Document ID: SEC-2014-0052-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ OMX PHLX, LLC
Posted Date: 2014-01-10T05:00Z

[Federal Register Volume 79, Number 7 (Friday, January 10, 2014)]
[Notices]
[Pages 1906-1908]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-00211]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-71236; File No. SR-PHLX-2014-01]

Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Clarify 
That an Extranet Access Fee is Not Charged

January 6, 2014.
    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 January 2, 2014, NASDAQ OMX PHLX LLC (``Phlx'' or the ``Exchange'') 
filed with the Securities and Exchange Commission (``Commission'') the 
proposed rule change as described in Items I and II 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 the 
Substance of the Proposed Rule Change

    The Exchange proposes to clarify that it does not charge an 
extranet access fee (``Extranet Access Fee'').
    The text of the proposed rule change is below. Proposed new 
language is italicized.
* * * * *

NASDAQ OMX PHLX LLC \1\ PRICING SCHEDULE

* * * * *

VIII. NASDAQ OMX PSX FEES

* * * * *

Market Data Distributor Fees

    (a)-(c) No change.
Extranet Access
    Extranet providers that establish a connection with the Exchange to 
offer direct access connectivity to market data feeds shall not be 
assessed a monthly access fee per recipient Customer Premises Equipment 
(``CPE'') Configuration. For purposes of this rule, the term ``Customer 
Premises Equipment Configuration'' shall mean any line, circuit, router 
package, or

[[Page 1907]]

other technical configuration used by an extranet provider to provide a 
direct access connection to Exchange market data feeds to a recipient's 
site.

Administrative Reports

    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, 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 Exchange is proposing to clarify that the Exchange does not 
charge an Extranet Access Fee, unlike The NASDAQ Stock Market LLC 
(``NASDAQ'') \3\ or NASDAQ OMX BX, Inc. (``BX'') \4\.
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    \3\ See NASDAQ Rule 7025.
    \4\ See BX Rule 7025.
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    Specifically, the proposed rule change provides that extranet 
providers that establish a connection with the Exchange to offer direct 
access connectivity to market data feeds will not be assessed a monthly 
access fee per recipient Customer Premises Equipment (``CPE'') 
Configuration.\5\
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    \5\ As defined in the proposed rule text, a ``Customer Premises 
Equipment Configuration'' means any line, circuit, router package, 
or other technical configuration used by an extranet provider to 
provide a direct access connection to Exchange market data feeds to 
a recipient's site.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act \6\ in general, and with Section 6(b)(5) of the Act,\7\ 
in particular. The Exchange believes the proposal furthers the 
objectives of Section 6(b)(5) of the Act \8\ in that it is designed to 
promote just and equitable principles of trade, to remove impediments 
to and perfect the mechanism of a free and open market and a national 
market system, and, in general to protect investors and the public 
interest and is not designed to permit unfair discrimination between 
customer, issuers, brokers and dealers. The Exchange is proposing to 
add clarifying language that states that extranet providers that 
establish an extranet connection with the Exchange to access market 
data feeds from the Exchange will not be subject to an Extranet Access 
Fee. Accordingly, the Exchange believes that it is consistent with the 
protection of investors and the public interest to avoid potential 
market participant confusion that may be caused by the omission of the 
proposed rule text.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(5).
    \8\ Id.
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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 
result in any burden on competition that is not necessary or 
appropriate in furtherance of the purposes of the Act, as amended. The 
proposed rule change clarifies that no fee is being instituted and this 
applies across all extranet providers and none are [sic] compelled to 
establish a connection with the Exchange to offer access connectivity 
to market data feeds.

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

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \9\ and 
subparagraph (f)(6) of Rule 19b-4 thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\12\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative immediately upon filing. The Commission believes 
that waiving the 30-day operative delay is consistent with the 
protection of investors and the public interest. The proposed rule 
change presents no novel issues. Waiver will allow the Exchange to 
immediately clarify that it does not charge an extranet access fee, 
thereby reducing the potential for confusion. For these reasons, the 
Commission hereby waives the 30-day operative delay and designates the 
proposal operative upon filing.\13\
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    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of such 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 under 
Section 19(b)(2)(B) \14\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \14\ 15 U.S.C. 78s(b)(2)(B).
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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 email to rule-comments@sec.gov. Please include 
File Number SR-PHLX-2014-01 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-2014-01. This file 
number should be included on the subject line if email 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

[[Page 1908]]

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, 100 F Street NE., Washington, DC 
20549 on official business days between the hours of 10:00 a.m. and 
3:00 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-PHLX-2014-01, and should be 
submitted on or before January 31, 2014.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-00211 Filed 1-9-14; 8:45 am]
BILLING CODE 8011-01-P