[Federal Register Volume 67, Number 241 (Monday, December 16, 2002)]
[Notices]
[Pages 77121-77123]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-31593]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-46977; File No. SR-NASD-2002-160]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the National Association of 
Securities Dealers, Inc. To Remove Inoperative Rule Language Relating 
to Fees for the Nasdaq Workstation I Service

December 9, 2002.
    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 5, 2002, the National Association of Securities Dealers, 
Inc. (``NASD''), through its subsidiary, The Nasdaq Stock Market, Inc. 
(``Nasdaq''), filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I, II, 
and III below, which Nasdaq has prepared. Nasdaq has designated this 
proposal as one concerned solely with the administration of the self-
regulatory organization under section 19(b)(3)(A)(iii) of the Act \3\ 
and Rule 19b-4(f)(3) thereunder,\4\ which renders the rule immediately 
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)(iii).
    \4\ 17 CFR 240.19b-4(f)(3).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to amend NASD Rules 7010(f) and 7020 to remove 
inoperative rule language relating to fees for the discontinued Nasdaq 
Workstation I service. Nasdaq will implement the proposed rule change 
immediately upon filing.
    The text of the proposed rule change is below. Proposed new 
language is in italics; proposed deletions are in [brackets].
A. Rule 7010. System Services
    (a)-(e) No change.
    (f) Nasdaq WorkstationTM Service:
    (1) [The following charges shall apply to the receipt of Level 2 or 
Level 3 Nasdaq Service via an authorized personal computer (PC):]


[Service Charge].......................  [$345/PC/month].
[Advance Communication Charge].........  [$135/PC/month for the first
                                          unit, $85/PC/month for each
                                          additional unit at the same
                                          site].
[Maintenance (offered only on UNISYS     [$55/PC/month].
 and Tandem PCs)].
[Second Monitor/keyboard Attached to an  [$195/month].
 Authorized PC].
 


[[Page 77122]]

    [(2)] The following charges shall apply to the receipt of Level 2 
or Level 3 Nasdaq Service via equipment and communications linkages 
prescribed for the Nasdaq Workstation II Service:


Service Charge.........................  $1,875/month per service
                                          delivery platform (``SDP'')
                                          from December 1, 2000 through
                                          February 28, 2001, $2,035/
                                          month per SDP beginning March
                                          1, 2001.
Display Charge.........................  $525/month per presentation
                                          device (``PD'').
Additional Circuit/SDP Charge..........  $3,075 per month from December
                                          1, 2000 through February 28,
                                          2001, and $3,235/month
                                          beginning March 1, 2001*.
Maintenance............................   $55/SDP or PD logon/month.
 


    A subscriber that accesses Nasdaq Workstation II Service via an 
application programming interface (``API'') shall be assessed the 
Service Charge for each of the subscriber's SDPs and shall be assessed 
the Display Charge for each of the subscriber's API linkages, including 
an NWII substitute or quote-update facility. API subscribers also shall 
be subject to the Additional Circuit /SDP Charge.
    (3) No change.
    * A subscriber shall be subject to the Additional Circuit/SDP 
Charge when the subscriber has not maximized capacity on its SDPs by 
placing eight PDs and/or API servers on an SDP and obtains an 
additional SDP(s); in such case, the subscriber shall be charged the 
Additional Circuit/SDP Charge (in lieu of the service charge) for each 
``underutilized'' SDP(s) (i.e., the difference between the number of 
SDPs a subscriber has and the number of SDPs the subscriber would need 
to support its PDs and/or API servers, assuming an eight-to-one ratio). 
A subscriber also shall be subject to the Additional Circuit/SDP Charge 
when the subscriber has not maximized capacity on its T1 circuits by 
placing eighteen SDPs on a T1 circuit; in such case, the subscriber 
shall be charged the Additional Circuit/SDP Charge (in lieu of the 
service charge) for each ``underutilized'' SDP slot on the existing T1 
circuit(s). Regardless of the SDP allocation across T1 circuits, a 
subscriber will not be subject to the Additional Circuit/SDP Charge if 
the subscriber does not exceed the minimum number of T1 circuits needed 
to support its SDP, assuming an eighteen-to-one ratio.
    (g)-(s) No change.
7020. [Equipment Related Charges] