```

[Federal Register Volume 89, Number 239 (Thursday, December 12, 2024)]
[Notices]
[Pages 100573-100578]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-29151]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-101839; File No. SR-NASDAQ-2024-076]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Certain Fees Based on the Rate of Inflation

December 6, 2024
    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 November 26, 2024, The Nasdaq Stock Market LLC (``Nasdaq'' 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.
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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 based on the 
rate of inflation.
    While these amendments are effective upon filing, the Exchange has 
designated the proposed amendments to be operative on January 1, 2025.
    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
    The purpose of the proposed rule change is to adjust market data 
fees for inflation, to be operative on January 1, 2025.\3\
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    \3\ This proposal was initially filed on November 12, 2024, as 
SR-Nasdaq-2024-069. On November 26, 2024, SR-Nasdaq-2024, SR-Nasdaq-
2024-069 was withdrawn and replaced with the instant filing to 
provide certain additional information.
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    Many Nasdaq market data fees have not changed for years, some for 
over 15. As such, the fees have fallen substantially in real terms. The 
Exchange proposes to restore fees to the real amount intended in the 
original filings in a one-time inflationary adjustment. This adjustment 
will become operative in three parts: 45 percent in 2025; 30 percent in 
2026; and the final 25 percent in 2027. The Exchange believes that it 
is necessary to spread the impact of this one-time adjustment for past 
inflation to prevent any undue impact that execution in a single 
tranche may have on our customers.\4\
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    \4\ This proposal will adjust for inflation up to August 2024. 
Depending on inflation thereafter, further adjustments may, or may 
not, be necessary.
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    The proposed fee increases will apply to ten product families 
within Nasdaq: (i) Distributor Fees; (ii) Short Interest; (iii) Depth 
of Book; (iv) Distribution Models; (v) FilterView; (vi) Nasdaq Last 
Sale; (vii) Nasdaq Share Volume; (viii) Nasdaq Basic; (ix) Daily Short 
Volume; and (x) MatchView. A detailed list of fee adjustments is set 
forth below. The Exchange is not proposing to adjust fees for non-
professional usage, administrative fees, extranet fees, or certain 
categories of Non-Display usage. The Exchange plans to use this 
inflationary adjustment to support continued investment in innovative, 
high-quality data products.
Investments in Nasdaq Data Products
    Nasdaq has continuously invested in its products in the period 
after the current fees were first instituted to accommodate the 
increasing amount of information processed and the changes in 
technology over time. It is reasonable and consistent with the Act for 
the Exchange to recoup its investments, at least in part, by adjusting 
its fees. Continuing to operate at fees frozen in time impacts the 
Exchange's ability to enhance its offerings and the interests of market 
participants and investors.
    These investments have been necessary in part because of 
significant

[[Page 100574]]

increases in the amount of information processed. The following message 
rate metrics for Nasdaq Basic illustrate this increase in throughput:

 Peak Rate by Millisecond: up approximately 141%
 Average Rate per Millisecond: up approximately 89%
 Peak Rate per Second: up approximately 25%
 Average Rate per Second: up approximately 23%
 Peak Total Messages: up approximately 209%
 Average Total Messages: up approximately 121%
 Average Daily Volume: up approximately 82%
 Maximum Message Count: up approximately 209%

    With this increase in message traffic, the Exchange expended 
significant resources to improve its market data products to meet 
customer expectations, including continued investment in all aspects of 
the technology ecosystem (e.g., software, hardware, and network). 
During the period between 2018 and 2023, advancements in system 
performance as measured by latency not only accommodated the high 
message traffic volumes but stayed well ahead of it. The following 
latency metrics \5\ illustrate the increase in message processing 
speed, despite the significant message traffic growth:
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    \5\ These measurements compare the time difference between 
events on the matching engine and the time these events are 
published.

 Median: down approximately 22%
 Average: down approximately 28%
 Max: down approximately 29%

    The Exchange continues to invest in enhancing its technology for 
the benefit and often at the behest of its customers. Yet the Exchange 
has not adjusted any of the fees included in this proposal for many 
years (as set forth below), to even partially offset the costs of 
maintaining and enhancing its market data offerings.
