Document ID: SEC-2009-0642-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NASDAQ Stock Market LLC
Posted Date: 2009-05-12T04:00Z

[Federal Register: May 12, 2009 (Volume 74, Number 90)]
[Notices]               
[Page 22197-22198]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12my09-72]                         

[[Page 22197]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59871; File No. SR-NASDAQ-2009-045]

 
Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of a Proposed Rule Change 
To Establish the Trade Reporting File Upload Service and Related Fees

May 6, 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 1, 2009, 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. 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

    Nasdaq proposes to establish a new service and related fees for use 
by Nasdaq Members. The new Trade Reporting File Upload service will 
enable subscribers to upload multiple trades in one file for submission 
to ACT via the NASDAQ Workstation or Weblink ACT 2.0.
    The text of the proposed rule change is below. Proposed new 
language is in italics.\3\
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    \3\ Changes are marked to the rules of The NASDAQ Stock Market 
LLC found at http://nasdaqomx.cchwallstreet.com. The Commission 
notes that deletions are in brackets.
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* * * * *
    7033. [Reserved] Trade Reporting File Upload
    The Trade Reporting File Upload service allows subscribing members 
to upload multiple trade reports in batches to the Automated 
Confirmation Transaction (ACT) service via the Nasdaq Workstation or 
WeblinkACT 2.0.
    The Trade Reporting File Upload service is available to members for 
a fee of $25 per user, per month.
* * * * *

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 proposes to establish a new add-on service to the Nasdaq 
Workstation and Weblink ACT 2.0, and establish related fees. Nasdaq's 
Trade Reporting File Upload service is a new tool that gives firms the 
ability to upload multiple trades in one file for submission to ACT via 
the NASDAQ Workstation or Weblink ACT 2.0. Member firms typically use 
internal systems that report trades automatically. When member firms 
encounter connectivity issues or other problems that prevent their 
automated systems from reporting trades, all unreported trades must be 
submitted to avoid a violation of the trade reporting rules once the 
problem is resolved. Member firm automated trade reporting systems are 
not designed to enter such unreported trades, and as a consequence, 
member firms must manually enter the unreported trades to ACT via the 
NASDAQ Workstation or Weblink ACT 2.0. The manual entry of unreported 
trades can be a very laborious and time-consuming process, depending on 
the number of trades that were not reported through the member firm's 
automated system. Member firms requested that Nasdaq develop an 
automated process for submitting these trades, and in response Nasdaq 
has developed the Trade Reporting File Upload service.
    The Trade Reporting File Upload service allows member firms to 
upload unreported trade data into a single file of up to 500 trades 
through the Nasdaq Workstation or Weblink ACT 2.0.\4\ Once submitted, 
the trades are reviewed by the service for data entry errors. Each 
trade within the file that is accepted by the system will receive a 
discrete ACT control number for tracking purposes. Trades that are 
rejected are marked as ``error'' so that users can edit the information 
and resubmit each rejected trade. Rejected trades do not result in the 
rejection of the entire file.
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    \4\ Subscribers to the Trade Reporting File Upload service must 
identify the unreported trades and provide a list of such trades in 
comma separated value format, also known as ``CSV''.
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    The Trade Reporting File Upload service can only be accessed using 
a Nasdaq Workstation or Weblink ACT 2.0 user account. Member firms 
subscribing to the Trade Reporting File Upload service are charged a 
monthly fee per user, which provides access to the service for each 
Nasdaq Workstation and Weblink ACT 2.0 user account selected for 
subscription to the Trade Reporting File Upload service. Nasdaq 
proposes to offer the Trade Reporting File Upload service to each 
subscriber for a subscription fee of $25 per user, per month. Use of 
the Trade Reporting File Upload service is voluntary and the 
subscription fee will be imposed on all purchasers equally based on the 
number of users selected. The proposed fee will be applied to offset 
the costs associated with establishing the service, responding to 
customer requests, configuring Nasdaq's systems, programming to user 
specifications, and administering the service, among other things. To 
the extent that costs are covered by the proposed fee, the proposed fee 
may also provide Nasdaq with a profit.
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 Section 
6(b)(4) of the Act,\6\ in particular, because 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 that 
the Nasdaq operates or controls, and it does not unfairly discriminate 
between customers, issuers, brokers or dealers. As noted, use of the 
Trade Reporting File Upload service is voluntary and the subscription 
fees will be imposed on all purchasers equally based on the number of 
users. The proposed fee will be allocated to cover the costs associated 
with establishing the service, responding to customer requests, 
configuring Nasdaq's systems, programming to user specifications, and 
administering the service, among other things, and may provide Nasdaq 
with a profit to the extent costs are covered.
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    \5\ 15 U.S.C. 78f.
    \6\ 15 U.S.C. 78f(b)(4).
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    Nasdaq also believes that the proposed rule change is consistent 
with the provisions of Section 6(b)(5) of the Act \7\ because it is 
designed to prevent fraudulent and manipulative acts and practices, to 
promote just and equitable principles of trade, to foster cooperation

[[Page 22198]]

and coordination with persons engaged in facilitating transactions in 
securities, and to remove impediments to and perfect the mechanism of a 
free and open market and a national market system. The Trade Reporting 
File Upload service will assist subscribing member firms to quickly 
upload reportable trades after recovering from a failure of their 
internal automated reporting system. As a result, member firms will be 
able to avoid a reporting violation that may otherwise result from 
using the time consuming manual entry process.
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    \7\ 15 U.S.C. 78f(b)(5).
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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.

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

    Pursuant to Section 19(b)(3)(A) of the Act \8\ and Rule 19b-4(f)(6) 
thereunder,\9\ Nasdaq has designated this proposal as one that effects 
a change that: (i) Does not significantly affect the protection of 
investors or the public interest; (ii) does not impose any significant 
burden on competition; and (iii) by its terms, does not become 
operative for thirty days after the date of the filing, or such shorter 
time as the Commission may designate if consistent with the protection 
of investors and the public interest. Nasdaq has provided the 
Commission written notice of its intent to file the proposed rule 
change, along with a brief description and text of the proposed rule 
change, at least five business days prior to the date of filing of the 
proposed rule change. Nasdaq believes that the filing may appropriately 
be designated for filing under Rule 19b-4(f)(6) because the filing 
provides a useful enhancement to an existing facility of Nasdaq that is 
designed to assist members in complying with reporting obligations and 
avoiding rule violations, and establishes a reasonable fee for such 
enhancement.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
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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-2009-045 on the subject line.

Paper Comments

     Send paper comments in triplicate to Elizabeth M. Murphy, 
Secretary, Securities and Exchange Commission, Station Place, 100 F 
Street, NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-NASDAQ-2009-045. 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 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 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-2009-045 and should be submitted on or before 
June 2, 2009.

    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. E9-10998 Filed 5-11-09; 8:45 am]

BILLING CODE 8010-01-P