7152 Federal Register / Vol. 86, No. 15 / Tuesday, January 26, 2021 / Notices 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See Fee Schedule, Limit of Fees on Options 

Strategy Executions, available here: https://

www.nyse.com/publicdocs/nyse/markets/arcaoptions/NYSE_Arca_Options_Fee_Schedule.pdf. 

5See id. 

6See proposed Fee Schedule, Limit of Fees on 

Options Strategy Executions. 

7See id. 

8See, e.g., Cboe fee schedule, footnote 13. Cboe 

caps fees for each participant at $0.00 for the 

following strategies executed on the same trading 

day: Short stock interest, reversal, conversion, jelly 

roll, and merger strategies. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–01592 Filed 1–25–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90949; No. SR–NYSEArca– 

2021–06] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Modify the NYSE Arca 

Options Fee Schedule Regarding the 

Limits on Fees for Options Strategy 

Executions 

January 19, 2021. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on January 

13, 2021, NYSE Arca, Inc. (‘‘NYSE 

Arca’’ 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 self-regulatory 

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 modify the 

NYSE Arca Options Fee Schedule (‘‘Fee 

Schedule’’) regarding the Limit of Fees 

on Options Strategy Executions. The 

Exchange proposes to implement the fee 

change effective January 13, 2021. 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 

on the proposed rule change. The text 

of those 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 parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of this filing is to amend 

the Fee Schedule to modify the Limit of 

Fees on Options Strategy Executions 

(‘‘Strategy Cap’’), effective January 13, 

2021. 

Currently, the Fee Schedule provides 

that transaction fees for OTP Holders 

and OTP Firms (collectively, ‘‘OTP 

Holders’’) are limited or capped at 

$1,000 for certain options strategy 

executions ‘‘on the same trading day,’’ 

meaning it is a daily fee cap.4 Strategy 

executions that qualify for the Strategy 

Cap are (a) reversals and conversions, 

(b) box spreads, (c) short stock interest 

spreads, (d) merger spreads, and (e) jelly 

rolls, which are described in detail in 

the Fee Schedule (the ‘‘Strategy 

Executions’’).5

The Exchange proposes to modify the 

Strategy Cap to offer a lower cap of $200 

for those OTP Holders that trade at least 

25,000 monthly billable contract sides 

in Strategy Executions.6 Thus, at the 

end of the month, qualifying OTP 

Holders would have transaction fees for 

their Strategy Executions for each day of 

the month capped at $200 (as opposed 

to $1,000 for non-qualifying OTP 

Holders).7

For example, assume an OTP Holder 

executes the following Strategy 

Executions against interest in the 

Trading Crowd on the third business 

day of the month on behalf of a nonCustomer that is not a Lead Market 

Maker, which participants are subject to 

a $0.25 per Manual transaction fee. 

Under the current Fee Schedule, an OTP 

Holder would be charged a total of 

$1,000 in options fees, per the daily fee 

cap: 

• Trade 1: A Reversal Conversion in 

DEF comprised of 3,000 call options 

against 3,000 put options would be 

$1,500 (at $0.25 per execution), absent 

the $1,000 Strategy Cap. 

• Trade 2: A Reversal Conversion in 

ABC comprised of 1,000 call options 

against 1,000 put options would be $500 

(at $0.25 per execution), absent the 

Strategy Cap, but the OTP Holder, 

having reached the daily cap, would not 

be charged for these transactions. 

However, if, in addition to the two 

trades above, the OTP Holder executes 

a ‘‘jelly roll’’ consisting of 5,000 October 

puts and 5,000 October calls against 

5,000 November calls and 5,000 

November puts on the fifteenth business 

day of the month, the total fees for these 

qualifying Strategy Executions under 

the proposed Fee Schedule would be 

capped at $200 for this trading day, 

given that the total number of contracts 

on day three and day fifteen is above the 

minimum 25,000 billable contract sides 

threshold. Similarly, having met this 

threshold, the fees charged on Trades 1 

and 2 that were executed on the third 

business day would likewise be capped 

at $200. Thus, the fees for each of the 

third and fifteenth trading days would 

be capped at $200 each, for a monthly 

total of $400 for Strategy Executions. 

