[Federal Register Volume 87, Number 57 (Thursday, March 24, 2022)]
[Notices]
[Pages 16811-16816]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-06187]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94466; File No. SR-NASDAQ-2022-024]


Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Create a Monthly Media Enterprise License for the Distribution of 
Nasdaq Basic to the General Investing Public for Display Usage

March 18, 2022.
    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 March 9, 2022, The Nasdaq Stock Market LLC (``Nasdaq'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I, II, and III, below, which Items have been prepared by the 
Exchange. The Commission is publishing this notice to solicit comments 
on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend the Exchange's fees to create a 
monthly Media Enterprise License for the distribution of Nasdaq Basic 
to the general investing public for Display Usage.
    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

[[Page 16812]]

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 Proposal is to create a monthly Media Enterprise 
License for the distribution of Nasdaq Basic to the general investing 
public for Display Usage.\3\
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    \3\ The Exchange initially filed the proposed pricing changes on 
January 31, 2022 (SR-NASDAQ-2022-014). On February 14, 2022, the 
Exchange withdrew that filing and submitted a new filing (SR-NASDAQ-
2022-016). The second filing was withdrawn on February 28, 2022, and 
replaced with another filing (SR-NASDAQ-2022-018). This last filing 
was withdrawn on March 9, 2022, and replaced with this filing.
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Nasdaq Basic
    Nasdaq Basic is a real-time market data product that offers best 
bid and offer and last sale information for all U.S. exchange-listed 
securities based on liquidity within the Nasdaq market center and 
trades reported to the FINRA/Nasdaq Trade Reporting Facilities at 
Chicago and Carteret (``TRFs''). It is a subset of the core quotation 
and last sale data provided by securities information processors 
(``SIPs''), which distribute consolidated data pursuant to the CTA/CQ 
Plan and the UTP Plan.
    Nasdaq Basic is separated into three components, which may be 
purchased individually or in combination: (i) Nasdaq Basic for Nasdaq, 
which contains the best bid and offer on the Nasdaq Market Center and 
last sale transaction reports for Nasdaq and the FINRA/Nasdaq TRFs for 
Nasdaq-listed stocks; (ii) Nasdaq Basic for NYSE, which covers NYSE-
listed stocks, and (iii) Nasdaq Basic for NYSE American, which provides 
data on stocks listed on NYSE American and other listing venues that 
disseminate quotes and trade reports on Tape B. The specific data 
elements available through Nasdaq Basic are: (i) Nasdaq Basic Quotes 
(``QBBO''), the best bid and offer and associated size available in the 
Nasdaq Market Center, as well as last sale transaction reports; \4\ 
(ii) Nasdaq opening and closing prices, as well as IPO and trading halt 
cross prices; and (iii) general exchange information, including systems 
status reports, trading halt information, and a stock directory.
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    \4\ Last sale transaction reports are available from both Nasdaq 
Last Sale and Nasdaq Last Sale Plus. See Equity 7, Section 139(e) 
(``NLS Plus may be received by itself or in combination with Nasdaq 
Basic.''). The customer that purchases Nasdaq Basic will also 
receive Nasdaq Last Sale because it is a component of Nasdaq Basic.
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Proposed Changes
Media Enterprise License
    Nasdaq proposes to introduce a Media Enterprise License that will 
allow any External Distributor \5\ to disseminate Nasdaq Basic, or any 
subset thereof,\6\ to the general investing public for Display Usage 
\7\ for a monthly fee of $100,000.\8\ Information may be distributed 
via television, websites, mobile devices, or any other unrestricted 
means of transmission to an unlimited number of Users.\9\ A Hosted 
Display Solution \10\ may be used to distribute data under this 
license, provided that the External Distributor purchases a separate 
Media Enterprise License for each such Hosted Display Solution.
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    \5\ The term ``Distributor'' refers to any entity that receives 
Nasdaq Basic data directly from Nasdaq or indirectly through another 
entity and then distributes it to one or more Subscribers. Equity 7, 
Section 147(d)(1). ``External Distributors'' are Distributors that 
receive Nasdaq Basic data and then distribute that data to one or 
more Subscribers outside the Distributor's own entity. Equity 7, 
Section 147(d)(1)(B).
    \6\ The Exchange expects most purchasers of the proposed license 
to distribute last sale transaction reports and best bid and offer 
information. Firms will have the discretion, however, to distribute 
