their own market data. This proprietary
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data is produced by each individual
exchange, as well as other entities, in a
vigorously competitive market.
Broker-dealers currently have
numerous alternative venues for their
order flow, including thirteen SRO
markets, as well as internalizing brokerdealers (‘‘BDs’’) and various forms of
alternative trading systems (‘‘ATSs’’),
including dark pools and electronic
communication networks (‘‘ECNs’’).
Each SRO market competes to produce
transaction reports via trade executions,
and two FINRA-regulated Trade
Reporting Facilities (‘‘TRFs’’) compete
to attract internalized transaction
reports. Competitive markets for order
flow, executions, and transaction
reports provide pricing discipline for
the inputs of proprietary data products.
The large number of SROs, TRFs, BDs,
and ATSs that currently produce
proprietary data or are currently capable
of producing it provides further pricing
discipline for proprietary data products.
Each SRO, TRF, ATS, and BD is
currently permitted to produce
proprietary data products, and many
currently do or have announced plans to
do so, including NASDAQ, New York
Stock Exchange LLC (‘‘NYSE’’), NYSE
MKT LLC, NYSE Arca LLC, and BATS
Exchange, Inc. (‘‘BATS’’).
Any ATS or BD can combine with any
other ATS, BD, or multiple ATSs or BDs
to produce joint proprietary data
products. Additionally, order routers
and market data vendors can facilitate
single or multiple broker-dealers’
production of proprietary data products.
The potential sources of proprietary
products are virtually limitless.
The fact that proprietary data from
ATSs, BDs, and vendors can by-pass
SROs is significant in two respects.
First, non-SROs can compete directly
with SROs for the production and sale
of proprietary data products, as BATS
and Arca did before registering as
exchanges by publishing data on the
Internet. Second, because a single order
or transaction report can appear in an
SRO proprietary product, a non-SRO
proprietary product, or both, the data
available in proprietary products is
exponentially greater than the actual
number of orders and transaction
reports that exist in the marketplace.
Market data vendors provide another
form of price discipline for proprietary
data products because they control the
primary means of access to end
Subscribers. Vendors impose price
restraints based upon their business
models. For example, vendors such as
Bloomberg and Thomson Reuters that
assess a surcharge on data they sell may
refuse to offer proprietary products that
end Subscribers will not purchase in
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sufficient numbers. Internet portals,
such as Google, impose a discipline by
providing only data that will enable
them to attract ‘‘eyeballs’’ that
contribute to their advertising revenue.
Retail broker-dealers, such as Schwab
and Fidelity, offer their customers
proprietary data only if it promotes
trading and generates sufficient
commission revenue. Although the
business models may differ, these
vendors’ pricing discipline is the same:
They can simply refuse to purchase any
proprietary data product that fails to
provide sufficient value. NASDAQ and
other producers of proprietary data
products must understand and respond
to these varying business models and
pricing disciplines in order to market
proprietary data products successfully.
In addition to the competition and
price discipline described above, the
market for proprietary data products is
also highly contestable because market
entry is rapid, inexpensive, and
profitable. The history of electronic
trading is replete with examples of
entrants that swiftly grew into some of
the largest electronic trading platforms
and proprietary data producers:
Archipelago, Bloomberg Tradebook,
Island, RediBook, Attain, TracECN,
BATS Trading and Direct Edge. A
proliferation of dark pools and other
ATSs operate profitably with
fragmentary shares of consolidated
market volume.
Regulation NMS, by deregulating the
market for proprietary data, has
increased the contestability of that
market. While broker-dealers have
previously published their proprietary
data individually, Regulation NMS
encourages market data vendors and
broker-dealers to produce proprietary
products cooperatively in a manner
never before possible. Multiple market
data vendors already have the capability
to aggregate data and disseminate it on
a profitable scale, including Bloomberg,
and Thomson Reuters.
