Document ID: SEC-2011-0122-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: BATS Exchange, Inc., Chicago Board Options Exchange, Inc., Chicago Stock Exchange, Inc., et al.
Posted Date: 2011-01-28T05:00Z

[Federal Register Volume 76, Number 19 (Friday, January 28, 2011)]
[Notices]
[Pages 5231-5232]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-1857]

[[Page 5231]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-63754; File No. S7-24-89]

Joint Industry Plan; Notice of Filing and Immediate Effectiveness 
of Amendment No. 23 to the Joint Self-Regulatory Organization Plan 
Governing the Collection, Consolidation and Dissemination of Quotation 
and Transaction Information for Nasdaq-Listed Securities Traded on 
Exchanges on an Unlisted Trading Privileges Basis Submitted by the BATS 
Exchange, Inc., Chicago Board Options Exchange, Incorporated, Chicago 
Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., 
Financial Industry Regulatory Authority, Inc., International Securities 
Exchange LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX, Inc., Nasdaq Stock 
Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, 
NYSE Amex, Inc., and NYSE Arca, Inc.

January 21, 2011.
    Pursuant to Rule 608 of the Securities Exchange Act of 1934 (the 
``Act'') \1\ notice is hereby given that on December 15, 2010, the 
operating committee (``Operating Committee'' or ``Committee'') \2\ of 
the Joint Self-Regulatory Organization Plan Governing the Collection, 
Consolidation, and Dissemination of Quotation and Transaction 
Information for Nasdaq-Listed Securities Traded on Exchanges on an 
Unlisted Trading Privilege Basis (``Nasdaq/UTP Plan'' or ``Plan'') 
filed with the Securities and Exchange Commission (``Commission'') an 
amendment to the Plan.\3\ This amendment represents Amendment No. 23 to 
the Plan and proposes to establish a broker-dealer enterprise maximum 
(the ``Enterprise Maximum'') in respect of fees that the broker-dealer 
is required to pay for distribution of UTP Level 1 Service to 
nonprofessional subscribers that are brokerage account customers of the 
broker/dealer. The Commission is publishing this notice to solicit 
comments from interested persons on the proposed Amendment.
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    \1\ 17 CFR 242.608.
    \2\ The Plan Participants (collectively, ``Participants'') are 
the: BATS Exchange, Inc. (``BATS''); Chicago Board Options Exchange, 
Incorporated (``CBOE''); Chicago Stock Exchange, Inc. (``CHX''); 
EDGA Exchange, Inc. (``EDGA''); EDGX Exchange, Inc. (``EDGX''); 
Financial Industry Regulatory Authority, Inc. (``FINRA''); 
International Securities Exchange LLC (``ISE''); NASDAQ OMX BX, Inc. 
(``BX''); NASDAQ OMX PHLX, Inc. (``PHLX''); Nasdaq Stock Market LLC 
(``Nasdaq''); National Stock Exchange, Inc. (``NSX''); New York 
Stock Exchange LLC (``NYSE''); NYSE Amex, Inc. (``NYSEAmex''); and 
NYSE Arca, Inc. (``NYSEArca'').
    \3\ The Plan governs the collection, processing, and 
dissemination on a consolidated basis of quotation information and 
transaction reports in Eligible Securities for each of its 
Participants. This consolidated information informs investors of the 
current quotation and recent trade prices of Nasdaq securities. It 
enables investors to ascertain from one data source the current 
prices in all the markets trading Nasdaq securities. The Plan serves 
as the required transaction reporting plan for its Participants, 
which is a prerequisite for their trading Eligible Securities. See 
Securities Exchange Act Release No. 55647 (April 19, 2007) 72 FR 
20891 (April 26, 2007).
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I. Rule 608(a)

