Self-Regulatory Organizations; The NASDAQ Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Exchange's Connectivity Fees at Rule 7051, 46877-46879 [2017-21541]
Download as PDF
Federal Register / Vol. 82, No. 193 / Friday, October 6, 2017 / Notices
IV. Procedure: Request for Written
Comments
The Commission requests that
interested persons provide written
submissions of their views, data, and
arguments with respect to the issues
identified above, as well as any other
concerns they may have with the
proposal. In particular, the Commission
invites the written views of interested
persons concerning whether the
proposal is consistent with Section
6(b)(5) or any other provision of the Act,
or the rules and regulations thereunder.
Although there do not appear to be any
issues relevant to approval or
disapproval that would be facilitated by
an oral presentation of views, data, and
arguments, the Commission will
consider, pursuant to Rule 19b–4, any
request for an opportunity to make an
oral presentation.23
Interested persons are invited to
submit written data, views, and
arguments regarding whether the
proposal should be approved or
disapproved by October 27, 2017. Any
person who wishes to file a rebuttal to
any other person’s submission must file
that rebuttal by November 13, 2017. The
Commission asks that commenters
address the sufficiency of the
Exchange’s statements in support of the
proposal, which are set forth in
Amendment No. 1,24 in addition to any
other comments they may wish to
submit about the proposed rule change.
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–
NYSEArca–2017–56 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEArca–2017–56. 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
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
NYSEArca–2017–56 and should be
submitted on or before October 27,
2017. Rebuttal comments should be
submitted by November 13, 2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.25
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017–21537 Filed 10–5–17; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–81798; File No. SR–
NASDAQ–2017–097]
Self-Regulatory Organizations; The
NASDAQ Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend the
Exchange’s Connectivity Fees at Rule
7051
asabaliauskas on DSKBBXCHB2PROD with NOTICES
October 2, 2017.
23 Section 19(b)(2) of the Act, as amended by the
Securities Acts Amendments of 1975, Public Law
94–29 (June 4, 1975), grants the Commission
flexibility to determine what type of proceeding—
either oral or notice and opportunity for written
comments—is appropriate for consideration of a
particular proposal by a self-regulatory
organization. See Securities Acts Amendments of
1975, Senate Comm. on Banking, Housing & Urban
Affairs, S. Rep. No. 75, 94th Cong., 1st Sess. 30
(1975).
24 See supra note 3.
VerDate Sep<11>2014
18:40 Oct 05, 2017
Jkt 244001
Pursuant to section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on
September 18, 2017, The NASDAQ
Stock Market LLC (‘‘Nasdaq’’ or
25 17
CFR 200.30–3(a)(57).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
PO 00000
Frm 00125
Fmt 4703
Sfmt 4703
46877
‘‘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
Rule 7051, which sets forth the schedule
of fees that the Exchange charges to its
clients for connecting directly to the
Exchange’s data centers and/or
receiving third party market data feeds
and other non-Exchange services from
the Exchange via circuits provided by
third party telecommunications
providers.
While these amendments are effective
upon filing, the Exchange has
designated the proposed amendments to
be operative on October 1, 2017.
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 to amend
Rule 7051, which sets forth the schedule
of fees that the Exchange charges to its
clients for connecting directly to the
Exchange’s data centers and/or
receiving third party market data feeds
and other non-Exchange services from
the Exchange via circuits provided by
third party telecommunications
providers.
Subscribers may use the connectivity
provided under Rule 7051 to link them
E:\FR\FM\06OCN1.SGM
06OCN1
asabaliauskas on DSKBBXCHB2PROD with NOTICES
46878
Federal Register / Vol. 82, No. 193 / Friday, October 6, 2017 / Notices
to the Exchange for order entry and to
receive proprietary data feeds, to receive
public quote feeds from Securities
Information Processors, and to connect
to facilities of FINRA, such as the
FINRA/Nasdaq TRF. The Exchange
provides various direct connectivity
options based on the capacity of the
connection. A subscriber generally
determines the capacity of the
connection it needs based on the
number of data services it wishes to
receive and its estimated usage for
trading and trade reporting purposes.
