Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Chapter XV, Entitled “Options Pricing,” at Section 2 Governing Pricing for NASDAQ Members, 70282-70284 [2015-28810]

Download as PDF 70282 Federal Register / Vol. 80, No. 219 / Friday, November 13, 2015 / Notices trading platform earns reflects the revenues it receives from both products and the joint costs it incurs. Moreover, the operation of the exchange is characterized by high fixed costs and low marginal costs. This cost structure is common in content and content distribution industries such as software, where developing new software typically requires a large initial investment (and continuing large investments to upgrade the software), but once the software is developed, the incremental cost of providing that software to an additional user is typically small, or even zero (e.g., if the software can be downloaded over the internet after being purchased).19 In NASDAQ’s case, it is costly to build and maintain a trading platform, but the incremental cost of trading each additional share on an existing platform, or distributing an additional instance of data, is very low. Market information and executions are each produced jointly (in the sense that the activities of trading and placing orders are the source of the information that is distributed) and are each subject to significant scale economies. In such cases, marginal cost pricing is not feasible because if all sales were priced at the margin, NASDAQ would be unable to defray its platform costs of providing the joint products. Similarly, data products cannot make use of TRF trade reports without the raw material of the trade reports themselves, and therefore necessitate the costs of operating, regulating,20 and maintaining a trade reporting system, costs that must be covered through the fees charged for use of the facility and sales of associated data. 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. jstallworth on DSK7TPTVN1PROD with NOTICES III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Pursuant to Section 19(b)(3)(A)(ii) of the Act,21 the Exchange has designated this proposal as establishing or changing a due, fee, or other charge imposed on any person, whether or not the person 19 See William J. Baumol and Daniel G. Swanson, ‘‘The New Economy and Ubiquitous Competitive Price Discrimination: Identifying Defensible Criteria of Market Power,’’ Antitrust Law Journal, Vol. 70, No. 3 (2003). 20 It should be noted that the costs of operating the FINRA/NASDAQ TRF borne by NASDAQ include regulatory charges paid by NASDAQ to FINRA. 21 15 U.S.C. 78s(b)(3)(A)(ii). VerDate Sep<11>2014 15:03 Nov 12, 2015 Jkt 238001 is a member of the self-regulatory organization, which renders the proposed rule change effective upon filing. At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 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: office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–BX–2015–063 and should be submitted on or before December 4, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.22 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–28807 Filed 11–12–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76386; File No. SR– NASDAQ–2015–128] 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– BX–2015–063 on the subject line. Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Chapter XV, Entitled ‘‘Options Pricing,’’ at Section 2 Governing Pricing for NASDAQ Members Paper comments • Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC All submissions should refer to File Number SR–BX–2015–063. This file number should be included on the subject line if email 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 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal November 6, 2015. PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 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 October 27, 2015, 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 Substance of the Proposed Rule Change The Exchange proposes to amend the Exchange’s transaction fees at Chapter XV, Section 2 entitled ‘‘NASDAQ Options Market—Fees and Rebates,’’ which governs pricing for NASDAQ members using the NASDAQ Options Market (‘‘NOM’’), NASDAQ’s facility for executing and routing standardized equity and index options. While these amendments are effective upon filing, the Exchange has 22 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\13NON1.SGM 13NON1 Federal Register / Vol. 80, No. 219 / Friday, November 13, 2015 / Notices designated the proposed amendments to be operative on November 2, 2015. 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. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change jstallworth on DSK7TPTVN1PROD with NOTICES 1. Purpose The Exchange proposes the following change to the NOM transaction fees set forth at Chapter XV, Section 2 for executing and routing standardized equity and index options under the Penny Pilot 3 options program. 