Federal Register / Vol. 81, No. 29 / Friday, February 12, 2016 / Notices 7597 

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

2 17 CFR [sic] § 240.19b–4. 

3See SR–NASDAQ–2016–001, which was 

withdrawn by Nasdaq on January 19, 2016 

(available at http://nasdaq.cchwallstreet.com/

NASDAQ/pdf/nasdaq-filings/2016/SR–NASDAQ– 

2016–001.pdf). 

4FPGA hardware is able to process more data 

packets during peak market conditions without the 

introduction of variable queuing latency, which 

improves the predictability of telecommunications 

ports over non-FPGA hardware and thereby adds 

value to the user. 

Form 1. An exchange that seeks an 

exemption from registration based on 

limited trading volume also must apply 

for such exemption on Form 1. Rule 6a– 

2 under the Act requires registered and 

exempt exchanges: (1) To amend the 

Form 1 if there are any material changes 

to the information provided in the 

initial Form 1; and (2) to submit 

periodic updates of certain information 

provided in the initial Form 1, whether 

such information has changed or not. 

The information required pursuant to 

Rules 6a–1 and 6a–2 is necessary to 

enable the Commission to maintain 

accurate files regarding the exchange 

and to exercise its statutory oversight 

functions. Without the information 

submitted pursuant to Rule 6a–1 on 

Form 1, the Commission would not be 

able to determine whether the 

respondent has met the criteria for 

registration (or an exemption from 

registration) set forth in Section 6 of the 

Exchange Act. The amendments and 

periodic updates of information 

submitted pursuant to Rule 6a–2 are 

necessary to assist the Commission in 

determining whether a national 

securities exchange or exempt exchange 

is continuing to operate in compliance 

with the Exchange Act. 

Initial filings on Form 1 by new 

exchanges are made on a one-time basis. 

The Commission estimates that it will 

receive approximately one initial Form 

1 filing per year and that each 

respondent would incur an average 

burden of 880 hours to file an initial 

Form 1 at an average internal labor cost 

per response of approximately $302,694. 

Therefore, the Commission estimates 

that the annual burden for all 

respondents to file the initial Form 1 

would be 880 hours (one response/

respondent × one respondents × 880 

hours/response) and an internal 

compliance cost of $302,694 (one 

response/respondent × one respondents 

× $302,694/response). 

There currently are 18 entities 

registered as national securities 

exchanges. The Commission estimates 

that each registered or exempt exchange 

files nine amendments or periodic 

updates to Form 1 per year, incurring an 

average burden of 25 hours to comply 

with Rule 6a–2. The SEC estimates that 

the average internal labor cost for a 

national securities exchange per 

response would be approximately 

$9,445. The Commission estimates that 

the annual burden for all respondents to 

file amendments and periodic updates 

to the Form 1 pursuant to Rule 6a–2 is 

4,050 hours (18 respondents × 25 hours/ 

response × nine responses/respondent 

per year) and an internal compliance 

cost of $1,530,090 (18 respondents × 

$9,445/response × nine responses/

respondent per year). 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA unless it displays a 

currently valid OMB control number. 

The public may view background 

documentation for this information 

collection at the following Web site, 

www.reginfo.gov. Comments should be 

directed to: (i) Desk Officer for the 

Securities and Exchange Commission, 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, Room 10102, New Executive 

Office Building, Washington, DC 20503, 

or by sending an email to: Shagufta_

Ahmed@omb.eop.gov; and (ii) Pamela 

Dyson, Director/Chief Information 

Officer, Securities and Exchange 

Commission, c/o Remi Pavlik-Simon, 

100 F Street NE., Washington, DC 

20549, or by sending an email to: PRA_

Mailbox@sec.gov. Comments must be 

submitted to OMB within 30 days of 

this notice. 

Dated: February 8, 2016. 

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–02833 Filed 2–11–16; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–77077; File No. SR– 

NASDAQ–2016–014] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change to 

Retroactively Apply Recently-Reduced 

Port Fees 

February 8, 2016 

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 January 

29, 2016, The NASDAQ Stock Market 

LLC (‘‘Nasdaq’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by Nasdaq. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Nasdaq proposes to retroactively 

apply recently-reduced port fees 

charged to members and non-members 

for ports used to enter orders into 

Nasdaq systems, in connection with the 

use of the FIX, RASH, and OUCH 

trading protocols under Nasdaq Rules 

7015(b) and (g) beginning January 4, 

2016. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, 

Nasdaq 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. Nasdaq 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 apply recently-reduced port 

fees charged to members and nonmembers for ports used to enter orders 

into Nasdaq systems, in connection with 

the use of the FIX, RASH, and OUCH 

trading protocols under Nasdaq Rules 

7015(b) and (g) during the period from 

January 4, 2016 to January 19, 2016. 

Effective January 4, 2016, Nasdaq 

increased fees for FIX Ports under Rule 

7015(b) and for RASH and OUCH Ports 

under Rule 7015(g) from $550 per port, 

per month to $575 per port, per month.3

Nasdaq increased the fees to offset costs 

associated with upgrading these ports 

with new field-programmable gate array 

(‘‘FPGA’’) technology, which is a 

hardware-delivery mechanism that 

provides improved performance in 

terms of predictability.4 Nasdaq 

implemented the new FPGA hardware 


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7598 Federal Register / Vol. 81, No. 29 / Friday, February 12, 2016 / Notices 

5See note 3 above. 