The vigor of competition for
information is significant. NASDAQ has
made a determination to adjust the fees
associated with this product in order to
reflect more accurately the value of its
products and the investments made to
enhance them, as well as to keep pace
with changes in the industry and
evolving customer needs. This product
is entirely optional and is geared
towards attracting new customers, as
well as retaining existing customers.
The Exchange has witnessed
competitors creating new products and
innovative pricing in this space over the
course of the past year. NASDAQ
continues to see firms challenge its
pricing on the basis of the Exchange’s
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explicit fees being higher than the zeropriced fees from other competitors such
as BATS. In all cases, firms make
decisions on how much and what types
of data to consume on the basis of the
total cost of interacting with NASDAQ
or other exchanges. Of course, the
explicit data fees are but one factor in
a total platform analysis. Some
competitors have lower transactions fees
and higher data fees, and others are vice
versa.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to Section
19(b)(3)(A)(ii) of the Act.7
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: (i) Necessary or appropriate in
the public interest; (ii) for the protection
of investors; or (iii) otherwise in
furtherance of the purposes of the Act.
If the Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NASDAQ–2014–106 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2014–106. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
7 15
U.S.C. 78s(b)(3)(A)(ii).
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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
10:00 a.m. and 3:00 p.m. Copies of such
filing also will be available for
inspection and copying at the principal
offices 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–2014–106, and should be
submitted on or before December 17,
2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.8
Kevin M. O’ Neill,
Deputy Secretary.
[FR Doc. 2014–28026 Filed 11–25–14; 8:45 am]
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Clarify Rule
7018(a) With Respect to Execution and
Routing of Orders in Securities Priced
at $1 or More Per Share
mstockstill on DSK4VPTVN1PROD with NOTICES
November 20, 2014.
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 November
12, 2014, The NASDAQ Stock Market
LLC (‘‘NASDAQ’’ or ‘‘Exchange’’) filed
with the Securities and Exchange
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
VerDate Sep<11>2014
17:21 Nov 25, 2014
Jkt 235001
The Exchange proposes to make a
minor clarifying change Rule 7018(a)
with respect to execution and routing of
orders in securities priced at $1 or more
per share.
The text of the proposed rule change
is available on the Exchange’s Web site
at https://nasdaq.cchwallstreet.com, at
the principal office of the Exchange, and
at the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
1. Purpose
[Release No. 34–73661; File No. SR–
NASDAQ–2014–107]
1 15
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
BILLING CODE 8011–01–P
8 17
Commission (‘‘SEC’’ or ‘‘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.
The purpose of the proposed rule
change is to make a minor clarifying
change to the definition of the term
‘‘Consolidated Volume’’ provided in
Rule 7018(a). Consolidated Volume is
currently defined as the total
consolidated volume reported to all
consolidated transaction reporting plans
by all exchanges and trade reporting
facilities during a month, excluding
executed orders with a size of less than
one round lot.3 Consolidated Volume is
used as a measure in determining
member firm liability for certain
charges, and eligibility for certain
credits, for participation in NASDAQ.
The Exchange compares a member
3 The Exchange also excludes from both total
Consolidated Volume and the member’s trading
activity, expressed as a percentage of or ratio to
Consolidated Volume, the date of the annual
reconstitution of the Russell Investments Indexes.
PO 00000
Frm 00106
Fmt 4703
Sfmt 4703
firm’s equity transactions in NASDAQ
to Consolidated Volume to determine
how impactful its particular order
activity in NASDAQ is in relation to
overall equity market volume. The
Exchange notes that the definition of
Consolidated Volume does not
expressly state that it encompasses
equity securities only. Accordingly, the
Exchange is proposing to add language
to the definition to clarify that the
definition of Consolidated Volume
under Rule 7018(a) applies only to
equity securities.
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6 of the Act,4 in general, and
furthers the objectives of Sections
6(b)(4) and 6(b)(5) 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 the Exchange
operates or controls, and 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; and
are not designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers. Specifically,
the proposed change furthers these
objectives because it clarifies the rule
and helps avoid potential investor
confusion on how the credits and
charges that use the definition are
applied. The Exchange notes that it is
not changing how the rule is applied,
and therefore the fees and credits
continue to be reasonable and equitably
allocated among member firms.