Inflationary Index
    The fee increases the Exchange proposes are based on an industry-
specific Producer Price Index (PPI), which is a tailored measure of 
inflation.\6\ As a general matter, the Producer Price Index is a family 
of indexes that measures the average change over time in selling prices 
received by domestic producers of goods and services, measuring price 
change from the perspective of the seller. This contrasts with other 
metrics, such as the Consumer Price Index (CPI), that measure price 
change from the purchaser's perspective.\7\
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    \6\ See https://fred.stlouisfed.org/series/PCU51825182#0.
    \7\ See https://www.bls.gov/ppi/overview.htm.
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    About 10,000 PPIs for individual products and groups of products 
are tracked and released each month.\8\ PPIs are available for the 
output of nearly all industries in the goods-producing sectors of the 
U.S. economy--mining, manufacturing, agriculture, fishing, and 
forestry--as well as natural gas, electricity, and construction, among 
others. The PPI program covers approximately 69 percent of the service 
sector's output, as measured by revenue reported in the 2017 Economic 
Census.
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    \8\ See https://www.bls.gov/ppi/overview.htm.
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    For purposes of this proposal, the relevant industry-specific PPI 
is the Data Processing and Related Services PPI (``Data Processing 
PPI''), which is an industry net-output PPI that measures the average 
change in selling prices received by companies that provide data 
processing services. The Data Processing PPI was introduced in January 
2002 by the Bureau of Labor Statistics (BLS) as part of an ongoing 
effort to expand Producer Price Index coverage of the services sector 
of the U.S. economy and is identified as NAICS--518210 in the North 
American Industry Classification System.\9\ According to the BLS 
``[t]he primary output of NAICS 518210 is the provision of electronic 
data processing services. In the broadest sense, computer services 
companies help their customers efficiently use technology. The 
processing services market consists of vendors who use their own 
computer systems--often utilizing proprietary software--to process 
customers' transactions and data. Companies that offer processing 
services collect, organize, and store a customer's transactions and 
other data for record-keeping purposes. Price movements for the NAICS 
518210 index are based on changes in the revenue received by companies 
that provide data processing services. Each month, companies provide 
net transaction prices for a specified service. The transaction is an 
actual contract selected by probability, where the price-determining 
characteristics are held constant while the service is repriced. The 
prices used in index calculation are the actual prices billed for the 
selected service contract.'' \10\
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    \9\ NAICS appears in table 5 of the PPI Detailed Report and is 
available at https://data.bls.gov/timeseries/PCU518210518210.
    \10\ See https://www.bls.gov/ppi/factsheets/producer-price-index-for-the-data-processing-and-related-servicesindustry-naics-518210.htm.
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    The Exchange believes the Data Processing PPI is an adequate 
measure to for adjusting fees for its proprietary market data products 
because the Exchange uses its ``own computer systems'' and 
``proprietary software,'' i.e., its own data center and proprietary 
matching engine software, respectively, to collect, organize, store and 
report customers' transactions in U.S. equity securities.\11\
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    \11\ The Exchange notes that the Bureau of Labor Statistics uses 
a number of measures of inflation that may apply to Exchange market 
data. For example, there is also an inflation measure related to PPI 
industry data for data processing, hosting, and related services: 
Hosting, ASP, and other IT infrastructure provisioning services. 
This other measure has been used by other SROs in determining price 
changes and may provide an alternative point of reference.
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    The Exchange furthermore notes that the Data Processing PPI is a 
stable metric with limited volatility, unlike other consumer-side 
inflation metrics. The Data Processing PPI has not experienced a 
greater than 2.16% increase for any one calendar year period since Data 
Processing PPI was introduced into the PPI in January 2002. The average 
calendar year change from January 2002 to December 2023 was 0.62%, with 
a cumulative increase of 15.67% over this 21-year period.
