Federal Register / Vol. 76, No. 152 / Monday, August 8, 2011 / Notices 48193 

11Supra note 2. 

12Supra note 3. 

13 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

NSCC has not solicited or received 

written comments relating to the 

proposed rule change. NSCC will notify 

the Commission of any written 

comments it receives. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective upon filing pursuant to Section 

19(b)(3)(A)(ii) of the Act 11 and Rule 

19b–4(f)(2) 12 thereunder because the 

proposed rule change establishes or 

changes a due, fee, or other charge 

applicable only to a member. 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. 

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 e-mail to rulecomments@sec.gov. Please include File 

No. SR–NSCC–2011–06 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File No. 

SR–NSCC–2011–06. This file number 

should be included on the subject line 

if e-mail 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 (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 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 

a.m. and 3 p.m. Copies of such filings 

also will be available for inspection and 

copying at NSCC’s principal office and 

NSCC’s Web site at http:// 

www.dtcc.com/downloads/legal/ 

rule_filings/2011/nscc/2011–06.pdf. 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 No. 

SR–NSCC–2011–06 and should be 

submitted on or before August 29, 2011. 

For the Commission by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–19980 Filed 8–5–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65020; File No. SR– 

NASDAQ–2011–099] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule To Amend Fees 

Assessed for Use of NASDAQ PreTrade Risk Management 

August 3, 2011. 

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 July 25, 

2011, The NASDAQ Stock Market LLC 

(the ‘‘Exchange’’ or ‘‘NASDAQ’’) 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 NASDAQ. 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 

NASDAQ is proposing to amend fees 

assessed for use of NASDAQ Pre-trade 

Risk Management (‘‘PRM’’) and to make 

a minor technical correction. NASDAQ 

will implement the amended fees 

effective August 1, 2011. 

The text of the proposed rule change 

is below. Proposed new language is in 

italics; proposed deletions are in 

brackets. 

7016. Nasdaq Risk Management 

(a) No change. 

(b) Users of NASDAQ Pre-trade Risk 

Management (‘‘PRM’’) will be assessed 

[a charge of $100 per month per PRMenabled port.] a monthly fee based on 

the following table, and such fees will 

not exceed $25,000 per member firm, 

per month: 

Port tiers Number of PRM-enabled ports Monthly fee 

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. 

(c) Users of PRM services specified 

below will be assessed the following 

charges in addition to the applicable 

PRM-enabled port charges: 

PRM Modules—[$500 per month per 

PRM Module] No charge 

Aggregate Total Checks—[$0.025 per 

each eligible side, capped at $2,000 per 

month per PRM Module] No charge 

PRM Workstation Add-ons to an $100 

per each PRM Workstation Add-on per 

month [existing NASDAQ Workstation 

or beginning July 2006 (no charge for 

mstockstill on DSK4VPTVN1PROD with NOTICES

48194 Federal Register / Vol. 76, No. 152 / Monday, August 8, 2011 / Notices 

3For example, PRM provides a ‘‘Fat Finger 

Check,’’ which allows a user to compare price 

instructions on incoming orders against the current 

displayed size and price in the market. If the order 

is not in line with the displayed price and size, the 

order will be rejected before it can execute. Users 

can set order limits at several levels to ensure that 

clearly erroneous orders never execute. 

4 Id. 

5A member using FIX or Rash ports can configure 

its PRM Module to pre-trade-manage a subscriber’s 

order flow for a specified MPID and PRM-enabled 

port, or for an account within an MPID. A member 

using OUCH ports can configure its PRM Module 

to pre-trade-manage a subscriber’s order flow for a 

specified port. 6 15 U.S.C. 78f(b)(4). 

any PRM WeblinkACT 2.0 Workstation 

Add-ons in April, May and June 2008] 

* * * * * 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

NASDAQ 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. 

