36562 Federal Register / Vol. 87, No. 117 / Friday, June 17, 2022 / Notices 

14 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. 78977 

(September 29, 2016), 81 FR 69140 (October 5, 

2016) (SR–NASDAQ–2016–132). 

4Pursuant to Equity 7, Section 118(a), the term 

‘‘Consolidated Volume’’ shall mean the total 

consolidated volume reported to all consolidated 

transaction reporting plans by all exchanges and 

trade reporting facilities during a month in equity 

securities, excluding executed orders with a size of 

less than one round lot. For purposes of calculating 

Consolidated Volume and the extent of a member’s 

trading activity the date of the annual reconstitution 

of the Russell Investments Indexes shall be 

excluded from both total Consolidated Volume and 

the member’s trading activity. For the purposes of 

calculating the extent of a member’s trading activity 

during the month on Nasdaq and determining the 

charges and credits applicable to such member’s 

activity, all M–ELO Orders that a member executes 

on Nasdaq during the month will count as liquidityadding activity on Nasdaq. 

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–ICEEU–2022–013. 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 such 

filings will also be available for 

inspection and copying at the principal 

office of ICE Clear Europe and on ICE 

Clear Europe’s website at https://

www.theice.com/clear-europe/ 

regulation. 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–ICEEU– 

2022–013 and should be submitted on 

or before July 8, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–13043 Filed 6–16–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–95091; File No. SR– 

NASDAQ–2022–036] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Exchange’s Transaction Fees at Equity 

7, Section 118(a) 

June 13, 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 June 1, 

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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend the 

Exchange’s transaction fees at Equity 7, 

Section 118, to: (i) eliminate the Nasdaq 

Growth Program, at Equity 7, Section 

114(j); (ii) adjust or eliminate several of 

the Exchange’s transaction credits, at 

Equity 7, 118(a); (iii) add a new credit 

to Equity 7, Section 118(a); and (iv) reorganize, re-format, and re-state the 

Exchange’s schedule of transaction fees 

and credits at Equity 7, Section 118(a), 

as described further below. 

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 proposed Rule change will (i) 

eliminate the Nasdaq Growth Program, 

at Equity 7, Section 114(j); (ii) adjust or 

eliminate several of the Exchange’s 

transaction credits, at Equity 7, 118(a); 

(iii) add a new credit to Equity 7, 

Section 118(a); and (iv) re-organize, reformat, and re-state the Exchange’s 

schedule of transaction fees and credits 

at Equity 7, Section 118(a). 

Elimination of the Nasdaq Growth 

Program 

The Exchange presently offers the 

‘‘Nasdaq Growth Program,’’ as set forth 

in Equity 7, Section 114(j),3 which 

exists to incentivize members to 

increase the extent to which they add 

liquidity to the Exchange over time. 

Under the Nasdaq Growth Program, the 

Exchange provides a credit of $0.0025 

per share executed (in securities priced 

at $1 or more) to members that provide 

a certain amount of liquidity to the 

Exchange and also grow the extent to 

which they add such liquidity over 

time. Specifically, a member is eligible 

for the credit if it both: (A) adds greater 

than 750,000 shares a day on average 

during the month through one or more 

of its Nasdaq Market Center MPIDs; and 

(B) increases its shares of liquidity 

provided through one or more of its 

Nasdaq Market Center MPIDs as a 

percent of Consolidated Volume 4 by 

20% versus the member’s Growth 

Baseline or (ii) have met the growth 

criteria in Equity 7, Section 114(j)(1)(A) 

and (j)(1)(B)(i) in three separate months 

and maintained or increased its shares 

of liquidity provided through one or 

more of its Nasdaq Market Center MPIDs 

as a percent of Consolidated Volume 

compared to the Growth Baseline 

established when the member met the 


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5As defined in Equity 7, Section 114, the 

‘‘Growth Baseline’’ is the member’s shares of 

liquidity provided in all securities through one or 

more of its Nasdaq Market Center MPIDs as a 

percent of Consolidated Volume during the last 

month a member qualified for the Nasdaq Growth 

Program under Equity 7, Section 114(j)(1)(B)(i). If a 

member has not qualified for a credit under this 

program, its May 2018 share of liquidity provided 

in all securities through one or more of its Nasdaq 

Market Center MPIDs as a percent of Consolidated 

Volume is used to establish a baseline. 

criteria for the third month.5 The 

Exchange provides this Nasdaq Growth 

Program credit in lieu of other credits 

that it otherwise makes available to a 

member for displayed quotes/orders 

(other than Supplemental Orders or 

Designated Retail Orders) that provide 

liquidity under Equity 7, Section 118 if 

the former credit is greater than the 

latter credit. 