The Exchange’s fees are constrained 

by intermarket competition, as OTP 

Holders may direct their order flow to 

any of the 16 options exchanges, 

including another exchange that 

provides a cap on fees for strategy 

executions.8 Thus, OTP Holders have a 

choice of where they direct their order 

flow. This proposed change is designed 

to incent OTP Holders to increase their 

Strategy Execution volumes by 

executing (often smaller) strategies that 

are not necessarily economically viable 

on a per symbol basis, but which may 

be profitable when fees on Strategy 

Executions—regardless of symbol—are 

capped for the trading day. The 

Exchange notes that all market 

participants stand to benefit from 

increased volume, which promotes 

market depth, facilitates tighter spreads 

and enhances price discovery, and may 

lead to a corresponding increase in 

order flow from other market 

participants. 

The Exchange cannot predict with 

certainty whether any, or how many, 

OTP Holders would avail themselves of 

this proposed fee change. The Exchange 

believes that OTP Holders that execute 

Strategy Executions on the Exchange 

can achieve the proposed 25,000 

minimum contract sides threshold to 

qualify for the proposed (reduced) 

Strategy Cap and that this proposal may 

encourage OTP Holders to execute (and 

aggregate) Strategy Executions on the 

Federal Register / Vol. 86, No. 15 / Tuesday, January 26, 2021 / Notices 7153 

9 15 U.S.C. 78f(b). 

10 15 U.S.C. 78f(b)(4) and (5). 

11See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(S7–10–04) (‘‘Reg NMS Adopting Release’’). 

12The OCC publishes options and futures volume 

in a variety of formats, including daily and monthly 

volume by exchange, available here: https://

www.theocc.com/Market-Data/Market-DataReports/Volume-and-Open-Interest/MonthlyWeekly-Volume-Statistics. 

13Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, see id., the 

Exchange’s market share in multiply-listed equity 

and ETF options increased from 9.65% for the 

month of November 2019 to 10.35% for the month 

of November 2020. 

14See supra note 8 (regarding Cboe capped fees 

for strategies). 

Exchange, which order flow would 

enhance price discovery. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,9 in general, and 

furthers the objectives of Sections 

6(b)(4) and (5) of the Act,10 in particular, 

because it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members, 

issuers and other persons using its 

facilities and does not unfairly 

discriminate between customers, 

issuers, brokers or dealers. 

The Proposed Rule Change Is 

Reasonable 

The Exchange operates in a highly 

competitive market. The Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, 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 

broader forms that are most important to 

investors and listed companies.’’ 11

The Exchange is only one of 16 

options venues to which market 

participants may direct their order flow. 

Based on publicly available information, 

no single options exchange has more 

than 16% of the market share of 

executed volume of multiply-listed 

equity and ETF options trades.12

Therefore, no exchange possesses 

significant pricing power in the 

execution of multiply-listed equity and 

ETF options order flow. More 

specifically, since November 2019, the 

Exchange has had less than 11% market 

share of executed volume of multiplylisted equity and ETF options trades.13

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can shift order flow, or discontinue or 

reduce use of certain categories of 

products, in response to fee changes. 

Accordingly, competitive forces 

constrain options exchange transaction 

fees. Stated otherwise, modifications to 

exchange transaction fees can have a 

direct effect on the ability of an 

exchange to compete for order flow. 

The Exchange believes that the 

proposed modification to the Strategy 

Cap is reasonable because it is designed 

to incent OTP Holders to increase their 

Strategy Executions submitted to and 

executed on the Exchange’s Trading 

Floor. The Exchange offers a hybrid 

market system and aims to balance 

incentives for its OTP Holders to 

continue to contribute to deep liquid 

markets for investors on both its 

electronic and open outcry platforms. 

