Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Transaction Fees To Implement New Incentive, 8230-8235 [2017-01464]
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Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Notices
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Authority: 5 U.S.C. 3301 and 3302; E.O.
10577, 3 CFR, 1954–1958 Comp., p. 218.
www.prc.gov, Docket Nos. MC2017–79,
CP2017–106.
solicit comments on the proposed rule
change from interested persons.
U.S. Office of Personnel Management.
Beth F. Cobert,
Acting Director.
Stanley F. Mires,
Attorney, Federal Compliance.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
[FR Doc. 2017–01557 Filed 1–23–17; 8:45 am]
[FR Doc. 2017–01470 Filed 1–23–17; 8:45 am]
BILLING CODE 7710–12–P
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SECURITIES AND EXCHANGE
COMMISSION
POSTAL SERVICE
Product Change—Priority Mail
Negotiated Service Agreement
AGENCY:
ACTION:
[Release No. 34–79809; File No. SR–
NASDAQ–2017–001]
Postal ServiceTM.
Notice.
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FOR FURTHER INFORMATION CONTACT:
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SUPPLEMENTARY INFORMATION:
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Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend
Transaction Fees To Implement New
Incentive
January 17, 2017.
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 January 3,
2017, 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
1 15
2 17
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
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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. Nasdaq
proposes to implement a new incentive
for NOM Participants that add liquidity
for Customer and Professional orders in
Penny and Non-Penny Pilot Options as
described further below.
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
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Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Notices
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
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1. Purpose
The Exchange proposes to create an
alternative method for earning a rebate
for adding liquidity for both Customers 3
and Professionals 4 in Penny Pilot 5 and
Non-Penny Pilot Options. For
Customers and Professionals transacting
in Penny Pilot Options, the Exchange
currently pays a volume-based tiered
rebate to add liquidity. That rebate
consists of 8 tiers, ranging from $0.20
per contract to $0.48 per contract, with
the volume requirements increasing
with each tier. Thus, a NOM Participant
would qualify for a rebate of $0.20 per
contract in Tier 1 for Customers and
Professionals if it added Customer,
Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in
Penny Pilot Options and/or Non-Penny
Pilot Options of up to 0.10% of total
industry customer equity and ETF
option average daily volume (‘‘ADV’’)
contracts per day in a month. In
comparison, a Participant would qualify
for a rebate of $0.48 in Tier 8 for
Customers and Professionals if it adds
Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options above 0.75%
or more of total industry customer
equity and ETF option ADV contracts
per day in a month, or if the Participant
adds: (1) Customer and/or Professional
liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options of 0.25% or
more of total industry customer equity
3 The term ‘‘Customer’’ or (‘‘C’’) 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 broker or dealer or for the account of a
‘‘Professional’’ (as that term is defined in Chapter
I, Section 1(a)(48)).
4 The term ‘‘Professional’’ or (‘‘P’’) 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.
5 The Penny Pilot was established in March 2008.
See Securities Exchange Act Release No. 57579
(March 28, 2008), 73 FR 18587 (April 4, 2008) (SR–
NASDAQ–2008–026) (notice of filing and
immediate effectiveness establishing Penny Pilot).
Since that date, the Penny Pilot has been expanded
and is currently extended through December 31,
2016 or the date of permanent approval, if earlier.
See Securities Exchange Act Release No. 78037
(June 10, 2016), 81 FR 39299 (June 16, 2016) (SR–
NASDAQ–2016–052).
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and ETF option ADV contracts per day
in a month, and (2) has added liquidity
in all securities through one or more of
its Nasdaq Market Center MPIDs that
represent 1.00% or more of
Consolidated Volume in a month or
qualifies for MARS.6
Currently, Customers and
Professionals transacting in Non-Penny
Pilot Options on NOM receive a $0.80
per contract Rebate to Add Liquidity. In
addition, a Participant that qualifies for
a Customer or Professional Penny Pilot
Options Rebate to Add Liquidity in
Tiers 2, 3, 4, 5 or 6 in a month will
receive an additional $0.10 per contract
Non-Penny Pilot Options Rebate to Add
Liquidity for each transaction which
adds liquidity in Non-Penny Pilot
Options in that month. A Participant
that qualifies for a Customer or
Professional Penny Pilot Options Rebate
to Add Liquidity in Tiers 7 or 8 in a
month will receive an additional $0.20
per contract Non-Penny Pilot Options
Rebate to Add Liquidity for each
transaction which adds liquidity in
Non-Penny Pilot Options in that month.
Furthermore, a Participant that may
receive a $0.53 per contract Rebate to
Add Liquidity in Penny Pilot Options as
a Customer or Professional, and $1.00
per contract Rebate to Add Liquidity in
Non-Penny Pilot Options as a Customer
or Professional, if that NOM Participant
transacts on the NASDAQ Stock Market
through one or more of its Nasdaq
Market Center MPIDs in the same
month, and such transactions in all
securities on the NASDAQ Stock Market
that month through all of its Nasdaq
Market Center MPIDs represent 3.00%
or more of Consolidated Volume.7
Participants that qualify for this rebate
would not be eligible for any other
rebates in Tiers 1 through 8 or other
rebate incentives on NOM for Customer
and Professional order flow in Chapter
XV, Section 2(1) of NOM Rules.8
The Exchange proposes an additional
incentive to a Participant that adds
Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or
6 MARS refers to the Market Access and Routing
Subsidy, which is set forth in Chapter XV, Section
6 [sic]. The MARS payment comprises four volumebased tiers, and is paid to NOM Participants that
route eligible contracts to NOM through a
participating NOM Participant’s System. The MARS
Payment will be paid on all executed Eligible
Contracts that add liquidity. See NOM Rules at
Chapter XV, Section 6 [sic].
7 Consolidated Volume would be determined as
set forth in Nasdaq Rule 7018(a).
8 In calculating total volume, the Exchange will
add the NOM Participant’s total volume transacted
on the NASDAQ Stock Market in a given month
across its Nasdaq Market Center MPIDs, and will
divide this number by the total industry
Consolidated Volume.
PO 00000
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8231
Non-Penny Pilot Options above 1.45%
of total industry customer equity and
ETF option ADV contracts per day in a
month, (b) executes greater than 0.04%
of Consolidated Volume (‘‘CV’’) 9 via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) 10 volume within the
NASDAQ Stock Market Closing Cross
within a month, and (c) adds greater
than 1.5 million shares per day of nondisplayed volume within the NASDAQ
Stock Market within a month. The
Participant would receive a $0.55 per
contract rebate to add liquidity in Penny
Pilot Options as Customer or
Professional and $1.05 per contract
rebate to add liquidity in Non-Penny
Pilot Options as Customer or
Professional. Participants that qualify
for this rebate would not be eligible for
any other rebates in Tiers 1–8 or other
rebate incentives on NOM for Customer
and Professional order flow in Chapter
XV, Section 2(1). The Exchange believes
that the new incentives will attract a
greater amount of order flow on NOM
by offering a discounted rate.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act,11 in general, and furthers the
objectives of Sections 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, and is not
designed to permit unfair
discrimination between customers,
issuers, brokers, or dealers.
