Document ID: SEC-2018-0542-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: The Nasdaq Stock Market LLC
Posted Date: 2018-04-04T04:00Z

[Federal Register Volume 83, Number 65 (Wednesday, April 4, 2018)]
[Notices]
[Pages 14534-14536]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-06774]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82964; File No. SR-NASDAQ-2018-022]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Exchange Rule 7034

March 29, 2018.
    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 March 16, 2018, The Nasdaq Stock Market LLC (``Nasdaq'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by the Exchange. The 
Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons.
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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

    The Exchange proposes to amend Rule 7034, as described below.
    The text of the proposed rule change is available on the Exchange's 
website 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 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 Exchange proposes to amend Rule 7034 pertaining to colocation 
services and fees to harmonize it with the rules of Nasdaq BX, Inc. 
(``BX'').
    The Exchange first proposes to amend Rule 7034(b), under the 
heading ``Market Data Connectivity,'' to re-categorize and to update 
references to the CBOE/Bats/Direct Edge data feeds to reflect their 
current names. Similarly, the Exchange proposes to delete a $1,000 
installation fee that presently applies to the Direct Edge feeds 
because the Direct Edge feeds are now offerings of CBOE, along with the 
BZX and BYX feeds. Going forward, a single, one-time $1,000 
installation fee will apply to subscribers to any or all of the CBOE 
data feeds. The Exchange also proposes to correct a typographical error 
in the name of the TSXV Level 2 Feed. The Exchange notes that this 
proposal will render this paragraph of Rule 7034(b) consistent with BX 
Rule 7034(b).
    Second, the Exchange proposes to amend Rule 7034(b), under the 
heading

[[Page 14535]]

``Connectivity to Nasdaq,'' to specify that connectivity to the 
Exchange will also provide for connectivity to any or all of the other 
Nasdaq, Inc. Exchanges, including not only BX and Nasdaq PHLX LLC 
(``Phlx''), but also Nasdaq ISE LLC (``Nasdaq ISE''), Nasdaq MRX LLC 
(``Nasdaq MRX''), and Nasdaq GEMX LLC (``Nasdaq GEMX'') (the ``Nasdaq, 
Inc. Exchanges''). These changes will render this paragraph of the 
Rules consistent with corresponding paragraphs in the rulebooks and 
fees schedules of the other Nasdaq Exchanges.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\3\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\4\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest.
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    \3\ 15 U.S.C. 78f(b).
    \4\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that its proposal to update Rule 7034 will 
serve the interests of the public and investors by ensuring that the 
Exchange's Rules are accurate and current with respect to the names of 
the third party data feeds to which it offers connectivity. 
Furthermore, the Exchange believes that it is in the public interest to 
correct typographical errors that could otherwise lead to confusion. 
Likewise, it will serve the public interest and the interests of 
investors to specify in the Exchange's Rules that connectivity to the 
Exchange will also provide for connectivity to any or all of the other 
Nasdaq, Inc. Exchanges, including not only BX and Phlx, but also Nasdaq 
ISE, Nasdaq MRX, and Nasdaq GEMX. The existing Rule is outdated as it 
does not reflect the acquisition by Nasdaq, Inc. of Nasdaq ISE, Nasdaq 
MRX, and Nasdaq GEMX and the shared connectivity that has resulted from 
that acquisition. The proposal updates the existing Rule. These 
proposals will not impact competition or limit access to or 
availability of the Exchange or its systems. The Exchange notes the 
proposal is noncontroversial because BX has made the same changes to 
its rules.
    The Exchange's proposal to eliminate the $1,000 installation fee 
that presently applies to the Direct Edge feeds is consistent with 
Section 6(b) of the Act,\5\ in general, and furthers the objectives of 
Sections 6(b)(4) and 6(b)(5) of the Act,\6\ 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, and is not designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers. The proposal is reasonable 
because the Direct Edge feeds are now offerings of CBOE, along with the 
BZX and BYX feeds. The Exchange believes it is equitable, going 
forward, to charge a single, one-time $1,000 installation fee to 
subscribers to any or all of the CBOE data feeds, including the BZX 
Depth, BYX Depth, EDGA Depth, and EDGX Depth feeds. This proposal is 
not unfairly discriminatory because it will apply to all similarly 
situated customers of the CBOE data feeds.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4) and (5).
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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 not necessary or appropriate in 
furtherance of the purposes of the Act.
    In this instance, the proposed changes merely eliminate or replace 
obsolete text, update references to data feeds and shared connectivity, 
and correct typographical errors. The Exchange does not intend for or 
expect that such changes will have any impact on competition.

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

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \7\ and Rule 19b-
4(f)(6) thereunder.\8\
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    \7\ 15 U.S.C. 78s(b)(3)(A).
    \8\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
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    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \9\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \10\ permits the 
Commission to designate a shorter time if such action is consistent 
with the protection of investors and the public interest. The Exchange 
has requested that the Commission waive the 30-day operative delay so 
that the proposed rule change may become operative upon filing. Waiver 
of the operative delay would allow the Exchange to update its rules 
without delay to reflect current and accurate information with respect 
to the third party data feeds to which it offers connectivity, to 
reflect the acquisition by Nasdaq, Inc. of Nasdaq ISE, Nasdaq MRX, and 
Nasdaq GEMX and the shared connectivity that resulted from the 
acquisition, and to correct a typographical error. The Commission also 
notes that BX recently made similar changes to its rules.\11\ 
Therefore, the Commission believes that waiver of the 30-day operative 
delay is consistent with the protection of investors and the public 
interest. Accordingly, the Commission hereby waives the operative delay 
and designates the proposed rule change operative upon filing.\12\
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    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ 17 CFR 240.19b-4(f)(6)(iii).
    \11\ See Securities Exchange Act Release No. 82628 (February 5, 
2018), 83 FR 5818 (February 9, 2018) (SR-BX-2018-006).
    \12\ For purposes only of waiving the 30-day operative delay, 
the Commission also has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    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. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.

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:

[[Page 14536]]

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NASDAQ-2018-022 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2018-022. 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 website (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 website 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. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NASDAQ-2018-022, and should be submitted 
on or before April 25, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
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    \13\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2018-06774 Filed 4-3-18; 8:45 am]
 BILLING CODE 8011-01-P