Federal Register / Vol. 75, No. 100 / Tuesday, May 25, 2010 / Notices 29381 

57 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

competition that is not necessary or 

appropriate in furtherance of the 

purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(A) By order approve such proposed 

rule change, or 

(B) Institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

The Commission is considering 

granting accelerated approval of the 

proposed rule change at the end of a 15- 

day comment period. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

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

Number SR–C2–2010–002 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–C2–2010–002. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street, NE., 

Washington, DC 20549, on official 

business days between the hours of 10 

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

also will be available for inspection and 

copying at the principal office of the C2. 

All comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–C2–2010–002 and should 

be submitted on or before June 9, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.57

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–12507 Filed 5–24–10; 8:45 am] 

BILLING CODE 8010–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–62117; File No. SR–ISE– 

2010–34] 

Self-Regulatory Organizations; 

International Securities Exchange, 

LLC; Notice of Filing of Proposed Rule 

Change Relating to Fees for the ISE 

Order Feed 

May 18, 2010. 

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

Securities Exchange Act of 1934 (the 

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

notice is hereby given that on May 11, 

2010, the International Securities 

Exchange, LLC (the ‘‘Exchange’’ or the 

‘‘ISE’’) filed with the Securities and 

Exchange Commission the proposed 

rule change as described in Items I, II, 

and III below, which items have been 

prepared by the self-regulatory 

organization. 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 ISE is proposing to amend its 

Schedule of Fees to adopt subscription 

fees for the sale of a new market data 

offering called the ISE Order Feed. The 

text of the proposed rule change is 

available on the Exchange’s Web site 

(http://www.ise.com), 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 

self-regulatory organization 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 self-regulatory organization 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 

ISE proposes to amend its Schedule of 

Fees to adopt subscription fees for the 

sale of the ISE Order Feed. These 

proposed fee changes will be operative 

on July 1, 2010, pending regulatory 

approval. 

The ISE Order Feed provides realtime updates every time a new limit 

order that is not immediately executable 

at the best bid/offer (BBO) is placed on 

the ISE order book. This feed does not 

include market orders, immediate or 

cancel (IOC) orders, quotes or any nondisplayed interest. 

While the Options Price Reporting 

Authority (OPRA) feed provides 

aggregated ISE BBO order information, 

the ISE Order Feed provides each 

individual order. The information 

included on the ISE Order Feed 

includes the order type (buy/sell), the 

order price, the order size, and customer 

indicator (which reflects whether the 

order is a customer order), as well as 

details for each instrument series, 

including the symbols (series and 

underlying security), put or call 

indicator, the expiration and the strike 

price of the series. 

The ISE BBO on the OPRA feed 

includes all quotes provided by ISE 

market makers and all orders provided 

by members which are then aggregated 


srobinson on DSKHWCL6B1PROD with NOTICES
29382 Federal Register / Vol. 75, No. 100 / Tuesday, May 25, 2010 / Notices 

3A ‘‘distributor’’ is any firm that receives the ISE 

Order Feed directly from ISE or indirectly through 

a ‘‘redistributor’’ and then distributes it either 

internally or externally. All distributors will be 

required by the Exchange to execute an ISE 

distributor agreement. ‘‘Redistributors’’ include 

market data vendors and connectivity providers 

such as extranets and private network providers. 

4A ‘‘controlled device’’ is as any device that a 

distributor of the ISE Order Feed permits to access 

the information in the ISE Order Feed. 

5 15 U.S.C. 78f. 

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

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

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

9See Securities Exchange Act Release No. 57917 

(Dec. 2, 2008) (‘‘NetCoalition Order’’ resolving File 

No. SR–NYSEArca–2006–21). 

10 Id. at 48–49. 

11 Id. at 4. 

12 Id. at 51–65. The Commission then spent an 

additional 36 pages (65–101) analyzing and refuting 

comments challenging the Commission’s 

competition analysis. 

at the BBO. The ISE Order Feed, on the 

other hand, includes each individual 

limit order rather than only the 

aggregated volume of all orders. The ISE 

Order Feed does not include quote 

traffic, which will result in much less 

data for subscribers to process and less 

bandwidth than feeds that provide 

aggregated quotes and orders. 

The Exchange currently does not 

charge fees for the ISE Order Feed. This 

market data offering will be made 

available to both members and nonmembers on a subscription basis. The 

Exchange proposes to charge 

distributors 3 of the ISE Order Feed (i) 

$2,000 per month and will not charge 

distributors a monthly fee per controlled 

device 4 as long the ISE Order Feed is for 

internal use only, (ii) $2,000 per month 

and $10 per external controlled device 

per month (a) if the ISE Order Feed is 

redistributed externally by a subscriber, 

or (b) if the ISE Order Feed is 

redistributed internally and externally. 