The Exchange notes that all market 

participants stand to benefit from any 

increase in volume transacted on the 

Trading Floor, which promotes market 

depth, facilitates tighter spreads and 

enhances price discovery, and may lead 

to a corresponding increase in order 

flow from other market participants. 

To the extent that the proposed 

change attracts more Strategy 

Executions to the Exchange, this 

increased (open outcry) order flow 

would continue to make the Exchange a 

more competitive venue for order 

execution, which, in turn, promotes just 

and equitable principles of trade and 

removes impediments to and perfects 

the mechanism of a free and open 

market and a national market system. 

Finally, to the extent the proposed 

change continues to attract greater 

volume and liquidity, the Exchange 

believes the proposed change would 

improve the Exchange’s overall 

competitiveness and strengthen its 

market quality for all market 

participants. In the backdrop of the 

competitive environment in which the 

Exchange operates, the proposed rule 

change is a reasonable attempt by the 

Exchange to increase the depth of its 

market and improve its market share 

relative to its competitors. The 

Exchange’s fees are constrained by 

intermarket competition, as OTP 

Holders may direct their order flow to 

any of the 16 options exchanges, 

including another exchange that 

provides a cap on fees for strategy 

executions.14 Thus, OTP Holders have a 

choice of where they direct their order 

flow—including their Strategy 

Executions. The proposed rule change is 

designed to incent OTP Holders to 

direct liquidity, and specifically 

Strategy Executions, to the Exchange, 

thereby promoting market depth, price 

discovery and improvement and 

enhancing order execution 

opportunities for market participants. 

The Exchange cannot predict with 

certainty whether any, or how many, 

OTP Holders would avail themselves of 

this proposed fee change. The Exchange 

believes that OTP Holders that execute 

Strategy Executions on the Exchange 

can achieve the proposed 25,000 

minimum contract sides threshold to 

qualify for the proposed (reduced) 

Strategy Cap and that this proposal may 

encourage OTP Holders to execute (and 

aggregate) Strategy Executions on the 

Exchange, which order flow would 

enhance price discovery. 

The Proposed Rule Change Is an 

Equitable Allocation of Credits and Fees 

The Exchange believes the proposed 

rule change is an equitable allocation of 

its fees and credits. The proposal is 

based on the amount and type of 

business transacted on the Exchange 

and OTP Holders can opt to avail 

themselves of the Strategy Cap or not. 

The proposed Strategy Cap, as modified, 

applies to all qualifying Strategy 

Executions transacted on the Trading 

Floor. The Exchange believes that the 

proposed change would facilitate the 

execution of orders via open outcry, 

thus enhancing price discovery as a 

result of increased liquidity. Moreover, 

the proposal is designed to encourage 

OTP Holders to aggregate all Strategy 

Executions at the Exchange as a primary 

execution venue. To the extent that the 

proposed change attracts more Strategy 

Executions to the Exchange, this 

increased order flow would continue to 

make the Exchange a more competitive 

venue for order execution. Thus, the 

Exchange believes the proposed rule 

change would improve market quality 

for all market participants on the 

Exchange and, as a consequence, attract 

more order flow to the Exchange thereby 

improving market-wide quality and 

price discovery. 

The Proposed Rule Change Is Not 

Unfairly Discriminatory 

The Exchange believes it is not 

unfairly discriminatory to modify the 

Strategy Cap because the proposed 

modification would be available to all 

similarly-situated market participants 

on an equal and non-discriminatory 

basis. 

The proposal is based on the amount 

and type of business transacted on the 

Exchange and OTP Holders are not 

obligated to try to achieve the modified 

Strategy Cap, nor are they obligated to 

7154 Federal Register / Vol. 86, No. 15 / Tuesday, January 26, 2021 / Notices 

15See Reg NMS Adopting Release, supra note 11, 

at 37499. 

16See supra note 12. 

17Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, see supra 

note 13, the Exchange’s market share in multiplylisted equity and ETF options increased from 9.65% 

for the month of November 2019 to 10.35% for the 

month of November 2020. 