For direct connectivity to Nasdaq,
Rule 7051(a) provides for 1 GB, 1 GB
Ultra, and 10 GB Ultra hand-offs. The
installation fee for all such connections
is $1,500 and the monthly fee is $7,500
for 10 GB connections and $2,500 for
both 1 GB and 1 GB Ultra hand-offs. The
Exchange also charges a $925 fee to
customers that choose to install a cable
router in its data center and a monthly
fee of $150 for customers that choose to
install equipment in the Exchange’s data
center to support the connectivity.
For direct connectivity to third party
services, Rule 7051(b) provides for 1GB
Ultra and 10 GB Ultra hand-offs. The
installation fee for both 10 GB Ultra and
1 GB Ultra direct connections is $1,500.
Meanwhile, the monthly fee is $5,000
for 10 GB Ultra connections and $2,000
for 1 GB Ultra hand-offs. For 1 GB Ultra
or 10 GB Ultra connections for UTP
only, the installation fee and monthly
fee is waived for the first two
connections and thereafter the
installation fee is $100 and the monthly
fee is also $100. Again, the Exchange
charges a $925 fee to customers that
choose to install a cable router in its
data center for purposes of receiving
these third party services and a monthly
fee of $150 for customers that choose to
install equipment in the Exchange’s data
center to support the connectivity.
In order to reflect the changing nature
of the Exchange’s ecosystem and of the
connection technologies it employs, the
Exchange proposes to clarify Rule 7051
in several respects.
First, the Exchange proposes to list
separately those fees it charges for
certain connectivity that it presently
includes under the general heading of
Direct Connectivity, pursuant to Rule
7051(a). Specifically, the Exchange
proposes to break out the fees it charges
to clients that connect directly to the
Exchange through a ‘‘Point of Presence’’
or ‘‘POP’’ from the fees it charges to
clients that connect through a direct
circuit connection. In contrast to a
traditional direct circuit connection, in
which a client uses an external
telecommunications provider’s circuit
to connect directly to the Exchange’s
VerDate Sep<11>2014
18:40 Oct 05, 2017
Jkt 244001
primary data center in Carteret, New
Jersey, a ‘‘POP’’ connection is one in
which a client directly connects to the
Exchange at one of its satellite data
centers located elsewhere. Each such
POP, in turn, has a fully redundant
connection to the Exchange’s primary
data center.
The Exchange proposes to list POP
connectivity fees separately from
traditional direct circuit connectivity
fees because it wishes to highlight POP
connectivity as a distinct connection
option, particularly as it contemplates
expanding the numbers and locations of
its POPs in the future.
To effect the foregoing change, the
Exchange proposes to add a new
subsection (c) to Rule 7051 entitled
‘‘Point of Presence Connectivity.’’ Under
proposed Rule 7051(c), the installation
and monthly fees that the Exchange
proposes to charge expressly for POP
connectivity would not be new fees and
they would differ only in name, and not
in amount, from those fees that clients
presently pay under Rule 7051(a) for the
same connectivity. The new subsection
would provide for clients to choose
between 10 GB Ultra and 1 GB Ultra
bandwidth hand-offs for connections to
POPs. However, the proposed
subsection (c) will not include charges
for installing optional cable routers or
cabinet space rentals insofar as clients
may not install routers in or rent cabinet
space directly from the Exchange at the
POPs. Likewise, proposed subsection (c)
will not include fees for regular 1 GB
hand-offs insofar such hand-offs are not
available for connections to POPs.
In addition to the above, the Exchange
proposes to update the headings of Rule
7051(a) and (b) so that they more
accurately reflect the nature of the
services to which they apply. Because
Rule 7051(a) and (b) list the fees that the
Exchange charges customers for
installing and maintaining direct
telecommunications ‘‘circuit’’
connectivity with the Exchange, the
Exchange proposes to change the
heading of subsection (a) from ‘‘Direct
Connectivity to Nasdaq’’ to ‘‘Direct
Circuit Connection to Nasdaq’’ and the
heading of subsection (b) from ‘‘Direct
Connectivity to Third Party Services’’ to
‘‘Direct Circuit Connection to Third
Party Services.’’