The Exchange proposes to eliminate 

the Nasdaq Growth Program because it 

has not been successful in 

accomplishing its objectives. That is, it 

has not induced members to grow 

materially the extent to which they add 

liquidity to the Exchange over time. The 

Exchange has limited resources to 

allocate to incentive programs like this 

one and it must, from time to time, 

reallocate those resources to maximize 

their net impact on the Exchange, 

market quality, and participants. Going 

forward, the Exchange plans to 

reallocate the resources it devotes to the 

Nasdaq Growth Program to other 

incentive programs that it hopes will be 

more impactful. 

Adjustments to Transaction Credits for 

Displayed Quotes/Orders (Other Than 

Supplemental Orders or Designated 

Retail Orders) That Provide Liquidity to 

the Exchange 

Next, the Exchange proposes to adjust 

several existing credits to its members 

for displayed quotes/orders (other than 

Supplemental Orders or Designated 

Retail Orders) that provide liquidity to 

the Exchange. For all of these credits 

described below, the purpose of the 

changes is to recalibrate the credits to 

account for changes in member behavior 

over time that have rendered the credits 

less challenging for members to attain. 

That is, the Exchange proposes to 

reduce the amount of the credits 

because members now readily meet the 

volume requirements to qualify for 

them, such that the credits reward these 

members for remaining static in their 

activity on the Exchange. By reducing 

the amount of these credits, the 

Exchange wishes to incent such 

members to strive to qualify for higher 

available credits by further increasing 

the extent to which they add liquidity 

to the Exchange. 

Currently, the Exchange provides a 

$0.0025 per share executed credit for 

securities in all three Tapes to a member 

with shares of liquidity provided in all 

securities through one or more of its 

Nasdaq Market Center MPIDs that 

represent more than 0.10% of 

Consolidated Volume. The Exchange 

proposes to reduce the amount of this 

credit to $0.0020 per share executed for 

securities in all three Tapes. 

Currently, the Exchange also provides 

a $0.0020 per share executed credit for 

securities in Tape C to a member with 

shares of liquidity provided in all 

securities representing less than 0.10% 

of Consolidated Volume, through one or 

more of its Nasdaq Market Center 

MPIDs; provided that (i) the member 

also provides a daily average of at least 

250,000 shares of liquidity provided in 

securities listed on an exchange other 

than Nasdaq, or (ii) the member routes 

a daily average volume of at least 10,000 

shares during the month via the QDRK 

routing strategy. The Exchange proposes 

to reduce the amount of this credit for 

securities in Tape C to $0.0018 per share 

executed. 

Currently, the Exchange provides a 

$0.0025 per share executed credit for 

securities in all three Tapes to a member 

that provides a daily average of at least 

4 million shares of liquidity, of which 

more than 1.5 million shares per day 

must consist of non-displayed liquidity, 

excluding midpoint orders, or Midpoint 

Extended Life Orders (‘‘M–ELOs’’). The 

Exchange proposes to reduce the 

amount of this credit to $0.0020 per 

share executed for securities in all three 

Tapes. 

Finally, the Exchange currently 

provides a credit of $0.0020 per share 

executed for securities in Tapes A and 

B and $0.0015 per share executed for 

securities in Tape C for all other 

displayed quotes/orders that provide 

liquidity to the Exchange. The Exchange 

proposes to reduce the amount of this 

credit to $0.0018 per share executed for 

securities in Tapes A and B, and to 

$0.0013 per share executed for 

securities in Tape C. 

Elimination of Two Credits for NonDisplayed Orders (Other Than 

Supplemental Orders) That Provide 

Liquidity to the Exchange 

The Exchange proposes to eliminate 

two credits for non-displayed orders 

(other than Supplemental orders) that 

provide liquidity to the Exchange. 