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.
Specifically, the change does not alter
the meaning or application of the fees
and credits provided under Rule
7018(a), and therefore does not affect
competition in any respect.
4 15
5 15
U.S.C. 78f.
U.S.C. 78f(b)(4) and (5).
E:\FR\FM\26NON1.SGM
26NON1
]]>Agencies
[Federal Register Volume 79, Number 228 (Wednesday, November 26, 2014)]
[Notices]
[Pages 70600-70604]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-28026]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73662; File No. SR-NASDAQ-2014-106]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change
Relating to Short Interest Reports
November 20, 2014.
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 November 12, 2014, The NASDAQ Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I, II, and III, below, which Items have been prepared by the
Exchange. The Commission is publishing this notice to solicit comments
on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of the
Substance of the Proposed Rule Change
The Exchange proposes to change the model of pricing for Short
Interest Reports under the category of Historical Research and
Administrative Reports under NASDAQ Rule 7022. Specifically, NASDAQ
proposes to replace the current subscriber-based model with a fee based
on internal or external distribution of the reports. Although the
proposed rule is effective upon filing, NASDAQ plans to implement the
fee on January 1, 2015.
The text of the proposed rule change is below; proposed new
language is italicized; proposed deletions are in brackets.
* * * * *
7022. Historical Research and Administrative Reports
(a) No Change.
(b) The charge to be paid by the purchaser of an Historical
Research Report regarding a Nasdaq security that wishes to obtain a
license to redistribute the information contained in the report to
subscribers shall be determined in accordance with the following
schedule:
Number of Subscribers
----------------------------------------------------------------------------------------------------------------
1-500 501-999 1,000-4,999 5,000-9,999 10,000+
----------------------------------------------------------------------------------------------------------------
A. Market Summary Statistics:
More often than once a month $250 $350 $450 $550 $750
Once a month, quarter, or 125 175 225 275 375
year.......................
B. Reserved.
C. Nasdaq Issues Summary
Statistics:
More often than once a month [500 600 700 800 1,000]
Internal Distribution... 1,000 1,000 1,000 1,000 1,000
External Distribution... 2,500 2,500 2,500 2,500 2,500
Once a month, quarter, or 250 300 350 400 500
year.......................
Aggregation of data on an 3,000 3,000 3,000 3,000 3,000
annual basis...............
D. Intra-Day Quote and Intra-Day
Time and Sales Data:
For a security and/or a 200 300 400 500 700
market participant for a
day........................
For all market participants 1,000 1,500 2,500 3,500 5,000
for a day or for all
securities for a day.......
----------------------------------------------------------------------------------------------------------------
(c) No change.
(d) No change.
* * * * *
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 pricing model for historical research
and administrative reports categorized as Nasdaq Issues Summary
Statistics under subsection C of NASDAQ Rule 7022(b). The current
pricing schedule for Nasdaq Issues Summary Statistics
[[Page 70601]]
reports currently includes only short interest information.\3\ The fee
schedule is currently divided into two tranches depending upon whether
the report is distributed once per month or less, or more than once
monthly. Within each tranche, the fee depends upon how many subscribers
receive the report from a given Distributor. This proposal affects only
the tranches of reports that are distributed more than once per month,
meaning it will apply only to Short Interest Reports.
---------------------------------------------------------------------------
\3\ In 2013, NASDAQ moved the Daily List and Fundamental Data
formerly covered by this rule into new NASDAQ Rule 7022(d). See
Exchange Act Release No. 68636 (Jan. 11, 2013). In the future, this
category may include other information that properly falls within
the category of Nasdaq Issues Summary Statistics.
---------------------------------------------------------------------------
For this category only, NASDAQ has determined to replace the
subscriber-based tiers with a fee based on internal versus external
distribution, a model already utilized by NASDAQ for multiple products.
