Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Relating to Connectivity, Surveillance and Risk Management Services, 42552-42555 [2024-10594]
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Federal Register / Vol. 89, No. 95 / Wednesday, May 15, 2024 / Notices
only one method. The Commission will
post all comments on the Commission’s
internet website (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 website 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. Do not include
personal identifiable information in
submissions; you should submit only
information that you wish to make
available publicly. We may redact in
part or withhold entirely from
publication submitted material that is
obscene or subject to copyright
protection. All submissions should refer
to file number SR–NYSEARCA–2024–
37, and should be submitted on or
before June 5, 2024.
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on April 29,
2024 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
Exchange filed the proposal as a ‘‘noncontroversial’’ proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of
the Act 3 and Rule 19b–4(f)(6)
thereunder.4 The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.24
Sherry R. Haywood,
Assistant Secretary.
Equity Rules
[FR Doc. 2024–10587 Filed 5–14–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100093; File No. SR–
NASDAQ–2024–018]
Self-Regulatory Organizations; The
Nasdaq Stock Market LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change to Relating to
Connectivity, Surveillance and Risk
Management Services
May 9, 2024.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
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24 17
CFR 200.30–3(a)(12).
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to rule amend
Equity 7, Sections 70, 115 116, 149 and
161, and to remove Sections 116–A and
149–A of the Exchange’s pricing
schedule to retire services and products
that have been replaced by enhanced
services.
The text of the proposed rule change
is set forth below. Proposed new
language is italicized; deleted text is in
brackets.
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THE NASDAQ STOCK MARKET LLC RULES
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Equity 7: Pricing Schedule
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the 15th of the month, or the following
business day if the 15th is not a business day,
and the amount in dispute is at least $10,000
or greater. The 8000 Series Rules and the
following Rules will be subject to this
Section: Equity 7, Section 10 (Membership
Fees), Equity 7, Section 114 (Market Quality
Incentive Programs Investor Support
Program), Equity 7, Section 115 (Ports and
other Services), Equity 7, Section 116
(Nasdaq Post-Trade Risk Management),
Equity 7, Section 118 (Nasdaq Market Center
Order Execution and Routing), Equity 7,
Section 121 (NasdaqTrader.com Trading and
Compliance Data Package Fee), Equity 7,
Section 124 (Clearly Erroneous Module),
Equity 7, Section 127 (Aggregation of
Activity of Affiliated Members), Equity 7,
Section 129 (Installation, Removal or
Relocation), Equity 7, Section 130 (Other
Services), General 8, Section 1 (Co-Location
Services), Equity 7, Section 138 (Step-Outs
and Sales Fees Transfers), Equity 7, Section
141 (Nasdaq Regulation Reconnaissance
Service), Equity 7, Section 142 (Non-Tape
Riskless Submissions), Equity 7, Section 143
(Inclusion of Transaction Fees in Clearing
Reports Submitted to ACT), Equity 7, Section
149 (Nasdaq Real-Time Stats[InterACT]),
General 8, Section 2 (Direct Connectivity),
Equity 7, Section 155 (Short Sale Monitor),
Equity 7, Section 158 (QView), Equity 7,
Section 160 (Equity Trade Journal for
Clearing Firms) and Equity 7, Section 161
(Limit Locator).
(b) No change.
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Section 70. Collection of Exchange Fees and
Other Claims and Billing Policy
(a) Each Nasdaq member, and all
applicants for registration as such, shall be
required to provide a clearing account
number for an account at the National
Securities Clearing Corporation (‘‘NSCC’’) for
purposes of permitting the Exchange to debit
any undisputed or final fees, fines, charges
and/or other monetary sanctions or other
monies due and owing to the Exchange or
other charges related to the rules, as specified
below, and 8000 series rules which are due
and owing to Nasdaq. If a Nasdaq member
disputes an invoice, the Exchange will not
include the disputed amount in the debit if
the member has disputed the amount in
writing to the Exchange’s designated staff by
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1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
2 17
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Section 115. Ports and Services †
The charges under this section are assessed
by Nasdaq for connectivity to services and
the following systems operated by Nasdaq or
FINRA: the Nasdaq Market Center, FINRA
Trade Reporting and Compliance Engine
(TRACE), the FINRA/Nasdaq Trade Reporting
Facility, and the FINRA OTC Reporting
Facility (ORF). The following fees are not
applicable to The Nasdaq Options Market
LLC. For related options fees for Ports and
other Services refer to Options 7, Section 3
of the Options Rules.