Presently, the Exchange provides a 

credit of $0.0019 per share executed for 

securities in Tapes and B [sic], and 

$0.0013 per share executed for 

securities in Tape C, to a member with 

midpoint orders (excluding buy (sell) 

orders with Midpoint pegging that 

receive an execution price that is lower 

(higher) than the midpoint of the NBBO) 

if the member (i) executes a combined 

volume of 1 million or more shares in 

midpoint orders provided and M–ELO 

executed during the month through one 

or more of its Nasdaq Market Center 

MPIDs and (ii) has a 10% or greater 

increase in midpoint orders provided 

and M–ELO executed through one or 

more of its Nasdaq Market Center MPIDs 

during the month over the month of 

April 2019. The Exchange proposes to 

eliminate this credit. 

The Exchange also provides a credit 

of $0.00125 per share executed for 

securities in Tapes A and B, and 

$0.0010 per share executed for 

securities in Tape C, to a member with 

other non-displayed orders if the 

member, during the month (i) provides 

0.30% or more of Consolidated Volume 

through non-displayed orders 

(including midpoint orders) and 

through M–ELO Orders; and (ii) 

increases providing liquidity through 

non-displayed orders (including 

midpoint orders) and through M–ELO 

Orders by 0.10% or more as a 

percentage of Consolidated Volume 

relative to the member’s August 2020 

Consolidated Volume provided through 

non-displayed orders (including 

midpoint orders) and through M–ELO. 

The Exchange also proposes to 

eliminate this credit. 

The Exchange proposes to eliminate 

these two credits because the baseline 

months for the growth elements of these 

tiers—April 2019 and August 2020—are 

no longer relevant benchmarks, as 

substantial increases in trading volumes 

have occurred since times. As such, 

these credits no longer provide growth 

incentives that are aligned with the 

Exchange’s needs. Again, the Exchange 

has limited resources to devote to 

incentive programs, and it is 

appropriate for the Exchange to 

reallocate these incentives periodically 

in a manner that best achieves the 

Exchange’s overall mix of objectives. 

Adjustment to Existing Credits and 

Addition of New Credit for NonDisplayed Orders (Other Than 

Supplemental Orders) That Provide 

Liquidity to the Exchange 

The Exchange proposes to adjust and 

add to a series of credits that the 

Exchange presently offers to members 

that either grow the extent of their 

volumes of M–ELO or midpoint orders 

relative to a baseline month or execute 

a substantial number of such orders on 

the Exchange during the month. 

Presently, the Exchange provides a 

credit of $0.0001 per share executed to 


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36564 Federal Register / Vol. 87, No. 117 / Friday, June 17, 2022 / Notices 

6The proposed rule change is similar to the 

formatting and organization changes made to the 

Exchange’s sister exchange, Nasdaq BX, Inc., in 

2019. See Securities Exchange Act Release No. 

85912 (May 22, 2019); 84 FR 24834 (May 29, 2019) 

(SR–BX–2019–013). 

a member, through one or more of its 

Nasdaq Market Center MPIDs, either: (i) 

increases the extent of its ADV of M– 

ELO Orders and/or midpoint orders 

(that execute against M–ELO Orders) in 

all securities by an ADV of 1 million 

shares or more during the month 

relative to the month of June 2021; or 

(ii) executes a combined volume of at 

least 3 million shares ADV through 

midpoint orders provided and M–ELO 

Orders during the month and increases 

the extent of its ADV of midpoint orders 

provided and M–ELO Orders in all 

securities by 100% or more during the 

month relative to the month of June 

2021. Alternatively, the Exchange 

provides a credit of $0.00015 per share 

executed to a member which, through 

one or more of its Nasdaq Market Center 

MPIDs, either: (i) increases the extent of 

its ADV of M–ELO Orders and/or 

midpoint orders (that execute against 

M–ELO Orders) in all securities by an 

ADV of 2 million shares or more during 

the month relative to the month of June 

2021; or (ii) executes a combined 

volume of at least a 4 million shares 

ADV through midpoint orders provided 

and M–ELO Orders during the month 

and increases the extent of its ADV of 

midpoint orders provided and M–ELO 

Orders in all securities by 150% or more 

during the month relative to the month 

of June 2021. The Exchange proposes to 

lower first of these credits from $0.0001 

to $0.00005 per share executed and 

lower the second of these credits from 

$0.00015 to $0.00010 per share 

executed. 

Next, the Exchange proposes to add a 

new credit of $0.0015 per share 

executed for a member that, through one 

or more of its Nasdaq Market Center 

MPIDs, executes a combined volume of 

at least a 5 million shares ADV through 

midpoint orders provided and M–ELO 

Orders during the month. This new 

proposed credit will not be combinable 

with the other two existing credits. 