    The Exchange notes that other exchanges have filed for increases in 
certain fees, based in part on the rate of inflation.\12\
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    \12\ See, e.g., Securities Exchange Act Release Nos. 34-100004 
(April 22, 2024), 89 FR 32465 (April 26, 2024) (SR-CboeBYX-2024-
012); and 34-100398 (June 21, 2024), 89 FR 53676 (June 27, 2024) 
(SR-BOX-2024-16); Securities Exchange Act Release No. 100994 
(September 10, 2024), 89 FR 75612 (September 16, 2024) (SR-NYSEARCA-
2024-79).
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Calculation and Proposed Fee Changes
    The proposed inflationary adjustments are based on a comparison of 
the Data Processing PPI index on the last date that the relevant fee 
was adjusted with the level of the Data Processing PPI index on August 
1, 2024. For example, for a fee that was last changed on September 1, 
2010, the Exchange divided the difference between the Data Processing 
PPI index on August 2024 (116.022) and the Data Processing PPI index in 
September 2010 (101.7) by the Data Processing PPI index in September 
2010 (101.7), to calculate a total inflationary adjustment of 14 
percent to obtain the percentage increase. That percentage increase was 
then applied to the prior fee to determine the proposed fee, and then 
rounding the result.\13\ This calculation was repeated for each market 
data fee.
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    \13\ The Exchange rounded fees as follows: fee values over 
$999.99 were rounded to the nearest $10; fees between $99.99 and 
$999.99 were rounded to the nearest dollar; fees between $9.99 and 
$99.99 were rounded to the nearest $0.50; fees less than $9.99 were 
rounded to the nearest $0.10. Where rounding would have caused the 
proposed fee to exceed the rate of inflation, the Exchange rounded 
downward.

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[[Page 100575]]

    As noted above, the Exchange proposes to adjust fees through a one-
time inflationary adjustment to be executed in three tranches: one in 
2025 that will cover 45 percent of the adjustment, another in 2026 to 
cover an additional 30 percent, and a final tranche in 2027 for the 
final 25 percent of the adjustment.
    Table 1 below shows the proposed changes for 2025, 2026 and 2027, 
the date of the last fee change, and the overall adjustment:

                                    Table 1--Proposed Inflationary Adjustment
----------------------------------------------------------------------------------------------------------------
                                                                                                        Overall
                                                                                                        percent
               Product                  Current      2025        2026        2027       Last change     change
                                                                                                         \14\
----------------------------------------------------------------------------------------------------------------
                                          Market Data Distributor Fees
----------------------------------------------------------------------------------------------------------------
Direct Access Fee (Nasdaq)..........      $2,000      $2,125      $2,224      $2,281   \15\ 9/1/2010        14.1
Direct Access Fee (Non-Nasdaq)......       1,000       1,065       1,116       1,141   \16\ 9/1/2010        14.1
Internal Distributor Fee (Nasdaq)...       1,000       1,070       1,125       1,162   \17\ 7/1/2006        16.2
Internal Distributor Fee (Non-               500         540         565         581   \18\ 7/1/2006        16.2
 Nasdaq)............................
External Distributor Fee (Nasdaq)...       2,500       2,680       2,820       2,906   \19\ 7/1/2006        16.2
External Distributor Fee (Non-             1,250       1,340       1,410       1,453   \20\ 7/1/2006        16.2
 Nasdaq)............................
----------------------------------------------------------------------------------------------------------------
                                              Short Interest Report
----------------------------------------------------------------------------------------------------------------
Access Fee..........................         500         520         535         543   \21\ 7/1/2017    \22\ 8.6
Internal Distribution...............       1,000       1,040       1,070       1,087   \23\ 7/1/2017         8.7
External Distribution (1-499               2,500       2,600       2,680       2,718   \24\ 7/1/2017         8.7
 Subscribers).......................
External Distribution (500-9,999           5,000       5,200       5,350       5,437   \25\ 7/1/2017         8.7
 Subscribers).......................
External Distribution (10,000+             7,500       7,800       8,030       8,155   \26\ 7/1/2017         8.7
 Subscribers).......................
External Distribution (Enterprise          1,500       1,560       1,610       1,631   \27\ 7/1/2017         8.7
 License)...........................