The Commission and the courts have
repeatedly expressed their preference
for competition over regulatory
intervention in determining prices,
products, and services in the securities
markets. In Regulation NMS, while
adopting a series of steps to improve the
current market model, the Commission
highlighted the importance of market
forces in determining prices and SRO
revenues and, also, recognized that
current regulation of the market system
‘‘has been remarkably successful in
promoting market competition in its
9 See
note 7 above.
as set forth in NASDAQ Rule 4754,
represents the volume in the NASDAQ Stock
Market Closing Cross that allows market
participants to contribute order flow that will result
in executions at the official closing price for the day
in the NASDAQ listed security. A ‘‘MOC Order’’ is
an order type entered without a price that may be
executed only during the NASDAQ Closing Cross,
which refers to the equity closing cross. A ‘‘LOC
Order’’ is an order type entered with a price that
may be executed only in the NASDAQ Closing
Cross.
11 15 U.S.C. 78f(b).
12 15 U.S.C. 78f(b)(4) and (5).
10 MOC/LOC,
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broader forms that are most important to
investors and listed companies.’’ 13
Likewise, in NetCoalition v. Securities
and Exchange Commission 14
(‘‘NetCoalition’’) the D.C. Circuit upheld
the Commission’s use of a market-based
approach in evaluating the fairness of
market data fees against a challenge
claiming that Congress mandated a costbased approach.15 As the court
emphasized, the Commission ‘‘intended
in Regulation NMS that ‘market forces,
rather than regulatory requirements’
play a role in determining the market
data . . . to be made available to
investors and at what cost.’’ 16
Further, ‘‘[n]o one disputes that
competition for order flow is ‘fierce.’
. . . As the SEC explained, ‘[i]n the U.S.
national market system, buyers and
sellers of securities, and the brokerdealers that act as their order-routing
agents, have a wide range of choices of
where to route orders for execution’;
[and] ‘no exchange can afford to take its
market share percentages for granted’
because ‘no exchange possesses a
monopoly, regulatory or otherwise, in
the execution of order flow from broker
dealers’ . . . . ’’ 17 Although the court
and the SEC were discussing the cash
equities markets, the Exchange believes
that these views apply with equal force
to the options markets.
The Exchange notes that the purpose
of the proposed rebates is to incentivize
NOM Participants to transact greater
volume on NOM and the NASDAQ
Stock Market in order to qualify for a
higher rebate on NOM. The Exchange
believes that the amount of the rebate
($0.55 per contract for Penny Pilot
Options and $1.05 per contract for NonPenny Pilot Options) along with the
various criteria for qualifying for the
rebate ((a) add Customer, Professional,
Firm, Non-NOM Market Maker and/or
Broker-Dealer liquidity in Penny Pilot
Options and/or Non-Penny Pilot
Options above 1.45% of total industry
customer equity and ETF option ADV
contracts per day in a month, (b)
execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month, and (c) add greater than
13 Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005)
(‘‘Regulation NMS Adopting Release’’).
14 NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir.
2010).
15 See NetCoalition, at 534–535.
16 Id. at 537.
17 Id. at 539 (quoting Securities Exchange Act
Release No. 59039 (December 2, 2008), 73 FR
74770, 74782–83 (December 9, 2008) (SR–
NYSEArca–2006–21)).
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1.5 million shares per day of nondisplayed within the NASDAQ Stock
Market within a month) are reasonable.
With respect to the rebate for Penny
Pilot Options, the Exchange notes that
the proposed $0.55 per contract rebate
is higher than the currently highest
rebate available ($0.53 per contract) to
Customers and Professionals for adding
liquidity in Penny Pilot Options.18 The
Exchange believes the proposed rebate
of $0.55 per contract is reasonable
because the proposed rebate requires
three components ((a) add Customer,
Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in
Penny Pilot Options and/or Non-Penny
Pilot Options above 1.45% of total
industry customer equity and ETF
option ADV contracts per day in a
month, (b) execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
18 As noted above, a NOM Participant will receive
a rebate of $0.48 per contract for adding liquidity
as a Customer or Professional in Penny Pilot
Options if it qualifies for Tier 8. In addition, as
noted in footnote c of Chapter XV, Section 2, a
NOM Participant may receive an additional rebate
of up to $0.05 per contract in Penny Pilot Options,
for a total rebate of $0.53 per contract. Specifically,
Participants that: (1) Add Customer, Professional,
Firm, Non-NOM Market Maker and/or BrokerDealer liquidity in Penny Pilot Options and/or NonPenny Pilot Options of 1.15% or more of total
industry customer equity and ETF option ADV
contracts per day in a month will receive an
additional $0.02 per contract Penny Pilot Options
Customer and/or Professional Rebate to Add
Liquidity for each transaction which adds liquidity
in Penny Pilot Options in that month; or (2) add
Customer, Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in Penny Pilot
Options and/or Non-Penny Pilot Options of 1.30%
or more of total industry customer equity and ETF
option ADV contracts per day in a month will
receive an additional $0.05 per contract Penny Pilot
Options Customer and/or Professional Rebate to
Add Liquidity for each transaction which adds
liquidity in Penny Pilot Options in that month; or
(3) (a) add Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer liquidity in
Penny Pilot Options and/or Non-Penny Pilot
Options above 0.80% of total industry customer
equity and ETF option ADV contracts per day in a
month, (b) add Customer, Professional, Firm, NonNOM Market Maker and/or Broker-Dealer liquidity
in Non-Penny Pilot Options above 0.15% of total
industry customer equity and ETF option ADV
contracts per day in a month, and (c) execute
greater than 0.04% of Consolidated Volume (‘‘CV’’)
via Market-on-Close/Limit-on-Close (‘‘MOC/LOC’’)
volume within the NASDAQ Stock Market Closing
Cross within a month will receive an additional
$0.05 per contract Penny Pilot Options Customer
and/or Professional Rebate to Add Liquidity for
each transaction which adds liquidity in Penny
Pilot Options in a month. Consolidated Volume
shall mean the total consolidated volume reported
to all consolidated transaction reporting plans by all
exchanges and trade reporting facilities during a
month in equity securities, excluding executed
orders with a size of less than one round lot. For
purposes of calculating Consolidated Volume and
the extent of an equity 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
shall be excluded from both total Consolidated
Volume and the member’s trading activity.
PO 00000
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Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month, and (c) add greater than
1.5 million shares per day of nondisplayed volume within the NASDAQ
Stock Market within a month) to be met
by NOM Participants in order to qualify
for that rebate. These requirements
require more volume to be submitted on
NOM than the current highest rebate
requires today. Similarly, the Exchange
believes the proposed $1.05 rebate per
contract for Non-Penny Pilot Options is
reasonable for similar reasons. The
requirements to obtain this rebate
require more volume to be submitted on
NOM.