Lastly, the Exchange proposes to
amend Rule 7051 to state that the
connectivity provided under the Rule
also applies to connectivity to the
markets of The NASDAQ Stock Market
LLC, NASDAQ BX, Inc., NASDAQ
PHLX LLC, Nasdaq ISE LLC, Nasdaq
MRX LLC, and Nasdaq GEMX LLC. This
purpose of this proposal is to specify
that a client can use the connections it
PO 00000
Frm 00126
Fmt 4703
Sfmt 4703
establishes and maintains under the
Rule to connect, not only to the
Exchange, but also to any or all of its
sister Exchanges, and in doing so, it will
be billed only once. Certain of the
Exchange’s other Rules already include
similar language, including Rules 7030
and 7034. The Exchange wishes now to
add such language to Rule 7051.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with section 6(b)
of the Act,3 in general, and furthers the
objectives of sections 6(b)(4) and 6(b)(5)
of the Act,4 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 Exchange believes that its
proposal to separately list its fees for
POP connectivity is reasonable as a
means of clearly distinguishing POP
connectivity from traditional direct
circuit connectivity as set forth in Rule
7051(a). The proposal will not assess
any new or different fees to customers
that connect to the Exchange through
POPs. Instead, the proposal will merely
re-characterize the fees that clients
presently pay under Rule 7051(a) as
relating specifically to POP
connectivity. The Exchange also
believes that this proposal is an
equitable allocation and is not unfairly
discriminatory because it will apply all
similarly situated clients that connect
through POPs.
The Exchange believes that its
proposal to modify the headings of
subsections (a) and (b) of Rule 7051 is
also reasonable because it clarifies that
the fees in these subsections pertain
specifically to connections to the
Exchange that involve circuits provided
by external telecommunications
providers. Again, this proposal is an
equitable allocation and is not unfairly
discriminatory in that it will apply to all
clients that use such direct circuits to
connect to the Exchange.
Lastly, the Exchange believes that its
proposal is reasonable and
nondiscriminatory to clarify that each of
the connection options and fees set forth
in Rule 7051 generally provide for
connectivity to The NASDAQ Stock
Market LLC, NASDAQ BX, Inc.,
NASDAQ PHLX LLC, Nasdaq ISE LLC,
Nasdaq MRX LLC, and Nasdaq GEMX
LLC. The Exchange does not restrict its
clients from utilizing their direct
3 15
4 15
E:\FR\FM\06OCN1.SGM
U.S.C. 78f(b).
U.S.C. 78f(b)(4) and (5).
06OCN1
Federal Register / Vol. 82, No. 193 / Friday, October 6, 2017 / Notices
connections to it to also access its sister
exchanges, and it does not charge its
clients more than once to do so.
Although certain of the Exchange’s
other connectivity Rules already make
these points clear (e.g., Rules 7030 and
7034), Rule 7051 does not do so. The
Exchange therefore believes its proposal
to clarify Rule 7051 is warranted.
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 proposal
merely clarifies the Exchange’s existing
services and associated fees and the
Exchange does not anticipate that such
clarifications will have any impact on
competition whatsoever.
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.5
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.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NASDAQ–2017–097. 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
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–2017–097, and should be
submitted on or before October 27,
2017.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.6
Eduardo A. Aleman,
Assistant Secretary.
IV. Solicitation of Comments
asabaliauskas on DSKBBXCHB2PROD with NOTICES
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:
[FR Doc. 2017–21541 Filed 10–5–17; 8:45 am]
Electronic Comments
Scrap Metal Services Terminal
Railroad Company (Indiana), LLC—
Lease and Operation Exemption—Rail
Line of Scrap Metal Services, LLC
• 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–2017–097 on the subject line.
