Federal Register / Vol. 74, No. 13 / Thursday, January 22, 2009 / Notices 4063 

9 15 U.S.C. 78s(b)(2). 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3An SQT is an Exchange Registered Options 

Trader (‘‘ROT’’) who has received permission from 

the Exchange to generate and submit option 

quotations electronically through an electronic 

interface with AUTOM via an Exchange approved 

proprietary electronic quoting device in eligible 

options to which such SQT is assigned. See 

Exchange Rule 1014(b)(ii)(A). 

4An RSQT is an ROT and participant in the 

Exchange’s electronic trading system, ‘‘Phlx XL’’ 

who has received permission from the Exchange to 

trade in options for his own account, and to 

generate and submit option quotations 

electronically from off the floor of the Exchange 

through AUTOM in eligible options to which such 

RSQT has been assigned. See Exchange Rule 

1014(b)(ii)(B). 

5A Complex Order is composed of two or more 

option components and is priced as a single order 

(a ‘‘Complex Order Strategy’’) on a net debit or net 

credit basis. See Exchange Rule 1080, Commentary 

.08. For a complete description of the Exchange’s 

Complex Order System, see Securities Exchange 

Act Release No. 58361 (August 14, 2008), 73 FR 

49529 (August 21, 2008) (SR–Phlx–2008–50). 

6See Securities Exchange Act Release No. 50100 

(July 27, 2004), 69 FR 46612 (August 3, 2004) (SR– 

Phlx–2003–59). 

7This proposal and the Exhibits attached hereto 

include amendments to the Exchange’s fee schedule 

that were submitted on December 30, 2008 as part 

of SR–Phlx–2008–86. Beginning with transactions 

settling on or after January 2, 2009, the Exchange 

will assess an option transaction charge of $0.22 per 

contract for ROTs, $0.24 per contract for Firms that 

submit proprietary orders, and $0.14 for Firm 

facilitation orders. The Commission notes that the 

preceding sentence refers to the ‘‘Summary of 

Equity Option, and MNX, NDX, RUT and RMN 

Charges’’ on the fee schedule as amended by File 

No. Phlx–2008–86. 

8The Commission notes that prior to this filing, 

Phlx did not assess transaction charges for Complex 

Orders. 

the Exchange should add liquidity to 

the market in the options classes that 

PMMs on the Exchange decline to seek 

an allocation, and therefore should 

provide trading opportunities that 

should benefit all market participants. 

In addition, the Commission notes that 

Alternative PMMs will have all of the 

responsibilities and all of the privileges 

of a PMM under the ISE’s rules with 

respect to all appointed options classes. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,9 that the 

proposed rule change (SR–ISE–2008–90) 

be, and hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–1230 Filed 1–21–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59097; File No. SR–FINRA– 

2008–057] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Update Rule CrossReferences and Make Other Various 

Non-Substantive Technical Changes to 

FINRA Rules 

Correction 

In notice document E8–30319 

beginning on page 78412 in the issue of 

Monday, December 22, 2008, make the 

following correction: 

On page 78412, the subject should 

read as set forth above. 

[FR Doc. Z8–30319 Filed 1–21–09; 8:45 am] 

BILLING CODE 1505–01–D 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59247; File No. SR–Phlx– 

2008–87] 

Self-Regulatory Organizations; 

NASDAQ OMX PHLX, Inc.; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Amending the 

Phlx Fee Schedule 

January 14, 2009. 

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 December 

31, 2008, NASDAQ OMX PHLX, Inc. 

(‘‘Phlx’’ 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 

substantially prepared by the Exchange. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change from interested 

parties. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend its 

Summary of Equity Option, and MNX, 

NDX, RUT and RMN Charges; Summary 

of Index Option Charges; and Summary 

of U.S Dollar-Settled Foreign Currency 

Option Charges fee schedules. 

Specifically, the Exchange proposes to 

assess an option transaction charge of 

$0.08 per contract side for specialists 

and Registered Options Traders 

(‘‘ROTs’’), including Streaming Quote 

Traders (‘‘SQTs’’) 3 and Remote 

Streaming Quote Traders (‘‘RSQTs’’) 4

on contracts that are executed 

electronically as part of a Complex 

Order 5 in equity options on the 

Exchange’s electronic trading platform 

for options, Phlx XL.6 Market 

participants other than specialists and 

ROTs would be assessed the applicable 

current equity options transaction 

charge. 