----------------------------------------------------------------------------------------------------------------
                                               Depth-of-Book Data
----------------------------------------------------------------------------------------------------------------
Level 2 Pro.........................          76       80.50       84.00       86.00   \28\ 3/1/2012   \29\ 13.2
TotalView Pro.......................          76       80.50       84.00       86.00   \30\ 3/1/2012   \31\ 13.2
Non-Display (1-39 Subscribers)......         375         396         412         421   \32\ 1/1/2016   \33\ 12.3
Non-Display (40-99 Subscribers).....      15,000      15,840      16,490      16,863   \34\ 1/1/2016        12.4
Non-Display (100-249 Subscribers)...      30,000      31,680      32,990      33,727   \35\ 1/1/2016        12.4
Trading Platform Fee................       5,000       5,270       5,480       5,600  \36\ 12/1/2014   \37\ 12.0
Trading Platform Fee Threshold......      15,000      15,810      16,440      16,800  \38\ 12/1/2014   \39\ 12.0
----------------------------------------------------------------------------------------------------------------
                                               Distribution Models
----------------------------------------------------------------------------------------------------------------
Enhanced Display Solutions (EDS) (1-       4,000       4,220       4,390       4,479  \40\ 11/1/2014        12.0
 399)...............................
Enhanced Display Solutions (400-999)       7,500       7,910       8,230       8,399  \41\ 11/1/2014        12.0
Enhanced Display Solutions (1,000+).      15,000      15,810      16,440      16,798  \42\ 11/1/2014        12.0
Enhanced Display Solutions                    80       84.50       88.00       89.50  \43\ 11/1/2014   \44\ 11.9
 Professional.......................
Enhanced Display Solutions                33,500      34,990      36,150      36,806   \45\ 2/1/2017         9.9
 Enterprise License.................
Enterprise License Professional.....          76       80.50       84.00       86.00   \46\ 3/1/2012   \47\ 13.2
Managed Data Solution per                  2,500       2,640       2,750       2,810   \48\ 1/1/2016        12.4
 Distributor........................
Managed Data Solution per                    375         396         412         421   \49\ 1/1/2016   \50\ 12.3
 Professional.......................
FPGA Internal.......................      25,000      26,570      27,790      28,490   \51\ 5/1/2012        14.0
FPGA External.......................       2,500       2,660       2,780       2,849   \52\ 5/1/2012        14.0
FGPA Internal and External..........      27,500      29,230      30,570      31,339   \53\ 5/1/2012        14.0
Managed Data Solution Administration       5,000       5,280       5,500       5,621   \54\ 1/1/2016        12.4
 Fee first Subscriber...............
Managed Data Solution Administration         750         792         825         843   \55\ 1/1/2016        12.4
 Fee additional Subscribers.........
----------------------------------------------------------------------------------------------------------------
                                               FilterView Service
----------------------------------------------------------------------------------------------------------------
FilterView..........................         750         780         803         815  \56\ 12/1/2017         8.7
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                                             Nasdaq Last Sale (NLS)
----------------------------------------------------------------------------------------------------------------
NLS per Subscriber (Nasdaq--                  13       13.50       14.10       14.50   \57\ 1/1/2014   \58\ 11.5
 Specialized Use)...................
NLS per Subscriber (non-Nasdaq--              13  \59\ 13.80       14.40       14.50   \60\ 1/1/2014   \61\ 11.5
 Specialized Use)...................