Internal distribution is defined as distribution of NASDAQ data by a
given firm or other entity that receives data from NASDAQ only to
recipients within that firm or entity. Conversely, external
distribution is defined as distribution of NASDAQ data by a given firm
or other entity that receives data from NASDAQ to recipients either
outside of the entity or both within and outside of that firm or
entity. Replacing the per-subscriber fee with a Distributor fee will
reduce the administrative burden on firms by eliminating the
requirement to control and/or count the number of recipients of the
report. In addition, external distributors will continue to be
permitted to use the Information internally without additional charges.
NASDAQ has determined to assess a monthly per Distributor fee of
$1,000 for internal distribution and $2,500 for external distribution.
NASDAQ determined to assess higher fees for external Distributors based
on historical experience that external distributors offer wider
distribution than internal Distributors, and they therefore derive
higher value than internal Distributors while typically maintaining a
lower fee per unit.
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)(4) and 6(b)(5) of the Act,\5\ in particular, in that it provides
an equitable allocation of reasonable fees among Subscribers and
recipients of NASDAQ data and is not designed to permit unfair
discrimination between them. In adopting Regulation NMS, the Commission
granted self-regulatory organizations and broker-dealers increased
authority and flexibility to offer new and unique market data to the
public.
---------------------------------------------------------------------------
\4\ 15 U.S.C. 78f.
\5\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------
The Commission concluded that Regulation NMS--by deregulating the
market in proprietary data--would itself further the Act's goals of
facilitating efficiency and competition:
[E]fficiency is promoted when broker-dealers who do not need the
data beyond the prices, sizes, market center identifications of the
NBBO and consolidated last sale information are not required to
receive (and pay for) such data. The Commission also believes that
efficiency is promoted when broker-dealers may choose to receive
(and pay for) additional market data based on their own internal
analysis of the need for such data.\6\
---------------------------------------------------------------------------
\6\ Securities Exchange Act Release No. 51808 (June 9, 2005), 70
FR 37496 (June 29, 2005).
By removing ``unnecessary regulatory restrictions'' on the ability of
exchanges to sell their own data, Regulation NMS advanced the goals of
the Act and the principles reflected in its legislative history. If the
free market should determine whether proprietary data is sold to
broker-dealers at all, it follows that the price at which such data is
sold should be set by the market as well.
On July 21, 2010, President Barack Obama signed into law H.R. 4173,
the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
(``Dodd-Frank Act''), which amended Section 19 of the Act. Among other
things, Section 916 of the Dodd-Frank Act amended paragraph (A) of
Section 19(b)(3) of the Act by inserting the phrase ``on any person,
whether or not the person is a member of the self-regulatory
organization'' after ``due, fee or other charge imposed by the self-
regulatory organization.'' As a result, all self-regulatory
organization (``SRO'') rule proposals establishing or changing dues,
fees, or other charges are immediately effective upon filing regardless
of whether such dues, fees, or other charges are imposed on members of
the SRO, non-members, or both. Section 916 further amended paragraph
(C) of Section 19(b)(3) of the Act to read, in pertinent part, ``At any
time within the 60-day period beginning on the date of filing of such a
proposed rule change in accordance with the provisions of paragraph (1)
[of Section 19(b)], the Commission summarily may temporarily suspend
the change in the rules of the self-regulatory organization made
thereby, 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 this title. If the
Commission takes such action, the Commission shall institute
proceedings under paragraph (2)(B) [of Section 19(b)] to determine
whether the proposed rule should be approved or disapproved.''
The decision of the United States Court of Appeals for the District
of Columbia Circuit in NetCoalition v. SEC, No. 09-1042 (D.C. Cir.
2010), although reviewing a Commission decision made prior to the
effective date of the Dodd-Frank Act, upheld the Commission's reliance
upon competitive markets to set reasonable and equitably allocated fees
for market data. ``In fact, the legislative history indicates that the
Congress intended that the market system `evolve through the interplay
of competitive forces as unnecessary regulatory restrictions are
removed' and that the SEC wield its regulatory power `in those
situations where competition may not be sufficient,' such as in the
creation of a `consolidated transactional reporting system.' ''
NetCoalition, at 15 (quoting H.R. Rep. No. 94-229, at 92 (1975), as
reprinted in 1975 U.S.C.C.A.N. 321, 323).