5 15
U.S.C. 78s(b)(3)(A)(ii).
VerDate Sep<11>2014
18:40 Oct 05, 2017
BILLING CODE 8011–01–P
SURFACE TRANSPORTATION BOARD
[Docket No. FD 36145]
Scrap Metal Services Terminal
Railroad Company (Indiana), LLC
(SMSRRIN), a noncarrier, has filed a
6 17
Jkt 244001
PO 00000
CFR 200.30–3(a)(12).
Frm 00127
Fmt 4703
Sfmt 4703
46879
verified notice of exemption under 49
CFR 1150.31 to acquire by lease from
Scrap Metal Services, LLC (SMS), and to
operate,1 approximately 2,115 linear
feet (0.40 mile) of railroad right-of-way
and trackage located at the East Chicago
Transload Facility at the intersection of
East 151st Street and the Indiana Harbor
Belt Railroad right-of-way in East
Chicago, Ind. (the East Chicago
Transload Facility trackage), pursuant to
an agreement. SMS Realty (East
Chicago), LLC, owns the East Chicago
Transload Facility trackage, which is
leased to SMS.
According to SMSRRIN, there are no
mileposts associated with the East
Chicago Transload Facility trackage.
SMSRRIN states that the trackage is
used in conjunction with interchanging
to and from Indiana Harbor Belt
Railroad carloads of scrap metal for
transloading into trucks for delivery to
metal working manufacturers.
SMSRRIN asserts that, because the
trackage in question will constitute the
entire line of railroad of SMSRRIN, this
trackage is a line of railroad under 49
U.S.C. 10901, rather than spur,
switching, or side tracks excepted from
Board acquisition and operation
authority by virtue of 49 U.S.C. 10906.2
Although SMSRRIN states in its
verified notice that the operations were
proposed to be consummated on or
about September 15, 2017, this
transaction may not be consummated
until October 21, 2017 (30 days after the
verified notice was filed).
SMSRRIN certifies that its projected
annual revenues as a result of this
transaction do not exceed those that
would qualify it as a Class III rail carrier
and will not exceed $5 million.
SMSRRIN also certifies that there are no
provisions or agreements that may limit
future interchange commitments.
If the verified notice contains false or
misleading information, the exemption
is void ab initio. Petitions to revoke the
exemption under 49 U.S.C. 10502(d)
may be filed at any time. The filing of
a petition to revoke will not
automatically stay the effectiveness of
the exemption. Petitions to stay must be
filed no later than October 13, 2017 (at
least seven days before the exemption
becomes effective).
An original and 10 copies of all
pleadings, referring to Docket No. FD
36145, must be filed with the Surface
Transportation Board, 395 E Street SW.,
1 A draft copy of the operating agreement was
submitted with the notice of exemption.
2 See Effingham R.R.—Pet. for Declaratory
Order—Constr. at Effingham, Ill., 2 S.T.B. 606,
609–10 (STB served Sept. 12, 1997), aff’d sub nom.
United Transp. Union-Illinois Legislative Bd. v.
STB, 183 F.3d 606 (7th Cir. 1999).
E:\FR\FM\06OCN1.SGM
06OCN1
Agencies
[Federal Register Volume 82, Number 193 (Friday, October 6, 2017)]
[Notices]
[Pages 46877-46879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-21541]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-81798; File No. SR-NASDAQ-2017-097]
Self-Regulatory Organizations; The NASDAQ Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend the Exchange's Connectivity Fees at Rule 7051
October 2, 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 September 18, 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 Rule 7051, which sets forth the
schedule of fees that the Exchange charges to its clients for
connecting directly to the Exchange's data centers and/or receiving
third party market data feeds and other non-Exchange services from the
Exchange via circuits provided by third party telecommunications
providers.
While these amendments are effective upon filing, the Exchange has
designated the proposed amendments to be operative on October 1, 2017.