6See SR–NASDAQ–2016–007, which has not yet 

been published in the Federal Register (available at 

http://nasdaq.cchwallstreet.com/NASDAQ/pdf/

nasdaq-filings/2016/SR–NASDAQ–2016–007.pdf). 

The Commission notes that this filing was 

subsequently withdrawn, because it was deemed 

unnecessary. Nasdaq’s withdrawal of SR– 

NASDAQ–2016–001 effectively caused the rule text 

to revert to the lower fees that were in place prior 

to January 4, 2016. See note 3. 

7Nasdaq bills in arrears for the connectivity 

provided under Rule 7015. Thus, subscribers have 

not yet been billed at the higher rate in place from 

January 4, 2016 to January 19, 2016. 

8 15 U.S.C. 78f. 

9 15 U.S.C. 78f(b)(4) and (5). 

10 15 U.S.C. 78s(b)(3)(A). 

11 17 CFR 240.19b–4(f)(6). 

12For purposes only of waiving the 30-day 

operative delay, the Commission has also 

considered the proposed rule’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

in mid-December 2015 and increased 

the related port fees on January 4, 2016.5

Nasdaq recently encountered a few 

unforeseen minor, but not easily 

rectifiable, issues with the new 

implementation that potentially could 

have a greater impact on the market. As 

a consequence, Nasdaq determined that 

the risk associated with keeping the 

FPGA technology in terms of potential 

disruption to trading outweighed the 

benefit provided in terms of increased 

performance. Effective January 7, 2016, 

Nasdaq removed the FPGA hardware 

and reverted all FIX, RASH, and OUCH 

ports to the infrastructure that was in 

place prior to the upgrade to those ports. 

Nasdaq also filed a rule change with the 

Commission to reduce the fees assessed 

for FIX, RASH, and OUCH ports back to 

their lower levels of $550 per port, per 

month, which was effective January 19, 

2016.6

Nasdaq proposes to apply the reduced 

fees of $550 per port, per month during 

the period from January 4, 2016 to their 

reduction on January 19, 2016, 

effectively eliminating any fee increase 

for FIX, RASH, and OUCH ports. 

Subscribers to the affected ports did not 

enjoy the benefit of the improved 

hardware for any significant time, as the 

issues with the ports began to manifest 

themselves on December 30, 2015 up to 

the point at which Nasdaq determined 

to remove the hardware and revert the 

ports back to the infrastructure in place 

before. Thus, Nasdaq believes that it is 

inappropriate to apply the higher fees at 

any point during January 2016.7

2. Statutory Basis 

This proposal is consistent with the 

provisions of section 6 of the Act,8 in 

general, and with sections 6(b)(4) and 

6(b)(5) of the Act,9 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 Nasdaq operates or 

controls, and is designed to prevent 

fraudulent and manipulative acts and 

practices, 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. 

Retroactively applying the lower fees 

that were assessed prior to the upgrade 

to the FIX, RASH and OUCH ports 

effective January 4, 2016 is reasonable 

because the improved hardware did not 

provide a trouble-free benefit to 

subscribers for a significant time during 

the month of January 2016. Nasdaq did 

not provide an improved service for the 

ports in return for the increased fees 

paid during the period from January 4, 

2016 to their reduction on January 19, 

2016. The basis for the increased fees 

was the costs associated with 

purchasing hardware (capital 

expenditures) and supporting and 

maintaining the infrastructure 

(operating expenditures) for the FPGA 

enhancement. Thus, retroactively 

applying the reduced pre-upgrade fee is 

reasonable. 

Applying the lower pre-upgrade fees 

retroactively is both an equitable 

allocation and not unfairly 

discriminatory because it will apply 

uniformly to all market participants that 

subscribed to FIX Ports under Rule 

7015(b), and OUCH and RASH Ports 

under Rule 7015(g) during the 

timeframe of January 4, 2016 to January 

19, 2016 based on the number of such 

ports subscribed. Accordingly, all 

subscribers to the ports under Rule 

7015(b) and (g) will be assessed the fees 

in place prior to the increase, since they 

did not realize a significant and troublefree benefit from the hardware. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

The proposed rule change will not 

impose any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. In terms of 

inter-market competition, Nasdaq 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. 

Nasdaq proposes to retroactively 

apply a lower fee since it did not 

provide the improved connectivity 

trouble-free for a significant time. Thus, 

Nasdaq does not believe that proposal 

places any burden on competition, but 

rather reduces fees assessed subscribers 

to a service, which will help maintain 

Nasdaq’s competitiveness among 

equities markets. 

