Document ID: SEC-2010-1077-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2010-07-15T04:00Z

[Federal Register: July 15, 2010 (Volume 75, Number 135)]
[Notices]               
[Page 41258-41262]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15jy10-108]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-62468; File No. SR-NASDAQ-2010-074]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing of a Proposed Rule Change, as Modified by Amendment 
No. 1, To Adopt Rule 4753(c) as a Six Month Pilot in 100 NASDAQ-Listed 
Securities

July 7, 2010.
    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 18, 2010, The NASDAQ Stock Market LLC (``Nasdaq'' or the 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Items have been prepared by Nasdaq. On June 25, 
2010, Nasdaq filed Amendment No. 1 to the proposed rule change. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change, as amended, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASDAQ is proposing to adopt Rule 4753(c) as an initial six month 
pilot in 100 NASDAQ-listed securities.
    The text of the proposed rule change is below. Proposed new 
language is in italics; proposed deletions are in brackets.\3\
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    \3\ Changes are marked to the rule text that appears in the 
electronic manual of NASDAQ found at http://
nasdaq.cchwallstreet.com.
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* * * * *
4753. Nasdaq Halt and Imbalance Crosses
    (a)-(b) No change.
    (c) Beginning August 1, 2010, for a period of six months, 
[B]between 9:30 a.m. and 4 p.m. EST, the System will

[[Page 41259]]

automatically monitor System executions to determine whether the market 
is trading in an orderly fashion and whether to conduct an Imbalance 
Cross in order to restore an orderly market in a single Nasdaq 
Security.
    (1) An Imbalance Cross shall occur if the System executes a 
transaction in a Nasdaq Security at a price that is beyond the 
Threshold Range away from the Triggering Price for that security. The 
Triggering Price for each Nasdaq Security shall be the price of any 
execution by the System in that security within the prior 30 seconds. 
The Threshold Range shall be determined as follows:

------------------------------------------------------------------------
                                                           Thresh[h]old
                                                            range away
                                                               from
                     Execution price                        triggering
                                                               price
                                                             (percent)
------------------------------------------------------------------------
$1.75 and under.........................................              15
Over $1.75 and up to $25................................              10
Over $25 and up to $50..................................               5
Over $50................................................               3
------------------------------------------------------------------------

     (2) If the System determines pursuant to subsection (1) above to 
conduct an Imbalance Cross in a Nasdaq Security, the System shall 
automatically cease executing trades in that security for a 60-second 
Display Only Period. During that 60-second Display Only Period, the 
System shall:
    (A) Maintain all current quotes and orders and continue to accept 
quotes and orders in that System Security; and
    (B) Disseminate by electronic means an Order Imbalance Indicator 
every 5 seconds.
    (3) At the conclusion of the 60-second Display Only Period, the 
System shall re-open the market by executing the Nasdaq Halt Cross as 
set forth in subsection (b)(2)-(4) above.
    (4) No change.
* * * * *