NLS Distributor.....................       1,500       1,600       1,680       1,724   \62\ 7/1/2008   \63\ 14.9
NLS Distributor (Specialized Use)...       2,000       2,080       2,140       2,170   \64\ 1/1/2018    \65\ 8.5
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                                           Nasdaq Share Volume Service
----------------------------------------------------------------------------------------------------------------
Access Fee..........................       2,500       2,680       2,820       2,897   \66\ 2/1/2007        15.9
----------------------------------------------------------------------------------------------------------------

[[Page 100576]]

 
                                                  Nasdaq Basic
----------------------------------------------------------------------------------------------------------------
Subscriber Fee (Nasdaq).............          13       13.50       14.10       14.50   \67\ 1/1/2014   \68\ 11.5
Subscriber Fee (NYSE)...............        6.50        6.90        7.20        7.25   \69\ 1/1/2014   \70\ 11.5
Subscriber Fee (Other)..............        6.50        6.90        7.20        7.25   \71\ 1/1/2014   \72\ 11.5
Distributor Fee (Internal)..........       1,500       1,600       1,680       1,723   \73\ 1/1/2009        14.9
Distributor Fee (External)..........       2,000       2,080       2,140       2,170   \74\ 1/1/2018    \75\ 8.5
----------------------------------------------------------------------------------------------------------------
                       Nasdaq Daily Short Volume and Monthly Short Sale Transaction Files
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Internal Distribution...............         750         783         809         824   \76\ 1/1/2017         9.9
External Distribution...............       1,250       1,300       1,340       1,373   \77\ 1/1/2017    \78\ 9.8
----------------------------------------------------------------------------------------------------------------
                                              Nasdaq MatchView Feed
----------------------------------------------------------------------------------------------------------------
One Server..........................       5,000       5,310       5,550       5,687  \79\ 10/1/2011        13.7
Two or more Servers.................      10,000      10,620      11,100      11,374  \80\ 10/1/2011        13.7
----------------------------------------------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal to change fees is 
consistent

[[Page 100577]]

with Section 6(b) of the Act,\81\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\82\ 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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    \14\ The overall percentage change is determined by the Data 
Processing PPI index, as discussed above. In a few instances, the 
overall percentage change is below the Data Processing PPI index due 
to rounding. Such instances are footnoted below.
    \15\ See Securities Exchange Act Release No. 62907 (September 
14, 2010), 75 FR 57324 (September 20, 2010) (SR-Nasdaq-2010-110).
    \16\ See id.
    \17\ See Securities Exchange Act Release No. 54179 (July 20, 
2006), 71 FR 42428 (July 26, 2006) (SR-Nasdaq-2006-013).
    \18\ See id.
    \19\ See id.
    \20\ See id.
    \21\ See Securities Exchange Act Release No. 81256 (July 28, 
2017), 82 FR 36168 (August 3, 2017) (SR-Nasdaq-2017-077).
    \22\ The change as calculated by the Data Processing PPI index 
is 8.7%. The actual change is 8.6% due to rounding of the fee.
    \23\ See Securities Exchange Act Release No. 81256 (July 28, 
2017), 82 FR 36168 (August 3, 2017) (SR-Nasdaq-2017-077).
    \24\ See id.
    \25\ See id.
    \26\ See id.
    \27\ See id.
    \28\ See Securities Exchange Act Release No. 66740 (April 5, 
2012), 77 FR 21609 (April 10, 2012) (SR-Nasdaq-2012-042).
    \29\ The change as calculated by the Data Processing PPI index 
is 13.6%. The actual change is 13.2% due to rounding of the fee.
    \30\ See Securities Exchange Act Release No. 66740 (April 5, 
2012), 77 FR 21609 (April 10, 2012) (SR-Nasdaq-2012-042).
    \31\ The change as calculated by the Data Processing PPI index 
is 13.6%. The actual change is 13.2% due to rounding of the fee.
    \32\ See Securities Exchange Act Release No. 76779 (December 28, 
2015), 81 FR 131 (January 4, 2016) (SR-Nasdaq-2015-157).
    \33\ The change as calculated by the Data Processing PPI index 
is 12.4%. The actual change is 12.3% due to rounding of the fee.
    \34\ See Securities Exchange Act Release No. 76779 (December 28, 
2015), 81 FR 131 (January 4, 2016) (SR-Nasdaq-2015-157).
    \35\ See id.
    \36\ See Securities Exchange Act Release No. 73978 (January 2, 
2015), 80 FR 1057 (January 8, 2015) (SR-Nasdaq-2014-125).
    \37\ The change as calculated by the Data Processing PPI index 
is 12.1%. The actual change is 12.0% due to rounding of the fee.