NASDAQ 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 the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

NASDAQ is proposing to amend the 

fees assessed users of NASDAQ PreTrade Risk Management. PRM provides 

member firms with the ability to set a 

wide range of parameters for orders to 

facilitate pre-trade protection by 

creating a PRM module defined to 

represent checks desired. Using PRM, 

firms can increase controls on their 

trading activity and the trading activity 

of their clients and customers at the 

order level, including the opportunity to 

prevent potentially erroneous 

transactions. PRM validates orders 

entered on PRM-enabled ports prior to 

allowing those orders into its matching 

engine and, using parameters set by the 

subscriber, determines if the order 

should be sent for fulfillment. If PRM 

rejects an order, it alerts the member 

firm and provides it with clearlydefined reasons for the rejection.3 These 

alerts are sent on Execution and Order/ 

Message DROP copy lines/reports. 

PRM users may choose to set PRM 

Order Checks, Aggregate Total Checks 

within a PRM Module, and subscribe to 

PRM Workstation Add-ons to [sic] an 

existing NASDAQ Workstation or 

WeblinkACT 2.0. PRM manages risk by 

checking each order, before it is 

accepted into the system, against certain 

parameters pre-specified by the user 

within a module, such as maximum 

order size or value, order type 

restrictions, market session restrictions 

(pre/post market), security restrictions, 

including per-security limits, restricted 

stock list, and certain other criteria. 

These checks are in addition to the Fat 

Finger Check, which is available for all 

orders submitted through a RASH/FIX 

PRM-enabled port.4 In order for a 

member firm to subscribe, at least one 

PRM Module per market participant ID 

(‘‘MPID’’) is required, but a user may 

have multiple PRM Module 

subscriptions per MPID, depending on 

the type and number of ports designated 

as PRM ports.5 A PRM Module is 

created to validate individual orders 

against pre-specified parameters. 

Aggregate Total Checks allow users to 

limit overall daily trading activity based 

on Buy, Sell, and/or Net trading limits. 

These daily trading activity limits may 

be established at an aggregate limit and/ 

or security specific limit per PRM 

Module. Member firms may subscribe to 

the PRM Workstation Add-on to [sic] an 

existing NASDAQ Workstation or 

WeblinkACT 2.0 for a fee. 

NASDAQ is proposing to change the 

means by which PRM fees are assessed 

under Rules 7016(b) and (c). Currently, 

under Rule 7016(b) subscribers pay a 

nominal fee of $100 per PRM-enabled 

port, and $500 per month, per PRM 

Module. Subscribers must subscribe to 

at least one PRM Module, but often 

subscribe to more than one PRM 

Module so that firm may monitor 

separate order flow sent through a single 

PRM-enabled port. In addition, a 

separate fee for Aggregate Total Checks 

is assessed at a rate of $.025 per each 

eligible side and is limited to a total of 

$2,000 per module, per month. As such, 

combined fees for a single PRM-enabled 

port often exceed the minimum fee of 

$600 per month. 

In lieu of assessing module-based and 

order-based fees under Rule 7016(c), 

NASDAQ is proposing to eliminate the 

fee for these two services and increase 

the per-port fee assessed under Rule 

7016(b). The new monthly port-based 

fee is tiered, decreasing as the number 

of PRM-enabled ports subscribed 

increase and the next tier is reached. 

NASDAQ is also proposing to limit the 

fees assessed a member firm under the 

new tiered fee structure to a total of 

$25,000 per month. Although NASDAQ 

is proposing to eliminate the fees 

assessed for PRM Modules and 

Aggregate Total Check, both services 

will continue to be available to 

subscribers with no change to the 

service provided. 

NASDAQ believes that assessing PRM 

fees by port will simplify the billing 

process and either result in no increase 

in fees as assessed under the current 

rules, or more likely result in a fee 

decrease for the majority of current 

subscribers. For example, a subscriber to 

a single PRM-enabled port with a single 

PRM Module subscription would incur 

the same fee under both the proposed 

PRM-enabled port fee and the current 

fee regime—$600 per month. A 

subscriber to five PRM-enabled ports 

with five PRM Modules would be 

assessed a fee of $3,000 per month 

under the current rules, whereas the 

same subscriber would only pay $2,750 

per month under the proposed rules. A 

subscriber with five PRM-enabled ports 

and a total of ten PRM Modules would 

pay $5,500 per month under the current 

rules, yet only $2,750 per month under 

the proposed fees. This analysis does 

not account for the additional savings 

that subscribers to Aggregate Total 

Checks will realize under the proposed 

new fees. 