For subscribers who redistribute the ISE 

Order Feed externally, or redistribute 

the ISE Order Feed internally and 

externally, the Exchange proposes to 

limit for any one month the combined 

maximum amount of fees payable to 

$2,500. For example, a firm that 

subscribes to the ISE Order Feed and 

then redistributes it to 40 clients will 

pay $2,400 per month ($2,000 for the 

feed and $400 for the controlled device 

($10 × 40)). If that same firm 

redistributes the data to 100 clients, the 

fee for that firm will be capped at 

$2,500, resulting in a savings of $500. 

2. Statutory Basis 

The basis under the Securities 

Exchange Act of 1934 (the ‘‘Exchange 

Act’’) for this proposed rule change is 

the requirement under Section 6(b)(4), 

that an exchange have an equitable 

allocation of reasonable dues, fees and 

other charges among its members and 

other persons using its facilities. The 

Exchange believes introduction of the 

new product will provide market 

participants with an opportunity to 

obtain additional data in furtherance of 

their investment decisions. 

The Exchange believes that the 

proposed rule change is consistent with 

the provisions of Section 6 of the Act,5

in general, and with Sections 6(b)(4) of 

the Act,6 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 or system 

which ISE operates or controls. 

The Exchange believes that the 

proposed rule change is also consistent 

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

the Act,7 in that it is designed to 

promote just and equitable principles of 

trade, to foster cooperation and 

coordination with persons engaged in 

regulating, clearing, settling, processing 

information with respect to, and 

facilitating transactions in securities, to 

remove impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest; and is not designed to 

permit unfair discrimination between 

customers, issuers, brokers, or dealers, 

or to regulate by virtue of any authority 

conferred by the Act matters not related 

to the purposes of the Act or the 

administration of the Exchange. 

The Exchange believes that the 

proposed rule change is also consistent 

with Section 6(b)(8) of the Act 8 in that 

it does not impose any burden on 

competition not necessary or 

appropriate in furtherance of the 

purposes of the Act, as set forth in more 

detail below. 

In adopting Regulation NMS, the 

Commission granted self-regulatory 

organizations and broker-dealers 

increased authority and flexibility to 

offer new and unique market data to the 

public. It was believed that this 

authority would expand the amount of 

data available to consumers, and also 

spur innovation and competition for the 

provision of market data. 

The Commission has recently issued 

an order firmly establishing that in 

reviewing non-core data products such 

as the ISE Order Feed, the Commission 

will utilize a market-based approach 

that relies primarily on competitive 

forces to determine the terms on which 

non-core data is made available to 

investors.9 The Commission adopted a 

two-part test: 

The first is to ask whether the exchange 

was subject to significant competitive forces 

in setting the terms of its proposal for noncore data, including the level of any fees. If 

an exchange was subject to significant 

competitive forces in setting the terms of a 

proposal, the Commission will approve the 

proposal unless it determines that there is a 

substantial countervailing basis to find that 

the terms nevertheless fail to meet an 

applicable requirement of the Exchange Act 

or the rules thereunder. If, however, the 

exchange was not subject to significant 

competitive forces in setting the terms of a 

proposal for non-core data, the Commission 

will require the exchange to provide a 

substantial basis, other than competitive 

forces, in its proposed rule change 

demonstrating that the terms of the proposal 

are equitable, fair, reasonable, and not 

unreasonably discriminatory.10

This standard begins from the premise 

that no Commission rule requires 

exchanges or market participants either 

to distribute non-core data to the public 

or to display non-core data to 

investors.11

In its NetCoalition Order the 

Commission concluded that ‘‘at least 

two broad types of significant 

competitive forces applied to NYSE 

Arca in setting the terms of its proposal 

to distribute the ArcaBook data: (1) 

NYSE Arca’s compelling need to attract 

order flow from market participants; 

and (2) the availability to market 

participants of alternatives to 

purchasing the ArcaBook data. The 

Commission conducted an exhaustive 

14-page review of these two competitive 

forces before concluding that the 

availability of alternatives, as well as the 

compelling need to attract order flow, 

imposed significant competitive 

pressure on that exchange’s need to act 

equitably, fairly, and reasonably in 

setting the terms of the fees for its noncore data product.12

The market data provided in the ISE 

Order Feed is non-core data that is 

governed by the same analysis the 

Commission set forth in the 

NetCoalition Order. As with the NYSE 

Arca depth-of-book product, no rules 

require ISE or any other exchange to 

offer this data; nor are vendors required 

to purchase or display this data. 

Additionally, ISE is constrained by 

the same two competitive forces in the 

options market as the Commission 

found was present in the NetCoalition 

Order. First, ISE has a compelling need 

to attract order flow from market 

participants in order to maintain its 

share of trading volume. This 

compelling need to attract order flow 

imposes significant pressure on ISE to 

act reasonably in setting the fees for its 

market data offerings, particularly given 

that the market participants that will 

pay such fees often will be the same 


srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 75, No. 100 / Tuesday, May 25, 2010 / Notices 29383 

13See Securities Exchange Act Release No. 61878 

(April 8, 2010), 75 FR 20023 (April 16, 2010) (SR– 

PHLX–2010–48). 