less than the full set of information available--for example, some 
firms may distribute last sale information only--or to distribute 
all of the information available on Nasdaq Basic.
    \7\ ``Display Usage'' means any method of accessing Nasdaq Basic 
data that involves the display of such data on a screen or other 
visualization mechanism for access or use by a natural person or 
persons. Equity 7, Section 147(d)(2).
    \8\ The proposed license will not cover the Distributor Fee for 
Nasdaq Basic set forth in Equity 7, Section 147(c)(1).
    \9\ The Exchange proposes to define a ``User'' as ``a natural 
person who has access to Exchange information.'' Equity 7, Section 
147(d)(7).
    \10\ A ``Hosted Display Solution'' is a product, solution or 
capability provided by a Distributor in which the Distributor makes 
available Nasdaq data or Derived Data to an application branded or 
co-branded with the third-party brand for use by external 
subscribers of the third-party entity or Distributor. The 
Distributor maintains control of the data, entitlements and display 
of the product, solution or capability. Hosted Display Solutions 
include, but are not limited to: (1) ``Widgets'' (such as an iframe, 
applet, or other solution), in which the Hosted Display Solution is 
a part or a subset of a website or platform hosted or maintained by 
the third-party entity; and (2) ``White Labels,'' in which the 
Distributor hosts or maintains the website or platform on behalf of 
the third-party entity. Equity 7, Section 147(d)(5).
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    Distribution of Nasdaq Basic through the Media Enterprise License 
will be subject to two primary restrictions. First, distribution of 
Derived Data \11\ is not permitted. The purpose of the license is to 
disseminate accurate market information to the general investing 
public. Derived Data--which cannot be reverse engineered to recreate 
Nasdaq information, or be used to create other data that is 
recognizable as a reasonable substitute for Nasdaq information--does 
not serve that purpose.
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    \11\ ``Derived Data'' is pricing data or other information that 
is created in whole or in part from Nasdaq information; it cannot be 
reverse engineered to recreate Nasdaq information, or be used to 
create other data that is recognizable as a reasonable substitute 
for Nasdaq information. Equity 7, Section 147(d)(6).
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    Second, data may only be used for informational and non-trading 
purposes. Nasdaq Basic information may only be distributed on platforms 
pre-approved by the Exchange as providing a reasonable basis to 
conclude that all Users of such Information are either Non-
Professionals \12\ or Professionals \13\ whom the Distributor has no 
reason to believe are using Nasdaq Basic in their professional 
capacity. A Distributor has ``no reason to believe'' that Nasdaq Basic 
is being used in a professional capacity when, for example, the data is 
made available to the general investing public in a format that would 
be ``unlikely to be of significant use to Professionals acting in a 
professional capacity.'' \14\
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    \12\ A ``Non-Professional Subscriber'' is a natural person who 
is not: (A) Registered or qualified in any capacity with the 
Securities and Exchange Commission, the Commodity Futures Trading 
Commission, any state securities agency, any securities exchange or 
association, or any commodities or futures contract market or 
association; (B) engaged as an `investment adviser' as that term is 
defined in Section 202(a)(11) of the Investment Advisers Act of 1940 
(whether or not registered or qualified under that Act); or (C) 
employed by a bank or other organization exempt from registration 
under federal or state securities laws to perform functions that 
would require registration or qualification if such functions were 
performed for an organization not so exempt. Equity 7, Section 
147(d)(4)(A).
    \13\ A ``Professional Subscriber'' is any Subscriber other than 
a Non-Professional Subscriber. Equity 7, Section 147(d)(4)(B).
    \14\ Securities Exchange Act Release No. 34-82723 (February 15, 
2018), 83 FR 7812 (February 22, 2018) (SR-NASDAQ-2018-010) 
(discussing when a distributor of NLS has ``no reason to believe'' 
that it is being used by Professionals acting in their professional 
capacity).
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    The proposed Media Enterprise License does not cover the 
Distributor Fee for Nasdaq Basic set forth in subparagraph (c)(1).
Extension to Broker-Dealer Enterprise Licenses
    Nasdaq also proposes to provide the Media Enterprise License at no 
additional cost to broker-dealers that purchase either of the following 
two enterprise licenses: (i) The license to distribute Nasdaq Basic to 
natural persons in a brokerage relationship with