Together, the adjustments to the two 

existing credits, and the addition of the 

third, will re-align existing incentives 

for members to grow or add M–ELO or 

midpoint liquidity while introducing a 

new incentive for members to add even 

larger volumes of M–ELO and midpoint 

orders during the month to attain the 

highest existing level of credits. To the 

extent that the Exchange succeeds 

through these proposals in increasing 

the addition of midpoint or M–ELO 

liquidity or executions on the Exchange, 

all participants will benefit from the 

increase in market quality. 

Additionally, and as part of the 

reorganization described below, the 

Exchange proposes to relocate the two 

existing credits and the new credit in 

the section of the schedule entitled 

‘‘Supplemental credit to member for 

displayed quotes/orders (other than 

Supplemental Orders or Designated 

Retail Orders) that provide liquidity (per 

share executed.’’ The Exchange believes 

that the three credits are, in fact, 

supplemental credits and belong 

logically in that section of the schedule. 

Finally, for ease of reference, the 

Exchange proposes to refer to these 

three credits as ‘‘M–ELO Supplemental 

Credits,’’ and label them M–ELO 

Supplemental Credit A ($0.00005), B 

($0.0001), and C ($0.00015), 

respectively. 

Elimination of Supplemental Credit for 

Certain Midpoint Orders 

Presently, the Exchange provides a 

supplemental credit for midpoint orders 

(excluding buy (sell) orders with 

midpoint pegging that receive an 

execution price that is lower (higher) 

than the midpoint of the NBBO). A 

member currently receives a credit of 

either: (a) $0.0001 per share executed 

for orders in securities in all three Tapes 

if the member, during the month (i) 

provides at least 15 million shares of 

midpoint liquidity per day during the 

month and (ii) increases providing 

liquidity through midpoint orders by 

10% or more relative to the member’s 

May 2021 ADV provided through 

midpoint orders; or (b) $0.0002 per 

share executed for orders in securities in 

all three Tapes if the member, during 

the month (i) provides at least 15 

million shares of midpoint liquidity per 

day during the month; and (ii) increases 

providing liquidity through midpoint 

orders by 30% or more relative to the 

member’s May 2021 ADV provided 

through midpoint orders. The Exchange 

proposes to eliminate the $0.001 per 

share executed credit but retain the 

$0.0002 per share executed credit. 

The Exchange proposes to eliminate 

the credit because many members now 

readily meet the volume requirements to 

qualify for it, such that the credit in 

many cases rewards these members for 

remaining static in their activity on the 

Exchange. By eliminating the lower of 

these two credits, the Exchange wishes 

to incent such members to strive to 

qualify for the higher credit by further 

increasing the extent to which they add 

liquidity to the Exchange. 

Reorganization and Re-Formatting of 

Exchange’s Schedule of Transaction 

Credits and Charges 

In addition to the above changes to 

the substance of the Exchange’s 

schedule of credits and fees, at Equity 

7, Section 118(a), the Exchange also 

proposes non-substantive amendments 

to the schedule that will re-organize and 

re-format it to render it shorter, better 

and more logically organized, and easier 

to read and comprehend. 

Most notably, the Exchange proposes 

to consolidate the schedule of charges 

and fees and restate it as a single chart. 

Presently, the Rule lists the contents of 

the schedule three times successively— 

once for securities in Tape A, once for 

securities in Tape B, and once for 

securities in Tape C. This format is 

cumbersome for participants to read and 

onerous for the Exchange to maintain. 

The proposed amendments will shorten 

and simplify the schedule by listing all 

of the Exchange’s transaction credits 

and charges one time. It will do so by 

reformatting the schedule into a chart 

with rows listing each tier of credit/ 

charge and columns listing the 

applicable amounts of those credits/ 

charges for transactions in securities in 

each of the three Tapes. In the proposed 

amended and restated schedule, when a 

credit or charge does not apply to 

securities in a particular Tape, the chart 

will so indicate with the term ‘‘N/A.’’ 6

The Exchange also proposes to reformat and emphasize in bold type the 

headings for the credits and fees that 

comprise the schedule so that members 

can distinguish these sections more 

easily. The proposal will simplify the 

schedule by removing redundant 

explanatory text, such as the phrase 

‘‘per share executed’’ for each credit/ 

charge (the headings of the chart already 

indicate that all credits and charges 

apply on a per share executed basis), 

‘‘charge to . . .’’ (as the headings of the 

schedule already state where they are 

charges and credits), and ‘‘in additional 

to the credits provided for . . .’’ (which 

is not needed for credits already under 

the heading ‘‘Supplemental credit to 

member . . .’’). 

