49822 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices 

8 15 U.S.C. 78s(b)(3)(A)(ii). 9 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 64958 

(July 25, 2011) (SR–NASDAQ–2011– 095) 

(‘‘NASDAQ Proprietary Trader Filing’’). 

Exchange members and other persons 

using its facilities. 

The Exchange believes that its 

proposal to extend the applicability of 

the Cap for Active SQF Port Fees is both 

reasonable and equitable because it 

would allow member organizations 

additional time to transition from SQF 

5.0 to SQF 6.0. The proposal is equitable 

and not unfairly discriminatory in that 

the Exchange is extending the Cap for 

all member organizations. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Act.8 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–Phlx–2011–105 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–Phlx–2011–105. 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–Phlx– 

2011–105 and should be submitted on 

or before September 1, 2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20387 Filed 8–10–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65041; File No. SR– 

NASDAQ–2011–107] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Correct the 

Proprietary Trader Registration 

Category 

August 5, 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 August 1, 

2011, The NASDAQ Stock Market LLC 

(the ‘‘Exchange’’ or ‘‘NASDAQ’’) 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 

NASDAQ is filing with the 

Commission a proposed rule change to 

correct a prior filing to make it 

applicable to NASDAQ and not just the 

NASDAQ Options Market (‘‘NOM’’).3

The prior filing amended NASDAQ Rule 

1032, Categories of Representative 

Registration, to adopt a new limited 

category of representative registration 

for proprietary traders, as described 

further below. 

The text of the proposed rule change 

is available at http:/nasdaq.

cchwallstreet.com/, at NASDAQ’s 

principal office, 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 


srobinson on DSK4SPTVN1PROD with NOTICES
Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices 49823 

4Rule 1011(o) defines a proprietary trading firm 

as an Applicant with the following characteristics: 

(1) The Applicant is not required by Section 

15(b)(8) of the Act to become a FINRA member but 

is a member of another registered securities 

exchange not registered solely under Section 6(g) of 

the Act; (2) all funds used or proposed to be used 

by the Applicant for trading are the Applicant’s 

own capital, traded through the Applicant’s own 

accounts; (3) the Applicant does not, and will not 

have ‘‘customers,’’ as that term is defined in Nasdaq 

Rule 0120(g); and (4) all Principals and 

Representatives of the Applicant acting or to be 

acting in the capacity of a trader must be owners 

of, employees of, or contractors to the Applicant. 

‘‘Applicant’’ is defined in Rule 1011(a). 

5Such persons may also be subject to registration 

as an Equity Trader pursuant to Rule 1032(f), which 

requires successful completion of the Series 55 

exam (for which the prerequisite is the Series 7 

examination). 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78(c)(3)(B) [sic]. 

8 15 U.S.C. 78f(b)(5). 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 240.19b–4(f)(6). 

11 Id. 

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to correct a prior filing, the 

NASDAQ Proprietary Trader Filing, to 

make it applicable to NASDAQ and not 

just the NASDAQ Options Market 

(‘‘NOM’’). Although that filing was 

correctly submitted as a NASDAQ filing, 

the exhibit to the filing was incorrectly 

limited to NOM. 

The NASDAQ Proprietary Trader 

Filing amended NASDAQ Rule 1032, 

Categories of Representative 

Registration, to adopt a new limited 

category of representative registration 

for proprietary traders. This new 

category should apply to all NASDAQ 

members, not just NOM participants. 

Specifically, paragraph (c) to Rule 1032 

recognized the ‘‘Proprietary Trader’’ 

category of registration for persons 

engaged solely in proprietary trading; it 

expressly provides that such person’s 

activities in the investment banking or 

securities business are limited solely to 

proprietary trading, that he passes the 

Series 56 and that he is an associated 

person of a proprietary trading firm as 

defined in Rule 1011(o).4 NASDAQ 

proposes herein that Rule 1032(c) 

applies to all NASDAQ members. 

Accordingly, as stated in the 

NASDAQ Proprietary Trader Filing, 

associated persons of NASDAQ 

members who deal with the public do 

not fit in this registration category and 

must continue to register as General 

Securities Representatives, and 

NASDAQ believes that the new limited 

registration category and qualification 

examination are appropriate, because 

they are tailored to proprietary trading 

functions. In addition, because 

NASDAQ rules require it, persons 

associated with NASDAQ members are, 

today, already registered as General 

Securities Representatives and have 

passed the Series 7 examination. As 

applied to all NASDAQ members, this 

proposal does not require proprietary 

traders who have already registered as 

General Securities Representatives and 

have passed the Series 7 examination to 

register under the new category as 

Proprietary Traders or to pass the Series 

56, because NASDAQ believes this 

would be redundant. Persons who are 

registered as General Securities 

Representatives and have passed the 

Series 7 may, of course, perform the 

functions of a Proprietary Trader, 

because the new Proprietary Trader 

registration category is a limited 

registration category. As applied to all 

NASDAQ members, this proposal does 

not preclude associated persons from 

registering as General Securities 

Representatives and passing the Series 7 

examination and then functioning as a 

Proprietary Trader. 