(a)–(c) No change.
(d) Reserved[New Nasdaq Workstation]
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[Nasdaq Workstation Trader] ..........
[Nasdaq Workstation Post Trade] ...
42553
[$575 per user per month (including: data entitlement package; the Trade Reporting File Upload service,
which allows members to upload multiple trade reports in batches to Automated Confirmation Transaction Service (‘‘ACT’’); the ACT Reject Scan service, which provides a list of all of a member’s rejected
ACT trade entries and a copy of each rejected trade report form submitted to ACT; and the IPO Indicator service, which provides information on order execution that would be received in an IPO during the
launch process)].
[See Equity 7, Section 115(e)].
(e) Specialized Services Related to FINRA/
Nasdaq Trade Reporting Facility
[WebLink
ACT
or
Nasdaq
Workstation Post Trade].
[ACT Workstation] ...........................
Nasdaq WorkX ................................
[A subscription includes: the Trade Reporting File Upload service, which allows members to upload multiple trade reports in batches to ACT; and the ACT Reject Scan service, which provides a list of all of a
member’s rejected ACT trade entries and a copy of each rejected trade report form submitted to ACT].
[$625/logon/month].
$625/logon/month.
[For customers using both Act Workstation and Nasdaq WorkX, fees for Nasdaq WorkX will be waived for
the first month of service].
(f) TradeInfo
[Members not subscribing to the Nasdaq
Workstation using TradeInfo will be
charged a fee of $95 per user per month.]
A member firm that has a TradeInfo user
subscription may subscribe to the Limit Up/
Limit Down Band Lookup [add-on service]
for a fee of $200 per user per month
[beginning May 1, 2013]. The Limit Up/Limit
Down Band Lookup add-on service provides
a subscribing member firm with intraday and
historical limit up/limit down price band
information for individual securities that are
subject to limit up/limit down price bands.
1
2
3
4
...............................................
...............................................
...............................................
...............................................
† Fees
*
*
*
*
Monthly fee †
50 or more .....................................
20 to 49 .........................................
5 to 19 ...........................................
1 to 4 .............................................
$400
$500
$550
$600
per
per
per
per
port,
port,
port,
port,
per
per
per
per
month.
month.
month.
month.
are assessed in full month increments under this section, and thus are not prorated.
(c) Users of PRM services specified below
will be assessed the following charges in
addition to the applicable PRM-enabled port
charges:
PRM Modules ...........................................................................................
Aggregate Total Checks ...........................................................................
PRM Workstation Add-ons to an existing Nasdaq Workstation or
WeblinkACT 2.0.
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Section 116. [Nasdaq Risk Management
(a) Clearing brokers using the Nasdaq Risk
Management Service will be assessed a
charge of $0.030 per side per trade monitored
by Nasdaq Risk Management and a charge of
$17.25 per month per correspondent
executing broker monitored by Nasdaq Risk
Management, up to a maximum charge of
$7,500 per month per correspondent
executing broker. Clearing brokers with less
than 17,000 trades per month per
correspondent executing broker and that fall
below 50 total correspondents monitored
during the month are assessed a monthly fee
of $500 per correspondent executing broker
monitored in lieu of the $0.030 per side per
trade charge.
(b) Users of Nasdaq Pre-trade Risk
Management (‘‘PRM’’) will be assessed a
monthly fee based on the following table, and
such fees will not exceed $25,000 per
member firm, per month:
Number of PRMenabled ports
Port tiers
Tier
Tier
Tier
Tier
(g)–(j) No change.
† Fees are assessed in full month
increments under this section, and thus are
not prorated.
Section 116–A. ]Nasdaq Post-Trade Risk
Management
(a) Clearing brokers using the Nasdaq PostTrade Risk Management Service will be
assessed a charge of $0.030 per side per trade
monitored by Nasdaq Post-Trade Risk
Management and a charge of $17.25 per
month per correspondent executing broker
monitored by Nasdaq Post-Trade Risk
Management, up to a maximum charge of
$7,500 per month per correspondent
executing broker. Clearing brokers with less
than 17,000 trades per month per
correspondent executing broker and that fall
below 50 total correspondents monitored
during the month are assessed a monthly fee
of $500 per correspondent executing broker
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No charge.
No charge.
$100 per each PRM Workstation Add-on per month.
monitored in lieu of the $0.030 per side per
trade charge. [For customers using both
Nasdaq Risk Management and Nasdaq PostTrade Risk Management, fees for Nasdaq
Post-Trade Risk Management will be waived
for the first month of service.]