3 The Penny Pilot was established in March 2008 and has since been expanded and extended through June 30, 2016. See Securities Exchange Act Release Nos. 57579 (March 28, 2008), 73 FR 18587 (April 4, 2008) (SR–NASDAQ–2008–026) (notice of filing and immediate effectiveness establishing Penny Pilot); 60874 (October 23, 2009), 74 FR 56682 (November 2, 2009)(SR–NASDAQ–2009–091) (notice of filing and immediate effectiveness expanding and extending Penny Pilot); 60965 (November 9, 2009), 74 FR 59292 (November 17, 2009)(SR–NASDAQ–2009–097) (notice of filing and immediate effectiveness adding seventy-five classes to Penny Pilot); 61455 (February 1, 2010), 75 FR 6239 (February 8, 2010) (SR–NASDAQ–2010–013) (notice of filing and immediate effectiveness adding seventy-five classes to Penny Pilot); 62029 (May 4, 2010), 75 FR 25895 (May 10, 2010) (SR–NASDAQ– 2010–053) (notice of filing and immediate effectiveness adding seventy-five classes to Penny Pilot); 65969 (December 15, 2011), 76 FR 79268 (December 21, 2011) (SR–NASDAQ–2011–169) (notice of filing and immediate effectiveness [sic] extension and replacement of Penny Pilot); 67325 (June 29, 2012), 77 FR 40127 (July 6, 2012) (SR– NASDAQ–2012–075) (notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through December 31, 2012); 68519 (December 21, 2012), 78 FR 136 (January 2, 2013) (SR–NASDAQ–2012–143) (notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through June 30, 2013); 69787 (June 18, 2013), 78 FR 37858 (June 24, 2013) (SR–NASDAQ–2013–082) (notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through December 31, 2013); 71105 (December 17, 2013), 78 FR 77530 (December 23, 2013) (SR–NASDAQ–2013–154) VerDate Sep<11>2014 15:03 Nov 12, 2015 Jkt 238001 The proposed change is as follows: Fees for Removing Liquidity in Penny Pilot Options: the Exchange proposes to: 1. Increase the Customer 4 Fee for Removing Liquidity in Penny Pilot Options from $0.48 to $0.50 per contract. This rule change is described in greater detail below. Customer Fee for Removing Liquidity in Penny Pilot Options The Exchange proposes, beginning November 2, 2015, to increase the Customer Fee for Removing Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 per contract. The Exchange notes that the Fees for Removing Liquidity for other Participants in Penny Pilot Options will remain the same.5 The purpose of the proposed fee change is to increase the transaction fee for Customers to the same fee level that is assessed today to Professionals,6 Firms,7 NOM Market Makers,8 NonNOM Market Makers 9 and Broker(notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through June 30, 2014); 79 FR 31151 [sic] (May 23, 2014), 79 FR 31151 (May 30, 2014) (SR–NASDAQ–2014– 056) (notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through December 31, 2014); 73686 (December 2, 2014), 79 FR 71477 (November 25, 2014) (SR– NASDAQ–2014–115) (notice of filing and immediate effectiveness and extension and replacement of Penny Pilot through June 30, 2015) and 75283 (June 24, 2015), 80 FR 37347 (June 30, 2015) (SR–NASDAQ–2015–063) (Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Extension of the Exchange’s Penny Pilot Program and Replacement of Penny Pilot Issues That Have Been Delisted.) See also NOM Rules, Chapter VI, Section 5. 4 The term ‘‘Customer’’ applies to any transaction that is identified by a Participant for clearing in the Customer range at The Options Clearing Corporation (‘‘OCC’’) which is not for the account of [sic] broker or dealer or for the account of a ‘‘Professional’’ (as that term is defined in Chapter I, Section 1(a)(48)). 5 Non-Customers will continue to be assessed a $0.50 per contract Fee for Removing Liquidity in Penny Pilot Options. 6 The term ‘‘Professional’’ means any person or entity that (i) is not a broker or dealer in securities, and (ii) places more than 390 orders in listed options per day on average during a calendar month for its own beneficial account(s) pursuant to Chapter I, Section 1(a)(48). All Professional orders shall be appropriately marked by Participants. 7 The term ‘‘Firm’’ or (‘‘F’’) applies to any transaction that is identified by a Participant for clearing in the Firm range at OCC. 8 The term ‘‘NOM Market Maker’’ or (‘‘M’’) is a Participant that has registered as a Market Maker on NOM pursuant to Chapter VII, Section 2, and must also remain in good standing pursuant to Chapter VII, Section 4. In order to receive NOM Market Maker pricing in all securities, the Participant must be registered as a NOM Market Maker in at least one security. 9 The term ‘‘Non-NOM Market Maker’’ or (‘‘O’’) is a registered market maker on another options exchange that is not a NOM Market Maker. A NonNOM Market Maker must append the proper Non- PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 70283 Dealers.10 With this proposal all market participants will be assessed the same Fee for Removing Liquidity in Penny Pilot Options of $0.50 per contract. Despite the increase, the Exchange believes that Customers will continue to send order flow to NOM. 2. Statutory Basis NASDAQ believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,11 in general, and with Section 6(b)(4) and 6(b)(5) of the Act,12 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, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. Customer Fee for Removing Liquidity in Penny Pilot Options The Exchange’s proposal to increase the Customer Fee for Removing Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 is reasonable because all other market participants are currently assessed a fee of $0.50 per contract today. The Exchange’s increase would result in all market participants being assessed the same Fee for Removing Liquidity in Penny Pilot Options. The Exchange’s proposal to increase the Customer Fee for Removing Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 is equitable and not unfairly discriminatory because all market participants would be uniformly assessed the same rate of $0.50 per contract. B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The Exchange’s proposal to increase the Customer Fee for Removing Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 will result in all market participants being uniformly assessed the same fee for transactions in Penny Pilot Options. The Exchange notes that it operates in a highly competitive market in which NOM Market Maker designation to orders routed to NOM. 10 The term ‘‘Broker-Dealer’’ or (‘‘B’’) applies to any transaction which is not subject to any of the other transaction fees applicable within a particular category. 