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.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    NASDAQ is proposing to adopt Rule 4753(c), a volatility-based pause 
in trading in individual NASDAQ-listed securities traded on NASDAQ 
(``NASDAQ Securities''). NASDAQ is proposing to adopt the rule 
initially as a six-month pilot in 100 NASDAQ Securities beginning 
August 1, 2010.
Background
    NASDAQ's efficient market structure allows the price of a security 
to change quickly in response to information and market demand. 
Allowing trading to react quickly is generally beneficial to investors. 
In some circumstances, however, abrupt and significant movements in the 
price at which a security is traded can indicate aberrant volatility, 
which is harmful to investors. On August 19, 2008, the Commission 
approved new Rule 4753(c), which established a volatility-based halt 
process on a one-year pilot basis for an initial 100 NASDAQ-listed 
securities.\4\ Subsequent to the Commission's approval, NASDAQ 
implemented a market order price collar to address aberrant volatility 
in lieu of immediately implementing the Rule 4753(c) pilot.\5\ Although 
these collars are designed to address volatility by reducing the risk 
that market orders will execute at prices that are significantly worse 
than the national best bid and offer, they had limited effect on May 6, 
2010 because of the limited number of market orders involved in trading 
that day on NASDAQ.
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    \4\ Securities Exchange Act Release No. 58386 (August 19, 2008), 
73 FR 50380 (August 26, 2008) (SR-NASDAQ-2007-067).
    \5\ This process cancels any portion of most unpriced orders 
that would execute either on NASDAQ or when routed to another market 
center at a price that is the greater of $0.25 or 5 percent worse 
than the NBBO at the time NASDAQ receives the order. See Securities 
Exchange Act Release No. 60371 (July 23, 2009), 74 FR 38075 (July 
30, 2009) (SR-NASDAQ-2009-070).
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    In light of the unprecedented aberrant volatility witnessed on May 
6, 2010, and the limited effect that NASDAQ's market collars had in 
dampening such volatility, NASDAQ believes that the Rule 4753(c) halt 
process is needed to protect its listed securities and market 
participants from such volatility in the future. Accordingly, as 
described below, NASDAQ is proposing to adopt Rule 4753(c) again as a 
six-month pilot for 100 NASDAQ-listed securities.
NASDAQ's Approach: Rule 4753(c)
    NASDAQ originally adopted Rule 4753(c) to promote the protection of 
investors by providing a meaningful pause in NASDAQ Securities on 
NASDAQ in the midst of abrupt and significant price movements, while 
permitting trading to move freely in rapid and stable markets.\6\ As 
the events of May 6, 2010 show, severe and rapid price dislocation can 
occur in securities with no connection to the fundamental soundness of 
the underlying companies. Such dislocation may be caused by operational 
and structural factors beyond the control of issuers and individual 
markets. NASDAQ's Rule 4753(c) process is designed to protect NASDAQ 
securities and market participants from aberrant volatility, which can 
quickly spread like a contagion from market to market, to allow time to 
reestablish a rational market in NASDAQ Securities.
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    \6\ NASDAQ has other similar processes that serve to protect 
investors during periods of abnormal trading activity. NASDAQ Rule 
4120 authorizes NASDAQ Regulation to halt trading in a security 
based upon news or an emergency in the market. NASDAQ Regulation 
also has the ability under NASDAQ Rule 11890 to break trades in 
order to protect the integrity of the market.
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    NASDAQ's proposed Rule 4753(c) process automatically suspends 
trading in individual NASDAQ Securities that are the subject of abrupt 
and significant intraday price movements between 9:30 a.m. and 4 p.m. 
Eastern Standard Time. The Rule 4753(c) process is triggered 
automatically when the execution price of a NASDAQ Security moves more 
than a fixed amount away from a pre-established ``triggering price'' 
for that security. The Triggering Price for each NASDAQ Security is the 
price of any execution by the System \7\ in that security within the 
previous 30 seconds. For each NASDAQ Security, the System continually 
compares the price of each execution in the System against the prices 
of all System executions in that security over the 30 seconds.
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    \7\ As defined in Rule 4751(a).
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    Proposed Rule 4753(c) has tiered triggering price range percentages 
that are based on the execution price of a security. NASDAQ has 
observed that, on a percentage basis, lower priced stocks normally 
trade in a wider range than stocks with higher prices. For example, 
during the first quarter of 2010, a period of relatively low market 
volatility, stocks priced under $1.75 had an average range (percent 
difference from high to low over the course of the day) of 9%, stocks 
priced $1.75 up to $24.99 had an average range of 4%. Stocks priced $25 
to $49.99 had an average range of 3%. Stocks priced above $50