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 to amend Rule 7051, which sets forth the
schedule of fees that the Exchange charges to its clients for
connecting directly to the Exchange's data centers and/or receiving
third party market data feeds and other non-Exchange services from the
Exchange via circuits provided by third party telecommunications
providers.
Subscribers may use the connectivity provided under Rule 7051 to
link them
[[Page 46878]]
to the Exchange for order entry and to receive proprietary data feeds,
to receive public quote feeds from Securities Information Processors,
and to connect to facilities of FINRA, such as the FINRA/Nasdaq TRF.
The Exchange provides various direct connectivity options based on the
capacity of the connection. A subscriber generally determines the
capacity of the connection it needs based on the number of data
services it wishes to receive and its estimated usage for trading and
trade reporting purposes.
For direct connectivity to Nasdaq, Rule 7051(a) provides for 1 GB,
1 GB Ultra, and 10 GB Ultra hand-offs. The installation fee for all
such connections is $1,500 and the monthly fee is $7,500 for 10 GB
connections and $2,500 for both 1 GB and 1 GB Ultra hand-offs. The
Exchange also charges a $925 fee to customers that choose to install a
cable router in its data center and a monthly fee of $150 for customers
that choose to install equipment in the Exchange's data center to
support the connectivity.
For direct connectivity to third party services, Rule 7051(b)
provides for 1GB Ultra and 10 GB Ultra hand-offs. The installation fee
for both 10 GB Ultra and 1 GB Ultra direct connections is $1,500.
Meanwhile, the monthly fee is $5,000 for 10 GB Ultra connections and
$2,000 for 1 GB Ultra hand-offs. For 1 GB Ultra or 10 GB Ultra
connections for UTP only, the installation fee and monthly fee is
waived for the first two connections and thereafter the installation
fee is $100 and the monthly fee is also $100. Again, the Exchange
charges a $925 fee to customers that choose to install a cable router
in its data center for purposes of receiving these third party services
and a monthly fee of $150 for customers that choose to install
equipment in the Exchange's data center to support the connectivity.
In order to reflect the changing nature of the Exchange's ecosystem
and of the connection technologies it employs, the Exchange proposes to
clarify Rule 7051 in several respects.
First, the Exchange proposes to list separately those fees it
charges for certain connectivity that it presently includes under the
general heading of Direct Connectivity, pursuant to Rule 7051(a).
Specifically, the Exchange proposes to break out the fees it charges to
clients that connect directly to the Exchange through a ``Point of
Presence'' or ``POP'' from the fees it charges to clients that connect
through a direct circuit connection. In contrast to a traditional
direct circuit connection, in which a client uses an external
telecommunications provider's circuit to connect directly to the
Exchange's primary data center in Carteret, New Jersey, a ``POP''
connection is one in which a client directly connects to the Exchange
at one of its satellite data centers located elsewhere. Each such POP,
in turn, has a fully redundant connection to the Exchange's primary
data center.
The Exchange proposes to list POP connectivity fees separately from
traditional direct circuit connectivity fees because it wishes to
highlight POP connectivity as a distinct connection option,
particularly as it contemplates expanding the numbers and locations of
its POPs in the future.
To effect the foregoing change, the Exchange proposes to add a new
subsection (c) to Rule 7051 entitled ``Point of Presence
Connectivity.'' Under proposed Rule 7051(c), the installation and
monthly fees that the Exchange proposes to charge expressly for POP
connectivity would not be new fees and they would differ only in name,
and not in amount, from those fees that clients presently pay under
Rule 7051(a) for the same connectivity. The new subsection would
provide for clients to choose between 10 GB Ultra and 1 GB Ultra
bandwidth hand-offs for connections to POPs. However, the proposed
subsection (c) will not include charges for installing optional cable
routers or cabinet space rentals insofar as clients may not install
routers in or rent cabinet space directly from the Exchange at the
POPs. Likewise, proposed subsection (c) will not include fees for
regular 1 GB hand-offs insofar such hand-offs are not available for
connections to POPs.