    \38\ See Securities Exchange Act Release No. 73978 (January 2, 
2015), 80 FR 1057 (January 8, 2015) (SR-Nasdaq-2014-125).
    \39\ The change as calculated by the Data Processing PPI index 
is 12.1%. The actual change is 12.0% due to rounding of the fee.
    \40\ See Securities Exchange Act Release No. 73807 (December 10, 
2014), 79 FR 74784 (December 16, 2014) (SR-Nasdaq-2014-117).
    \41\ See id.
    \42\ See id.
    \43\ See id.
    \44\ The change as calculated by the Data Processing PPI index 
is 12.0%. The actual change is 11.9% due to rounding of the fee.
    \45\ See Securities Exchange Act Release No. 80015 (February 10, 
2017), 82 FR 10944 (February 16, 2017) (SR-Nasdaq-2017-007).
    \46\ See id.
    \47\ The change as calculated by the Data Processing PPI index 
is 13.6%. The actual change is 13.2% due to rounding of the fee.
    \48\ See Securities Exchange Act Release No. 76797 (December 30, 
2015), 81 FR 544 (January 6, 2016) (SR-Nasdaq-2015-158).
    \49\ See Securities Exchange Act Release No. 76779 (December 28, 
2015), 81 FR 131 (January 4, 2016) (SR-Nasdaq-2015-157)
    \50\ The change as calculated by the Data Processing PPI index 
is 12.4%. The actual change is 12.3% due to rounding of the fee.
    \51\ See Securities Exchange Act Release No. 76297 (June 28, 
2012), 77 FR 39752 (July 5, 2012) (SR-Nasdaq-2012-063).
    \52\ See id.
    \53\ See id.
    \54\ See Securities Exchange Act Release No. 76797 (December 30, 
2015), 81 FR 544 (January 6, 2016) (SR-Nasdaq-2015-158).
    \55\ See id.
    \56\ See Securities Exchange Act Release No. 82467 (January 9, 
2018), 83 FR 2261 (January 16, 2018) (SR-Nasdaq-2017-134).
    \57\ Nasdaq Last Sale (specialized use case) was instituted in 
2018. See Securities Exchange Act Release No. 82723 (February 15, 
2018), 83 FR 7812 (February 22, 2018) (SR-Nasdaq-2018-010). At that 
time, fees were set to be the equivalent of Nasdaq Basic fees set in 
2014. See Securities Exchange Act Release No. 71507 (February 7, 
2014), 79 FR 8763 (February 13, 2014) (SR-Nasdaq-2014-011). In order 
to ensure that these fees remained aligned as intended by the 2018 
filing, we are using the 2014 date, when the Nasdaq Basic fees were 
first set, to calculate the inflationary adjustment.
    \58\ Fees for NLS (Specialized Use Case) were designed to be 
equivalent to Nasdaq Basic Fees. The PPI adjustment for Nasdaq Basic 
is 12.3%. The fee adjustment for NLS Specialized Use Case is 11.5%.
    \59\ The fees for NLS (non-Nasdaq--Specialized Use Case for 
2025, 2026 and 2027 are being adjusted to remain equivalent to the 
Subscriber fees for Nasdaq Basic. See Equity 7, Section 147(a)(1). 
As discussed in note 49 below, the fees for NLS Specialized Use Case 
were intended to be the same as the fees for Nasdaq Basic. See 
Securities Exchange Act Release No. 82723 (February 15, 2018), 83 FR 
7812 (February 22, 2018) (SR-Nasdaq-2018-010).
    \60\ Nasdaq Last Sale (specialized use case) was instituted in 
2018. See Securities Exchange Act Release No. 82723 (February 15, 
2018), 83 FR 7812 (February 22, 2018) (SR-Nasdaq-2018-010). At that 
time, fees were set to be the equivalent of Nasdaq Basic fees set in 
2014. See Securities Exchange Act Release No. 71507 (February 7, 
2014), 79 FR 8763 (February 13, 2014) (SR-Nasdaq-2014-011). In order 
to ensure that these fees remained aligned as intended by the 2018 
filing, we are using the 2014 date, when the Nasdaq Basic fees were 
first set, to calculate the inflationary adjustment.