NASDAQ expects that new members 

might consider the new category when 

applying for NASDAQ membership, 

once the new category and examination 

become available to NASDAQ members 

in WebCRD. Accordingly, NASDAQ 

believes that the new category should be 

helpful to attracting new members to 

NASDAQ, while at the same time 

preserving the important goals of 

appropriate registration and 

qualification for persons in the 

securities business. Additionally, 

members who hire new associated 

persons might choose to register those 

persons in the new category. 

Unlike the associated persons of 

proprietary trading firms covered by this 

proposal, associated persons of 

NASDAQ members that are NOT 

proprietary trading firms continue to be 

subject to registration as General 

Securities Representatives and have to 

pass the Series 7 examination.5 They are 

not eligible for the new registration 

category and examination. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act 6 in general, and furthers the 

objectives of: (1) Section 6(c)(3)(B) of the 

Act,7 pursuant to which a national 

securities exchange prescribes standards 

of training, experience and competence 

for members and their associated 

persons; and (2) Section 6(b)(5) of the 

Act,8 in that it is designed, among other 

things, to prevent fraudulent and 

manipulative acts and practices, 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, by 

offering a new, limited registration 

category to NASDAQ members. The 

Exchange believes that these new 

requirements should help ensure that all 

associated persons engaged in a 

securities business are, and will 

continue to be, properly trained and 

qualified to perform their functions, 

because the new category and 

examination are limited and tailored to 

persons performing proprietary trading 

functions. This proposal corrects the 

NASDAQ Proprietary Trader Filing by 

applying Rule 1032(c) to all NASDAQ 

members, not just NOM participants. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The Exchange does not believe that 

the proposed rule change will impose 

any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Pursuant to Section 19(b)(3)(A) of the 

Act 9 and Rule 19b–4(f)(6) 10 thereunder, 

the Exchange has designated this 

proposal as one that effects a change 

that: (i) Does not significantly affect the 

protection of investors or the public 

interest; (ii) does not impose any 

significant burden on competition; and 

(iii) by its terms, does not become 

operative for 30 days after the date of 

the filing, or such shorter time as the 

Commission may designate if consistent 

with the protection of investors and the 

public interest. Rule 19b–4(f)(6) 11

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. 


srobinson on DSK4SPTVN1PROD with NOTICES
49824 Federal Register / Vol. 76, No. 155 / Thursday, August 11, 2011 / Notices 

12 Id. 

13 15 U.S.C. 78s(b)(3)(A). 

14For purposes only of waiving the operative 

delay of this proposal, the Commission has 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). See also 17 CFR 200.30–3(a)(59). 15 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 63027 

(October 1, 2010), 75 FR 62160 (October 7, 2010) 

Under Rule 19b–4(f)(6) of the Act,12 a 

proposal does not become operative for 

30 days after the date of its filing, or 

such shorter time as the Commission 

may designate if consistent with the 

protection of investors and the public 

interest. The Exchange requests that the 

Commission waive the 30 day operative 

period for this filing so that it may 

become effective and operative upon 

filing with the Commission pursuant to 

Section 19(b)(3)(A) 13 of the Act and 

subparagraph (f)(6) thereunder. The 

Exchange believes waiving the 30-day 

operative delay is consistent with the 

protection of investors and the public 

interest as the waiver will allow the 

Exchange to apply NASDAQ Rule 

1032(c) to all NASDAQ members, not 

just NOM participants, near the same 

time as other exchanges have 

established proprietary trading 

registration and qualification 

requirements. For the reasons stated 

above, the Commission believes that 

waiving the 30-day operative delay is 

consistent with the protection of 

investors and the public interest and 

designates the proposal as operative 

upon filing.14

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 

Number SR–NASDAQ–2011–107 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–2011–107. 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 filing 

also will be available for inspection and 

copying at the principal office of 

NASDAQ. 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 

publicly available. All submissions 

should refer to File Number SR– 

NASDAQ–2011–107 and should be 

submitted on or before September 1, 

2011. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2011–20371 Filed 8–10–11; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–65043; File No. SR–Phlx2011–104] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Relating to the 

Extension of a Pilot Program 

Regarding Price Improvement XL 

August 5, 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 August 1, 

2011, NASDAQ OMX PHLX LLC 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III, below, which Items have been 

prepared by the Exchange. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

Exchange Rule 1080(n), Price 

Improvement XL (‘‘PIXLSM’’) to extend, 

through July 18, 2012, a pilot program 

(the ‘‘pilot’’) concerning (i) The early 

conclusion of the PIXL Auction (as 

described below), and (ii) permitting 

orders of fewer than 50 contracts into 

the PIXL Auction. The current pilot is 

scheduled to expire August 31, 2011. 

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 

forth in sections A, B, and C below, of 

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to extend the pilot through 

July 18, 2012. 

Background 

The Exchange adopted PIXL in 

October, 2010 as a price-improvement 

mechanism on the Exchange.3 PIXL is a 


srobinson on DSK4SPTVN1PROD with NOTICES