The proposed amendments will 

consolidate existing definitions of 

certain terms used within Section 118(a) 

into a single bulleted definitions 

paragraph at the outset of the Rule, 

including the terms ‘‘ADV’’ (or 

‘‘Average Daily Volume’’), 

‘‘Consolidated Volume,’’ and 

‘‘Designated Retail Order.’’ The proposal 

will not make any substantive changes 

to the meanings of these terms. 

The proposal will also re-format 

aspects of the schedule where presently, 

multiple credits and charges are listed 

in the same cells, and are thus difficult 

to read. For example, the proposed rule 


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

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

9NetCoalition 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)). 

will separate the single cells listing a 

‘‘charge or credit to [a] member entering 

TFTY, MOPB, MOPP, SAVE, SOLV, 

CART, QDRK, QCST or directed order 

that executes in a venue other than the 

Nasdaq Market Center’’ into multiple 

rows corresponding to each of them 

individually. 

Additionally, the proposal will amend 

the existing line item entitled ‘‘Credit to 

other members’’ by retitling it ‘‘Credit 

for all other displayed quotes/order that 

provide liquidity (per share executed).’’ 

This proposal will clarify that this credit 

applies to members for all other 

displayed quotes/orders not otherwise 

covered by all of the preceding credits 

for displayed quotes or orders that 

provide liquidity to the Exchange 

(rather than a subset thereof). 

The Exchange will relocate several 

charges and credits that are either 

misplaced or logically belong in other 

sections of the schedule. For example, 

in the section entitled ‘‘Charge to enter 

orders that execute in the Nasdaq 

Market Center,’’ the Exchange proposes 

to move the $0.0030 per share executed 

credit for ‘‘all other orders that execute 

in the Nasdaq Market Center’’ to the end 

of the section, as it is a baseline charge 

absent the availability of discounted 

charges. Additionally, the Exchange 

proposes to move from the displayed 

credits section of the schedule to the 

section listing supplemental credits for 

displayed orders/quotes that provide 

liquidity (other than Supplemental 

orders or Designated Retail Orders) the 

following three credits, as these credits 

logically are supplemental, rather than 

regular credits: (a) a $0.0005 per share 

executed credit for securities in Tape B 

for a member with shares of liquidity 

provided in all securities through one or 

more of its Nasdaq Market Center MPIDs 

that represent at least 1.75% of 

Consolidated Volume, including shares 

of liquidity provided with respect to 

securities that are listed on exchanges 

other than Nasdaq or NYSE that 

represent at least 0.60% of Consolidated 

Volume; (b) a $0.0001 per share 

executed credit for securities in Tape B 

for a member with shares of liquidity 

provided in securities that are listed on 

exchanges other than Nasdaq or NYSE 

during the month representing at least 

0.10% of Consolidated Volume through 

one or more of its Nasdaq Market Center 

MPIDs; and (c) a $0.0005 per share 

executed credit for securities in Tape A 

for a member with shares of liquidity 

provided in Tape A securities through 

one or more of its Nasdaq Market Center 

MPIDs that represent at least 0.75% of 

Consolidated Volume, and shares of 

liquidity provided in Tape B securities 

through one or more of its Nasdaq 

Market Center MPIDs that represent at 

least 0.60% of Consolidated Volume. 

