Document ID: SEC-2008-1659-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: The NASDAQ Stock Market LLC
Posted Date: 2008-12-10T05:00Z

[Federal Register: December 10, 2008 (Volume 73, Number 238)]
[Notices]               
[Page 75161-75163]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10de08-107]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59043; File No. SR-NASDAQ-2008-089]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Modify Fees for Members Using the Nasdaq Options Market

December 3, 2008.
    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 November 21, 2008, 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. Nasdaq has filed

[[Page 75162]]

the proposal pursuant to Section 19(b)(3)(A) of the Act \3\ and Rule 
19b-4(f)(2) thereunder,\4\ which renders the proposal effective upon 
filing with the Commission. 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.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to modify Rule 7050 governing pricing for Nasdaq 
members using the NASDAQ Options Market (``NOM''), Nasdaq's facility 
for executing and routing standardized equity and index options. 
Specifically, Nasdaq proposes to adopt a credit of $0.35 per executed 
contract to members who provide liquidity using price-improving orders 
through NOM. Nasdaq will make the proposed rule change effective on 
December 1, 2008. The text of the proposed rule change is below. 
Proposed new language is in italics.\5\
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    \5\ Changes are marked to the rule text that appears in the 
electronic Nasdaq Manual found at http://
nasdaqomx.cchwallstreet.com.
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* * * * *
    7050. NASDAQ Options Market.
    The following charges shall apply to the use of the order execution 
and routing services of the NASDAQ Options Market by members for all 
securities.
    (1) Fees for Execution of Contracts on the NASDAQ Options Market.
    Charge to member entering order that executes in the NASDAQ Options 
Market: $0.45 per executed contract.
    For a pilot period ending July 31, 2009, charge for members or non-
members entering order via the Options Intermarket Linkage that 
executes in the Nasdaq Options Market.
    Credit to member providing liquidity through the NASDAQ Options 
Market: $0.30 per executed contract.
    Credit to member providing liquidity using price-improving orders 
through the NASDAQ Options Market: $0.35 per executed contract.
    (2)--(4) No Change.
* * * * *

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 modify Rule 7050 to allow for a credit of 
$0.35 per executed contract to members who provide liquidity using 
price-improving orders through NOM. Currently, members that provide 
liquidity through NOM receive a credit of $0.30 per executed contract. 
Nasdaq believes increasing the credit to $0.35 per executed contract 
for those members that provide liquidity using price-improving orders 
through NOM should help to encourage additional price improvement, 
which should in turn, benefit takers of liquidity and investors.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\6\ in general, and with Section 
6(b)(4) of the Act,\7\ 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. Nasdaq believes that the proposed 
credit should encourage additional price improvement which should, in 
turn, benefit takers of liquidity and investors in general.
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    \6\ 15 U.S.C. 78f.
    \7\ 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, as amended. To the contrary, 
Nasdaq has designed its fees to compete effectively for the execution 
and routing of options contracts and to reduce the overall cost to 
investors of options trading.

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 \8\ and subparagraph (f)(2) of Rule 19b-4 
thereunder.\9\
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    \8\ 15 U.S.C. 78s(b)(3)(a)(ii).
    \9\ 17 CFR 240.19b-4(f)(2).
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    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.

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-2008-089 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-2008-089. 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,

[[Page 75163]]

DC 20549, on official business days between the hours of 10 a.m. and 3 
p.m. Copies of the 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-2008-089 and should be submitted 
on or before December 31, 2008.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-29136 Filed 12-9-08; 8:45 am]

BILLING CODE 8011-01-P