[[Page 16813]]

the broker-dealer at Equity 7, Section 147(b)(5); or (ii) the Market 
Data Enterprise License for Display Usage at Equity 7, Section 132. All 
of the terms and conditions set forth in Equity 7, Section 147(b)(6) 
will apply to any broker-dealer obtaining the license pursuant to 
either of these subsections.
    The enterprise license at Equity 7, Section 147(b)(5), allows a 
broker-dealer to distribute Nasdaq Basic, or Derived Data therefrom, 
through any electronic system approved by Nasdaq, to an unlimited 
number of Professional and Non-Professional Subscribers who are natural 
persons and with whom the broker-dealer has a brokerage relationship 
for a monthly fee of $100,000.\15\ That license currently includes the 
right to distribute Nasdaq Last Sale (``NLS'') \16\ data to the general 
investing public for Display Usage without paying the fees set forth in 
Equity 7, Section 139(b), subject to all of the provisions set forth 
therein, excluding those related to the payment of fees.\17\
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    \15\ Equity 7 Section 147(b)(5).
    \16\ NLS provides real-time last sale information for executions 
occurring within the Nasdaq market center and trades reported to the 
jointly-operated FINRA/Nasdaq TRFs. The NLS data feed, which 
provides price, volume and time of execution data for last sale 
transactions, includes transaction information for Nasdaq-listed 
stocks (``NLS for Nasdaq'') and for stocks listed on NYSE, NYSE 
American, and other Tape B listing venues (``NLS for NYSE/NYSE 
American''). It is, like Nasdaq Basic, a non-core product that 
provides a subset of the core data provided by the SIPs under the 
CTA and UTP plans. See, e.g., Securities Exchange Act Release No. 
91874 (May 12, 2021), 86 FR 26985 (May 18, 2021) (SR-Nasdaq-2021-
036).
    \17\ The Nasdaq Basic enterprise license also includes a number 
of other provisions and restrictions, including but not limited to: 
(i) A limitation that the use of the data by a Professional 
Subscriber shall be limited to the brokerage relationship, except 
that Nasdaq Basic data may be made available for up to 4,500 
internal Subscribers without incurring additional fees; (ii) a 
requirement for a separate enterprise license for each discrete 
electronic system; (iii) a requirement that the broker-dealer pay 
distributor fees under paragraph (c)(1); and (iv) a requirement that 
the broker-dealer report the number of Subscribers receiving Nasdaq 
Basic under this license. Equity 7, Section 147(b)(5).
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    Nasdaq proposes to add a reference to the Media Enterprise License 
to Equity 7, Section 147(b)(5). If a customer chooses to continue to 
distribute NLS it may do so without change.
    The Market Data Enterprise License for Display Usage at Equity 7, 
Section 132, allows a Distributor that is also a broker-dealer or an 
investment adviser to distribute, for Display Usage only, Depth-of-Book 
data and Nasdaq Basic to an unlimited number of internal and external 
recipients, to be used only in the context of a brokerage relationship 
with a broker-dealer or an engagement with an Investment Adviser. The 
license currently allows unlimited external distribution of NLS and NLS 
Plus through one of the mechanisms for the general investing public 
identified at Equity 7, Section 139(b), provided that platforms 
distributing such information are pre-approved by the Exchange as 
reasonably designed to meet the requirements with respect to each of 
the products identified. This license may be purchased for a monthly 
fee of $600,000, or the Distributor may purchase a full twelve months 
of the license in advance for a monthly fee of $500,000.
    The Exchange proposes to add a reference to Nasdaq Basic for the 
Market Data Enterprise License. If the purchaser wishes to continue to 
distribute NLS after the Proposal, it may do so without change.
Extension to Short Interest Report
    Nasdaq distributes a Short Interest Report under a fee schedule set 
forth at Equity 7, Section 122(c). Distributors that currently purchase 
enterprise licenses at Equity 7, Section 123(c)(3) or Equity 7, Section 
147(b)(5), or that expend $5,000 or more on any product offered at 
Equity 7, Section 139 in a particular month, excluding distributor fees 
at Equity 7, Section 139(c), may distribute the Short Interest Report 
