Document ID: SEC-2006-1273-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: National Association of Securities Dealers, Inc.
Posted Date: 2006-10-02T04:00Z

[Federal Register: October 2, 2006 (Volume 71, Number 190)]
[Notices]               
[Page 58029-58030]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr02oc06-138]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-54498; File No. SR-NASD-2006-095]

 
Self-Regulatory Organizations; National Association of Securities 
Dealers, Inc.; Notice of Filing and Order Granting Accelerated Approval 
of Proposed Rule Change and Amendment No. 1 Thereto Regarding Fees for 
Non-NASD Member Subscribers to the New Nasdaq Workstation and Weblink 
ACT

September 25, 2006.
    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 August 1, 2006, the National Association of Securities Dealers, Inc. 
(``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc. 
(``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. Nasdaq amended the 
proposed rule change on September 20, 2006.\3\ The Commission is 
publishing this notice to solicit comments on the proposed rule change, 
as amended, from interested persons, and simultaneously granting 
accelerated approval of the proposed rule change, as amended.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Amendment No. 1.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to modify fees for non-NASD member subscribers to 
the New Nasdaq Workstation (``NNW'') and Weblink ACT. The proposed rule 
change will apply to these non-members the same changes that Nasdaq is 
instituting for members.\4\ Nasdaq seeks to implement the proposed rule 
change retroactively as of August 1, 2006. The text of the proposed 
rule change is available at the Commission's Public Reference Room, at 
NASD, and at http://www.nasd.com.\5\

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    \4\ See SR-NASD-2006-094.
    \5\ Changes are marked to the rule text that appears in the 
electronicNASD Manual found at http://www.nasd.com, as modified on 

an immediately effective basis by SR-NASD-2006-094. Nasdaq is filing 
this proposed rule change because the NNW and Weblink ACT may be 
used in limited circumstances by service bureaus that are not NASD 
members with respect to the quotation, execution, and trade 
reporting systems operated by Nasdaq with respect to non-Nasdaq 
securities. The NASDAQ Stock Market LLC (``Nasdaq Exchange'') is 
also filing a comparable modification to Nasdaq Exchange Rule 7015.
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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 III 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
    In SR-NASD-2006-094, Nasdaq amended Rule 7010 to change NASD member 
fees associated with its Web-based New Nasdaq Workstation (``NNW'') and 
Weblink ACT products. Since the NNW's inception as a replacement for 
the Nasdaq Workstation II (``NWII'') last year, the fee for the NNW had 
been $435 per user per month, plus $90 per month for data feeds 
included with the NNW, for a total cost of $525 per user per month. In 
SR-NASD-2006-094, Nasdaq reduced the fee to $475 per user per month, 
including the cost of the data feeds provided with the NNW. The change 
is designed to enhance the competitiveness of the NNW in contrast to 
front-end applications provided by broker-dealers and service bureaus, 
and, as discussed below, also reflects decreasing demand for the 
product.
    Weblink ACT, also referred to as Nasdaq Workstation Post Trade, is 
a Web-based application used for submission of trade reports. As such, 
as the Nasdaq Exchange begins to operate as a national securities 
exchange, Weblink ACT provides basic front-end access to the Trade 
Reporting Facility (``TRF'') operated by Nasdaq and the NASD,\6\ as 
well as access to ACT functionality still offered by Nasdaq under 
authority delegated by NASD.
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    \6\ Nasdaq expects that, consistent with current practice, most 
NASD members seeking access to the TRF would use a proprietary 
front-end system developed by the broker-dealer or a product offered 
by a service bureau. Weblink ACT is designed as a basic front-end 
system for low volume users.
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    Since the introduction of NNW and Weblink ACT, a number of former 
NWII users have opted to move to Weblink ACT rather than NNW, 
reflecting a desire to use these Web-based products exclusively for 
trade reporting, rather than active trading. Accordingly, in SR-NASD-
2006-094, Nasdaq increased the

[[Page 58030]]

comparatively low fees for Weblink ACT to ensure that, as between NNW 
and Weblink ACT, fees are allocated appropriately to allow recovery of 
Nasdaq's costs. Specifically, the current $150 fee for Weblink ACT 
users that report a daily average of 20 or fewer trades during a month 
is being raised to $200, while the $300 fee for higher volume users is 
being increased to $375. Nasdaq is filing this proposed rule change to 
apply the foregoing changes to non-NASD members subscribing to these 
products.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of Section 15A of the Act,\7\ in general, and with 
Section 15A(b)(5) of the Act,\8\ in particular, in that it provides for 
the equitable allocation of reasonable dues, fees and other charges 
among members and issuers and other persons using any facility or 
system which the NASD operates or controls. The proposed rule change 
applies to non-members a fee change that is being implemented for NASD 
members. Accordingly, the proposed rule change promotes an equitable 
allocation of fees between members and non-members using these 
services.
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    \7\ 15 U.S.C. 78o-3
    \8\ 15 U.S.C. 78o-3(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Nasdaq does not believe that the proposed rule change will result 
in any 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. 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 rule-comments@sec.gov. Please include 

File Number SR-NASD-2006-095 on the subject line.

Paper Comments

     Send paper comments in triplicate to Nancy M. Morris, 
Secretary, Securities and Exchange Commission, 100 F Street, NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number NASD-2006-095. 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. Copies of the filing 
also will be available for inspection and copying at the principal 
offices of NASD. 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-
NASD-2006-095 and should be submitted on or before October 23, 2006.

IV. Commission's Findings and Order Granting Accelerated Approval of 
Proposed Rule Change

    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a self-regulatory organization.\9\ 
Specifically, the Commission finds that the proposed rule change is 
consistent with Section 15A(b)(5) of the Act,\10\ which requires that 
the rules of a self-regulatory organization provide for the equitable 
allocation of reasonable dues, fees, and other charges among members 
and issuers and other persons using any facilities or system which it 
operates or controls.
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    \9\ In approving the proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition and 
capital formation. See 15 U.S.C. 78c(f).
    \10\ 15 U.S.C. 78o-3(b)(5).
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    The Commission notes that this proposal would permit the schedule 
for non-NASD members to mirror the schedule applicable to NASD members 
that became effective on August 1, 2006, pursuant to SR-NASD-2006-094.
    The Commission finds good cause for approving the proposed rule 
change, as amended, prior to the 30th day after the date of publication 
of the notice thereof in the Federal Register. The proposed fees for 
non-NASD members are identical to those in SR-NASD-2006-094, which 
implemented those fees for NASD members and which became effective as 
of August 1, 2006. The Commission notes that the instant proposed rule 
change will promote consistency in NASD's fee schedule by applying 
simultaneously the same pricing schedule for NASD members and non-NASD 
members alike. Therefore, the Commission finds that there is good 
cause, consistent with Section 19(b)(2) of the Act, to approve the 
proposed rule change on an accelerated basis.

V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that the proposed rule change, as amended (SR-NASD-2006-095), be, and 
hereby is, approved on an accelerated basis. 
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    \11\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\11\
Nancy M. Morris,
Secretary.
[FR Doc. E6-16166 Filed 9-29-06; 8:45 am]

BILLING CODE 8010-01-P