The Exchange proposes to assess any 

applicable option transaction charges to 

participants, including specialists and 

ROTs, on contracts in Index Options 

and U.S. Dollar-Settled Foreign 

Currency Options that are executed 

electronically as part of a Complex 

Order.7

This proposal is effective upon filing 

and will be implemented for 

transactions settling on or after January 

2, 2009. 

The text of the proposed rule change 

is available on the Exchange’s Web site 

at http://www.nasdaqtrader.com/micro.

aspx?id=PHLXRulefilings. 

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 provide an incentive for 

specialists and ROTs to provide 

liquidity in Complex Orders sent to the 

Exchange for execution, and to enhance 

Exchange revenues, by assessing an 

equity option transaction charge of 

$0.08 per contract side for specialists 

and ROTs instead of the current 

applicable charges that apply to simple 

option transactions in equity options.8

Respecting Complex Orders in equity 

options for other market participants, 

the equity option transaction charges in 

effect on the Exchange for simple orders 

would be assessed. 

Respecting Complex Orders in index 

and foreign currency options, the index 

option and foreign currency option 


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4064 Federal Register / Vol. 74, No. 13 / Thursday, January 22, 2009 / Notices 

9Customers are charged $0.12 per contract for 

executions in MNX and NDX options. The 

Commission notes that the Phlx fee schedule also 

provides for a $0.12 per contract charge for 

customer executions in RUT and RMN. See 

Securities Exchange Act Release No. 59243 (January 

13, 2009) (File No. Phlx–2008–86) (adding those 

charges to the fee schedule). 

10See Securities Exchange Act Release No. 58420 

(August 25, 2008), 73 FR 51035 (August 29, 2008) 

(SR–Phlx–2008–62). 

11 15 U.S.C. 78f(b). 

12 15 U.S.C. 78f(b)(4). 

13 15 U.S.C. 78s(b)(3)(A)(ii). 

14 17 CFR 240.19b–4(f)(2). 

transaction charges in effect on the 

Exchange for simple orders would be 

assessed on all participants. 

Pursuant to this proposal, the 

Exchange intends to amend the 

Exchange’s: (i) Summary of Equity 

Option, and MNX, NDX, RUT and RMN 

Charges; (ii) Summary of Index Option 

Charges; and (iii) Summary of U.S 

Dollar-Settled Foreign Currency Option 

Charges. 

Currently, the Exchange does not 

assess transaction charges for Complex 

Orders. The Exchange believes that the 

$0.08 transaction charge for Complex 

Orders in equity options (as opposed to 

the transaction charges for simple 

orders) should provide incentives for 

specialists and ROTs to provide 

liquidity in the Exchange’s markets for 

Complex Orders in equity options. 

Summary of Equity Option, and MNX, 

NDX, RUT and RMN Charges 

Currently, the Exchange assesses 

various option transaction charges for 

equity options, depending on such 

factors as the category of person(s) 

submitting orders for execution (e.g., 

customers, specialists, broker-dealers, 

ROTs and Firms are all charged 

differently, on a per contract basis, 

ranging from $0.00 per contract to $0.45 

per contract) and the manner in which 

the order is delivered to the Exchange. 

For example, broker-dealer orders 

submitted electronically to the 

Exchange’s systems are charged $0.45 

per contract, whereas broker-dealer 

orders submitted through means other 

than the Exchange’s electronic system 

are charged $0.25 per contract. 

Customers submitting orders in equity 

options are generally not charged 

transaction fees 9 whereas ROTs and 

Firms are charged. 

The Exchange proposes to amend the 

fee schedule to assess specialists and 

ROTs an option transaction charge of 

$0.08 per contract side on contracts in 

equity and MNX, NDX, RUT and RMN 

options that are executed electronically 

as part of a Complex Order. Participants 

other than specialists and ROTs would 

be assessed the regular equity option 

transaction charge applicable to simple 

equity option orders. 