In addition to the above, the Exchange proposes to update the
headings of Rule 7051(a) and (b) so that they more accurately reflect
the nature of the services to which they apply. Because Rule 7051(a)
and (b) list the fees that the Exchange charges customers for
installing and maintaining direct telecommunications ``circuit''
connectivity with the Exchange, the Exchange proposes to change the
heading of subsection (a) from ``Direct Connectivity to Nasdaq'' to
``Direct Circuit Connection to Nasdaq'' and the heading of subsection
(b) from ``Direct Connectivity to Third Party Services'' to ``Direct
Circuit Connection to Third Party Services.''
Lastly, the Exchange proposes to amend Rule 7051 to state that the
connectivity provided under the Rule also applies to connectivity to
the markets of The NASDAQ Stock Market LLC, NASDAQ BX, Inc., NASDAQ
PHLX LLC, Nasdaq ISE LLC, Nasdaq MRX LLC, and Nasdaq GEMX LLC. This
purpose of this proposal is to specify that a client can use the
connections it establishes and maintains under the Rule to connect, not
only to the Exchange, but also to any or all of its sister Exchanges,
and in doing so, it will be billed only once. Certain of the Exchange's
other Rules already include similar language, including Rules 7030 and
7034. The Exchange wishes now to add such language to Rule 7051.
2. Statutory Basis
The Exchange believes that its proposal is consistent with section
6(b) of the Act,\3\ in general, and furthers the objectives of sections
6(b)(4) and 6(b)(5) of the Act,\4\ 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.
---------------------------------------------------------------------------
\3\ 15 U.S.C. 78f(b).
\4\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------
The Exchange believes that its proposal to separately list its fees
for POP connectivity is reasonable as a means of clearly distinguishing
POP connectivity from traditional direct circuit connectivity as set
forth in Rule 7051(a). The proposal will not assess any new or
different fees to customers that connect to the Exchange through POPs.
Instead, the proposal will merely re-characterize the fees that clients
presently pay under Rule 7051(a) as relating specifically to POP
connectivity. The Exchange also believes that this proposal is an
equitable allocation and is not unfairly discriminatory because it will
apply all similarly situated clients that connect through POPs.
The Exchange believes that its proposal to modify the headings of
subsections (a) and (b) of Rule 7051 is also reasonable because it
clarifies that the fees in these subsections pertain specifically to
connections to the Exchange that involve circuits provided by external
telecommunications providers. Again, this proposal is an equitable
allocation and is not unfairly discriminatory in that it will apply to
all clients that use such direct circuits to connect to the Exchange.
Lastly, the Exchange believes that its proposal is reasonable and
nondiscriminatory to clarify that each of the connection options and
fees set forth in Rule 7051 generally provide for connectivity to The
NASDAQ Stock Market LLC, NASDAQ BX, Inc., NASDAQ PHLX LLC, Nasdaq ISE
LLC, Nasdaq MRX LLC, and Nasdaq GEMX LLC. The Exchange does not
restrict its clients from utilizing their direct
[[Page 46879]]
connections to it to also access its sister exchanges, and it does not
charge its clients more than once to do so. Although certain of the
Exchange's other connectivity Rules already make these points clear
(e.g., Rules 7030 and 7034), Rule 7051 does not do so. The Exchange
therefore believes its proposal to clarify Rule 7051 is warranted.
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 proposal merely clarifies
the Exchange's existing services and associated fees and the Exchange
does not anticipate that such clarifications will have any impact on
competition whatsoever.
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.\5\
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78s(b)(3)(A)(ii).
---------------------------------------------------------------------------
At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
Necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-NASDAQ-2017-097 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
All submissions should refer to File Number SR-NASDAQ-2017-097. 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 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-2017-097, and should
be submitted on or before October 27, 2017.
---------------------------------------------------------------------------
\6\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
---------------------------------------------------------------------------
pursuant to delegated authority.\6\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-21541 Filed 10-5-17; 8:45 am]
BILLING CODE 8011-01-P