Document ID: SEC-2011-1136-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2011-08-08T04:00Z

[Federal Register Volume 76, Number 152 (Monday, August 8, 2011)]
[Notices]
[Pages 48189-48190]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-19983]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65014; File No. SR-NASDAQ-2011-101]

Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Fees Assessed Under Rule 7015(h)

August 2, 2011.
    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 July 26, 2011, The NASDAQ Stock Market LLC (``NASDAQ'') 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. 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 the 
Substance of the Proposed Rule Change

    NASDAQ is proposing to amend the fees assessed under Rule 7015(h). 
NASDAQ will implement the amended fees effective August 1, 2011.
    The text of the proposed rule change is below. Proposed new 
language is in italics; proposed deletions are in brackets.
* * * * *

7015. Access Services

    The following charges are assessed by Nasdaq for connectivity to 
systems operated by NASDAQ, including the Nasdaq Market Center, the 
FINRA/NASDAQ Trade Reporting Facility, and FINRA's OTCBB Service. The 
following fees are not applicable to the NASDAQ Options Market LLC. For 
related options fees for Access Services refer to Rule 7053.
    (a)-(g) No change.
    (h) VTE Terminal Fees
     Each ID is subject to a minimum commission fee of 
$125[100] per month unless it executes a minimum of 100,000 shares.
     Each ID receiving market data is subject to pass-through 
fees for use of these services. Pricing for these services is 
determined by the exchanges and/or market center.
     Each ID that is given web access is subject to a $125[100] 
monthly fee.
* * * * *

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 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. 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
    NASDAQ is proposing to increase the fees assessed members under 
Rule 7015(h) for use of VTE terminals. A VTE terminal is a basic front-
end user interface used by NASDAQ members to connect to, and enter 
orders in, The Nasdaq Market Center. Members using VTE terminals pay 
the exchanges directly for data feeds and services provided by NASDAQ 
and other exchanges or market centers through VTE at the SEC-approved 
rate that they would pay to receive the data feeds through other means. 
These data feeds provide information that is necessary for users to 
enter orders through VTE. The two fees assessed under Rule 7015(h) 
relate to optional web access and commissions.
    Rule 7015(h) currently assesses monthly a minimum commission fee of 
$100 fee per ID, and a web access fee of $100 per ID. NASDAQ last 
raised fees assessed under Rule 7015(h) in 2007 when it raised the fee 
for access to the terminal via the web from $50 monthly to $100 
monthly, and raised the minimum commission fee for users executing 
orders totaling less than 100,000 shares per month from $50 monthly to 
$100 monthly.\3\ In light of increasing costs, NASDAQ is proposing to 
increase the fee for access to the terminal via the web from $100 
monthly to $125 monthly, and increase the minimum commission fee for 
users executing orders totaling less than 100,000 shares per month from 
$100 monthly to $125 monthly.
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    \3\ Securities Exchange Act Release No. 56390 (September 12, 
2007), 72 FR 53614 (September 19, 2007) (SR-NASDAQ-2007-075).
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    NASDAQ notes that web connectivity is one option available to 
NASDAQ users for accessing the VTE terminal. Another option is access 
through extranet connectivity, where a user contracts directly with a 
third-party extranet provider and pays fees to that provider. With 
respect to minimum commission fees, members that execute total orders 
above the 100,000 share threshold will continue to not be assessed a 
commission fee.
    Based on NASDAQ's operation of the VTE since it was acquired from 
INET, NASDAQ believes that the pricing changes are warranted in order 
to appropriately balance the demand for the product with increasing 
platform, overhead and technology infrastructure costs.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\4\ in general, and with Section 
6(b)(4) of the Act,\5\ 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. All similarly situated members are 
subject to the same fee structure, and access to this NASDAQ service is 
offered on fair and non-discriminatory terms. As noted, NASDAQ has not 
increased the fees assessed under Rule 7015(h) since 2007 despite 
incurring increased costs. Use of VTE terminals is voluntary and 
members can avail themselves of numerous other means of accessing The 
Nasdaq Market Center. NASDAQ further 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.
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    \4\ 15 U.S.C. 78f.
    \5\ 15 U.S.C. 78f(b)(4).
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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

[[Page 48190]]

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(ii) of the Act \6\ and subparagraph (f)(2) of Rule 19b-4 
thereunder.\7\ 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 should be approved or disapproved.
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    \6\ 15 U.S.C. 78s(b)(3)(a)(ii).
    \7\ 17 CFR 240.19b-4(f)(2).
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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 rule-comments@sec.gov. Please include 
File Number SR-NASDAQ-2011-101 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-2011-101. 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 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 offices 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-2011-101, and should be submitted on or before 
August 29, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-19983 Filed 8-5-11; 8:45 am]
BILLING CODE 8011-01-P