Summary of Index Option Charges 

The Exchange assesses an option 

transaction charge for index option 

transactions other than transactions 

involving Complex Orders, as described 

in the Exchange’s Summary of Index 

Option Charges. The Exchange proposes 

to amend its Summary of Index Option 

Charges to assess any applicable option 

transaction charges to participants, 

including specialists and ROTs, on 

contracts in index options that are 

executed electronically as part of a 

Complex Order. For clarity, the 

Exchange proposes to amend its 

Summary of Index Option Charges to 

state specifically that Registered Option 

Traders (on-floor) and specialists will be 

assessed $0.24 per contract side on 

contracts that are executed 

electronically as part of a Complex 

Order. 

Summary of U.S. Dollar-Settled Foreign 

Currency Option Charges 

The Exchange currently assesses an 

option transaction charge for 

transactions in options overlying U.S. 

dollar-settled foreign currencies, as 

described in the Exchange’s Summary of 

U.S Dollar-Settled Foreign Currency 

Option Charges. The Exchange proposes 

to amend its Summary of U.S DollarSettled Foreign Currency Option 

Charges schedule to assess any option 

transaction charges on contracts in U.S 

dollar-settled foreign currency options 

that are executed electronically as part 

of a Complex Order. For clarity, the 

Exchange proposes to amend its 

Summary of U.S Dollar-Settled Foreign 

Currency Option Charges schedule to 

state specifically that Registered Option 

Traders (on-floor) and specialists will be 

assessed $0.24 per contract side on 

contracts that are executed 

electronically as part of a Complex 

Order. 

The Exchange currently provides a 

discount for ROTs (on-floor) and 

specialists that exceed 4.5 million 

contracts in a given month (the 

‘‘Volume Threshold’’) by assessing 

$0.01 per contract on contract volume 

above the Volume Threshold instead of 

the applicable options transaction 

charge described in the Summary of 

Equity Option, and MNX, NDX, RUT 

and RMN Charges. Complex Order 

volume is not used in calculating the 

Volume Threshold.10

2. Statutory Basis 

The Exchange believes that its 

proposal to amend its schedule of fees 

is consistent with Section 6(b) of the 

Act 11 in general, and furthers the 

objectives of Section 6(b)(4) of the Act 12

in particular, in that it is an equitable 

allocation of reasonable fees and other 

charges among Exchange members. 

Specifically, the Exchange believes that 

this proposal is equitable because it 

would apply evenly to specialists and 

ROTs transacting with Complex Orders 

sent to the Exchange for execution. 

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 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. 

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 13 and 

paragraph (f)(2) of Rule 19b–4 14

thereunder. At any time within 60 days 

of the filing of the proposed rule change, 

the Commission may summarily 

abrogate such rule change if it appears 

to the Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

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–Phlx–2008–87 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. 


rmajette on PRODPC74 with NOTICES
Federal Register / Vol. 74, No. 13 / Thursday, January 22, 2009 / Notices 4065 

15 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3 In Amendment No. 2, NASDAQ removed data 

from the jointly-operated NASDAQ/FINRA Trade 

Reporting Facility (‘‘TRF’’) from the NASDAQ Basic 

product. NASDAQ notes that a separate filing will 

be made in the event approval is sought to include 

TRF data in this product. In addition, NASDAQ 

made technical changes including changing the 

name of the Alternext market, clarifying that no fees 

will be assessed during the first month of the pilot, 

and explaining the application of internal and 

external distributor fees. 4Changes are marked to the rule text that appears 

in the electronic NASDAQ Manual found at 

http://www.nasdaqtrader.com. 

All submissions should refer to File 

Number SR–Phlx–2008–87. 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 inspection and copying 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 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 No. 

SR–Phlx–2008–87 and should be 

submitted on or before February 12, 

2009. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Florence E. Harmon, 

Deputy Secretary. 

[FR Doc. E9–1232 Filed 1–21–09; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–59244; File No. SR– 

NASDAQ–2008–102] 

Self-Regulatory Organizations; The 

NASDAQ Stock Market LLC; Notice of 

Filing of Proposed Rule Change and 

Amendment No. 2 Thereto To Establish 

a Pilot Program for NASDAQ Basic 

Data Feeds 

January 13, 2009. 