A. Purpose of the Amendments

    The Participants propose to establish the Enterprise Maximum 
mentioned above. The proposed Enterprise Maximum would apply in respect 
of each entitlement system of an entity that is registered as a broker/
dealer under the Securities Exchange Act of 1934.
    For each entitlement system, it would limit the monthly maximum 
amount of fees that such a broker/dealer would be required to pay for 
distribution of UTP Level 1 Service to nonprofessional subscribers that 
are brokerage account customers of the broker/dealer.
    Exhibit 2 to the Plan defines ``nonprofessional subscriber'' as a 
natural person who is neither:
    (A) registered or qualified in any capacity with the Commission, 
the Commodities [sic] Futures Trading Commission, any state securities 
agency, any securities exchange or association or any commodities or 
futures contract market or association;
    (B) engaged as an ``investment adviser'' as that term is defined in 
Section 202(a)(11) of the Investment Advisors Act of 1940 (whether or 
not registered or qualified under that Act); nor
    (C) employed by a bank or other organization exempt from 
registration under federal or state securities laws to perform 
functions that would require registration or qualification if such 
functions were performed for an organization not so exempt.
    For calendar year 2010, the Participants propose to set the monthly 
Enterprise Maximum at $600,000 per entitlement system. For each 
subsequent calendar year, the Enterprise Maximum would increase by the 
percentage increase in the annual composite share volume for the 
preceding calendar year, subject to a maximum annual increase of five 
percent. However, the amendment would allow the Participants to 
determine to waive the increase for any calendar year.
    The Enterprise Maximum would enable broker/dealers with significant 
numbers of nonprofessional subscribers to limit their costs in respect 
of their provision of Plan data to nonprofessional subscribers and 
would facilitate their ability to budget their market data 
expenditures.

B. Governing or Constituent Documents

    Not applicable.

C. Implementation of Amendment

    The Participants propose to apply the monthly Enterprise Maximum to 
qualifying broker/dealers commencing with the month of January 2011.

D. Development and Implementation Phases

    Not applicable.

E. Analysis of Impact on Competition

    The proposed amendment does not impose any burden on competition 
that is not necessary or appropriate in furtherance of the purposes of 
the Exchange Act. The Participants do not believe that the proposed 
plan amendment introduces terms that are unreasonably discriminatory 
for the purposes of Section 11A(c)(1)(D) of the Exchange Act.

F. Written Understanding or Agreements relating to Interpretation of, 
or Participation in, Plan

    The Participants have no written understandings or agreements 
relating to interpretation of the Plan as a result of the amendment.

G. Approval by Sponsors in Accordance with Plan

    Each of the Plan's Participants has executed a written amendment to 
the Plan.

H. Description of Operation of Facility Contemplated by the Proposed 
Amendment

    Not applicable.

I. Terms and Conditions of Access

    See Item I(A) above.

J. Method of Determination and Imposition, and Amount of, Fees and 
Charges

    The Participants believe that the level of the fee allows broker/
dealers to contribute an appropriate amount for the market data 
services that they provide to nonprofessional subscribers. By capping 
the monthly amount payable in respect of nonprofessional subscribers, 
the Enterprise Maximum would both reduce the fees otherwise payable by 
broker/dealers with significant numbers of nonprofessional subscribers 
and enable those broker/dealers to forecast their market data 
expenditures more efficiently.

[[Page 5232]]

    The Participants believe that the proposed Enterprise Maximum is 
fair and reasonable and provides for an equitable allocation of dues, 
fees, and other charges among vendors, data recipients and other 
persons using the Participants' facilities.

K. Method and Frequency of Processor Evaluation

    Not applicable.

L. Dispute Resolution

    Not applicable.

II. Rule 601(a)

A. Reporting Requirements

    Not applicable.

B. Manner of Collecting, Processing, Sequencing, Making Available and 
Disseminating Last Sale Information

    Not applicable.

C. Manner of Consolidation

    Not applicable.

D. Standards and Methods Ensuring Promptness, Accuracy and Completeness 
of Transaction Reports

    Not applicable.

E. Rules and Procedures Addressed to Fraudulent or Manipulative 
Dissemination

    Not applicable.

F. Terms of Access to Transaction Reports

    Not applicable.

G. Identification of Marketplace of Execution

    Not Applicable.

III. Solicitation of Comments

    The Commission seeks general comments on Amendment No. 23. 
Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposal 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 S7-24-89 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 S7-24-89. 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 website (http://www.sec.gov/rules/sro.shtml). Copies of 
the submission, all written statements with respect to the proposed 
Plan amendment that are filed with the Commission, and all written 
communications relating to the proposed Plan amendment 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 on official business days between the hours of 10 a.m. 
and 3 p.m. Copies of the filing also will be available for website 
viewing and printing at the Office of the Secretary of the Committee, 
currently located at the CBOE, 400 S. LaSalle Street, Chicago, IL 
60605. 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 S7-24-
89 and should be submitted on or before February 18, 2011.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\4\
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    \4\ 17 CFR 200.30-3(a)(27).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. 2011-1857 Filed 1-27-11; 8:45 am]
BILLING CODE 8011-01-P