Document ID: SEC-2007-0053-0001
Agency: sec
Document Type: Notice
Title: Self-regulatory organizations; proposed rule changes: NASDAQ Stock Market LLC
Posted Date: 2007-01-12T05:00Z

[Federal Register: January 12, 2007 (Volume 72, Number 8)]
[Notices]               
[Page 1569-1570]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12ja07-118]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-55042; File No. SR-NASDAQ-2006-055]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Order Granting Accelerated Approval of a Proposed 
Rule Change as Amended by Amendment No. 1 To Temporarily Adjust Tier 
Volume Limits

January 4, 2007.
    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 December 15, 2006, The NASDAQ Stock Market LLC (``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 substantially prepared by Nasdaq. On December 21, 2006, the 
Exchange submitted Amendment No. 1 to the proposed rule change. The 
order provides notice of the proposed rule change as modified by 
Amendment No. 1 and approves the proposed rule change, as amended, on 
an accelerated basis.
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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 proposes to reduce, for the month of November 2006, the 
average daily volume tiers in Nasdaq-listed securities contained in 
Nasdaq Rule 7018(a) to qualify for certain fee and rebate levels. The 
text of the proposed rule change is available at Nasdaq, the 
Commission's Public Reference Room, and http://nasdaq.complinet.com/file_store/pdf/rulebooks/SR-NASDAQ-2006-055.pdf
.

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 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
    Nasdaq is proposing to reduce, for the month of November 2006, the 
average daily volume tiers for trading and routing in Nasdaq-listed 
securities contained in Nasdaq Rule 7018(a) to qualify for certain fee 
and rebate levels. Currently, in order to qualify for a per-share 
execution fee of $0.0028, members must have an average daily volume 
through Nasdaq facilities in all securities during a particular month 
of (i) more than 30 million shares of liquidity provided, and (ii) more 
than 50 million shares of liquidity accessed and/or routed. For the 
month of November 2006, Nasdaq is proposing to reduce those 
qualification volume tiers to 27 million shares and 47 million shares, 
respectively. In addition, Nasdaq is also reducing for the month of 
November 2006 the monthly average daily volume tier required to obtain 
the $0.0025 credit rebate from its current 30 million share level to 27 
million shares. For routed orders, to qualify for a fee of the greater 
of (a) $0.0028 per share executed or (b) a pass-through of all 
applicable access fees charged by electronic communications networks 
that charge

[[Page 1570]]

more than $0.003 per share executed, a firm must have an average daily 
volume through Nasdaq facilities in all securities during the month of 
(y) more than 30 million shares of liquidity provided, and (z) more 
than 50 million shares of liquidity access and/or routed.
    For the month of November 2006, Nasdaq is proposing to reduce the 
30 million fee qualification volume tiers described above to 27 million 
shares, and the 50 million fee qualification volume tiers described 
above to 47 million shares. In addition, Nasdaq is also reducing for 
the month of November 2006, the monthly average daily volume tier 
required to obtain the $0.0025 credit rebate from its current 30 
million share level to 27 million shares.
    The reduction is designed to respond to certain processing issues 
associated with Nasdaq's implementation of its new single-book 
execution facility that can result in inhibiting the ability of users 
to submit orders to the system and thus not reach their usual levels of 
participation that would historically entitle them to the most 
competitive fee and rebate levels. Nasdaq believes that a temporary 
reduction of the qualification tiers is appropriate while both Nasdaq 
and its users gain more familiarity with the new single-book trading 
environment. Nasdaq notes that a similar reduction in tier levels is 
currently in effect for the month of December 2006,\3\ and this filing 
merely makes the December tier levels retroactive to November 2006.
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    \3\ See Securities Exchange Act Release No. 54933 (Dec. 13, 
2006), 71 FR 76404 (Dec. 20, 2006) (SR-NASDAQ-2006-051).
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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 the proposal provides for 
the equitable allocation of reasonable dues, fees, and other charges 
among its members and issuers and other persons using its facilities.
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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 necessary or appropriate in 
furtherance of the purposes of the Act.

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-NASDAQ-2006-055 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 SR-NASDAQ-2006-055. 
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 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 available publicly. All submissions should refer to 
File Number SR-NASDAQ-2006-055 and should be submitted on or before 
February 2, 2007.

IV. Commission's Finding and Order Granting Accelerated Approval of the 
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 national securities exchange.\6\ 
Specifically, the Commission finds that approval of the proposed rule 
change is consistent with Section 6(b)(4) \7\ of the Act because the 
proposal provides for the equitable allocation of reasonable dues, 
fees, and other charges among members and issuers and other persons 
using the facilities of Nasdaq.
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    \6\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78f(b)(4).
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    The Commission finds good cause, pursuant to Section 19(b)(2) of 
the Act,\8\ for approving the proposed rule change prior to the 
thirtieth day after the date of publication of the notice in the 
Federal Register. Nasdaq stated that the reduction is intended to 
address processing issues related to Nasdaq's implementation of its 
single-book trading environment. The Commission notes that the proposal 
represents a fee reduction for system users and also notes that the 
proposal is limited in duration. Therefore, the Commission finds that 
accelerated approval of the proposal is appropriate and should permit 
Nasdaq to extend the benefits of the reduction to its users for the 
month of November.
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    \8\ 15 U.S.C. 78s(b)(2).
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V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that the proposed rule change (SR-NASDAQ-2006-055) is hereby approved 
on an accelerated basis.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. E7-312 Filed 1-11-07; 8:45 am]

BILLING CODE 8011-01-P