Document ID: SEC-2013-0351-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2013-02-19T05:00Z

[Federal Register Volume 78, Number 33 (Tuesday, February 19, 2013)]
[Notices]
[Pages 11716-11720]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-03682]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-68905; File No. SR-NASDAQ-2013-023]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Amend Rules 7014 and 7018

February 12, 2013.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\, and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on January 31, 2013, The NASDAQ Stock Market LLC (``NASDAQ'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I, II and III 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    NASDAQ is proposing (i) to modify the recently introduced Qualified 
Market Maker (``QMM'') pilot program to increase the incentives for 
participation provided thereunder; (ii) to replace the Extended Hours 
Investor Program (``EHIP'') with a similar financial incentive program 
focused both on usage of NASDAQ during pre- and post-market hours and 
use of NASDAQ's routing facility, to be referred to as the Routable 
Order Program (``ROP''); and (iii) to modify the securities covered by 
NASDAQ's recently introduced program of special pricing for certain 
``Designated Securities.''
    While changes pursuant to this proposal are effective upon filing, 
the Exchange will implement the proposed rule changes on February 1, 
2013.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaq.cchwallstreet.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. 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 the 
Statutory Basis for, the Proposed Rule Change

    1. Purpose
Qualified Market Maker Program
    In November 2012,\3\ NASDAQ introduced, on a six-month pilot basis, 
a market quality incentive program under which a member may be 
designated as a QMM with respect to one or more of its MPIDs if:
---------------------------------------------------------------------------

    \3\ Securities Exchange Act Release No. 68209 (November 9, 
2012), 77 FR 69519 (November 19, 2012) (SR-NASDAQ-2012-126).
---------------------------------------------------------------------------

     The member is not assessed any ``Excess Order Fee'' under 
Rule 7018 during the month; \4\ and
---------------------------------------------------------------------------

    \4\ Rule 7018(m). The Excess Order Fee is aimed at reducing 
inefficient order entry practices that place excessive burdens on 
the systems of NASDAQ and its members and that may negatively impact 
the usefulness and life cycle cost of market data. In general, the 
determination of whether to impose the fee on a particular MPID is 
made by calculating the ratio between (i) entered orders, weighted 
by the distance of the order from the NBBO, and (ii) orders that 
execute in whole or in part. The fee is imposed on MPIDs that have 
an ``Order Entry Ratio'' of more than 100.
---------------------------------------------------------------------------

     Through such MPID the member quotes at the national best 
bid or best offer (``NBBO'') at least 25% of the time during regular 
market hours \5\ in an average of at least 1,000 securities during the 
month.\6\

    \5\ Defined as 9:30 a.m. through 4:00 p.m., or such shorter 
period as may be designated by NASDAQ on a day when the securities 
markets close early (such as the day after Thanksgiving).
    \6\ A member MPID is considered to be quoting at the NBBO if it 
has a displayed order at either the national best bid or the 
national best offer or both the national best bid and offer. On a 
daily basis, NASDAQ determines the number of securities in which the 
member satisfied the 25% NBBO requirement. To qualify for QMM 
designation, the MPID must meet the requirement for an average of 
1,000 securities per day over the course of the month. Thus, if a 
member MPID satisfied the 25% NBBO requirement in 900 securities for 
half the days in the month, and satisfied the requirement for 1,100 
securities for the other days in the month, it would meet the 
requirement for an average of 1,000 securities. NASDAQ recently 
filed an amendment with respect to the QMM program to make it clear 
that if a member seeking to be designated as a QMM terminates the 
use of one MPID and simultaneously commences use of another MPID 
during the course of a month, it may aggregate activity on the two 
MPIDs for purposes of determining its eligibility as a QMM. See SR-
NASDAQ-2013-016 (January 30, 2013).
---------------------------------------------------------------------------

Thus, to be a QMM, a member must make a significant contribution to 
market quality by providing liquidity at the NBBO in a large number of 
stocks for a significant portion of the day. In