For the reasons stated above, NASDAQ believes that the allocation
of the proposed fee is fair and equitable in accordance with Section
6(b)(4) of the Act, and not unreasonably discriminatory in accordance
with Section 6(b)(5) of the Act. As described above, the proposed fee
is based on pricing conventions and distinctions that exist in NASDAQ's
current fee schedule. These distinctions are each based on principles
of fairness and equity that have helped for many years to maintain
fair, equitable, and not unreasonably discriminatory fees, and that
apply with equal or greater force to the current proposal.
NASDAQ believes that the $1,000 and $2,500 Distributor fees for the
short interest report are fair and equitable and not unreasonably
discriminatory. The Internal Distributor Fee represents an increase of
no more than $500 per month, with many Distributors paying a smaller
increase or no increase at all. The higher External Distributor Fee is
fair and equitable because External Distributors derive higher value
from the report and, therefore, should bear a higher burden than
internal Distributors. In addition, all Distributors benefit from the
reduced administrative burden of counting subscribers. NASDAQ further
believes that the distinction between internal and external
distribution is fair and
[[Page 70602]]
equitable and not unreasonably discriminatory because external
distributors have the potential to, and generally do, distribute to a
larger number of subscribers. As noted earlier, NASDAQ and other
exchanges have utilize this pricing model for many years.
As described in greater detail below, if NASDAQ has calculated
improperly and the market deems the proposed fees to be unfair,
inequitable, or unreasonably discriminatory, firms can discontinue the
use of their data because the proposed product is entirely optional to
all parties. Firms are not required to purchase data and NASDAQ is not
required to make data available or to offer specific pricing
alternatives for potential purchases. NASDAQ can discontinue offering a
pricing alternative (as it has in the past) and firms can discontinue
their use at any time and for any reason (as they often do), including
due to their assessment of the reasonableness of fees charged. NASDAQ
continues to establish and revise pricing policies aimed at increasing
fairness and equitable allocation of fees among Subscribers.
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. Notwithstanding its
determination that the Commission may rely upon competition to
establish fair and equitably allocated fees for market data, the
NetCoalition court found that the Commission had not, in that case,
compiled a record that adequately supported its conclusion that the
market for the data at issue in the case was competitive. NASDAQ
believes that a record may readily be established to demonstrate the
competitive nature of the market in question.
There is intense competition between trading platforms that provide
transaction execution and routing services and proprietary data
products. Transaction execution and proprietary data products are
complementary in that market data is both an input and a byproduct of
the execution service. In fact, market data and trade execution are a
paradigmatic example of joint products with joint costs. Data products
are valuable to many end Subscribers only insofar as they provide
information that end Subscribers expect will assist them or their
customers in making trading decisions.
The costs of producing market data include not only the costs of
the data distribution infrastructure, but also the costs of designing,
maintaining, and operating the exchange's transaction execution
platform and the cost of regulating the exchange to ensure its fair
operation and maintain investor confidence. The total return that a
trading platform earns reflects the revenues it receives from both
products and the joint costs it incurs. Moreover, an exchange's
customers view the costs of transaction executions and of data as a
unified cost of doing business with the exchange. A broker-dealer will
direct orders to a particular exchange only if the expected revenues
from executing trades on the exchange exceed net transaction execution
costs and the cost of data that the broker-dealer chooses to buy to
support its trading decisions (or those of its customers). The choice
of data products is, in turn, a product of the value of the products in
making profitable trading decisions. If the cost of the product exceeds
its expected value, the broker-dealer will choose not to buy it.