Similarly, the Exchange proposes to 

relocate to the regular displayed credits 

section of the schedule two credits that 

are misplaced now in the supplemental 

credits section: (a) a $0.0026 per share 

executed credit for securities in all 

Tapes to a member that, through one or 

more of its Nasdaq Market Center 

MPIDs: (i) provides shares of liquidity 

in all securities that represent equal to 

or greater than 0.15% of Consolidated 

Volume; (ii) increases the extent to 

which it provides liquidity in all 

securities as a percentage of 

Consolidated Volume by 20% or more 

during the month relative to the month 

of May 2021; and (iii) has a ratio of at 

least 50% NBBO liquidity provided (as 

defined in Equity 7, Section 114(g)) to 

liquidity provided by displayed quotes/ 

orders (other than Supplemental Orders 

or Designated Retail Orders) during the 

month; and (b) a $0.0027 per share 

executed credit for securities in all 

Tapes to a member that, through one or 

more of its Nasdaq Market Center 

MPIDs: (i) provides shares of liquidity 

in all securities that represent equal to 

or greater than 0.20% of Consolidated 

Volume; (ii) increases the extent to 

which it provides liquidity in all 

securities as a percentage of 

Consolidated Volume by 35% or more 

during the month relative to the month 

of May 2021; and (iii) has a ratio of at 

least 60% NBBO liquidity provided (as 

defined in Equity 7, Section 114(g)) to 

liquidity provided by displayed quotes/ 

orders (other than Supplemental Orders 

or Designated Retail Orders) during the 

month. Finally, the Exchange proposes 

to relocate to the section entitled 

‘‘Supplemental credit to member for 

displayed quotes/orders (other than 

Supplemental Orders) that provide 

liquidity (per share executed) the 

following credit, which was also 

misplaced in error: a $0.0005 per share 

executed credit for securities in Tape B 

to a member with shares of liquidity 

provided in securities that are listed on 

exchanges other than Nasdaq or NYSE 

during the month representing at least 

0.10% of Consolidated Volume through 

one or more of its Nasdaq Market Center 

MPIDs. 

Other non-substantive changes 

include correcting current 

inconsistencies in terminology, 

capitalizing defined terms, decapitalizing undefined terms, and decapitalizing the first word in the row. 

Misspellings of certain terms, including 

‘‘RTFY,’’ ‘‘TFYY,’’ and ‘‘MELO,’’ will be 

corrected to ‘‘RFTY,’’ ‘‘TFTY,’’ and ‘‘M– 

ELO,’’ respectively. The proposal also 

reconciles terminological 

inconsistencies among the three existing 

statements of the schedule, e.g., 

‘‘nondisplayed’’ and ‘‘non-displayed’’, 

and ‘‘of’’ and ‘‘of which.’’ The proposal 

also duly capitalizes the defined terms 

‘‘Order,’’ ‘‘Customer,’’ and ‘‘Market 

Hours.’’ 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,7 in general, and furthers the 

objectives of Section 6(b)(5) of the Act,8

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. 

The proposal is also consistent with 

Section 11A of the Act relating to the 

establishment of the national market 

system for securities. 

The Proposals are Reasonable, an 

Equitable Allocation of Fees, and are not 

Unfairly Discriminatory 

The Exchange’s proposals are 

reasonable in several respects. As a 

threshold matter, the Exchange is 

subject to significant competitive forces 

in the market for equity securities 

transaction services that constrain its 

pricing determinations in that market. 

The fact that this market is competitive 

has long been recognized by the courts. 

In NetCoalition v. Securities and 

Exchange Commission, the D.C. Circuit 

stated as follows: ‘‘[n]o one disputes 

that competition for order flow is 

‘fierce.’ . . . As the SEC explained, ‘[i]n 

the U.S. national market system, buyers 

and sellers of securities, and the brokerdealers 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’ . . . .’’ 9

The Commission and the courts have 

repeatedly expressed their preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, while 

adopting a series of steps to improve the 

current market model, the Commission 

highlighted the importance of market 


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36566 Federal Register / Vol. 87, No. 117 / Friday, June 17, 2022 / Notices 

10Securities Exchange Act Release No. 51808 

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

(‘‘Regulation NMS Adopting Release’’). 

forces in determining prices and SRO 

revenues and, also, recognized that 

current regulation of the market system 

‘‘has been remarkably successful in 

promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 10

Numerous indicia demonstrate the 

competitive nature of this market. For 

example, clear substitutes to the 

Exchange exist in the market for equity 

security transaction services. The 

Exchange is only one of several equity 

venues to which market participants 

may direct their order flow. Competing 

equity exchanges offer similar tiered 

pricing structures to that of the 

Exchange, including schedules of 

rebates and fees that apply based upon 

members achieving certain volume 

thresholds. The Exchange is also subject 

to intense competition for retail order 

flow with off-exchange competitors, 

including wholesale market makers. 