[[Page 11717]]

addition, the member must avoid imposing the burdens on NASDAQ and its 
market participants that may be associated with excessive rates of 
entry of orders away from the inside and/or order cancellation. A QMM 
may be, but is not required to be, a registered market maker in any 
security; thus, the QMM designation does not by itself impose a two-
sided quotation obligation or convey any of the benefits associated 
with being a registered market maker. The designation does, however, 
reflect the QMM's commitment to provide meaningful and consistent 
support to market quality and price discovery by extensive quoting at 
the NBBO in a large number of securities. Thus, the program is designed 
to attract liquidity both from traditional market makers and from other 
firms that are willing to commit capital to support liquidity at the 
NBBO. By providing incentives under the program, NASDAQ hopes to 
provide improved trading conditions for all market participants through 
narrower bid-ask spreads and increased depth of liquidity available at 
the inside market. In addition, the program reflects an effort to use 
financial incentives to encourage a wider variety of members, including 
members that may be characterized as high-frequency trading firms, to 
make positive commitments to promote market quality.
    Under the program as originally implemented, a member that is a QMM 
with respect to a particular MPID (a ``QMM MPID'') \7\ will receive:
---------------------------------------------------------------------------

    \7\ NASDAQ is adding the defined term ``QMM MPID'' to the rule 
through this proposed rule change.
---------------------------------------------------------------------------

     An ``NBBO Setter Incentive credit'' of $0.0005 with 
respect to displayed orders with a size of at least one round lot that 
set the NBBO or that first allow NASDAQ to join another trading center 
at the NBBO and that are entered through a QMM MPID; and
     A 25% discount on fees for ports used for entering orders 
for a QMM MPID, up to a total discount of $10,000 per QMM MPID per 
month.\8\ The specific fees subject to this discount are: (i) all ports 
using the NASDAQ Information Exchange (``QIX'') protocol,\9\ (ii) 
Financial Information Exchange (``FIX'') trading ports,\10\ and (iii) 
ports using other trading telecommunications protocols.\11\
---------------------------------------------------------------------------

    \8\ The ports subject to the discount are not used for receipt 
of market data.
    \9\ The applicable undiscounted fees are $1,200 per month for a 
port pair or ECN direct connection port pair, and $1,000 per month 
for an unsolicited message port. See Rule 7015(a).
    \10\ The applicable undiscounted fee is $500 per port per month. 
See Rule 7015(b).
    \11\ The applicable undiscounted fee is $500 per port pair per 
month. See Rule 7015(g).
---------------------------------------------------------------------------

    In order to further increase the appeal of the QMM program to 
potential participants, NASDAQ is adding the following additional 
benefits for QMMs:
     NASDAQ will provide a credit of $0.0001 per share executed 
with respect to all orders in securities priced at $1 or more per share 
that provide liquidity and that are entered through a QMM MPID, other 
than orders qualifying for the higher NBBO Setter Incentive credit 
described above. The $0.0001 credit will be in addition to any credit 
payable under Rule 7018. However, if a QMM also participates in the 
Investor Support Program (the ``ISP''), NASDAQ will pay the greater of 
any applicable credit under the ISP or the QMM program, but not a 
credit under both programs.
     NASDAQ will provide a credit of $0.0020 per share executed 
for all midpoint pegged or midpoint peg post-only orders (``midpoint 
orders'') in securities priced at $1 or more per share entered through 
a QMM MPID (in lieu of the credit payable under Rule 7018). NASDAQ 
notes that under Rule 7018, midpoint orders receive a higher rebate 
than other forms of non-displayed orders because they offer price 
improvement.
     For a number of shares not to exceed the number of shares 
of liquidity provided through a QMM MPID (the ``Numerical Cap''), 
NASDAQ will charge a fee of $0.0028 per share executed for orders in 
securities priced at $1 or more per share that access liquidity on the 
Nasdaq Market Center and that are entered through the same QMM MPID; 
provided, however, that orders that would otherwise be charged $0.0028 
per share executed under Rule 7018 will not count toward the Numerical 
Cap. For shares above the Numerical Cap, NASDAQ will charge the rate 
otherwise applicable under Rule 7018.
    NASDAQ is proposing these discounts as a means of recognizing the 
value of market participants that consistently quote at the NBBO in a 
large number of securities and providing greater incentives to market 
participants to meet the applicable quoting requirements. Even when 
such market participants are not formally registered as market makers, 
they risk capital by offering immediately executable liquidity at the 
price most favorable to market participants on the opposite side of the 
market. Such activity promotes price discovery and dampens volatility 
and thereby enhances the attractiveness of NASDAQ as a trading venue.
Routable Order Program and Extended Hours Investor Program
    NASDAQ is replacing its Extended Hours Investor Program with a 
similar program focused on recognizing the propensity of members 
representing retail customers to make more extensive use of exchange-
provided routing facilities and pre- and post-market trading sessions, 
as compared with proprietary traders. NASDAQ believes that this 
correlation results from the low cost and simplicity of exchange-
provided routing, and the convenience of pre- and post-market trading 
for persons who are not professional traders. Accordingly, NASDAQ is 
proposing a new program that, together with the ISP, is aimed at 
encouraging greater participation in NASDAQ by members that represent 
retail customers.\12\ The EHIP will be eliminated, however, because it 
has not been successful in attracting additional trading activity to 
NASDAQ.
---------------------------------------------------------------------------