Moreover, as a broker-dealer chooses to direct fewer orders to a
particular exchange, the value of the product to that broker-dealer
decreases, for two reasons. First, the product will contain less
information, because executions of the broker-dealer's orders will not
be reflected in it. Second, and perhaps more important, the product
will be less valuable to that broker-dealer because it does not provide
information about the venue to which it is directing its orders. Data
from the competing venue to which the broker-dealer is directing orders
will become correspondingly more valuable.
Thus, an increase in the fees charged for either transactions or
data has the potential to impair revenues from both products. ``No one
disputes that competition for order flow is `fierce'.'' NetCoalition at
24. However, the existence of fierce competition for order flow implies
a high degree of price sensitivity on the part of broker-dealers with
order flow, since they may readily reduce costs by directing orders
toward the lowest-cost trading venues. A broker-dealer that shifted its
order flow from one platform to another in response to order execution
price differentials would both reduce the value of that platform's
market data and reduce its own need to consume data from the disfavored
platform. Similarly, if a platform increases its market data fees, the
change will affect the overall cost of doing business with the
platform, and affected broker-dealers will assess whether they can
lower their trading costs by directing orders elsewhere and thereby
lessening the need for the more expensive data.
Analyzing the cost of market data distribution in isolation from
the cost of all of the inputs supporting the creation of market data
will inevitably underestimate the cost of the data. Thus, because it is
impossible to create data without a fast, technologically robust, and
well-regulated execution system, system costs and regulatory costs
affect the price of market data. It would be equally misleading,
however, to attribute all of the exchange's costs to the market data
portion of an exchange's joint product. Rather, all of the exchange's
costs are incurred for the unified purposes of attracting order flow,
executing and/or routing orders, and generating and selling data about
market activity. The total return that an exchange earns reflects the
revenues it receives from the joint products and the total costs of the
joint products.
Competition among trading platforms can be expected to constrain
the aggregate return each platform earns from the sale of its joint
products, but different platforms may choose from a range of possible,
and equally reasonable, pricing strategies as the means of recovering
total costs. For example, some platforms may choose to pay rebates to
attract orders, charge relatively low prices for market information (or
provide information free of charge) and charge relatively high prices
for accessing posted liquidity. Other platforms may choose a strategy
of paying lower rebates (or no rebates) to attract orders, setting
relatively high prices for market information, and setting relatively
low prices for accessing posted liquidity. In this environment, there
is no economic basis for regulating maximum prices for one of the joint
products in an industry in which suppliers face competitive constraints
with regard to the joint offering. This would be akin to strictly
regulating the price that an automobile manufacturer can charge for car
sound systems despite the existence of a highly competitive market for
cars and the availability of after-market alternatives to the
manufacturer-supplied system.
The market for market data products is competitive and inherently
contestable because there is fierce competition for the inputs
necessary to the creation of proprietary data and strict pricing
discipline for the proprietary products themselves. Numerous exchanges
compete with each other for listings, trades, and market data itself,
providing virtually limitless opportunities for entrepreneurs who wish
to produce and distribute their own market data. This proprietary
[[Page 70603]]
data is produced by each individual exchange, as well as other
entities, in a vigorously competitive market.
Broker-dealers currently have numerous alternative venues for their
order flow, including thirteen SRO markets, as well as internalizing
broker-dealers (``BDs'') and various forms of alternative trading
systems (``ATSs''), including dark pools and electronic communication
networks (``ECNs''). Each SRO market competes to produce transaction
reports via trade executions, and two FINRA-regulated Trade Reporting
Facilities (``TRFs'') compete to attract internalized transaction
reports. Competitive markets for order flow, executions, and
transaction reports provide pricing discipline for the inputs of
proprietary data products.
The large number of SROs, TRFs, BDs, and ATSs that currently
produce proprietary data or are currently capable of producing it
provides further pricing discipline for proprietary data products. Each
SRO, TRF, ATS, and BD is currently permitted to produce proprietary
data products, and many currently do or have announced plans to do so,
including NASDAQ, New York Stock Exchange LLC (``NYSE''), NYSE MKT LLC,
NYSE Arca LLC, and BATS Exchange, Inc. (``BATS'').