The Exchange believes it is 

reasonable, equitable, and not unfairly 

discriminatory to eliminate the Nasdaq 

Growth Program because the Program 

has not been successful in inducing 

members to grow materially the extent 

to which they add liquidity to the 

Exchange over time. The Exchange has 

limited resources to allocate to incentive 

programs like this one and it must, from 

time to time, reallocate those resources 

to maximize their net impact on the 

Exchange, market quality, and 

participants. Going forward, the 

Exchange plans to reallocate the 

resources it devotes to the Nasdaq 

Growth Program to other incentive 

programs that it hopes will be more 

impactful. 

It is also reasonable, equitable, and 

not unfairly discriminatory for the 

Exchange to adjust several existing 

credits for displayed quotes/orders 

(other than Supplemental Orders or 

Designated Retail Orders) that provide 

liquidity to the Exchange. These 

adjustments will recalibrate the credits 

to account for changes in member 

behavior over time that have rendered 

the credits less challenging for members 

to attain. That is, the Exchange proposes 

to reduce the amount of the credits 

because many members now readily 

meet the volume requirements to qualify 

for them, such that the credits in many 

cases reward these members for 

remaining static in their activity on the 

Exchange. By reducing the amount of 

these credits, the Exchange wishes to 

incent such members to strive to qualify 

for higher available credits by further 

increasing the extent to which they add 

liquidity to the Exchange. 

It is reasonable, equitable, and not 

unfairly discriminatory for the Exchange 

to eliminate two credits for nondisplayed orders (other than 

Supplemental orders) that provide 

liquidity to the Exchange. The baseline 

months for the growth elements of these 

tiers—April 2019 and August 2020—are 

no longer relevant benchmarks, as 

substantial increases in trading volumes 

have occurred since these dates. As 

such, these credits no longer provide 

growth incentives that are aligned with 

the Exchange’s needs. Again, the 

Exchange has limited resources to 

devote to incentive programs, and it is 

appropriate for the Exchange to 

reallocate these incentives periodically 

in a manner that best achieves the 

Exchange’s overall mix of objectives. 

It is reasonable, equitable, and not 

unfairly discriminatory for the Exchange 

to lower two existing credits for 

members that add or grow the extent to 

which they add midpoint or M–ELO 

liquidity to the Exchange, as well as add 

a new such credit. Together, the 

adjustments to the two existing credits, 

and the addition of the third, will realign existing incentives for members to 

grow or add M–ELO or midpoint 

liquidity while introducing a new 

incentive for members to add even 

larger volumes of M–ELO and midpoint 

orders during the month to attain the 

highest existing level of credits. To the 

extent that the Exchange succeeds 

through these proposals in increasing 

the addition of midpoint or M–ELO 

liquidity or executions on the Exchange, 

all participants will benefit from the 

increase in market quality. 

Furthermore, it is reasonable, 

equitable, and not unfairly 

discriminatory for the Exchange to 

eliminate one of its supplemental 

credits for midpoint orders (excluding 

buy (sell) orders with midpoint pegging 

that receive an execution price that is 

lower (higher) than the midpoint of the 

NBBO). Many members now readily 

meet the volume requirements to qualify 

for this credit, such that it rewards these 

members for remaining static in their 

activity on the Exchange. By eliminating 

the lower of these two credits, the 

Exchange wishes to incent such 

members to strive to qualify for the 

higher credit by further increasing the 

extent to which they add liquidity to the 

Exchange. 

The Exchange notes that the credits 

affected by this proposal are voluntary. 

Moreover, nothing about the Exchange’s 

volume-based tiered pricing model, as 

set forth in Equity 7, is inherently 

unfair; instead, it is a rational pricing 

model that is well-established and 

ubiquitous in today’s economy among 

firms in various industries—from cobranded credit cards to grocery stores to 

cellular telephone data plans—that use 

it to reward the loyalty of their best 

customers that provide high levels of 

business activity and incent other 

customers to increase the extent of their 

business activity. It is also a pricing 

model that the Exchange and its 

competitors have long employed with 

the assent of the Commission. It is fair 

because it enhances price discovery and 

improves the overall quality of the 

equity markets. 

Those participants that are 

dissatisfied with the elimination of the 

Nasdaq Growth Program or the 

amendments to the Exchange’s schedule 

of credits are free to shift their order 

flow to competing venues that provide 

more generous incentives or less 

stringent qualifying criteria. 