[[Page 41260]]

had an average range of 2%. The purpose of Rule 4753(c) is not to 
inhibit trading within the normal range, but rather to pause trading in 
instances of aberrant volatility. As a consequence, NASDAQ selected 
percentage tiers that allow for a wider range in lower priced 
securities, with decreasing ranges on a percentage basis as price 
increases.
    When the Rule 4753(c) process is triggered, NASDAQ institutes a 
formal trading halt during which time NASDAQ systems are prohibited 
from executing orders.\8\ Members, however, may continue to enter 
quotes and orders, which are queued during a 60-second Display Only 
Period. At the conclusion of the Display Only Period, the queued orders 
are executed at a single price, pursuant to Rule 4753.
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    \8\ A halt pursuant to Rule 4753(c) is not considered a 
regulatory halt and, therefore, it does not trigger a market-wide 
trading halt under Section X of the NASDAQ UTP Plan. As a result, 
other markets are permitted to continue trading a NASDAQ stock that 
is undergoing a Market Re-Opening on NASDAQ. During the Rule 4753(c) 
process, NASDAQ's quotations are marked ``closed,'' signaling to 
other markets that quotes and orders routed to NASDAQ will not be 
executed. A Rule 4753(c) trade is reported to the network processor 
as a single-price re-opening that is exempt from trade through 
restrictions pursuant to Rule 611(b)(3).
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Current Environment
    In light of the events of May 6, 2010, NASDAQ believes that 
circumstances warrant the implementation of Rule 4753(c), in addition 
to the market collar protections currently in place.\9\ NASDAQ believes 
that implementing Rule 4753(c) will serve to protect market 
participants from aberrant volatility such as that which occurred on 
May 6, 2010. NASDAQ also believes that Rule 4753(c) will serve as a 
complement to the recently-approved cross-market single stock pause to 
be adopted by the U.S. national securities exchanges.\10\ NASDAQ notes 
that there are several differences between the cross-market approach 
and Rule 4753(c). Specifically, Rule 4753(c) uses tiered threshold 
range percentages that are based on a security's execution price in 
determining the price at which a halt would be initiated, whereas the 
cross market approach does not. Rule 4753(c) also has a shorter time 
threshold used in determining that a pause in trading should be 
initiated, and a shorter time during which a security is paused, as 
compared to the cross-market approach. Rule 4753(c) is applied 
throughout the trading day, whereas the cross-market approach does 
[sic] not. Last, while the cross-market approach will help to prevent 
aberrant volatility, it applies only to S&P 500 Index securities, thus 
it will not address aberrant volatility in the majority of NASDAQ-
listed securities. Adoption of Rule 4753(c) will allow NASDAQ to extend 
the rule's protections to its listed securities trading on NASDAQ, with 
such protections initially applying to the 100 pilot securities \11\ 
but with the goal of applying the rule to all NASDAQ-listed securities.
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    \9\ NASDAQ notes that, while the market collar protections were 
in place during the events of May 6, 2010, only approximately five 
percent of the volume on NASDAQ was attributable to market orders.
    \10\ Securities Exchange Act Release No. 62252 (June 10, 2010), 
75 FR 34186 (June 16, 2010) (SR-BATS-2010-014; SR-EDGA-2010-01; SR-
EDGX-2010-01; SR-BX-2010-037; SR-ISE-2010-48; SR-NYSE-2010-39; SR-
NYSEAmex-2010-46; SR-NYSEArca-2010-41; SR-NASDAQ-2010-061; SR-CHX-
2010-10; SR-NSX-2010-05; SR-CBOE-2010-047).
    \11\ Amendment No. 1 indicates that the pilot securities will be 
the NASDAQ 100 securities.
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    The following examples illustrate how Rule 4753(c) would operate in 
relation to the new cross-market single stock pause. In this sequence 
of events, the Rule 4753(c) pause is triggered prior to the cross-
market trading pause process:
    WXYZ is NASDAQ-listed and included in the S&P 500 Index.