The Exchange believes that the
requirement that a NOM Participant add
Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options above 1.45%
of total industry customer equity and
ETF option ADV contracts per day in a
month, execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month, and add greater than
1.5 million shares per day of nondisplayed volume within the NASDAQ
Stock Market within a month is
reasonable because the Exchange is
offering to pay a rebate of $0.55 per
contract, the highest rebate. These more
stringent volume-based requirements
bring a greater amount of volume to
both NOM and the NASDAQ Stock
Market. The first volume requirement,
which requires volume to be added to
NOM, is reasonable because it is similar
to that required to qualify for certain
NOM Market Maker discounted remove
fees.19 The second volume requirement
19 See note ‘‘2’’ of Chapter XV, Section 2 of NOM
Rules. The note ‘‘2 ‘‘rebate is offered to Non-NOM
Market Makers and NOM Market Makers that add
1.30% of Customer, Professional, Firm, BrokerDealer or Non-NOM Market Maker liquidity in
Penny Pilot Options and/or Non-Penny Pilot
Options of total industry customer equity and ETF
option ADV contracts per day in a month will be
subject to the following pricing applicable to
executions: A $0.48 per contract Penny Pilot
Options Fee for Removing Liquidity when the
Participant is (i) both the buyer and the seller or (ii)
the Participant removes liquidity from another
Participant under Common Ownership. In the
alternative, Participants that add 1.50% of
Customer, Professional, Firm, Broker-Dealer or NonNOM Market Maker liquidity in Penny Pilot
Options and/or Non-Penny Pilot Options of total
industry customer equity and ETF option ADV
contracts per day in a month and meet or exceed
the cap for the NASDAQ Stock Market Opening
Cross during the month will be subject to the
following pricing applicable to executions less than
10,000 contracts: A $0.32 per contract Penny Pilot
Options Fee for Removing Liquidity when the
Participant is (i) both the buyer and seller or (ii) the
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to execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month is reasonable because it
is one of the same requirements to
qualify for note ‘‘c’’ in Chapter XV,
Section 2 of NOM Rules.20 The third
volume requirement to add greater than
1.5 million shares per day of nondisplayed volume within the NASDAQ
Stock Market within a month is a new
requirement, which must be met in
addition to the first and second volume
requirements. The Exchange believes
that this requirement is reasonable
because linking rebates on NOM to
activity on the NASDAQ Stock Market
is not novel. The Exchange believes that
requiring Participants to add nondisplayed volume within the NASDAQ
Stock Market is reasonable because this
type of liquidity benefits all market
participants by way of interacting with
Participant removes liquidity from another
Participant under Common Ownership. Finally,
Participants that add 1.75% of Customer,
Professional, Firm, Broker-Dealer or Non-NOM
Market Maker liquidity in Penny Pilot Options and/
or Non-Penny Pilot Options of total industry
customer equity and ETF option ADV contracts per
day in a month will be subject to the following
pricing applicable to executions less than 10,000
contracts: A $0.32 per contract Penny Pilot Options
Fee for Removing Liquidity when the Participant is
(i) both the buyer and seller or (ii) the Participant
removes liquidity from another Participant under
Common Ownership.
20 Note ‘‘c’’ of Chapter XV, Section 2 pays an
additional $0.05 per contract Penny Pilot Options
Customer and/or Professional Rebate to Add
Liquidity, in addition to the Tier 8 rebate of $0.48
per contract if a Participant: (1) Adds Customer,
Professional, Firm, Non-NOM Market Maker and/or
Broker-Dealer liquidity in Penny Pilot Options and/
or Non-Penny Pilot Options of 1.15% or more of
total industry customer equity and ETF option ADV
contracts per day in a month will receive an
additional $0.02 per contract Penny Pilot Options
Customer and/or Professional Rebate to Add
Liquidity for each transaction which adds liquidity
in Penny Pilot Options in that month; or (2) adds
Customer, Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in Penny Pilot
Options and/or Non-Penny Pilot Options of 1.30%
or more of total industry customer equity and ETF
option ADV contracts per day in a month will
receive an additional $0.05 per contract Penny Pilot
Options Customer and/or Professional Rebate to
Add Liquidity for each transaction which adds
liquidity in Penny Pilot Options in that month; or
(3) (a) adds Customer, Professional, Firm, NonNOM Market Maker and/or Broker-Dealer liquidity
in Penny Pilot Options and/or Non-Penny Pilot
Options above 0.80% of total industry customer
equity and ETF option ADV contracts per day in a
month, (b) adds Customer, Professional, Firm, NonNOM Market Maker and/or Broker-Dealer liquidity
in Non-Penny Pilot Options above 0.15% of total
industry customer equity and ETF option ADV
contracts per day in a month, and (c) executes
greater than 0.04% of Consolidated Volume (‘‘CV’’)
via Market-on-Close/Limit-on-Close (‘‘MOC/LOC’’)
volume within the NASDAQ Stock Market Closing
Cross within a month.
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19:36 Jan 23, 2017
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that liquidity on the equity market.21 By
encouraging market participants to
increase their participation on the
equities market by delivering nondisplayed volume, the Exchange is
rewarding Participants with an
opportunity to earn an additional
options incentive, provided all
requirements are met. The Exchange
notes that previous and current rebates
offered by NOM relate to activity on the
NASDAQ Stock Market.22 Similarly, the
NASDAQ Stock Market offers enhanced
rebates that are based on activity on
NOM.23 Moreover, the Exchange notes
that any NOM Options Participant may
trade equities on the NASDAQ Stock
Market because they are approved
members.24
Further, the Exchange believes it is
reasonable to make this rebate exclusive
of any other rebates in Tiers 1 through
8 or other rebate incentives on NOM for
Customer and Professional order flow in
Chapter XV, Section 2(1) of NOM Rules.
As noted above, the proposed rebates
are higher, and in some cases
significantly higher, than the rebates
that a NOM Participant may currently
receive for adding liquidity in Penny
Pilot and Non-Penny Pilot Options as a
Customer or Professional. Given the size
of the proposed rebates, the Exchange
believes it is reasonable to make these
rebates exclusive of other rebates on
NOM for Customer and Professional
order flow. Finally, the Exchange also
believes the proposal is reasonable
because the proposed rebates apply to
both transactions in Penny Pilot and
Non-Penny Pilot Options.
The Exchange believes that the
amount of the rebate ($0.55 per contract
for Penny Pilot Options and $1.05 per
contract for Non-Penny Pilot Options)
21 Orders that are non-displayed would not be
disseminated on the NASDAQ Stock Market Order
Book feed. A Participant may be incentivized to
increase their participation on the NASDAQ Stock
Market, which may result in interacting with such
non-displayed volume. Increased order interaction
benefits all market participants.
22 See current note ‘‘e’’ of Chapter XV, Section IV
[sic] of NOM Rules which provides a rebate to NOM
Participants that transact in all securities through
one or more of its Nasdaq Market Center MPIDs that
represent 3.00% or more of Consolidated Volume
in the same month on the NASDAQ Stock Market.
23 For example, Nasdaq provides an enhanced
rebate on the NASDAQ Stock Market of $0.00295
if the member adds Customer, Professional, Firm,
Non-NOM Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or Non-Penny
Pilot Options of 1.15% or more of total industry
ADV in the customer clearing range for Equity and
ETF option contracts per day in a month on NOM.
See Nasdaq Rule 7018.
24 Although a NOM Participant may incur
additional labor and/or costs to establish
connectivity to the NASDAQ Stock Market, there
are no additional membership fees for NOM
Participants that want to transact on the NASDAQ
Stock Market.
PO 00000
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8233
along with the various criteria for
qualifying for the rebate ((a) add
Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options above 1.45%
of total industry customer equity and
ETF option ADV contracts per day in a
month, (b) execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month, and (c) add greater than
1.5 million shares per day of nondisplayed within the NASDAQ Stock
Market within a month) is equitable and
not unfairly discriminatory because any
Participant that qualifies for this rebate
will be uniformly paid $0.55 per
contract for Penny Pilot Options and
$1.05 per contract for Non-Penny Pilot
Options. The requirements for earning
this rebate will be applied uniformly to
all market participants. The Exchange
believes that requiring Participants to
add non-displayed volume is equitable
and not unfairly discriminatory because
the Exchange will pay the incentive, in
a uniform manner, to Participants that
have met all criteria required for the
rebate.