to an unlimited number of external Subscribers, or on an open website, 
for $1,500 per month. The Exchange proposes to add the Media Enterprise 
License at Equity 7, Section 147(b)(6) to the list of licenses which 
will allow distribution of the Short Interest Report to an unlimited 
number of external Subscribers or on an open website for $1,500 per 
month.\18\
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    \18\ In addition, Nasdaq proposes to correct current references 
to ``NYSE MKT,'' which no longer exists, to ``NYSE American,'' and 
revise numbering to accommodate the addition of new Subsection 
147(b)(6).
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Discussion
    This Proposal is a response to customer requests. A number of 
firms, including financial media firms, mobile application vendors, and 
data vendors, have informed Nasdaq that they have observed an increase 
in demand for bid and offer information from the general investing 
public, and requested that Nasdaq create the proposed enterprise 
license. These potential customers compared Nasdaq's market data fee 
schedule to that of one of its competitors, which already allows 
general news websites to distribute real-time quote and trade 
information on open public websites and applications,\19\ and concluded 
that overall market transparency would be improved if Nasdaq Basic 
Quotes were distributed on open public websites and applications as 
well.
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    \19\ See, e.g., Securities Exchange Act Release No. 79699 
(December 28, 2016), 82 FR 892 (January 4, 2017) (SR-BatsEDGA-2016-
32) (introducing the digital media license for Bats EDGA); see also 
Cboe One Feed, Digital Media License, available at https://www.cboe.com/us/equities/market_data_services/cboe_one/(allowing 
general news websites to distribute real-time quote and trade 
information on open public websites and applications; information 
may be distributed via television, websites and mobile devices for 
informational and non-trading purposes only).
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    Upon consideration of these requests, Nasdaq has determined that 
distribution of best bid and offer information is in the best interest 
of our customers and the market as a whole. When NLS was introduced in 
2007, it was a significant leap forward for Retail Investors. NLS 
allowed, for the first time, a cost-effective method for the retail 
audience to gain insights into the real time price movements of US 
securities on open websites. The release of pre-trade information on a 
similar basis is the next step in expanding the availability and 
accessibility of accurate and reliable trading information, increasing 
overall transparency.
    Nasdaq believes that there is little risk that the proposed license 
will change the way that Professionals use pre-trade data. Although the 
new license may occasionally result in incidental professional use, 
data that is generally available to online customers via television, 
open websites, mobile devices, or any other unrestricted means of 
transmission is unlikely to have the breadth or depth of information, 
or desktop applications, used by professionals. Information for 
professional use is typically distributed through firewall-protected 
websites, intranet sites, secured terminals, or is otherwise protected 
from widespread dissemination.\20\ As an additional safeguard, Nasdaq 
proposes that any platform used to distribute data under this license 
contain sufficient controls to ensure that the feeds cannot be modified 
into a data feed or otherwise made suitable for professional use.
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    \20\ Professionals are also subject to regulatory requirements 
not applicable to the general investing public that require 
different sets of information to be displayed. SEC Rule 603(c), for 
example, requires Professionals to provide consolidated information, 
rather than proprietary data, under certain circumstances. See 17 
CFR 242.603(c).
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    The Exchange expects the new license to be attractive to financial 
media outlets, search engines and firms engaged in the development and 
sale of new financial applications. Based on Nasdaq's familiarity with 
the market, it