18 15 U.S.C. 78s(b)(3)(A). 

19 17 CFR 240.19b–4(f)(2). 

20 15 U.S.C. 78s(b)(2)(B). 

execute any Strategy Executions. Rather, 

the proposal is designed to encourage 

OTP Holders to utilize the Exchange as 

a primary trading venue for Strategy 

Executions (if they have not done so 

previously) or increase volume sent to 

the Exchange. To the extent that the 

proposed change attracts more Strategy 

Executions to the Exchange, this 

increased order flow would continue to 

make the Exchange a more competitive 

venue for, among other things, order 

execution. Thus, the Exchange believes 

the proposed rule change would 

improve market quality for all market 

participants on the Exchange and, as a 

consequence, attract more order flow to 

the Exchange thereby improving marketwide quality and price discovery. The 

resulting increased volume and 

liquidity would provide more trading 

opportunities and tighter spreads to all 

market participants and thus would 

promote just and equitable principles of 

trade, 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. 

Finally, the Exchange believes that it 

is subject to significant competitive 

forces, as described below in the 

Exchange’s statement regarding the 

burden on competition. 

For the foregoing reasons, the 

Exchange believes that the proposal is 

consistent with the Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with Section 6(b)(8) of 

the Act, the Exchange does not believe 

that the proposed rule change would 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

Instead, as discussed above, the 

Exchange believes that the proposed 

changes would encourage the 

submission of additional liquidity to a 

public exchange, thereby promoting 

market depth, price discovery and 

transparency and enhancing order 

execution opportunities for all market 

participants. As a result, the Exchange 

believes that the proposed change 

furthers the Commission’s goal in 

adopting Regulation NMS of fostering 

integrated competition among orders, 

which promotes ‘‘more efficient pricing 

of individual stocks for all types of 

orders, large and small.’’ 15

Intramarket Competition. The 

proposed change is designed to attract 

additional order flow (particularly 

Strategy Executions) to the Exchange. 

The Exchange believes that the 

proposed modification to the Strategy 

Cap would incent market participants to 

direct their Strategy Execution volume 

to the Exchange. Greater liquidity 

benefits all market participants on the 

Exchange and increased Strategy 

Executions would increase 

opportunities for execution of other 

trading interest. The proposed reduced 

Strategy Cap would be available to all 

similarly-situated market participants 

that incur transaction fees on Strategy 

Executions, and, as such, the proposed 

change would not impose a disparate 

burden on competition among market 

participants on the Exchange. 

Intermarket Competition. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily favor one of the 

16 competing option exchanges if they 

deem fee levels at a particular venue to 

be excessive. In such an environment, 

the Exchange must continually adjust its 

fees to remain competitive with other 

exchanges and to attract order flow to 

the Exchange. Based on publiclyavailable information, and excluding 

index-based options, no single exchange 

has more than 16% of the market share 

of executed volume of multiply-listed 

equity and ETF options trades.16

Therefore, no exchange possesses 

significant pricing power in the 

execution of multiply-listed equity and 

ETF options order flow. More 

specifically, in the third quarter of 2020, 

the Exchange had less than 11% market 

share of executed volume of multiplylisted equity and ETF options trades.17

The Exchange believes that the 

proposed rule change reflects this 

competitive environment because it 

modifies the Exchange’s fees in a 

manner designed to encourage OTP 

Holders to direct trading interest 

(particularly Strategy Executions) to the 

Exchange, to provide liquidity and to 

attract order flow. To the extent that this 

purpose is achieved, all the Exchange’s 

market participants should benefit from 

the improved market quality and 

increased opportunities for price 

improvement. 

The Exchange believes that the 

proposed change could promote 

competition between the Exchange and 

other execution venues, including those 

that currently offer similar Strategy 

Caps, by encouraging additional orders 

to be sent to the Exchange for execution. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 18 of the Act and 

subparagraph (f)(2) of Rule 19b–4 19

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

under Section 19(b)(2)(B) 20 of the Act to 

determine whether the proposed rule 

change 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NYSEArca–2021–06 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–2021–06. 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 

Federal Register / Vol. 86, No. 15 / Tuesday, January 26, 2021 / Notices 7155 

21 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3See Listing Rule IM–5900–7. Companies 

switching from a national securities exchange other 

than the NYSE are not eligible to receive 

complimentary services under IM–5900–7. 