The Exchange believes that the
requirement that a NOM Participant add
Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options above 1.45%
of total industry customer equity and
ETF option ADV contracts per day in a
month, execute greater than 0.04% of
Consolidated Volume (‘‘CV’’) via
Market-on-Close/Limit-on-Close
(‘‘MOC/LOC’’) volume within the
NASDAQ Stock Market Closing Cross
within a month, and add greater than
1.5 million shares per day of nondisplayed volume within the NASDAQ
Stock Market within a month is
equitable and not unfairly
discriminatory because while the
requirements for qualifying for the
proposed rebates may be more stringent
than other requirements for qualifying
for other rebates currently offered by
NOM, the Exchange believes that these
requirements are proportionate to the
amount of the proposed rebates and
equitably reflect the purpose of the
proposed rebates, which is to
incentivize NOM Participants to
transact greater volume on NOM and the
NASDAQ Stock Market. Moreover, all
similarly-situated NOM Participants,
e.g., those that add liquidity in either
Penny Pilot or Non-Penny Pilot Options
as either Customers or Professionals and
also transact on the NASDAQ Stock
E:\FR\FM\24JAN1.SGM
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Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Notices
Market, are equally capable of
qualifying for the proposed rebates, and
the same rebates will be paid to all
NOM Participants that qualify for them.
Further, the Exchange believes that it is
equitable and not unfairly
discriminatory to offer this rebate to
NOM Participants that add liquidity as
Customers or Professionals, and not to
offer this rebate to NOM Participants
that add liquidity as Firms,25 NOM
Market Makers,26 Non-NOM Market
Makers, or Broker-Dealers.27 Nasdaq
notes that Customer liquidity offers
unique benefits to the market which
benefits all market participants by
providing more trading opportunities,
which attracts Specialists and Market
Makers. An increase in the activity of
these market participants in turn
facilitates tighter spreads, which may
cause an additional corresponding
increase in order flow from other market
participants. The Exchange believes that
encouraging Participants to add
Professional liquidity is similarly
beneficial, as the rebates may cause
market participants to select NOM as a
venue to send Professional order flow,
increasing competition among the
exchanges. As with Customer liquidity,
the Exchange believes that increased
Professional additional order flow
should benefit other market
participants.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
sradovich on DSK3GMQ082PROD with NOTICES
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. In terms of
inter-market competition, the Exchange
notes that it operates in a highly
competitive market in which market
participants can readily favor competing
venues if they deem fee levels at a
particular venue to be excessive, or
rebate opportunities available at other
venues to be more favorable. In such an
environment, the Exchange must
continually adjust its fees to remain
competitive with other exchanges and
with alternative trading systems that
25 The term ‘‘Firm’’ or (‘‘F’’) applies to any
transaction that is identified by a Participant for
clearing in the Firm range at OCC.
26 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.
27 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.
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19:36 Jan 23, 2017
Jkt 241001
have been exempted from compliance
with the statutory standards applicable
to exchanges. Because competitors are
free to modify their own fees in
response, and because market
participants may readily adjust their
order routing practices, the Exchange
believes that the degree to which fee
changes in this market may impose any
burden on competition is extremely
limited.
The Exchange does not believe that
the proposed rebates will impose any
burden on competition that is not
necessary or appropriate. The Exchange
notes that the purpose of the proposed
rebate is to incentivize NOM
Participants to transact on NOM and the
NASDAQ Stock Market. All similarlysituated NOM Participants, e.g., those
that add liquidity in either Penny Pilot
or Non-Penny Pilot Options as either
Customers or Professionals and also
transact the requisite volumes on the
NASDAQ Stock Market, are equally
capable of qualifying for the proposed
rebates. Additionally, the Exchange will
pay the same rebates, in a uniform
manner, to all NOM Participants that
qualify for them. The Exchange believes
that Customer and Professional order
flow provides unique benefits to all
participants on the Exchange and may
even facilitate inter-market competition,
and is therefore offering the proposed
rebates to NOM Participants that add
liquidity as either a Customer or a
Professional accordingly. With respect
to linking the proposed rebates to a
participant’s activity on the NASDAQ
Stock Market, NOM currently offers
rebates that are based on activity on the
NASDAQ Stock Market.28 Similarly, the
NASDAQ Stock Market currently offers
reduced transaction fees that are based
on activity on NOM.29 Finally, because
they are approved members, any NOM
Options Participant may trade equities
on the NASDAQ Stock Market and
therefore attempt to qualify for the
proposed rebates.30
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.
28 See
note 22 above.
note 23 above.
30 See note 24 above.
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.31
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–2017–001 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–2017–001. 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
29 See
PO 00000
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Fmt 4703
31 15
Sfmt 4703
E:\FR\FM\24JAN1.SGM
U.S.C. 78s(b)(3)(A)(ii).
24JAN1
Federal Register / Vol. 82, No. 14 / Tuesday, January 24, 2017 / Notices
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
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–2017–001 and should be
submitted on or before February 14,
2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.32
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–01464 Filed 1–23–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–79812; File No. SR–BX–
2016–063]
Self-Regulatory Organizations;
NASDAQ BX, Inc.; Order Granting
Approval of Proposed Rule Change To
Amend the PRISM Price Improvement
Auction in BX Chapter VI, Section 9
and To Make Pilot Program Permanent
January 17, 2017.
I. Introduction
On November 21, 2016, NASDAQ BX,
Inc. (‘‘BX’’ or ‘‘Exchange’’) filed with the
Securities and Exchange Commission
(‘‘SEC’’ or ‘‘Commission’’), pursuant to
Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’),1 and
Rule 19b–4 thereunder,2 a proposed rule
change to amend the eligibility
requirements for its Price Improvement
Auction mechanism (‘‘PRISM’’ or
‘‘Auction’’) and make permanent those
aspects of the PRISM auction that are
currently operating on a pilot basis. The
proposed rule change was published for
comment in the Federal Register on
December 9, 2016.3 The Commission
received no comments regarding the
proposal. This order approves the
proposed rule change.
sradovich on DSK3GMQ082PROD with NOTICES
II. Description of the Proposal
The Exchange established PRISM in
November 2015 as a price improvement
32 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 79465
(December 5, 2016), 81 FR 89167 (‘‘Notice’’).
1 15
VerDate Sep<11>2014
19:36 Jan 23, 2017
Jkt 241001
mechanism.4 Pursuant to Chapter VI,
Section 9 of the BX Options Rules, a
Participant (an ‘‘Initiating Participant’’)
may electronically submit for execution
an order it represents as agent on behalf
of a Public Customer,5 Professional
customer, broker dealer, or any other
entity (‘‘PRISM Order’’) against
principal interest or against any other
order it represents as agent (an
‘‘Initiating Order’’), provided it submits
the PRISM Order for electronic
execution into the Auction. Parts of
PRISM are currently operating on a pilot
basis (‘‘Pilot’’),6 which is set to expire
on January 18, 2017.7 The Exchange
proposes to make the Pilot permanent,
and also proposes to amend the Auction
eligibility requirements for certain
PRISM Orders of less than 50 option
contracts.
A. PRISM Eligibility Requirements for
PRISM Orders of Fewer Than 50
Contracts
Currently, a PRISM Auction may be
initiated if certain conditions are met. If
the PRISM Order is for the account of
a Public Customer, the Initiating
Participant must stop the entire PRISM
Order at a price that is equal to or better
than the National Best Bid/Offer
(‘‘NBBO’’) on the opposite side of the
market from the PRISM Order, provided
that such price must be at least one
minimum trading increment (specified
in Chapter VI, Section 5 of the BX
Options Rules) better than any limit
order on the limit order book on the
same side of the market as the PRISM
Order.8 If the PRISM Order is for the
account of a broker dealer or any other
4 See Securities Exchange Release No. 76301
(October 29, 2015), 80 FR 68347 (November 4, 2015)
(SR–BX–2015–032) (‘‘PRISM Approval Order’’).