[[Page 16814]]

also believes that broker-dealers that currently distribute last sale 
transaction reports to the general investing public would similarly be 
interested in distributing QBBO information on their open websites to 
generate traffic and attract customers.
    Any firm that is interested in distributing Nasdaq Basic to the 
general investing public under the conditions set forth in the proposed 
rule would be able to do so. The Exchange expects financial media 
firms, firms engaged in the development and sale of new financial 
applications, broker-dealers, and data vendors in particular to benefit 
from the proposed license. The Proposal will promote competition as it 
is similar to a media license already offered by another exchange.\21\
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    \21\ See Cboe One Feed, Digital Media License, available at 
https://www.cboe.com/us/equities/market_data_services/cboe_one/ 
(allowing general news websites to distribute real-time quote and 
trade information on open public websites and applications; 
information may be distributed via television, websites and mobile 
devices for informational and non-trading purposes only).
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2. Statutory Basis
    The Exchange believes that its Proposal is consistent with Section 
6(b) of the Act,\22\ in general, and furthers the objectives of 
Sections 6(b)(4) and 6(b)(5) of the Act,\23\ 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.
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    \22\ See 15 U.S.C. 78f(b).
    \23\ See 15 U.S.C. 78f(b)(4) and (5).
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The Proposal Is an Equitable Allocation of Reasonable Dues, Fees and 
Other Charges
    As the Commission and courts \24\ have recognized, ``[i]f 
competitive forces are operative, the self-interest of the exchanges 
themselves will work powerfully to constrain unreasonable or unfair 
behavior.'' \25\ Accordingly, ``the existence of significant 
competition provides a substantial basis for finding that the terms of 
an exchange's fee proposal are equitable, fair, reasonable, and not 
unreasonably or unfairly discriminatory.'' \26\ Competition among 
exchanges in the sale of top-of-book data is a powerful competitive 
force that constrains the price of top-of-book data products.
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    \24\ The decision of the United States Court of Appeals for the 
District of Columbia Circuit in NetCoalition v. SEC, 615 F.3d 525 
(D.C. Cir. 2010) upheld the Commission's reliance upon competitive 
markets to set reasonable and equitably allocated fees for market 
data. ``In fact, the legislative history indicates that the Congress 
intended that the market system evolve through the interplay of 
competitive forces as unnecessary regulatory restrictions are 
removed and that the SEC wield its regulatory power in those 
situations where competition may not be sufficient, such as in the 
creation of a consolidated transactional reporting system.'' 
NetCoalition I, at 535 (quoting H.R. Rep. No. 94-229, at 92 (1975), 
as reprinted in 1975 U.S.C.C.A.N. 321, 323) (internal quotation 
marks omitted). The court agreed with the Commission's conclusion 
that ``Congress intended that competitive forces should dictate the 
services and practices that constitute the U.S. national market 
system for trading equity securities.'' Id. (quoting Securities 
Exchange Act Release No. 59039 (December 2, 2008), 73 FR 74770, 
74,771 (December 9, 2008) (SR-NYSEArca-2006-21)).
    \25\ See Securities Exchange Act Release No. 59039 (December 2, 
2008), 73 FR 74770 (December 9, 2008) (SR-NYSEArca-2006-21).
    \26\ Id.
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    Nasdaq Basic provides choices to broker-dealers and other data 
consumers by offering less than the quantum of data provided through 
the consolidated tape feeds, but at a lower price. All of the top-of-
book proprietary products offered by the exchanges are readily 
substitutable for each other.
    Top-of-book data can be used for many purposes--from a retail 
investor casually surveying the market to sophisticated market 
participants using it for a variety of applications, such as investment 
analysis, risk management, or portfolio valuation.
    All major exchange groups compete to sell top-of-book data. Nasdaq 
Basic provides data derived from liquidity within the Nasdaq market 
center and trades reported to the FINRA/Nasdaq TRFs. The NYSE BQT feed 