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Section 149. [Nasdaq InterACT
Nasdaq InterACT is a surveillance tool that
provides summaries of a subscribing
member’s trade activity for the FINRA/
Nasdaq Trade Reporting Facility. Such
summaries include the total number of trades
that have been reported to the Facility,
various statistics associated with those trades
reported (including: declines, cancels,
stepouts, as-ofs, etc), the total number of
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trades that must be reviewed for acceptance,
and the total number of Regulation NMS
trade throughs. ‘‘FINRA/Nasdaq Trade
Reporting Facility’’ shall mean the FINRA/
Nasdaq TRF Carteret and the FINRA/Nasdaq
TRF Chicago.
InterACT is available for a subscription fee
of $400 per month, per user, with a
maximum fee of $2,400 per month, per
member firm.
Section 149–A. ]Nasdaq Real-Time Stats
Nasdaq Real-Time Stats is a surveillance
tool that provides summaries of a subscribing
member’s trade activity for the FINRA/
Nasdaq Trade Reporting Facility to support
compliance with FINRA rules. Such
summaries include the total number of trades
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Federal Register / Vol. 89, No. 95 / Wednesday, May 15, 2024 / Notices
that have been reported to the Facility,
various statistics associated with those trades
reported (including: declines, cancels,
stepouts, as-ofs, etc), and the total number of
trades that must be reviewed for acceptance.
‘‘FINRA/Nasdaq Trade Reporting Facility’’
shall mean the FINRA/Nasdaq TRF Carteret
and the FINRA/Nasdaq TRF Chicago.
Real-Time Stats is available for a
subscription fee of $400 per month, per user,
with a maximum fee of $2,400 per month,
per member firm. [For customers using both
Nasdaq InterACT and Nasdaq Real-Time
Stats, fees for Nasdaq Real-Time Stats will be
waived for the first month of service.]
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Section 161. Limit Locator
Limit Locator is a tool to assist a member
firm in monitoring its trades reported into the
FINRA/Nasdaq TRF for compliance with the
requirements of the National Market System
Plan to Address Extraordinary Market
Volatility. The service provides a subscribing
member firm with an overview of its trades
reported at, or outside of, a designated Limit
Up/Limit Down pricing band. The service
will provide a total count of the subscribing
member firm’s trades in each category as well
as present this information graphically, on a
rolling month basis. A subscribing member
firm is able to create custom email[s] alerts
to notify users when a trade is reported at,
or outside of, a Limit Up/Limit Down pricing
band. Limit Locator is accessed through
Nasdaq WorkX[the Nasdaq Workstation or
Weblink ACT 2.0]and is offered for a fee of
$750 per month/per MPID [beginning April
8, 2013]. ‘‘FINRA/Nasdaq Trade Reporting
Facility’’ shall mean the FINRA/Nasdaq TRF
Carteret and the FINRA/Nasdaq TRF Chicago.
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The text of the proposed rule change
is available on the Exchange’s website at
https://listingcenter.nasdaq.com/
rulebook/nasdaq/rules, at the principal
office of the Exchange, and at the
Commission’s Public Reference Room.
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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
On April 20, 2021, Nasdaq filed a
proposal to re-platform three of its
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products for trade reporting,
surveillance and risk management
services—(1) ACT Workstation
(‘‘Workstation’’),5 (2) Nasdaq InterACT
(‘‘InterACT’’) 6 and (3) Nasdaq Risk
Management (‘‘Risk Management’’)
(collectively, the ‘‘Legacy Products’’). 7
These products were renamed (1)
Nasdaq WorkXTM (‘‘WorkX’’), (2)
Nasdaq Real-Time Stats (‘‘Real-Time
Stats’’) and (3) Nasdaq Post-Trade Risk
Management (‘‘Post-Trade Risk
Management’’), respectively
(collectively, the ‘‘Enhanced
Products.’’). At the time of the proposal,
Nasdaq stated that once all current
participants had migrated to the RePlatformed products, the Exchange
would retire the services and remove
the Legacy Products from its fee
schedule.8 The Exchange is proposing to
amend Equity 7, Sections 70, 115 116,
149 and 161, and to remove Sections
116–A and 149–A of the Exchange’s
pricing schedule to retire services and
products that have been replaced by
enhanced services.9
While Nasdaq provided the option of
users to maintain access to, and utilize,
both the Legacy and Re-Platformed
Products,10 as of January 2024, all
current participants have fully migrated
to the Re-Platformed Products and no
customers currently use the Legacy
Products. Therefore, Nasdaq is
proposing to retire the services and
remove the Legacy Products from its fee
schedule. Additionally, Nasdaq is
proposing to clarify that certain services
that were previously add-on services to
Workstation will be stand-alone
services.11
5 Workstation is a web-based application that
electronically facilitates trade reporting and
clearing functions for trades reported to the FINRA/
Nasdaq TRF. Workstation services include trade
entry, trade scan, and uploads for bulk trade entry
to support FINRA/Nasdaq TRF participant trade
reporting in accordance with Financial Industry
Regulatory Authority (‘‘FINRA’’) rules.