5 A Public Customer means a person that is not
a broker or dealer in securities. See Chapter I,
Section 1(a)(50) of the BX Options Rules. A
‘‘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). A Participant or a Public
Customer may, without limitation, be a
Professional. All Professional orders shall be
appropriately marked by Participants. See Chapter
I, Section 1(a)(49) of the BX Options Rules. For
purposes of PRISM rule, a Public Customer order
does not include a Professional order. See Chapter
VI, Section 9 of the BX Options Rules.
6 Three components of PRISM were approved by
the Commission on a pilot basis: (1) The early
conclusion of the PRISM Auction; (2) the provision
that an unrelated market or marketable limit order
(against the BX BBO) on the opposite side of the
market from the PRISM Order received during the
Auction will not cause the Auction to end early and
will execute against interest outside of the Auction;
and (3) no minimum size requirement of orders.
7 See Securities Exchange Act Release No. 78249
(July 7, 2016), 81 FR 45334 (July 13, 2016) (SR–BX–
2016–038).
8 See Chapter VI, Section 9(i)(A) of the BX
Options Rules.
PO 00000
Frm 00062
Fmt 4703
Sfmt 4703
8235
person or entity that is not a Public
Customer, the Initiating Participant
must stop the entire PRISM Order at a
price that is the better of: (i) The BX
BBO price improved by at least the
minimum trading increment on the
same side of the market as the PRISM
Order, or (ii) the PRISM Order’s limit
price (if the order is a limit order),
provided in either case that such price
is at or better than the NBBO.9
BX proposes to amend the Auction
eligibility requirements to require that,
if the PRISM Order is for less than 50
option contracts, and if the difference
between the NBBO is $0.01, the
Initiating Participant must stop the
entire PRISM Order at one minimum
price improvement increment better
than the NBBO on the opposite side of
the market from the PRISM Order, and
better than any limit order on the limit
order book on the same side of the
market as the PRISM Order. Thus, BX
would require that the PRISM Order
receive at least $0.01 price improvement
if that PRISM Order is for less than 50
contracts and if the difference between
the NBBO is $0.01. This requirement
will apply regardless of whether the
PRISM Order is for the account of a
Public Customer, or where the PRISM
Order is for the account of a broker
dealer or any other person or entity that
is not a Public Customer.
The Exchange will retain the current
requirements for Auction eligibility in
all other instances. Accordingly, if the
PRISM Order is for the account of a
Public Customer and such order is for
50 option contracts or more or if the
difference between the NBBO is greater
than $0.01, the Initiating Participant
must stop the entire PRISM Order at a
price that is equal to or better than the
NBBO on the opposite side of the
market from the PRISM Order, provided
that such price must be at least one
minimum trading increment better than
any limit order on the limit order book
on the same side of the market as the
PRISM Order. If the PRISM Order is for
the account of a broker dealer or any
other person or entity that is not a
Public Customer and such order is for
50 option contracts or more, or if the
difference between the NBBO is greater
than $0.01, the Initiating Participant
must stop the entire PRISM Order at a
price that is the better of: (i) The BX
BBO price improved by at least the
Minimum Increment on the same side of
the market as the PRISM Order, or (ii)
the PRISM Order’s limit price (if the
order is a limit order), provided in
9 See Chapter VI, Section 9(i)(B) of the BX
Options Rules.
E:\FR\FM\24JAN1.SGM
24JAN1
]]>Agencies
[Federal Register Volume 82, Number 14 (Tuesday, January 24, 2017)]
[Notices]
[Pages 8230-8235]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-01464]
=======================================================================
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-79809; File No. SR-NASDAQ-2017-001]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend Transaction Fees To Implement New Incentive
January 17, 2017.
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 January 3, 2017, 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. Nasdaq proposes to implement a
new incentive for NOM Participants that add liquidity for Customer and
Professional orders in Penny and Non-Penny Pilot Options as described
further below.
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
[[Page 8231]]
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 to create an alternative method for earning a
rebate for adding liquidity for both Customers \3\ and Professionals
\4\ in Penny Pilot \5\ and Non-Penny Pilot Options. For Customers and
Professionals transacting in Penny Pilot Options, the Exchange
currently pays a volume-based tiered rebate to add liquidity. That
rebate consists of 8 tiers, ranging from $0.20 per contract to $0.48
per contract, with the volume requirements increasing with each tier.
Thus, a NOM Participant would qualify for a rebate of $0.20 per
contract in Tier 1 for Customers and Professionals if it added
Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or Non-Penny Pilot Options of up
to 0.10% of total industry customer equity and ETF option average daily
volume (``ADV'') contracts per day in a month. In comparison, a
Participant would qualify for a rebate of $0.48 in Tier 8 for Customers
and Professionals if it adds Customer, Professional, Firm, Non-NOM
Market Maker and/or Broker-Dealer liquidity in Penny Pilot Options and/
or Non-Penny Pilot Options above 0.75% or more of total industry
customer equity and ETF option ADV contracts per day in a month, or if
the Participant adds: (1) Customer and/or Professional liquidity in
Penny Pilot Options and/or Non-Penny Pilot Options of 0.25% or more of
total industry customer equity and ETF option ADV contracts per day in
a month, and (2) has added liquidity in all securities through one or
more of its Nasdaq Market Center MPIDs that represent 1.00% or more of
Consolidated Volume in a month or qualifies for MARS.\6\
---------------------------------------------------------------------------
\3\ The term ``Customer'' or (``C'') 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 broker or dealer or for the account of a
``Professional'' (as that term is defined in Chapter I, Section
1(a)(48)).
\4\ The term ``Professional'' or (``P'') 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.
\5\ The Penny Pilot was established in March 2008. See
Securities Exchange Act Release No. 57579 (March 28, 2008), 73 FR
18587 (April 4, 2008) (SR-NASDAQ-2008-026) (notice of filing and
immediate effectiveness establishing Penny Pilot). Since that date,
the Penny Pilot has been expanded and is currently extended through
December 31, 2016 or the date of permanent approval, if earlier. See
Securities Exchange Act Release No. 78037 (June 10, 2016), 81 FR
39299 (June 16, 2016) (SR-NASDAQ-2016-052).
\6\ MARS refers to the Market Access and Routing Subsidy, which
is set forth in Chapter XV, Section 6 [sic]. The MARS payment
comprises four volume-based tiers, and is paid to NOM Participants
that route eligible contracts to NOM through a participating NOM
Participant's System. The MARS Payment will be paid on all executed
Eligible Contracts that add liquidity. See NOM Rules at Chapter XV,
Section 6 [sic].
---------------------------------------------------------------------------
Currently, Customers and Professionals transacting in Non-Penny
Pilot Options on NOM receive a $0.80 per contract Rebate to Add
Liquidity. In addition, a Participant that qualifies for a Customer or
Professional Penny Pilot Options Rebate to Add Liquidity in Tiers 2, 3,
4, 5 or 6 in a month will receive an additional $0.10 per contract Non-
Penny Pilot Options Rebate to Add Liquidity for each transaction which
adds liquidity in Non-Penny Pilot Options in that month. A Participant
that qualifies for a Customer or Professional Penny Pilot Options
Rebate to Add Liquidity in Tiers 7 or 8 in a month will receive an
additional $0.20 per contract Non-Penny Pilot Options Rebate to Add
Liquidity for each transaction which adds liquidity in Non-Penny Pilot
Options in that month.