disseminates top-of-book information from the NYSE, NYSE American, NYSE 
Arca, NYSE National and NYSE Chicago exchanges.\27\ The Cboe One 
Summary Feed provides data from the four Cboe equities exchanges: BZX 
Exchange, BYX Exchange, EDGX Exchange and EDGA Exchange.\28\
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    \27\ See New York Stock Exchange, NYSE Best Quote & Trades 
(BQT), available at https://www.nyse.com/market-data/real-time/nyse-bqt.
    \28\ See Cboe Market Data Services, U.S. Equities, U.S. Equities 
Market Data Products, available at: https://markets.cboe.com/us/
equities/market_data_services/
#:~:text=Cboe%20Top%20is%20a%20real,time%20on%20a%20Cboe%20book.&text
=It%20is%20a%20real%2Dtime,time%20on%20a%20Cboe%20book.
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    Nasdaq, NYSE and Cboe compete on price and quality. Like Nasdaq, 
both NYSE \29\ and Cboe \30\ offer enterprise licenses for their top-of 
book feeds. All of these top-of-book data feeds are substitutes. The 
value of the data depends on its quality, which is in large part 
determined by the amount of order flow attracted by the exchange--the 
more order flow, the more quotes and trades, and the better the 
exchange data will be able to match the NBBO.
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    \29\ See New York Stock Exchange, NYSE Best Quote & Trades 
(BQT), available at https://www.nyse.com/market-data/real-time/nyse-bqt.
    \30\ See Cboe, Market Data Services, Cboe One Feed, available at 
https://markets.cboe.com/us/equities/market_data_services/cboe_one/.
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    Competition among exchanges for order flow has long been recognized 
by the courts. As the D.C. Circuit stated in NetCoalition v. Securities 
and Exchange Commission, ``[n]o one disputes that competition for order 
flow is `fierce.' . . . `In the U.S. national market system, buyers and 
sellers of securities, and the broker-dealers that act as their order-
routing agents, have a wide range of choices of where to route orders 
for execution'; [and] `no exchange can afford to take its market share 
percentages for granted' because `no exchange possesses a monopoly, 
regulatory or otherwise, in the execution of order flow from broker 
dealers' . . . .'' \31\
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    \31\ See NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010) 
(quoting Securities Exchange Act Release No. 59039 (December 2, 
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-
21)).
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    The proposed Media Enterprise License is an element of the 
competition among exchanges for the sale of top-of-book feeds. As 
explained above, it was drafted in response to requests from potential 
customers, including financial media firms, mobile application vendors, 
and data vendors, and also as a response to the license offered by one 
of Nasdaq's competitors allowing general news websites to distribute 
real-time quote and trade information.\32\ The Exchange expects the new 
license to be attractive to financial media outlets, search engines, 
and firms engaged in the development and sale of new financial 
applications, as well as broker-dealers, and expects that the increased 
dissemination of Nasdaq data will enhance Nasdaq's ability to compete 
with other exchanges in the sale of top-of-book data.
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    \32\ See, e.g., Securities Exchange Act Release No. 79699 
(December 28, 2016), 82 FR 892 (January 4, 2017) (SR-BatsEDGA-2016-
32) (introducing the digital media license for Bats EDGA); see also 
Cboe One Feed, Digital Media License, available at https://www.cboe.com/us/equities/market_data_services/cboe_one/ (allowing 
general news websites to distribute real-time quote and trade 
information on open public websites and applications; information 
may be distributed via television, websites and mobile devices for 
informational and non-trading purposes only).
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    In addition to the new Media Enterprise License, Nasdaq proposes to 
expand the broker-dealer enterprise license at Equity 7, Section 
147(b)(5), and the Market Data Enterprise License for Display Usage at 
Equity 7, Section 132, to include the Media Enterprise License at no 
additional cost. The Exchange also proposes to add the Media Enterprise 
License at Equity 7,

[[Page 16815]]