    \61\ Fees for NLS (Specialized Use Case) were designed to be 
equivalent to Nasdaq Basic Fees. The PPI adjustment for Nasdaq Basic 
is 12.3%. The fee adjustment for NLS Specialized Use Case is 11.5%.
    \62\ See Securities Exchange Act Release No. 55255 (February 8, 
2007), 72 FR 7100 (February 14, 2007) (SR-Nasdaq-2006-060).
    \63\ The change as calculated by the Data Processing PPI index 
is 15.0%. The actual change is 14.9% due to rounding of the fee.
    \64\ As noted above, the Nasdaq Last Sale (specialized use case) 
was instituted in 2018. See Securities Exchange Act Release No. 
82723 (February 15, 2018), 83 FR 7812 (February 22, 2018) (SR-
Nasdaq-2018-010). At that time, fees were set to be the equivalent 
of Nasdaq Basic fees. The Nasdaq Basic external distributor fee was 
set in January of 2018. See Securities Exchange Act Release No. 
82541 (January 19, 2018), 83 FR 3790 (January 26, 2018) (SR-Nasdaq-
2018-004). To maintain equivalence of NLS (specialized use case) 
fees and Nasdaq Basic, we used the 2018 date for the inflationary 
adjustment.
    \65\ The change as calculated by the Data Processing PPI index 
is 8.6%. The actual change is 8.5% due to rounding of the fee.
    \66\ See Securities Exchange Act Release No. 55444 (March 12, 
2007), 72 FR 12648 (March 16, 2007) (SR-Nasdaq-2007-006).
    \67\ See Securities Exchange Act Release No. 71507 (February 7, 
2014), 79 FR 8763 (February 13, 2014) (SR-Nasdaq-2014-011).
    \68\ The change as calculated by the Data Processing PPI index 
is 12.3%. The actual change is 11.5% due to rounding of the fee.
    \69\ See id.
    \70\ The change as calculated by the Data Processing PPI index 
is 12.3%. The actual change is 11.5% due to rounding of the fee.
    \71\ See id.
    \72\ The change as calculated by the Data Processing PPI index 
is 12.3%. The actual change is 11.5% due to rounding of the fee.
    \73\ Securities Exchange Act Release No. 59244 (January 13, 
2009), 74 FR 4065 (January 22, 2009) (SR-Nasdaq-2008-102).
    \74\ Securities Exchange Act Release No. 82541 (January 19, 
2018), 83 FR 3790 (January 26, 2018) (SR-Nasdaq-2018-004).
    \75\ The change as calculated by the Data Processing PPI index 
is 8.7%. The actual change is 8.5% due to rounding of the fee.
    \76\ See Securities Exchange Act Release No. 79617 (December 20, 
2016), 81 FR 95213 (December 27, 2016) (SR-Nasdaq-2016-168).
    \77\ See id.
    \78\ The change as calculated by the Data Processing PPI index 
is 9.9%. The actual change is 9.8% due to rounding of the fee.
    \79\ Securities Exchange Act Release No. 65525 (October 11, 
2011), 76 FR 64158 (October 17, 2011) (SR-Nasdaq-2011-139).
    \80\ See id.
    \81\ 15 U.S.C. 78f(b).
    \82\ 15 U.S.C. 78f(b)(4) and (5).
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    This belief is based on two factors. First, the current fees do not 
properly reflect the quality of the services and products, as fees for 
the services and products in question have been static in nominal 
terms, and therefore falling in real terms due to inflation. Second, 
the Exchange believes that investments made in enhancing the capacity 
of Exchange systems have increased the performance of the services and 
products notwithstanding fees having remained static in nominal terms.
Equitable Allocation of Reasonable Dues, Fees and Other Charges
    The proposed changes are an equitable allocation of reasonable 
dues, fees, and other charges because, as noted above, the Exchange has 
not increased any of the fees included in the proposal since the dates 
indicated in Table 1. In the years following the last fee increase, the 
Exchange has made significant investments in upgrades to Exchange 
systems and enhancing the quality of its services as measured by, among 
other things, increased throughput. As such, Exchange customers have 
benefitted while the Exchange's ability to recoup its investments has 
been hampered, and Exchange fees have fallen in real terms during the 
relevant period.