Furthermore, a Participant that may receive a $0.53 per contract
Rebate to Add Liquidity in Penny Pilot Options as a Customer or
Professional, and $1.00 per contract Rebate to Add Liquidity in Non-
Penny Pilot Options as a Customer or Professional, if that NOM
Participant transacts on the NASDAQ Stock Market through one or more of
its Nasdaq Market Center MPIDs in the same month, and such transactions
in all securities on the NASDAQ Stock Market that month through all of
its Nasdaq Market Center MPIDs represent 3.00% or more of Consolidated
Volume.\7\ Participants that qualify for this rebate would not be
eligible for any other rebates in Tiers 1 through 8 or other rebate
incentives on NOM for Customer and Professional order flow in Chapter
XV, Section 2(1) of NOM Rules.\8\
---------------------------------------------------------------------------
\7\ Consolidated Volume would be determined as set forth in
Nasdaq Rule 7018(a).
\8\ In calculating total volume, the Exchange will add the NOM
Participant's total volume transacted on the NASDAQ Stock Market in
a given month across its Nasdaq Market Center MPIDs, and will divide
this number by the total industry Consolidated Volume.
---------------------------------------------------------------------------
The Exchange proposes an additional incentive to a Participant that
adds Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-
Dealer liquidity in Penny Pilot Options and/or Non-Penny Pilot Options
above 1.45% of total industry customer equity and ETF option ADV
contracts per day in a month, (b) executes greater than 0.04% of
Consolidated Volume (``CV'') \9\ via Market-on-Close/Limit-on-Close
(``MOC/LOC'') \10\ volume within the NASDAQ Stock Market Closing Cross
within a month, and (c) adds greater than 1.5 million shares per day of
non-displayed volume within the NASDAQ Stock Market within a month. The
Participant would receive a $0.55 per contract rebate to add liquidity
in Penny Pilot Options as Customer or Professional and $1.05 per
contract rebate to add liquidity in Non-Penny Pilot Options as Customer
or Professional. Participants that qualify for this rebate would not be
eligible for any other rebates in Tiers 1-8 or other rebate incentives
on NOM for Customer and Professional order flow in Chapter XV, Section
2(1). The Exchange believes that the new incentives will attract a
greater amount of order flow on NOM by offering a discounted rate.
---------------------------------------------------------------------------
\9\ See note 7 above.
\10\ MOC/LOC, as set forth in NASDAQ Rule 4754, represents the
volume in the NASDAQ Stock Market Closing Cross that allows market
participants to contribute order flow that will result in executions
at the official closing price for the day in the NASDAQ listed
security. A ``MOC Order'' is an order type entered without a price
that may be executed only during the NASDAQ Closing Cross, which
refers to the equity closing cross. A ``LOC Order'' is an order type
entered with a price that may be executed only in the NASDAQ Closing
Cross.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\11\ in general, and furthers the objectives of
Sections 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, and is not designed to permit unfair discrimination between
customers, issuers, brokers, or dealers.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(4) and (5).
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The Commission and the courts have repeatedly expressed their
preference for competition over regulatory intervention in determining
prices, products, and services in the securities markets. In Regulation
NMS, while adopting a series of steps to improve the current market
model, the Commission highlighted the importance of market forces in
determining prices and SRO revenues and, also, recognized that current
regulation of the market system ``has been remarkably successful in
promoting market competition in its
[[Page 8232]]
broader forms that are most important to investors and listed
companies.'' \13\
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\13\ Securities Exchange Act Release No. 51808 (June 9, 2005),
70 FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
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Likewise, in NetCoalition v. Securities and Exchange Commission
\14\ (``NetCoalition'') the D.C. Circuit upheld the Commission's use of
a market-based approach in evaluating the fairness of market data fees
against a challenge claiming that Congress mandated a cost-based
approach.\15\ As the court emphasized, the Commission ``intended in
Regulation NMS that `market forces, rather than regulatory
requirements' play a role in determining the market data . . . to be
made available to investors and at what cost.'' \16\
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\14\ NetCoalition v. SEC, 615 F.3d 525 (D.C. Cir. 2010).
\15\ See NetCoalition, at 534-535.
\16\ Id. at 537.
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Further, ``[n]o one disputes that competition for order flow is
`fierce.' . . . As the SEC explained, `[i]n the U.S. national market
system, buyers and sellers of securities, and the broker-dealers that
act as their order-routing agents, have a wide range of choices of
where to route orders for execution'; [and] `no exchange can afford to
take its market share percentages for granted' because `no exchange
possesses a monopoly, regulatory or otherwise, in the execution of
order flow from broker dealers' . . . . '' \17\ Although the court and
the SEC were discussing the cash equities markets, the Exchange
believes that these views apply with equal force to the options
markets.
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\17\ Id. at 539 (quoting Securities Exchange Act Release No.
59039 (December 2, 2008), 73 FR 74770, 74782-83 (December 9, 2008)
(SR-NYSEArca-2006-21)).
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The Exchange notes that the purpose of the proposed rebates is to
incentivize NOM Participants to transact greater volume on NOM and the
NASDAQ Stock Market in order to qualify for a higher rebate on NOM. The
Exchange believes that the amount of the rebate ($0.55 per contract for
Penny Pilot Options and $1.05 per contract for Non-Penny Pilot Options)
along with the various criteria for qualifying for the rebate ((a) add
Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or Non-Penny Pilot Options above
1.45% of total industry customer equity and ETF option ADV contracts
per day in a month, (b) execute greater than 0.04% of Consolidated
Volume (``CV'') via Market-on-Close/Limit-on-Close (``MOC/LOC'') volume
within the NASDAQ Stock Market Closing Cross within a month, and (c)
add greater than 1.5 million shares per day of non-displayed within the
NASDAQ Stock Market within a month) are reasonable. With respect to the
rebate for Penny Pilot Options, the Exchange notes that the proposed
$0.55 per contract rebate is higher than the currently highest rebate
available ($0.53 per contract) to Customers and Professionals for
adding liquidity in Penny Pilot Options.\18\ The Exchange believes the
proposed rebate of $0.55 per contract is reasonable because the
proposed rebate requires three components ((a) add Customer,
Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity
in Penny Pilot Options and/or Non-Penny Pilot Options above 1.45% of
total industry customer equity and ETF option ADV contracts per day in
a month, (b) execute greater than 0.04% of Consolidated Volume (``CV'')
via Market-on-Close/Limit-on-Close (``MOC/LOC'') volume within the
NASDAQ Stock Market Closing Cross within a month, and (c) add greater
than 1.5 million shares per day of non-displayed volume within the
NASDAQ Stock Market within a month) to be met by NOM Participants in
order to qualify for that rebate. These requirements require more
volume to be submitted on NOM than the current highest rebate requires
today. Similarly, the Exchange believes the proposed $1.05 rebate per
contract for Non-Penny Pilot Options is reasonable for similar reasons.
The requirements to obtain this rebate require more volume to be
submitted on NOM.