Last, NASDAQ is deleting language 

concerning a fee holiday from PRM 

Workstation Add-ons fees from the table 

under Rule 7016(c), since it concerns a 

limited timeframe that has since 

expired. 

2. Statutory Basis 

NASDAQ believes that the proposed 

rule change is consistent with Section 

6(b)(4) of the Act 6 in that it provides for 

the equitable allocation of reasonable 

dues, fees and other charges among 

members and issuers and other persons 

using any facility or system which the 

NASDAQ operates or controls, and it 

does not unfairly discriminate between 

customers, issuers, brokers or dealers. 

The amended fee schedule applies to all 

subscribers equally based on the 

number of ports subscribed. The 

proposed amended fees provide a more 

efficient means of billing, thus reducing 

administrative costs. The proposed 

changes may also provide incentive for 

member firms to subscribe to the service 

and utilize additional PRM features (i.e., 

Total Aggregate Checks) given the 

elimination of transaction-based fee for 

Total Aggregate Checks, the elimination 

of the monthly PRM Module fee, and 

the tiered PRM fee structure with a 

$25,000 monthly fee cap, per member 

firm. The proposed amended fees will 

continue to cover the costs associated 

with separately offering the service, 

mstockstill on DSK4VPTVN1PROD with NOTICES

Federal Register / Vol. 76, No. 152 / Monday, August 8, 2011 / Notices 48195 

7 15 U.S.C. 78f(b)(5). 

8 15 U.S.C. 78s(b)(3)(a)(ii). 

9 17 CFR 240.19b–4(f)(2). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

responding to customer requests, 

configuring NASDAQ’s systems, 

programming to user specifications, and 

administering the service, among other 

things, and may provide NASDAQ with 

a profit to the extent costs are covered. 

NASDAQ also believes that the 

proposed rule change is consistent with 

the provisions of Section 6(b)(5) of the 

Act 7 because it is designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, to foster cooperation 

and coordination with persons engaged 

in facilitating transactions in securities, 

and to remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. PRM is designed to assist 

member firms in avoiding entry of 

erroneous orders by screening out those 

that exceed pre-determined limits, 

which otherwise may harm both the 

member firm and the quality of the 

markets. As such, PRM is an important 

compliance tool that members may use 

to help maintain the regulatory integrity 

of the markets. NASDAQ believes that 

the amendments to the fees assessed for 

PRM and its services may encourage 

more member firms to subscribe to this 

useful compliance tool. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

NASDAQ 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 amended. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor 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 8 and 

subparagraph (f)(2) of Rule 19b-4 

thereunder.9 At any time within 60 days 

of the filing of the proposed rule change, 

the Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

comment form (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an e-mail to rulecomments@sec.gov. Please include File 

Number SR–NASDAQ–2011–099 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–NASDAQ–2011–099. This 

file number should be included on the 

subject line if e-mail 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 (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 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 

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. 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–2011–099 and should be 

submitted on or before August 29, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20008 Filed 8–5–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65010; File No. SR–Phlx– 

2011–100] 

Self-Regulatory Organizations; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change by NASDAQ 

OMX PHLX LLC Relating to Member 

and Member Organization Participation 

August 2, 2011. 

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

Securities Exchange Act of 1934 

(‘‘Act’’) 1, and Rule 19b–4 2 thereunder, 

notice is hereby given that on July 26, 

2011, NASDAQ OMX PHLX LLC 

(‘‘Phlx’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘Commission’’) the proposed 

rule change as described in Items I, II, 

and III, below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to apply 

Exchange Rule 3211 entitled ‘‘PSX 

Participant Registration’’ to members 

and member organizations conducting 

an options business. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.nasdaqtrader.com/ 

micro.aspx?id=PHLXRulefilings, 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 

mstockstill on DSK4VPTVN1PROD with NOTICES