    \12\ The Commission has expressed concern that a significant 
percentage of the orders of individual investors are executed in 
over-the-counter markets, that is, at off-exchange markets. 
Securities Exchange Act Release No. 61358 (January 14, 2010), 75 FR 
3594 (January 21, 2010) (Concept Release on Equity Market Structure, 
``Concept Release''). In the Concept Release, the Commission 
recognized the strong policy preference under the Act in favor of 
price transparency and displayed markets. See also Mary L. Schapiro, 
Strengthening Our Equity Market Structure (Speech at the Economic 
Club of New York, Sept. 7, 2010) (``Schapiro Speech,'' available on 
the Commission Web site) (comments of Commission Chairman on what 
she viewed as a troubling trend of reduced participation in the 
equity markets by individual investors, and that nearly 30 percent 
of volume in U.S.-listed equities is executed in venues that do not 
display their liquidity or make it generally available to the 
public).
---------------------------------------------------------------------------

    To be eligible for the new Routable Order Program, a member must 
have an MPID through which it provides an average daily volume of at 
least 35 million shares of displayed liquidity using orders that employ 
the SCAN or LIST routing strategies, including an average daily volume 
of at least 2 million shares that are provided prior to the NASDAQ 
Opening Cross and/or after the NASDAQ Closing Cross.\13\ SCAN is a 
basic routing strategy that is widely used by firms that represent 
retail customers. SCAN orders check the Nasdaq Market Center System for 
available shares, while remaining shares are simultaneously routed to 
destinations on the applicable routing table. If shares remain un-
executed after routing, they are posted on the book. Once on the book, 
if the order is

[[Page 11718]]

subsequently locked or crossed by another market center, the System 
will not route the order to the locking or crossing market center.\14\ 
LIST is a routing strategy that is used by firms that wish for their 
orders to participate in the opening and closing processes of each 
security's primary listing exchange, to access liquidity on all 
exchanges if marketable, and otherwise to post to the NASDAQ book. 
Members, including those that represent retail customers, use the LIST 
strategy to offload on the Exchange and its routing broker the 
technical complexity associated with routing orders to participate in 
the market open and/or close.
---------------------------------------------------------------------------

    \13\ If a member seeking to participate in the ROP terminates 
the use of one MPID and simultaneously commences use of another MPID 
during the course of a month, it may aggregate activity on the two 
MPIDs for purposes of determining its eligibility.
    \14\ The SKIP routing strategy is a form of SCAN in which the 
entering firm instructs the System to bypass any market centers 
included in the SCAN System routing table that are not posting 
Protected Quotations within the meaning of Regulation NMS. The ROP 
does not apply to SKIP orders, however, as it is less used by 
members that represent retail customers.
---------------------------------------------------------------------------