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\18\ As noted above, a NOM Participant will receive a rebate of
$0.48 per contract for adding liquidity as a Customer or
Professional in Penny Pilot Options if it qualifies for Tier 8. In
addition, as noted in footnote c of Chapter XV, Section 2, a NOM
Participant may receive an additional rebate of up to $0.05 per
contract in Penny Pilot Options, for a total rebate of $0.53 per
contract. Specifically, Participants that: (1) Add Customer,
Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or Non- Penny Pilot Options of
1.15% or more of total industry customer equity and ETF option ADV
contracts per day in a month will receive an additional $0.02 per
contract Penny Pilot Options Customer and/or Professional Rebate to
Add Liquidity for each transaction which adds liquidity in Penny
Pilot Options in that month; or (2) add Customer, Professional,
Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny
Pilot Options and/or Non-Penny Pilot Options of 1.30% or more of
total industry customer equity and ETF option ADV contracts per day
in a month will receive an additional $0.05 per contract Penny Pilot
Options Customer and/or Professional Rebate to Add Liquidity for
each transaction which adds liquidity in Penny Pilot Options in that
month; or (3) (a) add Customer, Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options above 0.80% of total industry customer
equity and ETF option ADV contracts per day in a month, (b) add
Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-
Dealer liquidity in Non-Penny Pilot Options above 0.15% of total
industry customer equity and ETF option ADV contracts per day in a
month, and (c) execute greater than 0.04% of Consolidated Volume
(``CV'') via Market-on-Close/Limit-on-Close (``MOC/LOC'') volume
within the NASDAQ Stock Market Closing Cross within a month will
receive an additional $0.05 per contract Penny Pilot Options
Customer and/or Professional Rebate to Add Liquidity for each
transaction which adds liquidity in Penny Pilot Options in a month.
Consolidated Volume shall mean the total consolidated volume
reported to all consolidated transaction reporting plans by all
exchanges and trade reporting facilities during a month in equity
securities, excluding executed orders with a size of less than one
round lot. For purposes of calculating Consolidated Volume and the
extent of an equity 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 shall be
excluded from both total Consolidated Volume and the member's
trading activity.
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The Exchange believes that the requirement that a NOM Participant
add Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-
Dealer liquidity in Penny Pilot Options and/or Non-Penny Pilot Options
above 1.45% of total industry customer equity and ETF option ADV
contracts per day in a month, execute greater than 0.04% of
Consolidated Volume (``CV'') via Market-on-Close/Limit-on-Close (``MOC/
LOC'') volume within the NASDAQ Stock Market Closing Cross within a
month, and add greater than 1.5 million shares per day of non-displayed
volume within the NASDAQ Stock Market within a month is reasonable
because the Exchange is offering to pay a rebate of $0.55 per contract,
the highest rebate. These more stringent volume-based requirements
bring a greater amount of volume to both NOM and the NASDAQ Stock
Market. The first volume requirement, which requires volume to be added
to NOM, is reasonable because it is similar to that required to qualify
for certain NOM Market Maker discounted remove fees.\19\ The second
volume requirement
[[Page 8233]]
to execute greater than 0.04% of Consolidated Volume (``CV'') via
Market-on-Close/Limit-on-Close (``MOC/LOC'') volume within the NASDAQ
Stock Market Closing Cross within a month is reasonable because it is
one of the same requirements to qualify for note ``c'' in Chapter XV,
Section 2 of NOM Rules.\20\ The third volume requirement to add greater
than 1.5 million shares per day of non-displayed volume within the
NASDAQ Stock Market within a month is a new requirement, which must be
met in addition to the first and second volume requirements. The
Exchange believes that this requirement is reasonable because linking
rebates on NOM to activity on the NASDAQ Stock Market is not novel. The
Exchange believes that requiring Participants to add non-displayed
volume within the NASDAQ Stock Market is reasonable because this type
of liquidity benefits all market participants by way of interacting
with that liquidity on the equity market.\21\ By encouraging market
participants to increase their participation on the equities market by
delivering non-displayed volume, the Exchange is rewarding Participants
with an opportunity to earn an additional options incentive, provided
all requirements are met. The Exchange notes that previous and current
rebates offered by NOM relate to activity on the NASDAQ Stock
Market.\22\ Similarly, the NASDAQ Stock Market offers enhanced rebates
that are based on activity on NOM.\23\ Moreover, the Exchange notes
that any NOM Options Participant may trade equities on the NASDAQ Stock
Market because they are approved members.\24\
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\19\ See note ``2'' of Chapter XV, Section 2 of NOM Rules. The
note ``2 ``rebate is offered to Non-NOM Market Makers and NOM Market
Makers that add 1.30% of Customer, Professional, Firm, Broker-Dealer
or Non-NOM Market Maker liquidity in Penny Pilot Options and/or Non-
Penny Pilot Options of total industry customer equity and ETF option
ADV contracts per day in a month will be subject to the following
pricing applicable to executions: A $0.48 per contract Penny Pilot
Options Fee for Removing Liquidity when the Participant is (i) both
the buyer and the seller or (ii) the Participant removes liquidity
from another Participant under Common Ownership. In the alternative,
Participants that add 1.50% of Customer, Professional, Firm, Broker-
Dealer or Non-NOM Market Maker liquidity in Penny Pilot Options and/
or Non-Penny Pilot Options of total industry customer equity and ETF
option ADV contracts per day in a month and meet or exceed the cap
for the NASDAQ Stock Market Opening Cross during the month will be
subject to the following pricing applicable to executions less than
10,000 contracts: A $0.32 per contract Penny Pilot Options Fee for
Removing Liquidity when the Participant is (i) both the buyer and
seller or (ii) the Participant removes liquidity from another
Participant under Common Ownership. Finally, Participants that add
1.75% of Customer, Professional, Firm, Broker-Dealer or Non-NOM
Market Maker liquidity in Penny Pilot Options and/or Non-Penny Pilot
Options of total industry customer equity and ETF option ADV
contracts per day in a month will be subject to the following
pricing applicable to executions less than 10,000 contracts: A $0.32
per contract Penny Pilot Options Fee for Removing Liquidity when the
Participant is (i) both the buyer and seller or (ii) the Participant
removes liquidity from another Participant under Common Ownership.
\20\ Note ``c'' of Chapter XV, Section 2 pays an additional
$0.05 per contract Penny Pilot Options Customer and/or Professional
Rebate to Add Liquidity, in addition to the Tier 8 rebate of $0.48
per contract if a Participant: (1) Adds Customer, Professional,
Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Penny
Pilot Options and/or Non-Penny Pilot Options of 1.15% or more of
total industry customer equity and ETF option ADV contracts per day
in a month will receive an additional $0.02 per contract Penny Pilot
Options Customer and/or Professional Rebate to Add Liquidity for
each transaction which adds liquidity in Penny Pilot Options in that
month; or (2) adds Customer, Professional, Firm, Non-NOM Market
Maker and/or Broker-Dealer liquidity in Penny Pilot Options and/or
Non-Penny Pilot Options of 1.30% or more of total industry customer
equity and ETF option ADV contracts per day in a month will receive
an additional $0.05 per contract Penny Pilot Options Customer and/or
Professional Rebate to Add Liquidity for each transaction which adds
liquidity in Penny Pilot Options in that month; or (3) (a) adds
Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-
Dealer liquidity in Penny Pilot Options and/or Non-Penny Pilot
Options above 0.80% of total industry customer equity and ETF option
ADV contracts per day in a month, (b) adds Customer, Professional,
Firm, Non-NOM Market Maker and/or Broker-Dealer liquidity in Non-
Penny Pilot Options above 0.15% of total industry customer equity
and ETF option ADV contracts per day in a month, and (c) executes
greater than 0.04% of Consolidated Volume (``CV'') via Market-on-
Close/Limit-on-Close (``MOC/LOC'') volume within the NASDAQ Stock
Market Closing Cross within a month.
\21\ Orders that are non-displayed would not be disseminated on
the NASDAQ Stock Market Order Book feed. A Participant may be
incentivized to increase their participation on the NASDAQ Stock
Market, which may result in interacting with such non-displayed
volume. Increased order interaction benefits all market
participants.