4 In addition, all companies listed on Nasdaq 

receive other standard services from Nasdaq, 

including Nasdaq Online and the Market 

Intelligence Desk. 

5Listing Rule IM–5900–7(c)(1). In this proposed 

rule change, Nasdaq proposes to update the value 

of certain of the services and the approximate retail 

value of the package offered to each of the tiers of 

services. 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (http://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. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NYSEArca–2021–06, and 

should be submitted on or before 

February 16, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.21

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–01588 Filed 1–25–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90955; File No. SR– 

NASDAQ–2021–002] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing of Proposed Rule Change To 

Modify and Expand the Package of 

Complimentary Services Provided to 

Eligible Companies and Update the 

Values of Certain Complimentary 

Services 

January 19, 2021. 

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 8, 

2021, 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 and 

II below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to modify and 

expand the package of complimentary 

services provided to eligible companies 

and update the values of certain 

complimentary. 

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 

Nasdaq offers complimentary services 

under IM–5900–7 to companies listing 

on the Nasdaq Global and Global Select 

Markets in connection with an initial 

public offering in the United States, 

including American Depository Receipts 

(other than a company listed under IM– 

5101–2), upon emerging from 

bankruptcy, in connection with a spinoff or carve-out from another company, 

in connection with a direct listing as 

defined in IM–5315–1 (including the 

listing of American Depository 

Receipts), or in conjunction with a 

business combination that satisfies the 

conditions in Nasdaq IM–5101–2(b) 

(‘‘Eligible New Listings’’) and to 

companies (other than a company listed 

under IM–5101–2) switching their 

listing from the New York Stock 

Exchange (‘‘NYSE’’) to the Global or 

Global Select Markets, or that have 

switched its listing from the NYSE and 

listed on Nasdaq under IM–5101–2 after 

the company publicly announced that it 

entered into a binding agreement for a 

business combination and that 

subsequently satisfies the conditions in 

IM–5101–2(b) and lists on the Global or 

Global Select Market in conjunction 

with that business combination 

(‘‘Eligible Switches’’).3 Nasdaq believes 

that the complimentary service program 

offers valuable services to newly listing 

companies, designed to help ease the 

transition of becoming a public 

company or switching markets, and 

makes listing on Nasdaq more attractive 

to these companies. The services offered 

include a whistleblower hotline, 

investor relations website, disclosure 

services for earnings or other press 

releases, webcasting, market analytic 

tools, and may include market advisory 

tools such as stock surveillance 

(collectively the ‘‘Service Package’’).4

Currently, Nasdaq provides 

complimentary services from the 

Service Package to the Eligible New 

Listings based on the following tiers: 

Eligible New Listing Tier 1: An 

Eligible New Listing that has a market 

capitalization less than $750 million 

will receive the following 

complimentary services for two years: 

Whistleblower Hotline, Investor 

Relations website, $15,000 per year of 

Disclosure Services, Audio Webcasting 

and Market Analytic Tools for two 

users. The total retail value of these 

services is reflected in the existing rule 

as approximately $75,500 per year. In 

addition, one-time development fees of 

approximately $5,000 to establish the 

services in the first year will be waived.5

Eligible New Listing Tier 2: An 

Eligible New Listing that has a market 

capitalization of $750 million or more 

but less than $5 billion will receive the 

following complimentary services for 

two years: Whistleblower Hotline, 

Investor Relations website, $20,000 per 

year of Disclosure Services, Audio 

Webcasting, Market Analytic Tools for 

two users and the choice of one Market 

Advisory Tool. The total retail value of 

these services is reflected in the existing 

rule as up to approximately $137,000 

per year. In addition, one-time