Section 147(b)(6) to the list of licenses which will allow distribution 
of the Short Interest Report to an unlimited number of external 
Subscribers or on an open website for a monthly fee. All of these 
changes will expand existing services at no additional cost to the 
purchaser.
    The fact that the new Media Enterprise License is subject to 
competition provides a substantial basis for a finding that the terms 
of the proposal are equitable, fair, and reasonable.
The Proposal Does Not Permit Unfair Discrimination
    The Proposal is not unfairly discriminatory. The proposed license 
will be available to any External Distributor to disseminate Nasdaq 
Basic to the general investing public for Display Usage. Broker-dealers 
that purchase the enterprise licenses at Equity 7, Sections 147(b)(5) 
and 132 will be able to distribute the same data to the general 
investing public at no additional charge, beyond the fees for the 
underlying licenses, and, as discussed above, these broker-dealers may 
continue to distribute NLS as they did before this change. Any firm 
that is interested in distributing Nasdaq Basic to the general 
investing public under the conditions set forth in the proposed rule 
would be able to do so on a non-discriminatory basis.
    With respect to the Short Interest Report at Equity 7, Section 
122(c), there is no unfair discrimination in allowing customers another 
means to qualify for purchase of the Short Interest Report for a 
reduced fee.
    For all of the reasons set forth herein, the proposed Media 
Enterprise License will be subject to significant competition, and that 
competition will ensure that there is no unfair discrimination. The 
Proposal will also benefit the general investing public by lowering the 
cost of distributing Nasdaq Basic, thereby enhancing overall market 
transparency.

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. With respect to inter-market 
competition--the competition among SROs--the Exchange's ability to 
price market data products is constrained by competition among 
exchanges for top-of-book data. The proposed Media Enterprise License 
is itself a response to a similar product offered by another exchange, 
and other exchanges are free to follow Nasdaq in offering their own 
version of the product. With respect to intra-market competition--the 
competition among consumers of exchange data--the Exchange expects the 
Proposal to promote competition by making Nasdaq Basic freely available 
to any External Distributor willing to distribute it to the general 
investing public under the terms set forth in this license.
Intermarket Competition
    As discussed in detail under Statutory Basis, Nasdaq competes with 
other exchanges in the sale of top-of-book products.
    Nasdaq is offering the proposed Media Enterprise License to gain 
new customers and to compete with a similar product offered by another 
exchange. The Proposal will not cause any unnecessary or inappropriate 
burden on intermarket competition, as other exchanges are free to 
respond with a similar license of their own.
Intramarket Competition
    The Proposal will not cause any unnecessary or inappropriate burden 
on intramarket competition. Indeed, it will foster competition by 
providing External Distributors--including financial media firms, 
search engines, vendors, and broker-dealers--with more options to 
deliver top-of-book information to the general investing public. The 
Proposal will also promote competition by increasing market 
transparency through greater dissemination of QBBO information to the 
general investing public. The license is available to all market 
participants that meet the terms set forth in the license, and nothing 
in the Proposal will place any unnecessary or inappropriate burden on 
intramarket competition.

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.\33\
---------------------------------------------------------------------------

    \33\ 15 U.S.C. 78s(b)(3)(A)(ii).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is: (i) 
Necessary or appropriate in the public interest; (ii) for the 
protection of investors; or (iii) otherwise in furtherance of the 
purposes of the Act. If the Commission takes such action, the 
Commission shall institute proceedings to determine whether the 
proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

    <bullet> Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#641611080149070b0909010a1017241701074a030b12"><span class="__cf_email__" data-cfemail="a0d2d5ccc58dc3cfcdcdc5ced4d3e0d3c5c38ec7cfd6">[email protected]</span></a>. Please include 
File Number SR-NASDAQ-2022-024 on the subject line.

Paper Comments

    <bullet> 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-2022-024. 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 (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-NASDAQ-2022-024 and

[[Page 16816]]

should be submitted on or before April 14, 2022.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\34\
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    \34\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-06187 Filed 3-23-22; 8:45 am]
BILLING CODE 8011-01-P


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