\22\ See current note ``e'' of Chapter XV, Section IV [sic] of
NOM Rules which provides a rebate to NOM Participants that transact
in all securities through one or more of its Nasdaq Market Center
MPIDs that represent 3.00% or more of Consolidated Volume in the
same month on the NASDAQ Stock Market.
\23\ For example, Nasdaq provides an enhanced rebate on the
NASDAQ Stock Market of $0.00295 if the member adds Customer,
Professional, Firm, Non-NOM Market Maker and/or Broker-Dealer
liquidity in Penny Pilot Options and/or Non-Penny Pilot Options of
1.15% or more of total industry ADV in the customer clearing range
for Equity and ETF option contracts per day in a month on NOM. See
Nasdaq Rule 7018.
\24\ Although a NOM Participant may incur additional labor and/
or costs to establish connectivity to the NASDAQ Stock Market, there
are no additional membership fees for NOM Participants that want to
transact on the NASDAQ Stock Market.
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Further, the Exchange believes it is reasonable to make this rebate
exclusive of any other rebates in Tiers 1 through 8 or other rebate
incentives on NOM for Customer and Professional order flow in Chapter
XV, Section 2(1) of NOM Rules. As noted above, the proposed rebates are
higher, and in some cases significantly higher, than the rebates that a
NOM Participant may currently receive for adding liquidity in Penny
Pilot and Non-Penny Pilot Options as a Customer or Professional. Given
the size of the proposed rebates, the Exchange believes it is
reasonable to make these rebates exclusive of other rebates on NOM for
Customer and Professional order flow. Finally, the Exchange also
believes the proposal is reasonable because the proposed rebates apply
to both transactions in Penny Pilot and Non-Penny Pilot Options.
The Exchange believes that the amount of the rebate ($0.55 per
contract for Penny Pilot Options and $1.05 per contract for Non-Penny
Pilot Options) along with the various criteria for qualifying for the
rebate ((a) add Customer, Professional, Firm, Non-NOM Market Maker and/
or Broker-Dealer liquidity in Penny Pilot Options and/or Non-Penny
Pilot Options above 1.45% of total industry customer equity and ETF
option ADV contracts per day in a month, (b) execute greater than 0.04%
of Consolidated Volume (``CV'') via Market-on-Close/Limit-on-Close
(``MOC/LOC'') volume within the NASDAQ Stock Market Closing Cross
within a month, and (c) add greater than 1.5 million shares per day of
non-displayed within the NASDAQ Stock Market within a month) is
equitable and not unfairly discriminatory because any Participant that
qualifies for this rebate will be uniformly paid $0.55 per contract for
Penny Pilot Options and $1.05 per contract for Non-Penny Pilot Options.
The requirements for earning this rebate will be applied uniformly to
all market participants. The Exchange believes that requiring
Participants to add non-displayed volume is equitable and not unfairly
discriminatory because the Exchange will pay the incentive, in a
uniform manner, to Participants that have met all criteria required for
the rebate.
The Exchange believes that the requirement that a NOM Participant
add Customer, Professional, Firm, Non-NOM Market Maker and/or Broker-
Dealer liquidity in Penny Pilot Options and/or Non-Penny Pilot Options
above 1.45% of total industry customer equity and ETF option ADV
contracts per day in a month, execute greater than 0.04% of
Consolidated Volume (``CV'') via Market-on-Close/Limit-on-Close (``MOC/
LOC'') volume within the NASDAQ Stock Market Closing Cross within a
month, and add greater than 1.5 million shares per day of non-displayed
volume within the NASDAQ Stock Market within a month is equitable and
not unfairly discriminatory because while the requirements for
qualifying for the proposed rebates may be more stringent than other
requirements for qualifying for other rebates currently offered by NOM,
the Exchange believes that these requirements are proportionate to the
amount of the proposed rebates and equitably reflect the purpose of the
proposed rebates, which is to incentivize NOM Participants to transact
greater volume on NOM and the NASDAQ Stock Market. Moreover, all
similarly-situated NOM Participants, e.g., those that add liquidity in
either Penny Pilot or Non-Penny Pilot Options as either Customers or
Professionals and also transact on the NASDAQ Stock
[[Page 8234]]
Market, are equally capable of qualifying for the proposed rebates, and
the same rebates will be paid to all NOM Participants that qualify for
them. Further, the Exchange believes that it is equitable and not
unfairly discriminatory to offer this rebate to NOM Participants that
add liquidity as Customers or Professionals, and not to offer this
rebate to NOM Participants that add liquidity as Firms,\25\ NOM Market
Makers,\26\ Non-NOM Market Makers, or Broker-Dealers.\27\ Nasdaq notes
that Customer liquidity offers unique benefits to the market which
benefits all market participants by providing more trading
opportunities, which attracts Specialists and Market Makers. An
increase in the activity of these market participants in turn
facilitates tighter spreads, which may cause an additional
corresponding increase in order flow from other market participants.
The Exchange believes that encouraging Participants to add Professional
liquidity is similarly beneficial, as the rebates may cause market
participants to select NOM as a venue to send Professional order flow,
increasing competition among the exchanges. As with Customer liquidity,
the Exchange believes that increased Professional additional order flow
should benefit other market participants.
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\25\ The term ``Firm'' or (``F'') applies to any transaction
that is identified by a Participant for clearing in the Firm range
at OCC.
\26\ 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.
\27\ 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.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. In terms of inter-market
competition, the Exchange notes that it operates in a highly
competitive market in which market participants can readily favor
competing venues if they deem fee levels at a particular venue to be
excessive, or rebate opportunities available at other venues to be more
favorable. In such an environment, the Exchange must continually adjust
its fees to remain competitive with other exchanges and with
alternative trading systems that have been exempted from compliance
with the statutory standards applicable to exchanges. Because
competitors are free to modify their own fees in response, and because
market participants may readily adjust their order routing practices,
the Exchange believes that the degree to which fee changes in this
market may impose any burden on competition is extremely limited.
The Exchange does not believe that the proposed rebates will impose
any burden on competition that is not necessary or appropriate. The
Exchange notes that the purpose of the proposed rebate is to
incentivize NOM Participants to transact on NOM and the NASDAQ Stock
Market. All similarly-situated NOM Participants, e.g., those that add
liquidity in either Penny Pilot or Non-Penny Pilot Options as either
Customers or Professionals and also transact the requisite volumes on
the NASDAQ Stock Market, are equally capable of qualifying for the
proposed rebates. Additionally, the Exchange will pay the same rebates,
in a uniform manner, to all NOM Participants that qualify for them. The
Exchange believes that Customer and Professional order flow provides
unique benefits to all participants on the Exchange and may even
facilitate inter-market competition, and is therefore offering the
proposed rebates to NOM Participants that add liquidity as either a
Customer or a Professional accordingly. With respect to linking the
proposed rebates to a participant's activity on the NASDAQ Stock
Market, NOM currently offers rebates that are based on activity on the
NASDAQ Stock Market.\28\ Similarly, the NASDAQ Stock Market currently
offers reduced transaction fees that are based on activity on NOM.\29\
Finally, because they are approved members, any NOM Options Participant
may trade equities on the NASDAQ Stock Market and therefore attempt to
qualify for the proposed rebates.\30\
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\28\ See note 22 above.
\29\ See note 23 above.
\30\ See note 24 above.
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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.\31\
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\31\ 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-2017-001 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-2017-001.
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
[[Page 8235]]
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 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-2017-001 and should be submitted on or before
February 14, 2017.
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\32\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\32\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-01464 Filed 1-23-17; 8:45 am]
BILLING CODE 8011-01-P