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 

Because the proposed rule change 

does not (i) significantly affect the 

protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate if 

consistent with the protection of 

investors and the public interest, the 

proposed rule change has become 

effective pursuant to section 19(b)(3)(A) 

of the Act 10 and Rule 19b–4(f)(6) 

thereunder.11

In its filing, Nasdaq requested that the 

Commission waive the 30-day operative 

delay so that Nasdaq may implement 

the fee reduction prior to the end of its 

monthly billing cycle. The Commission 

believes that waiving the 30-day 

operative delay is consistent with the 

protection of investors and the public 

interest. Nasdaq bills its members at the 

end of the month, and, as of the time of 

filing, it had not yet assessed the higher 

port fees put in place by SR–NASDAQ– 

2016–001. Waiver of the 30-day 

operative delay will not only allow 

Nasdaq to manage its billing process 

more efficiently, but it will also ensure 

that subscribers are not charged 

erroneous and inflated fees. For this 

reason, the Commission designates the 

proposed rule change to be operative 

upon filing.12

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: 


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Federal Register / Vol. 81, No. 29 / Friday, February 12, 2016 / Notices 7599 

13 17 CFR [sic] § 200.30–3(a)(12) and (59). 

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

2 17 CFR 240.19b–4. 

3The Commission approved BATS Rule 14.11(i) 

in Securities Exchange Act Release No. 65225 

(August 30, 2011), 76 FR 55148 (September 6, 2011) 

(SR–BATS–2011–018). 

4See Registration Statement on Form N–1A for 

the Trust, dated October 8, 2015 (File Nos. 333– 

173276 and 811–22542). The descriptions of the 

Fund and the Shares contained herein are based, in 

part, on information in the Registration Statement. 

The Commission has issued an order granting 

certain exemptive relief to the Trust under the 

Investment Company Act of 1940 (15 U.S.C. 80a– 

1) (‘‘1940 Act’’) (the ‘‘Exemptive Order’’). See 

Investment Company Act Release No. 29524 

(December 13, 2010) (File No. 812–13487). 

5An investment adviser to an open-end fund is 

required to be registered under the Investment 

Advisers Act of 1940 (the ‘‘Advisers Act’’). As a 

result, the Adviser and its related personnel as well 

as the Sub-Adviser and its related personnel are 

subject to the provisions of Rule 204A–1 under the 

Continued 

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–2016–014 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–2016–014. 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 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 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at Nasdaq’s 

principal office. 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– 

NASDAQ–2016–014 and should be 

submitted on or before March 4, 2016. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Robert W. Errett, 

Deputy Secretary. 

[FR Doc. 2016–02837 Filed 2–11–16; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–77078; File No. SR–BATS– 

2016–04] 

Self-Regulatory Organizations; BATS 

Exchange, Inc.; Notice of Filing of a 

Proposed Rule Change to Rule 14.11(i), 

Managed Fund Shares, To List and 

Trade Shares of the SPDR DoubleLine 

Short Term Total Return Tactical ETF 

of the SSgA Active Trust 

February 8, 2016. 

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 February 

4, 2016, BATS Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘BATS’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the Exchange. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange is proposing a rule 

change to list and trade shares of the 

SPDRDoubleLine Short Term Total 

Return Tactical ETF (the ‘‘Fund’’) of the 

SSgA Active Trust (the ‘‘Trust’’) under 

BATS Rule 14.11(i) (‘‘Managed Fund 

Shares’’). The shares of the Fund are 

collectively referred to herein as the 

‘‘Shares.’’ 

The text of the proposed rule change 

is available at the Exchange’s Web site 

at www.batstrading.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 

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 parts of such 

statements. 

(A) Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to list and 

trade the Shares under BATS Rule 

14.11(i), which governs the listing and 

trading of Managed Fund Shares on the 

Exchange.3 The Fund will be an actively 

managed fund. The Shares will be 

offered by the Trust, which was 

established as a Massachusetts business 

trust on March 30, 2011. The Trust is 

registered with the Commission as an 

open-end investment company and has 

filed a registration statement on behalf 

of the Fund on Form N–1A 

(‘‘Registration Statement’’) with the 

Commission.4

Description of the Shares and the Fund 

SSGA Funds Management, Inc. will 

be the investment adviser (‘‘SSGA FM’’ 

or ‘‘Adviser’’) to the Fund. The Adviser 

will serve as the administrator for the 

Fund (the ‘‘Administrator’’). DoubleLine 

Capital LP will be the Fund’s subadviser (‘‘Sub-Adviser’’). State Street 

Global Markets, LLC (the ‘‘Distributor’’) 

will be the principal underwriter and 

distributor of the Fund’s Shares. State 

Street Bank and Trust Company (the 

‘‘Sub-Administrator’’, ‘‘Custodian’’, 

‘‘Transfer Agent’’ or ‘‘Lending Agent’’) 

will serve as sub-administrator, 

custodian, transfer agent, and, where 

applicable, lending agent for the Fund. 

BATS Rule 14.11(i)(7) provides that, if 

the investment adviser to the 

investment company issuing Managed 

Fund Shares is affiliated with a brokerdealer, such investment adviser shall 

erect a ‘‘fire wall’’ between the 

investment adviser and the brokerdealer with respect to access to 

information concerning the composition 

and/or changes to such investment 

company portfolio.5 In addition, Rule 


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