    With respect to SCAN and LIST orders in securities priced at $1 or 
more per share that are entered through an MPID that qualifies for the 
ROP, NASDAQ will charge a fee of $0.0029 per share executed with 
respect to such orders when they access liquidity in the Nasdaq Market 
Center.\15\ If such orders are designated for display in the Nasdaq 
Market Center and provide liquidity after posting to the book, NASDAQ 
will provide a credit of $0.0037 per share executed. With respect to 
SCAN and LIST orders in securities priced less than $1 per share that 
are entered through an MPID that qualifies for the ROP, NASDAQ will 
charge a fee of 0.30% of the total transaction cost with respect to 
such orders when they access liquidity in the Nasdaq Market Center,\16\ 
and will provide a credit of $0.00003 per share executed if they are 
designated for display and provide liquidity after posting to the book. 
These fees and credits are in lieu of the fees and credits otherwise 
charged or provided under Rule 7018. Moreover, orders that qualify for 
these fees and credits are not eligible to receive additional credits 
under the ISP, but are included in calculations with regard to 
eligibility to participate in the ISP and other incentive programs 
under Rule 7014.
---------------------------------------------------------------------------

    \15\ When such orders execute at other market centers, the 
routing fees provided for in Rule 7018 will apply.
    \16\ When such orders execute at other market centers, the 
routing fees provided for in Rule 7018 will apply.
---------------------------------------------------------------------------

Designated Securities Pricing
    In December 2012,\17\ NASDAQ introduced a discounted execution fee 
of $0.0028 per share executed for the following securities 
(``Designated Securities''):
---------------------------------------------------------------------------

    \17\ Securities Exchange Act Release No. 68421 (December 13, 
2012), 77 FR 75232 (December 19, 2012) (SR-NASDAQ-2012-135).

BAC Bank of America Corporation
DIA SPDR Dow Jones Industrial Average ETF
EEM iShares MSCI Emerging Markets Index ETF
F Ford Motor Co.
GE General Electric Company
GEN GenOn Energy, Inc.
HPQ Hewlett-Packard Company
INTC Intel Corporation
IWM iShares Russell 2000 Index ETF
MSFT Microsoft Corporation
NOK Nokia Corporation
QQQ Powershares QQQ ETF
S Sprint Nextel Corp.
SPY SPDR S&P 500 ETF
TZA Direxion Daily Small Cap Bear 3X Shares ETF
VXX iPath S&P 500 VIX ST Futures ETN
XLF Financial Select Sector SPDR ETF
YHOO Yahoo! Inc.

    The discounted fee applies to all orders in Designated Securities 
entered through an MPID through which a member accesses, provides, or 
routes shares of liquidity that represent more than 0.25% of 
Consolidated Volume \18\ during the month, including a daily average 
volume of at least 2 million shares of liquidity provided. By lowering 
the fee for accessing liquidity in these securities, NASDAQ hoped to 
encourage members to give greater priority to NASDAQ in their routing 
decisions, thereby lowering their costs and improving the execution 
experience of liquidity providers in Designated Securities. In order to 
qualify for the discount, members must demonstrate a commitment to 
regular participation in the Nasdaq Market Center by reaching 
relatively modest usage levels (shares accessed, provided or routed 
representing 0.25% of Consolidated Volume), including an average daily 
volume of 2 million or more shares of liquidity provided.
---------------------------------------------------------------------------

    \18\ ``Consolidated Volume'' is defined as the total 
consolidated volume reported to all consolidated transaction plans 
by all exchanges and trade reporting facilities.
---------------------------------------------------------------------------

    Based on the performance of the program to date, NASDAQ has 
determined to modify the list of Designated Securities as follows:

AAPL Apple Inc.
CSCO Cisco Systems, Inc.
DELL Dell Inc.
INTC Intel Corporation
MSFT Microsoft Corporation
MU Micron Technology Inc.
NWSA News Corp.
ORCL Oracle Corporation
QQQ PowerShares QQQ ETF
YHOO Yahoo! Inc.

