Document ID: SEC-2010-0367-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2010-03-10T05:00Z

[Federal Register: March 10, 2010 (Volume 75, Number 46)]
[Notices]               
[Page 11213-11214]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr10mr10-132]                         

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-61645; File No. SR-NASDAQ-2010-029]

 
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 Market Center

March 4, 2010.
    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 February 26, 2010, The NASDAQ Stock Market LLC (``NASDAQ'' or the 
``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

    NASDAQ proposes to modify pricing for NASDAQ members using the 
NASDAQ Market Center. NASDAQ will implement the proposed change on 
March 1, 2010. The text of the proposed rule change is available at 
http://nasdaqomx.cchwallstreet.com/, at NASDAQ's principal office, 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, 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 making minor modifications to its pricing schedule for 
execution and routing of orders through the NASDAQ Market Center. 
First, NASDAQ is increasing the fee for members using the STGY, SCAN, 
SKNY, SKIP, or DOTI routing strategies.\3\ For orders using these 
strategies that execute in destinations other than the New York Stock 
Exchange (``NYSE'') (or NASDAQ OMX BX, in the case of DOTI orders), 
NASDAQ will increase the fee from $0.0029 to $0.0030 per share 
executed.\4\
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    \3\ Orders designated to use these routing strategies check the 
NASDAQ book for the full size of the order prior to routing. The 
terms and conditions of NASDAQ's routing strategies are described in 
NASDAQ Rule 4758.
    \4\ For DOTI orders that execute in NASDAQ OMX BX, NASDAQ will 
continue to pass through fees and rebates associated with order 
execution on that venue. SCAN, SKNY, STGY, and SKIP orders executed 
at NASDAQ OMX BX are currently charged $0.0029, however, and will 
now be charged $0.0030. DOTI, STGY, SCAN, SKNY, and SKIP orders that 
execute at NYSE are charged $0.0018 per share executed if they 
access liquidity at NYSE, or receive a $0.0010 per share executed 
credit if they add liquidity at NYSE. These fees and credits are 
unchanged.
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    Second, NASDAQ is eliminating a temporary pricing incentive 
designed to encourage use of Mid-Point Pegged Orders in the NASDAQ 
Market Center. Currently, members providing an average daily volume of 
more than 95 million shares of liquidity during a month pay no fee for 
the use of Mid-Point Pegged Orders. As a result of the change, all 
members will pay the same rates for executions of Mid-Point Pegged 
Orders as they pay for executions of other orders in the NASDAQ Market 
Center: either $0.0028 or $0.0030 per share executed, depending on the 
type of security traded and the member's trading volumes.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\5\ in general, and with Section 
6(b)(4) of the

[[Page 11214]]

Act,\6\ 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. The impact of the modest price increases upon the net fees 
paid by a particular market participant will depend upon a number of 
variables, including the routing strategies that it uses, the relative 
availability of liquidity on NASDAQ and other venues, the prices of the 
market participant's quotes and orders relative to the national best 
bid and offer (i.e., its propensity to add or remove liquidity), the 
types of securities that it trades, and its usage of Mid-Point Pegged 
Orders. NASDAQ notes that it operates in a highly competitive market in 
which market participants can readily direct order flow to competing 
venues if they deem fee levels at a particular venue to be excessive. 
Accordingly, if particular market participants object to the proposed 
fee increases, they can avoid paying the fees by directing orders to 
other venues or using routing strategies and order types that are not 
subject to the increases. NASDAQ believes that its fees continue to be 
reasonable and equitably allocated to members on the basis of whether 
they opt to direct orders to NASDAQ.
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    \5\ 15 U.S.C. 78f.
    \6\ 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. Because the market 
for order execution and routing is extremely competitive, members may 
readily direct orders to NASDAQ's competitors if they object to the 
proposed rule change.

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 \7\ and subparagraph (f)(2) of Rule 19b-4 
thereunder.\8\ 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 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-2010-029 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-NASDAQ-2010-029. 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,\9\ 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, 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 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-NASDAQ-2010-029 and should 
be submitted on or before March 31, 2010.
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    \9\ The text of the proposed rule change is available on the 
Commission's Web site at http://www.sec.gov/rules/sro.shtml.

    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,
Deputy Secretary.
[FR Doc. 2010-5070 Filed 3-9-10; 8:45 am]
BILLING CODE 8011-01-P