6 InterACT is a real-time compliance tool that
assists firms with regulatory supervision of trade
activity reported to the FINRA/Nasdaq TRF.
InterACT summarizes and consolidates data for
over-the-counter trade reports to help customers
comply with FINRA rules.
7 See Securities Exchange Act Release No. 34–
91744 (May 3, 20221), 86 FR 24685 (May 7, 2021)
(SR–NASDAQ–2021–025) (‘‘Initial Filing’’).
8 Id. at 24686 n. 7, 24687.
9 There will be no changes to the fees as a result
of the retirement of the retired services.
10 See Initial Filing at 24687; Securities Exchange
Act Release No. 34–98582 (September 28, 2023), 88
FR 68760, 68761 (Oct. 4, 2023) (SR–NASDAQ–
2023–038).
11 TradeInfo (Section 115(f)) and IPO Indicator
(Section 115(i)) will continue to be available as
stand-alone services. IPO Locator (Section 161) was
previously an add-on and a stand-alone service but
will only be a stand-alone service accessed through
WorkX going forward.
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2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act,12 in general, and furthers the
objectives of Sections 6(b)(4) and 6(b)(5)
of the Act,13 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
proposal is also designed to promote
just and equitable principles of trade, to
remove impediments to and perfect the
mechanism of a free and open market
and a national market system, and, in
general to protect investors and the
public interest.
The purpose of this proposal is to
remove the discontinued Legacy
Products from the Exchange’s rulebook
and to inform the SEC and market
participants of that change. The
Exchange believes that the proposal to
retire the Legacy Products is reasonable
and not unfairly discriminatory because
the Re-Platformed Products provide
similar but enhanced features and have
replaced the Legacy Products. Moreover,
no participants currently utilize the
Legacy Products and have all
transitioned to the Re-Platformed
Products and no participant will be
disrupted by the proposed change. For
the same reason, the Exchange believes
that the proposed changes remove
impediments to and perfect the
mechanism of a free and open market
and a national market system, constitute
an equitable allocation of fees, and
protect investors and the public interest
because under the proposed rule, the
Exchange’s rulebook would eliminate
certain products that are no longer being
offered to customers and the fees for the
Re-Platformed Products would continue
to remain the same. Additionally, from
time to time, the Exchange reviews its
rulebook to ensure that its fees are
accurate and align with its current
operation to protect investors and the
public interest.
The Exchange believes that the
proposal is not unfairly discriminatory.
All member firms have been notified of
the retirement of the Legacy Products
and have had an opportunity to access
the Enhance Products. Any firm that
was not satisfied with the Enhanced
Products was given over a year to find
an alternate service offered by a third
party. Moreover, the fees for the
12 15
13 15
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U.S.C. 78f(b).
U.S.C. 78f(b)(4) and (5).
15MYN1
Federal Register / Vol. 89, No. 95 / Wednesday, May 15, 2024 / Notices
Enhanced Products continue to remain
the same for all member firms.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will result in
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. As explained
above, the purpose of this proposal is to
remove the discontinued Legacy
Products from the Exchange’s rulebook
and to inform the SEC and market
participants of that change. The
Enhanced Products will continue to be
available to all market participants and
the fees will remain the same as the
Legacy Products.
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–2024–018 on the subject line.
Paper Comments
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
The Exchange neither solicited nor
received comments on the proposed
rule change.
All submissions should refer to file
number SR–NASDAQ–2024–018. 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 website (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 website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–NASDAQ–2024–018 and should be
submitted on or before June 5, 2024.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule
change does not:
A. significantly affect the protection
of investors or the public interest;
B. impose any significant burden on
competition; and
C. become operative for 30 days from
the date on which it was filed, or such
shorter time as the Commission may
designate, it has become effective
pursuant to Section 19(b)(3)(A) of the
Act 14 and Rule 19b–4(f)(6) 15
thereunder.16 At any time within 60
days of the filing of the proposed rule
change, the Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission will institute proceedings
to determine whether the proposed rule
change should be approved or
disapproved.