11 15 U.S.C. 78f. 12 15 U.S.C. 78f(b)(4) and (5). E:\FR\FM\13NON1.SGM 13NON1 70284 Federal Register / Vol. 80, No. 219 / Friday, November 13, 2015 / Notices market participants can readily favor competing venues if they deem fee levels at a particular venue to be excessive. In such an environment, the Exchange must continually adjust its fees to remain competitive with other exchanges and to attract order flow. The Exchange believes that the proposal reflects this competitive environment. 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.13 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: jstallworth on DSK7TPTVN1PROD with NOTICES 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–2015–128 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–2015–128. This file number should be included on the subject line if email 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 10:00 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– NASDAQ–2015–128 and should be submitted on or before December 4, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.14 Robert W. Errett, Deputy Secretary. [FR Doc. 2015–28810 Filed 11–12–15; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–76382; File No. 4–657] Order Granting Exemption From Compliance With the National Market System Plan To Implement a Tick Size Pilot Program November 6, 2015. I. Introduction Pursuant to Rule 608(e) 1 under the Securities Exchange Act of 1934 (‘‘Exchange Act’’), the Securities and Exchange Commission (‘‘Commission’’) may exempt from compliance with the provisions of Rule 608, either unconditionally or on specified terms and conditions, any self-regulatory organization, member thereof, or specified security, if the Commission determines that such exemption is consistent with the public interest, the protection of investors, the maintenance 14 17 13 15 U.S.C. 78s(b)(3)(A)(ii). VerDate Sep<11>2014 15:03 Nov 12, 2015 1 17 Jkt 238001 PO 00000 CFR 200.30–3(a)(12). CFR 242.608(e). Frm 00101 Fmt 4703 Sfmt 4703 of fair and orderly markets and the removal of impediments to, and perfection of the mechanisms of, a national market system. As discussed below, the Commission is exercising its authority under Rule 608(e) to exempt BATS Exchange, Inc., BATS YExchange, Inc., Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’), NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, the Nasdaq Stock Market LLC, New York Stock Exchange LLC (‘‘NYSE’’), NYSE MKT LLC, and NYSE Arca, Inc., (collectively ‘‘SROs’’ or ‘‘Participants’’), from implementing the Plan to Implement a Tick Size Pilot Program (‘‘Tick Size Pilot’’) until October 3, 2016. II. Background On May 6, 2015, the Commission approved the Tick Size Pilot and provided that the Tick Size Pilot be implemented within one year after the publication of the order.2 The Tick Size Pilot will have a two-year duration (‘‘Pilot Period’’),3 and will include exchange-listed common stocks that have the following characteristics: (1) A market capitalization of less than $3 billion; (2) a closing price of at least $2 per share on the last day of the measurement period (and a closing price of not less than $1.50 per share during the measurement period); (3) a consolidated average daily volume of one million shares or less; and (4) a volume-weighted average price of at least $2 per share (‘‘Pilot Securities’’). The Pilot Securities will be divided into one control group and three test groups. There will be 400 Pilot Securities per test group and the remaining Pilot Securities will be assigned to the control group. Test Group One Pilot Securities will quote in $0.05 per share increments and will trade at any currently permitted increment. Test Group Two Pilot Securities will quote in $0.05 per share increments like those in Test Group One, but will only be permitted to trade in $0.05 per share increments, subject to certain exceptions.4 Finally, Test Group 2 Securities Exchange Act Release No. 74892 (May 6, 2015), 80 FR 27514 (May 13, 2015). 3 The term Pilot Period means the operative period of the Tick Size Pilot, lasting two years from the date of implementation. See Section I.U of the Tick Size Pilot at 80 FR 27547. 4 First, executions will be able to at the midpoint between the national (or protected) best bid and the national (or protected) best offer; second, orders involving retail investor orders will be able to trade with price improvement of at least $0.005 per share; and third, negotiated trades (such as a volumeweighted average price trade or a time-weighted average price trade) will be able to trade outside of the $0.05 increment. E:\FR\FM\13NON1.SGM 13NON1