Finally, the Exchange believes that it 

is reasonable to re-organize, re-format, 

and re-state its schedule of credits and 

charges, Equity 7, Section 118(a). As 

noted above, the existing schedule is 

needlessly long, complex, and 

repetitive, and it contains unintended 

inconsistencies in terminology and 

capitalization, as well as several 

typographical errors. The Exchange 

believes that its proposals to address 

these issues will render the schedule 

shorter, simpler, more consistent, better 

and more logically organized, and more 

readable, to the benefit of investors, 

participants, and the public. It will also 

ease the burden to the Exchange of 

administering the schedule when it 

proposes to make substantive changes 

thereto, as it will no longer need to 

make three amendments to the schedule 

to accomplish a single change. The 

Exchange does not intend for the 

reorganization, reformatting, or 

restatement of the schedule to 

themselves effect any substantive 

changes to existing credits or charges. 

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 Exchange does not believe that its 

proposals will place any category of 

Exchange participant at a competitive 

disadvantage. 

As noted above, the Exchange’s 

intends for its proposed substantive 

changes to its credits to reallocate its 

limited resources more efficiently and 


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Federal Register / Vol. 87, No. 117 / Friday, June 17, 2022 / Notices 36567 

11 15 U.S.C. 78s(b)(3)(A)(ii). 12 17 CFR 200.30–3(a)(12). 

for optimized effect, to recalibrate them 

to reflect changing market behavior, and 

to align them with the Exchange’s 

overall mix of objectives. The Exchange 

notes that its members are free to trade 

on other venues to the extent they 

believe that these proposals are not 

attractive. As one can observe by 

looking at any market share chart, price 

competition between exchanges is 

fierce, with liquidity and market share 

moving freely between exchanges in 

reaction to fee and credit changes. 

Intermarket Competition 

In terms of inter-market competition, 

the Exchange notes that it operates in a 

highly competitive market in which 

market participants can readily favor 

competing venues if they deem fee 

levels at a particular venue to be 

excessive, or rebate opportunities 

available at other venues to be more 

favorable. In such an environment, the 

Exchange must continually adjust its 

credits and fees to remain competitive 

with other exchanges and with 

alternative trading systems that have 

been exempted from compliance with 

the statutory standards applicable to 

exchanges. Because competitors are free 

to modify their own credits and fees in 

response, and because market 

participants may readily adjust their 

order routing practices, the Exchange 

believes that the degree to which credit 

or fee changes in this market may 

impose any burden on competition is 

extremely limited. The proposals are 

reflective of this competition. 

Even as one of the largest U.S. 

equities exchanges by volume, the 

Exchange has less than 20% market 

share, which in most markets could 

hardly be categorized as having enough 

market power to burden competition. 

Moreover, as noted above, price 

competition between exchanges is 

fierce, with liquidity and market share 

moving freely between exchanges in 

reaction to fee and credit changes. This 

is in addition to free flow of order flow 

to and among off-exchange venues, 

which comprises upwards of 50% of 

industry volume. 

In sum, if the change proposed herein 

is unattractive to market participants, it 

is likely that the Exchange will lose 

market share as a result. Accordingly, 

the Exchange does not believe that the 

proposed change will impair the ability 

of members or competing order 

execution venues to maintain their 

competitive standing in the financial 

markets. 

Finally, the Exchange does not believe 

that its proposal to re-organize, reformat, and re-state its schedule of 

credits and fees, at Equity 7, Section 

118(a), will have any impact on 

competition, as it will merely render the 

schedule shorter, simpler, more 

consistent, better and more logically 

organized, and more readable, to the 

benefit of investors, participants, and 

the public. It will also ease the burden 

to the Exchange of administering the 

schedule when it proposes to make 

substantive changes thereto, as it will no 

longer need to make three amendments 

to the schedule to accomplish a single 

change. The Exchange does not intend 

for the reorganization, reformatting, or 

restatement of the schedule to 

themselves effect any substantive 

changes to existing credits or charges. 

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.11

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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NASDAQ–2022–036 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–10 

All submissions should refer to File 

Number SR–NASDAQ–2022–036. 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–2022–036 and 

should be submitted on or before July 8, 

2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–13039 Filed 6–16–22; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #17487 and #17488; 

NEW MEXICO Disaster Number NM–00081] 

Presidential Declaration of a Major 

Disaster for Public Assistance Only for 

the State of New Mexico 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a Notice of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the State of New Mexico (FEMA–4652– 

DR), dated 06/08/2022. 


lotter on DSK11XQN23PROD with NOTICES1