14 15
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IV. Solicitation of Comments
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(6).
16 17 CFR 240.19b–4(f)(6). In addition, Rule 19b4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
the proposed rule change at least five business days
prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
15 17
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42555
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–10594 Filed 5–14–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100095; File No. SR–NYSE–
2024–25]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend the
Connectivity Fee Schedule
May 9, 2024.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on April 29,
2024, New York Stock Exchange LLC
(‘‘NYSE’’ or the ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I, II, and III below, which Items
have been prepared by the selfregulatory organization. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend the
Connectivity Fee Schedule (‘‘Fee
Schedule’’) regarding colocation
services and fees to update the list of
included data products. The proposed
rule change is available on the
Exchange’s website at www.nyse.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
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
17 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
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[Federal Register Volume 89, Number 95 (Wednesday, May 15, 2024)]
[Notices]
[Pages 42552-42555]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-10594]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100093; File No. SR-NASDAQ-2024-018]
Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change to
Relating to Connectivity, Surveillance and Risk Management Services
May 9, 2024.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on April 29, 2024 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 Exchange filed the proposal as a ``non-controversial''
proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act
\3\ and Rule 19b-4(f)(6) thereunder.\4\ The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to rule amend Equity 7, Sections 70, 115 116,
149 and 161, and to remove Sections 116-A and 149-A of the Exchange's
pricing schedule to retire services and products that have been
replaced by enhanced services.
The text of the proposed rule change is set forth below. Proposed
new language is italicized; deleted text is in brackets.
* * * * *
THE NASDAQ STOCK MARKET LLC RULES
* * * * *
Equity Rules
* * * * *
Equity 7: Pricing Schedule
* * * * *
Section 70. Collection of Exchange Fees and Other Claims and Billing
Policy
(a) Each Nasdaq member, and all applicants for registration as
such, shall be required to provide a clearing account number for an
account at the National Securities Clearing Corporation (``NSCC'')
for purposes of permitting the Exchange to debit any undisputed or
final fees, fines, charges and/or other monetary sanctions or other
monies due and owing to the Exchange or other charges related to the
rules, as specified below, and 8000 series rules which are due and
owing to Nasdaq. If a Nasdaq member disputes an invoice, the
Exchange will not include the disputed amount in the debit if the
member has disputed the amount in writing to the Exchange's
designated staff by the 15th of the month, or the following business
day if the 15th is not a business day, and the amount in dispute is
at least $10,000 or greater. The 8000 Series Rules and the following
Rules will be subject to this Section: Equity 7, Section 10
(Membership Fees), Equity 7, Section 114 (Market Quality Incentive
Programs Investor Support Program), Equity 7, Section 115 (Ports and
other Services), Equity 7, Section 116 (Nasdaq Post-Trade Risk
Management), Equity 7, Section 118 (Nasdaq Market Center Order
Execution and Routing), Equity 7, Section 121 (NasdaqTrader.com
Trading and Compliance Data Package Fee), Equity 7, Section 124
(Clearly Erroneous Module), Equity 7, Section 127 (Aggregation of
Activity of Affiliated Members), Equity 7, Section 129
(Installation, Removal or Relocation), Equity 7, Section 130 (Other
Services), General 8, Section 1 (Co-Location Services), Equity 7,
Section 138 (Step-Outs and Sales Fees Transfers), Equity 7, Section
141 (Nasdaq Regulation Reconnaissance Service), Equity 7, Section
142 (Non-Tape Riskless Submissions), Equity 7, Section 143
(Inclusion of Transaction Fees in Clearing Reports Submitted to
ACT), Equity 7, Section 149 (Nasdaq Real-Time Stats[InterACT]),
General 8, Section 2 (Direct Connectivity), Equity 7, Section 155
(Short Sale Monitor), Equity 7, Section 158 (QView), Equity 7,
Section 160 (Equity Trade Journal for Clearing Firms) and Equity 7,
Section 161 (Limit Locator).
(b) No change.
* * * * *
Section 115. Ports and Services [dagger]
The charges under this section are assessed by Nasdaq for
connectivity to services and the following systems operated by
Nasdaq or FINRA: the Nasdaq Market Center, FINRA Trade Reporting and
Compliance Engine (TRACE), the FINRA/Nasdaq Trade Reporting
Facility, and the FINRA OTC Reporting Facility (ORF). The following
fees are not applicable to The Nasdaq Options Market LLC. For
related options fees for Ports and other Services refer to Options
7, Section 3 of the Options Rules.