Any ATS or BD can combine with any other ATS, BD, or multiple ATSs
or BDs to produce joint proprietary data products. Additionally, order
routers and market data vendors can facilitate single or multiple
broker-dealers' production of proprietary data products. The potential
sources of proprietary products are virtually limitless.
The fact that proprietary data from ATSs, BDs, and vendors can by-
pass SROs is significant in two respects. First, non-SROs can compete
directly with SROs for the production and sale of proprietary data
products, as BATS and Arca did before registering as exchanges by
publishing data on the Internet. Second, because a single order or
transaction report can appear in an SRO proprietary product, a non-SRO
proprietary product, or both, the data available in proprietary
products is exponentially greater than the actual number of orders and
transaction reports that exist in the marketplace.
Market data vendors provide another form of price discipline for
proprietary data products because they control the primary means of
access to end Subscribers. Vendors impose price restraints based upon
their business models. For example, vendors such as Bloomberg and
Thomson Reuters that assess a surcharge on data they sell may refuse to
offer proprietary products that end Subscribers will not purchase in
sufficient numbers. Internet portals, such as Google, impose a
discipline by providing only data that will enable them to attract
``eyeballs'' that contribute to their advertising revenue. Retail
broker-dealers, such as Schwab and Fidelity, offer their customers
proprietary data only if it promotes trading and generates sufficient
commission revenue. Although the business models may differ, these
vendors' pricing discipline is the same: They can simply refuse to
purchase any proprietary data product that fails to provide sufficient
value. NASDAQ and other producers of proprietary data products must
understand and respond to these varying business models and pricing
disciplines in order to market proprietary data products successfully.
In addition to the competition and price discipline described
above, the market for proprietary data products is also highly
contestable because market entry is rapid, inexpensive, and profitable.
The history of electronic trading is replete with examples of entrants
that swiftly grew into some of the largest electronic trading platforms
and proprietary data producers: Archipelago, Bloomberg Tradebook,
Island, RediBook, Attain, TracECN, BATS Trading and Direct Edge. A
proliferation of dark pools and other ATSs operate profitably with
fragmentary shares of consolidated market volume.
Regulation NMS, by deregulating the market for proprietary data,
has increased the contestability of that market. While broker-dealers
have previously published their proprietary data individually,
Regulation NMS encourages market data vendors and broker-dealers to
produce proprietary products cooperatively in a manner never before
possible. Multiple market data vendors already have the capability to
aggregate data and disseminate it on a profitable scale, including
Bloomberg, and Thomson Reuters.
The vigor of competition for information is significant. NASDAQ has
made a determination to adjust the fees associated with this product in
order to reflect more accurately the value of its products and the
investments made to enhance them, as well as to keep pace with changes
in the industry and evolving customer needs. This product is entirely
optional and is geared towards attracting new customers, as well as
retaining existing customers.
The Exchange has witnessed competitors creating new products and
innovative pricing in this space over the course of the past year.
NASDAQ continues to see firms challenge its pricing on the basis of the
Exchange's explicit fees being higher than the zero-priced fees from
other competitors such as BATS. In all cases, firms make decisions on
how much and what types of data to consume on the basis of the total
cost of interacting with NASDAQ or other exchanges. Of course, the
explicit data fees are but one factor in a total platform analysis.
Some competitors have lower transactions fees and higher data fees, and
others are vice versa.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\7\
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------
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: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2014-106 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASDAQ-2014-106. This
file number should be included on the subject line if email is used. To
help the Commission process and review your
[[Page 70604]]
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 10:00 a.m. and 3:00 p.m. Copies of
such filing also will be available for inspection and copying at the
principal offices 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-2014-106, and should be submitted on or before
December 17, 2014.
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\8\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
Kevin M. O' Neill,
Deputy Secretary.
[FR Doc. 2014-28026 Filed 11-25-14; 8:45 am]
BILLING CODE 8011-01-P