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 December 

23, 2008, 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. On January 8, 2009, 

NASDAQ filed Amendment No. 1 to the 

proposed rule change. On January 12, 

2009, NASDAQ replaced the original 

filing and Amendment No. 1 by filing 

Amendment No. 2 to the proposed rule 

change.3 The Commission is publishing 

this notice to solicit comments on the 

proposed rule change, as amended, from 

interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

NASDAQ is proposing a rule change 

to establish a five-month pilot to offer 

‘‘NASDAQ Basic’’ which is a real time 

data feed combining both NASDAQ’s 

Best Bid and Offer (‘‘QBBO’’) and the 

NASDAQ Last Sale. NASDAQ will offer 

information separately for NASDAQ-, 

NYSE- and Amex-listed stocks. 

NASDAQ Basic will be available free of 

charge for the first month of the fivemonth pilot. 

The text of the proposed rule change 

is below. Proposed new language is in 

italics; proposed deletions are in 

brackets.4

* * * * * 

7047. NASDAQ Basic 

(a) For a five-month pilot period 

commencing on February 1, 2009, 

NASDAQ shall offer proprietary data 

feeds containing real-time market 

information from the NASDAQ Market 

Center. There shall be no fee for 

NASDAQ Basic for the first month of the 

pilot. 

(1) ‘‘NASDAQ Basic for NASDAQ’’ 

shall contain NASDAQ’s best bid and 

offer and last sale for NASDAQ-listed 

stocks; and 

(2) ‘‘NASDAQ Basic for NYSE’’ shall 

contain NASDAQ’s best bid and offer 

and last sale for NYSE-listed stocks. 

(3) ‘‘NASDAQ Basic for Alternext’’ 

shall contain NASDAQ’s best bid and 

offer and last sale for Alternext-listed 

stocks. 

(b) User Fees 

(1) Except as provided in (b)(2) and 

(b)(3), for the NASDAQ Basic product 

there shall be a per subscriber monthly 

charge of $10 for NASDAQ-listed stocks, 

$5 for NYSE-listed stocks, and $5 for 

Alternext-listed stocks; or 

(2) For each non-professional 

subscriber, as defined in Rule 7011(b), 

there shall be a per subscriber monthly 

charge of $0.50 for NASDAQ-listed 

stocks, $0.25 for NYSE-listed stocks, 

and $0.25 for Alternext-listed stocks; or 

(3) There shall be a per query fee for 

NASDAQ Basic of $0.0025 for 

NASDAQ-listed stocks, $0.0015 for 

NYSE-listed stocks, and $0.0015 for 

Alternext-listed stocks. 

(c) Distributor Fees 

(1) Each Distributor of NASDAQ Basic 

for NASDAQ-listed stocks shall pay a 

fee of $1,500 per month for either 

internal or external distribution or both. 

(2) Each Distributor of NASDAQ Basic 

for NYSE-listed stocks shall pay a fee of 

$250 per month for internal distribution 

or $625 per month external distribution. 

Distributors that pay the external 

distribution fee may distribute NASDAQ 

Basic for NYSE-listed stocks internally 

with no additional distribution fee. 

(3) Each Distributor of NASDAQ Basic 

for Alternext-listed stocks shall pay a 

fee of 250 per month for internal 

distribution or $625 per month external 

distribution. Distributors that pay the 

external distribution fee may distribute 

NASDAQ Basic for Alternext-listed 

stocks internally with no additional 

distribution fee. 

(4) Each Distributor that receives 

Direct Access to the NASDAQ Basic 

shall also pay a monthly fee of $2,000 

for NASDAQ-listed stocks, $1,000 for 

NYSE-listed stocks, and $1,000 for 

Alternext-listed stocks. 

(5) The terms ‘‘Distributor’’ and 

‘‘Direct Access’’ shall have the same 

meanings as set forth in Rule 7019. 

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. The text of 

these statements may be examined at 

the places specified in Item IV below, 

and is set forth in Sections A, B, and C 

below. 


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