(a)-(c) No change.
(d) Reserved[New Nasdaq Workstation]
[[Page 42553]]
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[Nasdaq Workstation Trader]....... [$575 per user per month (including:
data entitlement package; the Trade
Reporting File Upload service,
which allows members to upload
multiple trade reports in batches
to Automated Confirmation
Transaction Service (``ACT''); the
ACT Reject Scan service, which
provides a list of all of a
member's rejected ACT trade entries
and a copy of each rejected trade
report form submitted to ACT; and
the IPO Indicator service, which
provides information on order
execution that would be received in
an IPO during the launch process)].
[Nasdaq Workstation Post Trade]... [See Equity 7, Section 115(e)].
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(e) Specialized Services Related to FINRA/Nasdaq Trade Reporting
Facility
------------------------------------------------------------------------
------------------------------------------------------------------------
[WebLink ACT or Nasdaq Workstation [A subscription includes: the Trade
Post Trade]. Reporting File Upload service,
which allows members to upload
multiple trade reports in batches
to ACT; and the ACT Reject Scan
service, which provides a list of
all of a member's rejected ACT
trade entries and a copy of each
rejected trade report form
submitted to ACT].
[ACT Workstation]................. [$625/logon/month].
Nasdaq WorkX...................... $625/logon/month.
[For customers using both Act
Workstation and Nasdaq WorkX, fees
for Nasdaq WorkX will be waived for
the first month of service].
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(f) TradeInfo
[Members not subscribing to the Nasdaq Workstation using TradeInfo
will be charged a fee of $95 per user per month.]
A member firm that has a TradeInfo user subscription may
subscribe to the Limit Up/Limit Down Band Lookup [add-on service]
for a fee of $200 per user per month [beginning May 1, 2013]. The
Limit Up/Limit Down Band Lookup add-on service provides a
subscribing member firm with intraday and historical limit up/limit
down price band information for individual securities that are
subject to limit up/limit down price bands.
(g)-(j) No change.
[dagger] Fees are assessed in full month increments under this
section, and thus are not prorated.
* * * * *
Section 116. [Nasdaq Risk Management
(a) Clearing brokers using the Nasdaq Risk Management Service
will be assessed a charge of $0.030 per side per trade monitored by
Nasdaq Risk Management and a charge of $17.25 per month per
correspondent executing broker monitored by Nasdaq Risk Management,
up to a maximum charge of $7,500 per month per correspondent
executing broker. Clearing brokers with less than 17,000 trades per
month per correspondent executing broker and that fall below 50
total correspondents monitored during the month are assessed a
monthly fee of $500 per correspondent executing broker monitored in
lieu of the $0.030 per side per trade charge.
(b) Users of Nasdaq Pre-trade Risk Management (``PRM'') will be
assessed a monthly fee based on the following table, and such fees
will not exceed $25,000 per member firm, per month:
------------------------------------------------------------------------
Number of PRM-
Port tiers enabled ports Monthly fee [dagger]
------------------------------------------------------------------------
Tier 1........................ 50 or more....... $400 per port, per
month.
Tier 2........................ 20 to 49......... $500 per port, per
month.
Tier 3........................ 5 to 19.......... $550 per port, per
month.
Tier 4........................ 1 to 4........... $600 per port, per
month.
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[dagger] Fees are assessed in full month increments under this section,
and thus are not prorated.
(c) Users of PRM services specified below will be assessed the
following charges in addition to the applicable PRM-enabled port
charges:
------------------------------------------------------------------------
------------------------------------------------------------------------
PRM Modules............................ No charge.
Aggregate Total Checks................. No charge.
PRM Workstation Add-ons to an existing $100 per each PRM Workstation
Nasdaq Workstation or WeblinkACT 2.0. Add-on per month.
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Section 116-A. ]Nasdaq Post-Trade Risk Management
(a) Clearing brokers using the Nasdaq Post-Trade Risk Management
Service will be assessed a charge of $0.030 per side per trade
monitored by Nasdaq Post-Trade Risk Management and a charge of
$17.25 per month per correspondent executing broker monitored by
Nasdaq Post-Trade Risk Management, up to a maximum charge of $7,500
per month per correspondent executing broker. Clearing brokers with
less than 17,000 trades per month per correspondent executing broker
and that fall below 50 total correspondents monitored during the
month are assessed a monthly fee of $500 per correspondent executing
broker monitored in lieu of the $0.030 per side per trade charge.