 2:00:00 p.m., WXYZ trades at $300 on NASDAQ, which is also the 
consolidated last sale price
[cir] 2:00:30 p.m., WXYZ trades below $291 on NASDAQ
    [cir] WXYZ is paused pursuant to Rule 4753(c)
    [cir] WXYZ continues to trade elsewhere
 2:01:30 p.m., WXYZ resumes trading on NASDAQ at $295
 2:02:00 p.m., WXYZ trades below 286.15 on NASDAQ
    [cir] WXYZ is again paused pursuant to Rule 4753(c)
    [cir] WXYZ continues to trade elsewhere
 2:03:00 p.m., WXYZ resumes trading on NASDAQ at $288;
 2:03:30 p.m., WXYZ trades below 279.36 on NASDAQ;
    [cir] WXYZ is again paused pursuant to Rule 4753(c)
    [cir] WXYZ continues to trade elsewhere
 2:04:00 p.m., WXYZ consolidated last sale price reaches $270
    [cir] The cross-market trading pause process is triggered
    [cir] NASDAQ abandons the Rule 4753(c) and now follows the cross-
market trading pause process

    The following sequence of events illustrates a situation whereby a 
NASDAQ-listed security that is also covered by the cross-market trading 
pause process triggers both processes simultaneously:
    WXYZ is NASDAQ-listed and included in the S&P 500 Index.

 2:00:00 p.m., WXYZ trades at $20 on NASDAQ, which is also the 
consolidated last sale price;
 2:00:30 p.m., WXYZ trades at $17 on NASDAQ;
    [cir] Because the execution price exceeds both the 10 percent tiers 
of the cross-market pause process and Rule 4753(c), the cross-market 
process is followed
    [cir] WXYZ is paused on all markets

    The following sequence of events illustrates a situation whereby a 
NASDAQ-listed security may fall greater than 15 percent, yet does not 
trigger the cross-market trading pause process:
    WXYZ is NASDAQ-listed, but not included in the S&P 500 Index.
 2:00:00 p.m., WXYZ trades at $1.50 on NASDAQ, which is also 
the consolidated last sale price;
 2:00:30 p.m., WXYZ trades below $1.275 on NASDAQ;
    [cir] Although the security dropped more than 10 percent, the 
cross-market trading pause process would not triggered, since the 
security is not included in the S&P 500 Index
    [cir] WXYZ is paused pursuant to Rule 4753(c) because the security 
dropped greater than 15 percent in the prior 30 seconds
    [cir] WXYZ continues to trade elsewhere
    The examples above show that, although Rule 4753(c) operates 
independently from the cross-market trading pause process, both trade 
pause processes work efficiently along side of each other to dampen 
aberrant volatility.
Other Market's Approach
    NASDAQ notes that another market has adopted a similar process 
whereby the market's listed securities each may be temporarily removed 
from automatic trading when the trading exceeds certain average daily 
volume-, price-, and volatility-based criteria.\12\ Although dissimilar 
in process due to the differing nature of the markets, the pause under 
Rule 4753(c) is designed to achieve the same goal, namely, to apply 
quantitative criteria to pause trading in a listed security during 
times of aberrant volatility so that a more representative market may 
develop. NASDAQ's process differs from the other market's process in 
that it uses completely transparent criteria and timeframes, which 
serve to eliminate uncertainty from the trade pause process. For 
example and as noted above, the Rule 4753(c) process is triggered by 
execution prices that are clear and available to all market 
participants, and the pause in trading has a fixed 60 second Display

[[Page 41261]]