Agencies

[Federal Register Volume 80, Number 219 (Friday, November 13, 2015)]
[Notices]
[Pages 70282-70284]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-28810]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76386; File No. SR-NASDAQ-2015-128]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Modify Chapter XV, Entitled ``Options Pricing,'' at Section 2 Governing 
Pricing for NASDAQ Members

November 6, 2015.
    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 October 27, 2015, 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's transaction fees at 
Chapter XV, Section 2 entitled ``NASDAQ Options Market--Fees and 
Rebates,'' which governs pricing for NASDAQ members using the NASDAQ 
Options Market (``NOM''), NASDAQ's facility for executing and routing 
standardized equity and index options.
    While these amendments are effective upon filing, the Exchange has

[[Page 70283]]

designated the proposed amendments to be operative on November 2, 2015.
    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.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes the following change to the NOM transaction 
fees set forth at Chapter XV, Section 2 for executing and routing 
standardized equity and index options under the Penny Pilot \3\ options 
program.
---------------------------------------------------------------------------

    \3\ The Penny Pilot was established in March 2008 and has since 
been expanded and extended through June 30, 2016. See Securities 
Exchange Act Release Nos. 57579 (March 28, 2008), 73 FR 18587 (April 
4, 2008) (SR-NASDAQ-2008-026) (notice of filing and immediate 
effectiveness establishing Penny Pilot); 60874 (October 23, 2009), 
74 FR 56682 (November 2, 2009)(SR-NASDAQ-2009-091) (notice of filing 
and immediate effectiveness expanding and extending Penny Pilot); 
60965 (November 9, 2009), 74 FR 59292 (November 17, 2009)(SR-NASDAQ-
2009-097) (notice of filing and immediate effectiveness adding 
seventy-five classes to Penny Pilot); 61455 (February 1, 2010), 75 
FR 6239 (February 8, 2010) (SR-NASDAQ-2010-013) (notice of filing 
and immediate effectiveness adding seventy-five classes to Penny 
Pilot); 62029 (May 4, 2010), 75 FR 25895 (May 10, 2010) (SR-NASDAQ-
2010-053) (notice of filing and immediate effectiveness adding 
seventy-five classes to Penny Pilot); 65969 (December 15, 2011), 76 
FR 79268 (December 21, 2011) (SR-NASDAQ-2011-169) (notice of filing 
and immediate effectiveness [sic] extension and replacement of Penny 
Pilot); 67325 (June 29, 2012), 77 FR 40127 (July 6, 2012) (SR-
NASDAQ-2012-075) (notice of filing and immediate effectiveness and 
extension and replacement of Penny Pilot through December 31, 2012); 
68519 (December 21, 2012), 78 FR 136 (January 2, 2013) (SR-NASDAQ-
2012-143) (notice of filing and immediate effectiveness and 
extension and replacement of Penny Pilot through June 30, 2013); 
69787 (June 18, 2013), 78 FR 37858 (June 24, 2013) (SR-NASDAQ-2013-
082) (notice of filing and immediate effectiveness and extension and 
replacement of Penny Pilot through December 31, 2013); 71105 
(December 17, 2013), 78 FR 77530 (December 23, 2013) (SR-NASDAQ-
2013-154) (notice of filing and immediate effectiveness and 
extension and replacement of Penny Pilot through June 30, 2014); 79 
FR 31151 [sic] (May 23, 2014), 79 FR 31151 (May 30, 2014) (SR-
NASDAQ-2014-056) (notice of filing and immediate effectiveness and 
extension and replacement of Penny Pilot through December 31, 2014); 
73686 (December 2, 2014), 79 FR 71477 (November 25, 2014) (SR-
NASDAQ-2014-115) (notice of filing and immediate effectiveness and 
extension and replacement of Penny Pilot through June 30, 2015) and 
75283 (June 24, 2015), 80 FR 37347 (June 30, 2015) (SR-NASDAQ-2015-
063) (Notice of Filing and Immediate Effectiveness of a Proposed 
Rule Change Relating to Extension of the Exchange's Penny Pilot 
Program and Replacement of Penny Pilot Issues That Have Been 
Delisted.) See also NOM Rules, Chapter VI, Section 5.
---------------------------------------------------------------------------

    The proposed change is as follows:
    Fees for Removing Liquidity in Penny Pilot Options: the Exchange 
proposes to:
    1. Increase the Customer \4\ Fee for Removing Liquidity in Penny 
Pilot Options from $0.48 to $0.50 per contract.
---------------------------------------------------------------------------

