Document ID: SEC-2009-0697-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Notice of Filing and Immediate Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating to the Order Entry Port Fee
Posted Date: 2009-05-22T04:00Z

[Federal Register: May 22, 2009 (Volume 74, Number 98)]
[Notices]               
[Page 24054-24055]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22my09-103]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59925; File No. SR-Phlx-2009-43]

 
Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by NASDAQ OMX PHLX, Inc. Relating 
to the Order Entry Port Fee

May 14, 2009.
    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 May 7, 2009, NASDAQ OMX PHLX, Inc. (``Phlx'' or ``Exchange'') 
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 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 modify the manner in which members are 
assessed the Order Entry Port Fee of $250 a month. The Exchange 
proposes to delete endnote 60, which references the Order Entry Port 
Fee and defines an active order entry port, and instead charge members 
the $250 monthly fee regardless of whether the order entry port is 
active.
    While changes to the Exchange's Fee Schedule pursuant to this 
proposal are effective upon filing, the Exchange has designated this 
proposal to be implemented on June 1, 2009.
    The text of the proposed rule change is available on the Exchange's 
Web site at http://nasdaqomxphlx.cchwallstreet.com/NASDAQOMXPHLX/
Filings/, 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 purpose of the proposed rule change is to modify the manner in 
which the Order Entry Port Fee is billed to members. The Order Entry 
Port Fee is a connectivity fee assessed on members in connection with 
routing orders to the Exchange via an external order entry port. 
Currently, members access the Exchange's network through order entry 
ports. A member organization may have more than one order entry port. 
Member are assessed a monthly fee of $250 in connection with sending 
orders to the Exchange. The $250 monthly Order Entry Port Fee is 
assessed per member organization order entry mnemonic.\3\ Specifically, 
the fee is currently assessed on any order entry mnemonic that is 
active during a billing month. An order entry mnemonic is considered 
active if a member organization sends at least one order to the 
Exchange using that order entry mnemonic during the applicable billing 
month.\4\
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    \3\ Order entry mnemonics are codes that identify member 
organization order entry ports.
    \4\ See Securities Exchange Act Release No. 58728 (October 3, 
2008), 73 FR 59695 (October 9, 2008) (SR-Phlx-2008-70). See also the 
Exchange's Fee Schedule at endnote 60.
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    The Exchange proposes to assess the $250 monthly Order Flow Port 
Fee on members regardless of whether the order entry mnemonic is active 
during the billing month. Accordingly, the Exchange proposes to delete 
endnote 60 which states, ``[a]n order entry mnemonic is considered 
active if a member organization sends at least one order to the 
Exchange using that order entry mnemonic during the applicable billing 
month.'' Instead, the Exchange

[[Page 24055]]

proposes to assess members the $250 monthly fee, regardless of usage, 
and solely on the number of order entry ports assigned to each member 
organization. Per this proposal, whether or not the order entry port is 
active will not be considered in billing the monthly fee of $250, only 
the amount of order entry ports per member organization will determine 
the amount billed to a member organization.
2. Statutory Basis
    The Exchange believes that its proposal to amend its schedule of 
fees is consistent with Section 6(b) of the Act \5\ in general, and 
furthers the objectives of Section 6(b)(4) of the Act \6\ in 
particular, in that it is an equitable allocation of reasonable fees 
and other charges among Exchange members. The proposal would continue 
to uniformly assess the Order Entry Port Fee on members in order to 
support the costs of the infrastructure associated with market access. 
The fee remains reasonable in that members will continue to be charged 
a flat rate for this service based on the number of order entry ports.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4).
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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.

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)(ii) of the Act \7\ and paragraph (f)(2) of Rule 19b-4 \8\ 
thereunder. At any time within 60 days of the filing of the proposed 
rule change, the Commission may summarily abrogate 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.
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    \7\ 15 U.S.C. 78s(b)(3)(A)(ii).
    \8\ 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 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 SR-Phlx-2009-43 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-Phlx-2009-43. 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, 100 F Street, NE., 
Washington, DC 20549, 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 office of Phlx. 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-Phlx-2009-43 and should be 
submitted on or before June 12, 2009.

    For the Commission, by the Division of Trading and Markets, 
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. E9-11937 Filed 5-21-09; 8:45 am]

BILLING CODE 8010-01-P