    The change reflects the fact that the program of Designated 
Securities has been most successful at increasing the share of orders 
routed to NASDAQ in NASDAQ-listed securities. Accordingly, NASDAQ is 
modifying the program to focus exclusively on NASDAQ-listed securities 
for which NASDAQ believes that the incentive provided through the 
program has the most potential to increase NASDAQ's share of 
executions.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\19\ in general, and with 
Sections 6(b)(4) and 6(b)(5) of the Act,\20\ 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 not 
designed to permit unfair discrimination between customers, issuers, 
brokers, or dealers.
---------------------------------------------------------------------------

    \19\ 15 U.S.C. 78f.
    \20\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    The proposed changes are reflective of NASDAQ's ongoing efforts to 
use pricing incentive programs to attract orders of retail customers to 
NASDAQ and improve market quality. The QMM program is intended to 
encourage members to promote price discovery and market quality by 
quoting at the NBBO for a significant portion of each day in a large 
number of securities, thereby benefitting NASDAQ and other investors by 
committing capital to support the execution of orders. The proposed 
changes to the program are intended to further promote these goals by 
providing additional incentives for market participants to achieve the 
requirements for participation in the program. Specifically, the 
proposed changes are consistent with statutory requirements in the 
following respects:
     The proposal reduces the access fee paid by QMMs to 
$0.0028 per share executed, for a number of shares that reflects the 
number of shares of liquidity provided by the QMM. This change is 
reasonable because it reflects a price reduction from the rate of 
$0.0030 or $0.0029 per share executed otherwise applicable. The change 
is consistent with an equitable allocation of fees and is not unfairly 
discriminatory because it is being offered to market participants that 
make significant contributions to market quality by satisfying the QMM

[[Page 11719]]