[For customers using both Nasdaq Risk Management and Nasdaq Post-
Trade Risk Management, fees for Nasdaq Post-Trade Risk Management
will be waived for the first month of service.]
* * * * *
Section 149. [Nasdaq InterACT
Nasdaq InterACT is a surveillance tool that provides summaries
of a subscribing member's trade activity for the FINRA/Nasdaq Trade
Reporting Facility. Such summaries include the total number of
trades that have been reported to the Facility, various statistics
associated with those trades reported (including: declines, cancels,
stepouts, as-ofs, etc), the total number of trades that must be
reviewed for acceptance, and the total number of Regulation NMS
trade throughs. ``FINRA/Nasdaq Trade Reporting Facility'' shall mean
the FINRA/Nasdaq TRF Carteret and the FINRA/Nasdaq TRF Chicago.
InterACT is available for a subscription fee of $400 per month,
per user, with a maximum fee of $2,400 per month, per member firm.
Section 149-A. ]Nasdaq Real-Time Stats
Nasdaq Real-Time Stats is a surveillance tool that provides
summaries of a subscribing member's trade activity for the FINRA/
Nasdaq Trade Reporting Facility to support compliance with FINRA
rules. Such summaries include the total number of trades
[[Page 42554]]
that have been reported to the Facility, various statistics
associated with those trades reported (including: declines, cancels,
stepouts, as-ofs, etc), and the total number of trades that must be
reviewed for acceptance. ``FINRA/Nasdaq Trade Reporting Facility''
shall mean the FINRA/Nasdaq TRF Carteret and the FINRA/Nasdaq TRF
Chicago.
Real-Time Stats is available for a subscription fee of $400 per
month, per user, with a maximum fee of $2,400 per month, per member
firm. [For customers using both Nasdaq InterACT and Nasdaq Real-Time
Stats, fees for Nasdaq Real-Time Stats will be waived for the first
month of service.]
* * * * *
Section 161. Limit Locator
Limit Locator is a tool to assist a member firm in monitoring
its trades reported into the FINRA/Nasdaq TRF for compliance with
the requirements of the National Market System Plan to Address
Extraordinary Market Volatility. The service provides a subscribing
member firm with an overview of its trades reported at, or outside
of, a designated Limit Up/Limit Down pricing band. The service will
provide a total count of the subscribing member firm's trades in
each category as well as present this information graphically, on a
rolling month basis. A subscribing member firm is able to create
custom email[s] alerts to notify users when a trade is reported at,
or outside of, a Limit Up/Limit Down pricing band. Limit Locator is
accessed through Nasdaq WorkX[the Nasdaq Workstation or Weblink ACT
2.0]and is offered for a fee of $750 per month/per MPID [beginning
April 8, 2013]. ``FINRA/Nasdaq Trade Reporting Facility'' shall mean
the FINRA/Nasdaq TRF Carteret and the FINRA/Nasdaq TRF Chicago.
* * * * *
The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/nasdaq/rules, 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
On April 20, 2021, Nasdaq filed a proposal to re-platform three of
its products for trade reporting, surveillance and risk management
services--(1) ACT Workstation (``Workstation''),\5\ (2) Nasdaq InterACT
(``InterACT'') \6\ and (3) Nasdaq Risk Management (``Risk Management'')
(collectively, the ``Legacy Products''). \7\ These products were
renamed (1) Nasdaq WorkX\TM\ (``WorkX''), (2) Nasdaq Real-Time Stats
(``Real-Time Stats'') and (3) Nasdaq Post-Trade Risk Management
(``Post-Trade Risk Management''), respectively (collectively, the
``Enhanced Products.''). At the time of the proposal, Nasdaq stated
that once all current participants had migrated to the Re-Platformed
products, the Exchange would retire the services and remove the Legacy
Products from its fee schedule.\8\ The Exchange is proposing to amend
Equity 7, Sections 70, 115 116, 149 and 161, and to remove Sections
116-A and 149-A of the Exchange's pricing schedule to retire services
and products that have been replaced by enhanced services.\9\
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\5\ Workstation is a web-based application that electronically
facilitates trade reporting and clearing functions for trades
reported to the FINRA/Nasdaq TRF. Workstation services include trade
entry, trade scan, and uploads for bulk trade entry to support
FINRA/Nasdaq TRF participant trade reporting in accordance with
Financial Industry Regulatory Authority (``FINRA'') rules.
