Document ID: SEC-2013-0594-0001
Agency: sec
Document Type: Notice
Title: Joint Industry Plans: BATS Exchange, Inc., BATS Y-Exchange, Inc., Chicago Board Options Exchange, Inc., et al.
Posted Date: 2013-03-28T04:00Z

[Federal Register Volume 78, Number 60 (Thursday, March 28, 2013)]
[Notices]
[Pages 19029-19031]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-07191]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-69215; File No. S7-24-89]

Joint Industry Plan; Notice of Filing and Immediate Effectiveness 
of Amendment No. 27 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., BATS Y-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 LLC, Nasdaq Stock Market LLC, National Stock Exchange, Inc., New 
York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc.

March 22, 2013.
    Pursuant to Section 11A of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 608 thereunder,\2\ notice is hereby given that 
on March 22, 2013, the operating committee (``Operating Committee'' or 
``Committee'') \3\ 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.\4\ This

[[Page 19030]]

amendment represents Amendment No. 27 (``Amendment'') to the Plan and 
proposes to revise the metric by which the Participants calculate the 
annual increase in the Enterprise Maximum. Pursuant to Rule 
608(b)(3)(i) under the Act, the Participants designated the Amendment 
as establishing or changing a fee or other charge collected on behalf 
of all of the Participants in connection with access to, or use of, the 
facilities contemplated by the Amendment. As a result, the Amendment 
has been put into effect upon filing with the Commission. At any time 
within 60 days of the filing of the Amendment, the Commission may 
summarily abrogate the Amendment and require that the Amendment be 
refiled in accordance with paragraph (a)(1) of Rule 608 and reviewed in 
accordance with paragraph (b)(2) of Rule 608, if it appears to the 
Commission that such action is necessary or appropriate in the public 
interest, for the protection of investors, or the maintenance of fair 
and orderly markets, to remove impediments to, and perfect the 
mechanisms of, a national market system or otherwise in furtherance of 
the purposes of the Act. The Commission is publishing this notice to 
solicit comments from interested persons.
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    \1\ 15 U.S.C. 78k-1.
    \2\ 17 CFR 242.608.
    \3\ The Plan Participants (collectively, ``Participants'') are 
the: BATS Exchange, Inc.; BATS Y-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 LLC; Nasdaq Stock Market LLC; National 
Stock Exchange, Inc.; New York Stock Exchange LLC; NYSE MKT LLC; and 
NYSE Arca, Inc.
    \4\ 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 revise the metric by which the 
Participants calculate the annual increase in the Enterprise Maximum.
    Paragraph (e) of Exhibit 2 to the Plan provides that an entity that 
is registered as a broker/dealer under the Securities Exchange Act of 
1934 is not required to pay more than the ``Enterprise Maximum'' for 
any month for each entitlement system. The ``Enterprise Maximum'' 
equals the aggregate amount of fees payable for distribution of UTP 
Level 1 Service to nonprofessional subscribers that are brokerage 
account customers of the broker/dealer. Paragraph (e) provides that the 
Enterprise Maximum shall increase by the ``Annual Increase Amount'' 
each year.
    Currently, the ``Annual Increase Amount'' for any calendar year 
equals the percentage increase in the annual composite share volume for 
the preceding calendar year, subject to a maximum annual increase of 
five percent; provided, however, that the Participants may determine to 
waive the ``Annual Increase Amount'' for any calendar year.
    In this amendment, the Participants propose to change the 
methodology for calculating the ``Annual Increase Amount.'' For each 
calendar year, the proposed formulation would permit an increase in the 
monthly enterprise maximum provided that no such annual increase could 
exceed four percent of the then current Enterprise Maximum amount.
    This proposed means for determining the increase in the broker-
dealer Enterprise Maximum would reduce the amount of any one year's 
permissible increase from five percent to four percent and would better 
reflect inflation than does the current means. The maximum four percent 
increase is consistent with the average cost of living adjustment 
(``COLA'') as published by the Social Security Administration for the 
past 38 years.
    The Participants adopted the Enterprise Maximum in 2010 and set it 
at $600,000 for that year. It currently remains at $600,000. They 
propose to increase the amount of the Enterprise Maximum by four 
percent to $624,000, effective April 1, 2013. The number of firms 
reaching the enterprise caps is minimal.

B. Governing or Constituent Documents

    Not applicable.

C. Implementation of Amendment

    All of the Participants have manifested their approval of the 
proposed Amendment by means of their execution of the Amendment. The 
Participants propose to make the rate changes effective as of April 1, 
2013.

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 in the NASDAQ/UTP Plan have not raised the amount 
of the Enterprise Maximum since they first adopted it in 2010. The 
change would affect a very small number of broker-dealers, as few firms 
take advantage of the Enterprise Maximum.
    In addition, the proposed change to the metric for calculating the 
annual increase in the Enterprise Maximum is identical to the metric 
that the Participants in the CTA and CQ Plans have adopted for their 
enterprise maximums. As a result, this Amendment promotes consistency 
in price structures among the national market system plans and would 
make market data fees easier to administer.
    In the Participants' view, the proposed fee schedule would allow 
broker-dealers with large numbers of nonprofessional subscriber 
brokerage account customers to contribute an appropriate amount for 
their receipt and use of market data under the Plan. The proposed fee 
change would provide for an equitable allocation of dues, fees, and 
other charges among broker-dealers, vendors, end users and others 
receiving and using market data made available under the Plans.
    The Participants would apply the revised metric uniformly to all 
broker-dealers qualifying for the Enterprise Maximum and do not believe 
that the proposed change introduces terms that are unreasonably 
discriminatory.

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 A(1) above.

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

    The Participants believe that the proposed change to the metric for 
calculating the annual increase in the Enterprise Maximum provides a 
fair basis for taking inflation into account for the Enterprise 
Maximum. They believe it 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.

[[Page 19031]]

II. Rule 601(a)

A. Equity Securities for Which Transaction Reports Shall Be Required by 
the Plan

    Not applicable.

B. Reporting Requirements

    Not applicable.

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

    Not applicable.

D. Manner of Consolidation

    Not applicable.

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

    Not applicable.

F. Rules and Procedures Addressed to Fraudulent or Manipulative 
Dissemination

    Not applicable.

G. Terms of Access to Transaction Reports

    Not applicable.

H. Identification of Marketplace of Execution

    Not Applicable.

III. Solicitation of Comments

    The Commission seeks general comments on Amendment No. 27. 
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 email 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 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 Web site (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 Web site viewing and printing in the Commission's Public 
Reference Room on official business days between the hours of 10:00 
a.m. and 3:00 p.m. Copies of the filing also will be available for Web 
site 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 April 18, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(27).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-07191 Filed 3-27-13; 8:45 am]
BILLING CODE 8011-01-P