    Between 2018 and 2023, for example, the overall inflation rate was 
an average of 3.93% per year, producing a cumulative inflation rate of 
21.28%.\83\ Using the more targeted inflation number of Data Processing 
PPI, the cumulative inflation rate was 8.07%.\84\ The Exchange believes 
the Data Processing PPI is a reasonable metric for this fee increase 
because it is targeted to producer-side increases in the data 
processing industry, which, based on the definition adopted by BLS, 
would include the Exchange's market data products. Notwithstanding this 
inflation, the Exchange has not increased its fees for the subject 
services for the period of time indicated in Table 1, and therefore the 
proposed fee changes represent a reasonable increase from the current 
fees.
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    \83\ See https://www.officialdata.org/us/inflation/2019?endYear=2023&amount=1.
    \84\ See https://data.bls.gov/timeseries/PCU518210518210.
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    The Exchange believes the proposed fee increase is reasonable in 
light of the Exchange's continued expenditure in maintaining a robust 
technology ecosystem. The Exchange continues to invest in maintaining 
and enhancing its market data products for the benefit and often at the 
behest of its customers and global investors. Such enhancements include 
refreshing all aspects of the technology ecosystem including software, 
hardware, and network while introducing new and innovative products. 
The goal of these enhancements, among other things, is to provide 
faster and more consistent market data products. The Exchange continues 
to expend resources to innovate and modernize technology so that it may 
benefit its members in offering its market data products.
The Proposal Does Not Permit Unfair Discrimination
    The proposed fee increases are not unfairly discriminatory because 
they would apply to all data recipients that choose to purchase the 
market data products identified above. Any person that chooses to 
purchase any of these products would be subject to the same fee 
schedule, regardless of what type of business they operate or the use 
they plan to make of the data feed. Additionally, the fee increase 
would be applied uniformly to subscribers without regard to Exchange 
membership status or the extent of any other business with the Exchange 
or affiliated entities.
    The proposed changes are also not unfairly discriminatory because 
the fees would be assessed uniformly across all market participants 
that purchase these products in the same manner they are today, and all 
products will remain available for purchase by all market 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.
Intramarket Competition
    The proposed fees do not put any market participants at a relative 
disadvantage compared to other market participants. As noted above, the 
fee schedule would continue to apply to all customers of the market 
data products identified above in the same manner as it does today, 
albeit at inflation-adjusted rates for certain fees, and customers may 
choose whether to subscribe to the feed at all. The Exchange also 
believes that the level of the proposed fees neither favors nor 
penalizes any one or more categories of market participants in a manner 
that would impose an undue burden on competition.
Intermarket Competition
    The proposed fees do not impose a burden on competition or on other 
Self Regulatory Organizations that is not necessary or appropriate. In 
determining the proposed fees, the Exchange utilized an objective and 
stable metric with limited volatility. Utilizing Data Processing PPI 
over a specified period of time is a reasonable means of recouping the 
Exchange's investment in maintaining and enhancing the market data 
products identified above. The Exchange believes utilizing Data 
Processing PPI, a tailored measure of inflation, to increase certain 
market data fees to recoup the Exchange's investment in maintaining and 
enhancing its market data products would not impose a burden on 
competition.

[[Page 100578]]

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.\85\
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    \85\ 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

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-NASDAQ-2024-076 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to file number SR-NASDAQ-2024-076. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for website viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE, 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the filing also will be available for 
inspection and copying at the principal office of the Exchange. Do not 
include personal identifiable information in submissions; you should 
submit only information that you wish to make available publicly. We 
may redact in part or withhold entirely from publication submitted 
material that is obscene or subject to copyright protection. All 
submissions should refer to file number SR-NASDAQ-2024-076 and should 
be submitted on or before January 2, 2025.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\86\
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    \86\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-29151 Filed 12-11-24; 8:45 am]
BILLING CODE 8011-01-P
```