\6\ InterACT is a real-time compliance tool that assists firms
with regulatory supervision of trade activity reported to the FINRA/
Nasdaq TRF. InterACT summarizes and consolidates data for over-the-
counter trade reports to help customers comply with FINRA rules.
\7\ See Securities Exchange Act Release No. 34-91744 (May 3,
20221), 86 FR 24685 (May 7, 2021) (SR-NASDAQ-2021-025) (``Initial
Filing'').
\8\ Id. at 24686 n. 7, 24687.
\9\ There will be no changes to the fees as a result of the
retirement of the retired services.
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While Nasdaq provided the option of users to maintain access to,
and utilize, both the Legacy and Re-Platformed Products,\10\ as of
January 2024, all current participants have fully migrated to the Re-
Platformed Products and no customers currently use the Legacy Products.
Therefore, Nasdaq is proposing to retire the services and remove the
Legacy Products from its fee schedule. Additionally, Nasdaq is
proposing to clarify that certain services that were previously add-on
services to Workstation will be stand-alone services.\11\
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\10\ See Initial Filing at 24687; Securities Exchange Act
Release No. 34-98582 (September 28, 2023), 88 FR 68760, 68761 (Oct.
4, 2023) (SR-NASDAQ-2023-038).
\11\ TradeInfo (Section 115(f)) and IPO Indicator (Section
115(i)) will continue to be available as stand-alone services. IPO
Locator (Section 161) was previously an add-on and a stand-alone
service but will only be a stand-alone service accessed through
WorkX going forward.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\12\ in general, and furthers the objectives of
Sections 6(b)(4) and 6(b)(5) of the Act,\13\ 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 proposal is also designed
to promote just and equitable principles of trade, to remove
impediments to and perfect the mechanism of a free and open market and
a national market system, and, in general to protect investors and the
public interest.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(4) and (5).
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The purpose of this proposal is to remove the discontinued Legacy
Products from the Exchange's rulebook and to inform the SEC and market
participants of that change. The Exchange believes that the proposal to
retire the Legacy Products is reasonable and not unfairly
discriminatory because the Re-Platformed Products provide similar but
enhanced features and have replaced the Legacy Products. Moreover, no
participants currently utilize the Legacy Products and have all
transitioned to the Re-Platformed Products and no participant will be
disrupted by the proposed change. For the same reason, the Exchange
believes that the proposed changes remove impediments to and perfect
the mechanism of a free and open market and a national market system,
constitute an equitable allocation of fees, and protect investors and
the public interest because under the proposed rule, the Exchange's
rulebook would eliminate certain products that are no longer being
offered to customers and the fees for the Re-Platformed Products would
continue to remain the same. Additionally, from time to time, the
Exchange reviews its rulebook to ensure that its fees are accurate and
align with its current operation to protect investors and the public
interest.
The Exchange believes that the proposal is not unfairly
discriminatory. All member firms have been notified of the retirement
of the Legacy Products and have had an opportunity to access the
Enhance Products. Any firm that was not satisfied with the Enhanced
Products was given over a year to find an alternate service offered by
a third party. Moreover, the fees for the
[[Page 42555]]
Enhanced Products continue to remain the same for all member firms.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. As explained
above, the purpose of this proposal is to remove the discontinued
Legacy Products from the Exchange's rulebook and to inform the SEC and
market participants of that change. The Enhanced Products will continue
to be available to all market participants and the fees will remain the
same as the Legacy Products.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not:
A. significantly affect the protection of investors or the public
interest;
B. impose any significant burden on competition; and
C. become operative for 30 days from the date on which it was
filed, or such shorter time as the Commission may designate, it has
become effective pursuant to Section 19(b)(3)(A) of the Act \14\ and
Rule 19b-4(f)(6) \15\ thereunder.\16\ At any time within 60 days of the
filing of the proposed rule change, the Commission summarily may
temporarily suspend such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission will institute proceedings to determine whether the proposed
rule change should be approved or disapproved.
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\14\ 15 U.S.C. 78s(b)(3)(A).
\15\ 17 CFR 240.19b-4(f)(6).
\16\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
file number SR-NASDAQ-2024-018 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-2024-018. 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 website (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 website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10 a.m. and 3
p.m. Copies of the filing also will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-NASDAQ-2024-018 and should be submitted
on or before June 5, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
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\17\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-10594 Filed 5-14-24; 8:45 am]
BILLING CODE 8011-01-P