Only period process that cannot be extended.\13\ In addition, the pause 
will be followed by a ``cross'' that is predictable and well defined. 
As a consequence, application of the Rule 4753(c) process is automatic 
and precise, allowing no place for uncertainty. This will make the 
transition to this rule predictable and understandable. Most 
importantly, it will allow NASDAQ to insulate its issuers from 
volatility injected in the market from exchange halt programs with 
subjective criteria. Primary markets with responsibility to listed 
companies have an obligation and right to take actions to provide 
additional levels of protection from volatility to companies that list 
with it [sic].
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    \12\ NYSE Rule 1000(a)(iv).
    \13\ NYSE's LRP process has an indeterminate length, but can 
last several minutes during which the NYSE is not transmitting a 
protected quote in the affected security.
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Summary
    In approving Rule 4753(c), the Commission stated that 
systematically suspending trading in NASDAQ-listed securities that are 
the subject of abrupt and significant intra-day price movements 
promotes fair and orderly markets and the protection of investors.\14\ 
NASDAQ believes that adopting Rule 4753(c) is more appropriate now than 
it was at the time the Commission originally approved Rule 4753(c) 
given the need to protect investors from aberrant volatility, such as 
the volatility witnessed on May 6, 2010. Accordingly, NASDAQ is 
proposing to adopt Rule 4753(c) in identical form as originally 
approved by the Commission, but as a six month pilot for an initial 100 
Nasdaq-listed securities. During this pilot period, NASDAQ will study 
the impact of the rule on the pilot securities and will provide the 
Commission with monthly reports detailing its ongoing review of the 
pilot. These reports will inform the Commission of the number of times 
Rule 4753(c) is triggered and the security or securities involved, and 
will describe any patterns that emerge during the pilot period. NASDAQ 
is also making a technical correction to the table found in Rule 
4753(c)(1).
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    \14\ Supra note 4 at 50381.
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2. Statutory Basis
    NASDAQ believes the proposed rule change is consistent with the 
provisions of Section 6 of the Act,\15\ in general and with Section 
6(b)(5) of the Act,\16\ in particular, which requires that the rules of 
an exchange be designed to prevent fraudulent and manipulative acts and 
practices, promote just and equitable principles of trade, foster 
cooperation and coordination with persons engaged in regulating, 
clearing, settling, processing information with respect to, and 
facilitating transactions in securities, remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general, protect investors and the public interest. The 
proposed rule change is consistent with these requirements in that it 
will reduce the negative impacts of sudden, unanticipated volatility in 
individual NASDAQ Securities, and serve to restore an orderly market in 
a transparent and uniform manner, enhance the price-discovery process, 
increase overall market confidence, and promote fair and orderly 
markets and the protection of investors.
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    \15\ 15 U.S.C. 78f.
    \16\ 15 U.S.C. 78f(b)(5).
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    NASDAQ notes that the proposed rule change is identical to the rule 
change approved by the Commission when it approved Rule 4753(c) in 
August 2008, except that NASDAQ plans to implement the pilot on a 
shorter, six month basis. In approving Rule 4753(c), the Commission 
acknowledged that Rule 4753(c), which systematically suspends trading 
in NASDAQ-listed securities that are the subject of abrupt and 
significant intra-day price movements, promotes fair and orderly 
markets and the protection of investors.\17\ NASDAQ notes that the 
Commission received no comments on the proposed rule change that 
adopted Rule 4753(c) originally. NASDAQ believes that the lack of 
comment signaled that market participants considered the proposed new 
rule to be non-controversial. NASDAQ believes that, given the events of 
May 6, 2010, adopting Rule 4753(c) as a new pilot will ensure that 
covered NASDAQ Securities, and market participants trading therein on 
NASDAQ, are provided the needed protections of the rule.
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    \17\ Supra note 4 at 50381.
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    NASDAQ notes that the proposed rule change supplements the cross-
market single stock pause to be adopted by the national securities 
exchanges, which was approved by the Commission on June 10, 2010.\18\ 
NASDAQ applauds the Commission's leadership in bringing the national 
securities exchanges together to achieve a cross-market solution to 
help address the issues that may have caused the events of May 6, 2010. 
NASDAQ is continuously assessing actions it can take to further 
strengthen its market. In this regard, NASDAQ believes that quickly 
implementing Rule 4753(c) will complement the cross-market single stock 
pause by serving to better protect all of NASDAQ's listed securities 
covered by the pilot trading on NASDAQ during times of aberrant 
volatility, such as the volatility witnessed on May 6, 2010. NASDAQ 
notes that Rule 4753(c) in no way conflicts with the new cross-market 
single stock pause, but rather applies, in some cases, more stringent 
criteria to pause a broader range of securities on NASDAQ only. In 
addition, should a cross-market single stock pause be initiated in a 
NASDAQ Security during a Rule 4753(c) pause, the security would be 
subject to the cross-market single stock pause process.
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    \18\ Supra note 10.
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    NASDAQ has an obligation to adopt rules that protect investors and 
the public interest, which include rules that protect its listed 
securities and those that trade in them. Instituting Rule 4753(c) will 
serve to protect market participants within the scope of NASDAQ's 
authority under the Act. NASDAQ notes that market participants would be 
able to trade in securities subject to a Rule 4753(c) pause at other 
market venues, should they so choose.\19\
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    \19\ Supra note 8.
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    Last, NASDAQ notes that, in approving another market's approach to 
dealing with abnormal volatility in its listed securities, the 
Commission stated that precluding automatic executions under certain 
circumstances is warranted.\20\ Like that market's process, the 
proposed change to NASDAQ Rule 4753(c) will extend the rule's halt 
process to all listed securities traded on NASDAQ and will likewise 
serve to dampen volatility, thus providing market participants with 
time to react to achieve a more natural trading pattern of a particular 
security.
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    \20\ Securities Exchange Act Release No. 53539 (March 22, 2006), 
71 FR 16353, 16377-78 (March 31, 2006) (SR-NYSE-2004-05).
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    NASDAQ will keep the Commission apprised of the use of Rule 4753(c) 
as part of NASDAQ's ongoing review of the pilot. In this regard, during 
the pilot period NASDAQ will provide the Commission with monthly 
reports detailing the use of Rule 4753(c) and describing any patterns 
that may develop. As such, NASDAQ believes that the proposed rule 
change is consistent with the protection of investors and the public 
interest, and does not raise any novel regulatory issues.