    \4\ The term ``Customer'' applies to any transaction that is 
identified by a Participant for clearing in the Customer range at 
The Options Clearing Corporation (``OCC'') which is not for the 
account of [sic] broker or dealer or for the account of a 
``Professional'' (as that term is defined in Chapter I, Section 
1(a)(48)).
---------------------------------------------------------------------------

    This rule change is described in greater detail below.
Customer Fee for Removing Liquidity in Penny Pilot Options
    The Exchange proposes, beginning November 2, 2015, to increase the 
Customer Fee for Removing Liquidity in Penny Pilot Options from $0.48 
per contract to $0.50 per contract. The Exchange notes that the Fees 
for Removing Liquidity for other Participants in Penny Pilot Options 
will remain the same.\5\
---------------------------------------------------------------------------

    \5\ Non-Customers will continue to be assessed a $0.50 per 
contract Fee for Removing Liquidity in Penny Pilot Options.
---------------------------------------------------------------------------

    The purpose of the proposed fee change is to increase the 
transaction fee for Customers to the same fee level that is assessed 
today to Professionals,\6\ Firms,\7\ NOM Market Makers,\8\ Non-NOM 
Market Makers \9\ and Broker-Dealers.\10\ With this proposal all market 
participants will be assessed the same Fee for Removing Liquidity in 
Penny Pilot Options of $0.50 per contract. Despite the increase, the 
Exchange believes that Customers will continue to send order flow to 
NOM.
---------------------------------------------------------------------------

    \6\ The term ``Professional'' means any person or entity that 
(i) is not a broker or dealer in securities, and (ii) places more 
than 390 orders in listed options per day on average during a 
calendar month for its own beneficial account(s) pursuant to Chapter 
I, Section 1(a)(48). All Professional orders shall be appropriately 
marked by Participants.
    \7\ The term ``Firm'' or (``F'') applies to any transaction that 
is identified by a Participant for clearing in the Firm range at 
OCC.
    \8\ The term ``NOM Market Maker'' or (``M'') is a Participant 
that has registered as a Market Maker on NOM pursuant to Chapter 
VII, Section 2, and must also remain in good standing pursuant to 
Chapter VII, Section 4. In order to receive NOM Market Maker pricing 
in all securities, the Participant must be registered as a NOM 
Market Maker in at least one security.
    \9\ The term ``Non-NOM Market Maker'' or (``O'') is a registered 
market maker on another options exchange that is not a NOM Market 
Maker. A Non-NOM Market Maker must append the proper Non-NOM Market 
Maker designation to orders routed to NOM.
    \10\ The term ``Broker-Dealer'' or (``B'') applies to any 
transaction which is not subject to any of the other transaction 
fees applicable within a particular category.
---------------------------------------------------------------------------

2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\11\ in general, and with 
Section 6(b)(4) and 6(b)(5) of the Act,\12\ 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, and is not 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78f.
    \12\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

Customer Fee for Removing Liquidity in Penny Pilot Options
    The Exchange's proposal to increase the Customer Fee for Removing 
Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 is 
reasonable because all other market participants are currently assessed 
a fee of $0.50 per contract today. The Exchange's increase would result 
in all market participants being assessed the same Fee for Removing 
Liquidity in Penny Pilot Options.
    The Exchange's proposal to increase the Customer Fee for Removing 
Liquidity in Penny Pilot Options from $0.48 per contract to $0.50 is 
equitable and not unfairly discriminatory because all market 
participants would be uniformly assessed the same rate of $0.50 per 
contract.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The Exchange's proposal to 
increase the Customer Fee for Removing Liquidity in Penny Pilot Options 
from $0.48 per contract to $0.50 will result in all market participants 
being uniformly assessed the same fee for transactions in Penny Pilot 
Options.
    The Exchange notes that it operates in a highly competitive market 
in which

[[Page 70284]]

market participants can readily favor competing venues if they deem fee 
levels at a particular venue to be excessive. In such an environment, 
the Exchange must continually adjust its fees to remain competitive 
with other exchanges and to attract order flow. The Exchange believes 
that the proposal reflects this competitive environment.

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.\13\
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    \13\ 15 U.S.C. 78s(b)(3)(A)(ii).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is: (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-2015-128 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-2015-128. This 
file number should be included on the subject line if email 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 10:00 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-NASDAQ-2015-128 and should 
be submitted on or before December 4, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Robert W. Errett,
Deputy Secretary.
[FR Doc. 2015-28810 Filed 11-12-15; 8:45 am]
BILLING CODE 8011-01-P
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