14 Id. 

15NetCoalition Order at 63. 

16The text of the proposed rule change is 

available on the Commission’s Web site at http:// 

www.sec.gov/rules/sro.shtml. 

17 17 CFR 200.30–3(a)(12). 

market participants from whom ISE 

must attract order flow. These market 

participants include broker-dealers that 

control the handling of a large volume 

of customer and proprietary order flow. 

Given the portability of order flow from 

one exchange to another, any exchange 

that sought to charge unreasonably high 

market data fees would risk alienating 

many of the same customers on whose 

orders it depends for competitive 

survival. 

Second, the Exchange is constrained 

in pricing the ISE Order Feed by the 

availability to market participants of 

alternatives to purchasing ISE’s market 

data offerings. ISE must consider the 

extent to which market participants 

would choose one or more alternatives 

instead of purchasing the exchange’s 

data. Other exchanges, including some 

who may enjoy greater market share 

than ISE, are potential competitors as 

they too sell similar market data 

offerings that market participants may 

choose to purchase instead. For 

example, NASDAQ OMX PHLX 

(‘‘PHLX’’) has filed a proposed rule 

change to adopt fees for a market data 

product that includes a data feed that is 

similar to the ISE Order Feed.13 The 

PHLX’ Specialized Order Feed, which 

PHLX has proposed to integrate into its 

TOPO Plus Orders market data offering, 

includes ‘‘real-time information to keep 

track of single order book(s).’’ 14 Further, 

the NetCoalition Order notes that one of 

the principal market data reforms 

adopted by the Commission was to 

authorize the independent distribution 

of data by broker/dealers. If one or more 

broker/dealers determine that the cost of 

subscribing to the ISE Order Feed is too 

high, they are entitled to independently 

distribute their own order data and may 

do so with or without charging a fee.15

In the aftermath of the NetCoalition 

Order, the Exchange believes that the 

competition among exchanges for order 

flow and the competition among 

exchanges for market data products 

subject ISE’s proposed market data 

offerings to significant competitive 

forces. In addition, the Exchange 

believes that no substantial 

countervailing basis exists to support a 

finding that the proposed fees fail to 

meet the requirement of the Act. In sum, 

the availability of alternative sources of 

information impose significant 

competitive pressures on the ISE Order 

Feed and ISE’s compelling need to 

attract order flow impose significant 

competitive pressure on the Exchange to 

act equitably, fairly, and reasonably in 

setting its fees. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The proposed rule change does not 

impose any burden on competition that 

is not necessary or appropriate in 

furtherance of the purposes of the Act. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants or Others 

The Exchange has not solicited, and 

does not intend to solicit, comments on 

this proposed rule change. The 

Exchange has not received any 

unsolicited written comments from 

members or other interested parties. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Within 35 days of the date of 

publication of this notice in the Federal 

Register or within such longer period (i) 

as the Commission may designate up to 

90 days of such date if it finds such 

longer period to be appropriate and 

publishes its reasons for so finding or 

(ii) as to which the self-regulatory 

organization consents, the Commission 

will: 

(a) By order approve such proposed 

rule change, or 

(b) Institute proceedings to determine 

whether the proposed rule change 

should be disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s Internet 

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

rules/sro.shtml); or 

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

Number SR–ISE–2010–34 on the subject 

line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street, NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–ISE–2010–34. This file 

number should be included on the 

subject line if e-mail is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

Internet Web site (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission,16 all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for Web site viewing and 

printing in the Commission’s Public 

Reference Room, on official business 

days between the hours of 10 a.m. and 

3 p.m. Copies of the filing also will be 

available for inspection and copying at 

the principal office of the Exchange. All 

comments received will be posted 

without change; the Commission does 

not edit personal identifying 

information from submissions. You 

should submit only information that 

you wish to make available publicly. All 

submissions should refer to File 

Number SR–ISE–2010–34 and should be 

submitted on or before June 15, 2010. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. 2010–12506 Filed 5–24–10; 8:45 am] 

BILLING CODE 8010–01–P 

DEPARTMENT OF TRANSPORTATION 

Office of the Secretary 

[Docket No. DOT–OST–2010–0076] 

Agency Request for Emergency 

Approval of an Information Collection 

AGENCY: Office of the Secretary (OST), 

DOT. 

ACTION: Notice and request for 

comments. 

SUMMARY: The Department of 

Transportation (DOT) provides notice 

that it will submit an information 

collection request (ICR) to the Office of 

Management and Budget (OMB) for 

emergency approval of a proposed 

information collection under the 

Paperwork Reduction Act of 1995 (Pub. 

L. 104–13, 44 U.S.C. 3501 et seq.). Upon 


srobinson on DSKHWCL6B1PROD with NOTICES