requirements, thereby benefitting other NASDAQ market participants.
     The proposal increases the rebate paid with respect to 
orders, other than orders that set or join the NBBO under the terms of 
the NBBO Setter Incentive program, by $0.0001. This change is 
reasonable because it provides a modest additional incentive for market 
participants to achieve the market quality requirements of the QMM 
program, while still providing an appropriate differentiation from 
orders that qualify for the NBBO Setter Incentive program, thereby 
receiving an extra rebate of $0.0005. The change is consistent with an 
equitable allocation of fees and is not unfairly discriminatory because 
it is being offered to market participants that make significant 
contributions to market quality by satisfying the QMM requirements, 
thereby benefitting other NASDAQ market participants.
     The proposal increases the rebate paid with respect to 
midpoint orders to $0.0020 per share executed, as compared with the 
rebate of $0.0015 or $0.0017 per share executed otherwise payable under 
Rule 7018. This change is reasonable, because it will result in a price 
reduction with respect to these orders. It is also reasonable because 
it is consistent with NASDAQ's existing practice of paying a higher 
rebate with respect to midpoint orders than with respect to other forms 
of non-displayed orders due to the greater potential for midpoint 
orders to provide price improvement to market participants that execute 
against them. The change is consistent with an equitable allocation of 
fees and is not unfairly discriminatory because it is being offered to 
market participants that make significant contributions to market 
quality by satisfying the QMM requirements, thereby benefitting other 
NASDAQ market participants.
    NASDAQ further believes that the proposed ROP is consistent with 
the requirements of the Act. Specifically, as with the existing ISP, 
the goal of the program is to provide meaningful incentives for members 
that represent significant numbers of retail customers to increase 
their participation in NASDAQ. The proposed fees and credits applicable 
to orders covered by the ROP are reasonable because they reflect 
significant fee reductions, thereby reducing the costs of members that 
represent retail customers and that take advantage of the program, and 
potentially also reducing costs to the customers themselves. The change 
is consistent with an equitable allocation of fees because NASDAQ 
believes that it is reasonable to use fee reductions as a means to 
encourage greater retail participation in NASDAQ. Because retail orders 
are more likely to reflect long-term investment intentions than the 
orders of proprietary traders, they promote price discovery and dampen 
volatility. Accordingly, their presence in the NASDAQ market has the 
potential to benefit all market participants. For this reason, NASDAQ 
believes that it is equitable to provide significant financial 
incentives to encourage greater retail participation in the market. 
NASDAQ further believes that the proposed program is not unreasonable 
discriminatory because it is offered to firms representing retail 
customers that provide significant levels of liquidity, and is 
therefore complementary to existing programs, such as the ISP, that 
already aim to encourage greater retail participation.
    NASDAQ believes that the proposed elimination of the EHIP is 
reasonable because no market participants have taken advantage of it 
since its inception, and therefore its elimination will not have a 
significant impact on members' fees and credits. Similarly, the 
elimination is consistent with an equitable allocation of fees and is 
not unreasonably discriminatory because significant financial 
incentives aimed at encouraging retail participation in a manner 
similar to the EHIP are already offered and are being added to NASDAQ's 
fee schedule through this filing.
    NASDAQ believes that the proposal to modify the pricing incentive 
for Designated Securities is reasonable because it will focus an 
existing fee reduction on securities that NASDAQ believes are more 
likely to have their volumes on NASDAQ increase, thereby reducing fees 
for a larger number of trades. The proposal is consistent with an 
equitable allocation of fees and not unfairly discriminatory because it 
will reduce fees for members that have demonstrated a commitment to 
regular participation in the Nasdaq Market Center through reaching 
specified levels of overall usage and liquidity provision. Incentives 
focused on the members that provide liquidity are prevalent in 
securities markets because higher levels of liquidity provision aid 
price discovery and dampen volatility. In addition, the focus of the 
incentive on Designated Securities is equitable and not unreasonably 
discriminatory because, despite strong quotes in terms of size and time 
at the inside, NASDAQ's share of executions in these securities has 
declined, thereby risking the willingness of members to continue to 
offer liquidity at current levels. By providing an incentive for 
members to access NASDAQ's quote in these securities, the price change 
will benefit liquidity providers as well as liquidity accessors. The 
discount is also not unfairly discriminatory because NASDAQ believes 
that the modified list of Designated Securities will be more widely 
traded than the former list, and the change will therefore result in 
broader pricing reductions.
    Finally, 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. In 
such an environment, NASDAQ must continually adjust its fees to remain 
competitive with other exchanges and with alternative trading systems 
that have been exempted from compliance with the statutory standards 
applicable to exchanges. NASDAQ believes that all aspects of the 
proposed rule change reflect this competitive environment because the 
changes reflect significant price reductions, offset only to a small 
extent by the elimination of the EHIP.

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. Specifically, 
NASDAQ believes that these changes reflect significant price 
reductions, offset only to a small extent by the elimination of the 
EHIP. Such reductions reflect the high degree of competition in the 
cash equities markets and will further enhance that competition by 
lowering fees and possibly encouraging NASDAQ's competitors to make 
competitive responses. The market for order execution is extremely 
competitive and members may readily opt to disfavor NASDAQ's execution 
services if they believe that alternatives offer them better value. 
Accordingly, NASDAQ believes that the degree to which fee changes in 
this market may impose any burden on competition is extremely limited. 
Because competitors are free to modify their own fees in response, and 
because market participants may readily adjust their order routing 
practices, NASDAQ does not believe that the proposed changes will 
impair the ability of members or competing order execution venues to 
maintain their competitive standing in the financial markets.

[[Page 11720]]

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A) of the Act \21\ and paragraph (f) of Rule 19b-4 
thereunder.\22\ At any time within 60 days of the filing of the 
proposed rule change, the Commission summarily may temporarily suspend 
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.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78s(b)(3)(A).
    \22\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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 email to rule-comments@sec.gov. Please 
include File Number SR-NASDAQ-2013-023 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-NASDAQ-2013-023. 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 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-NASDAQ-2013-023 and should 
be submitted on or before March 12, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\23\
---------------------------------------------------------------------------

    \23\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-03682 Filed 2-15-13; 8:45 am]
BILLING CODE 8011-01-P