B. Self-Regulatory Organization's Statement on Burden on Competition

    NASDAQ does not believe that the proposed rule change will result 
in any

[[Page 41262]]

burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act, as amended.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    Written comments were neither solicited nor received.

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 all aspects of the foregoing, including whether 
the proposed rule change is consistent with the Act. A stated purpose 
of the proposal is to protect Nasdaq-listed securities and market 
participants from ``aberrant'' volatility, such as that which occurred 
on May 6, 2010 and may be caused by operational or structural factors 
beyond the control of issuers and individual markets. To what extent do 
the price changes that would trigger a trading halt under the proposal 
indicate the potential existence of ``aberrant'' volatility, as opposed 
to the normal operation of the markets? If these price changes indicate 
potentially ``aberrant'' volatility, to what extent will the proposal 
address such volatility in a manner appropriate and consistent with the 
purposes of the Act? Will a trading halt at Nasdaq under the proposal 
restrict liquidity or increase volatility in the affected stock, since 
other markets can continue to trade the stock and may not have 
comparable volatility halts? In what respects are the consequences of 
this proposal likely to be similar to, or different from, the effects 
of other exchange-specific mechanisms that currently restrict trading 
on the relevant exchange under certain circumstances? More generally, 
to what extent is it appropriate for different exchanges to adopt 
different and potentially inconsistent approaches to trading pauses or 
restrictions that might affect the same stock? To what extent does the 
answer change based on whether the affected stock is already subject to 
a market-wide single-stock circuit breaker that applies consistently 
across all trading venues?
    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 rule-comments@sec.gov. Please include 
File Number SR-Nasdaq-2010-074 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-Nasdaq-2010-074. 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 Nasdaq. 
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 publicly 
available. All submissions should refer to File Number SR-Nasdaq-2010-
074 and should be submitted on or before August 5, 2010.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
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    \21\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-17191 Filed 7-14-10; 8:45 am]
BILLING CODE 8010-01-P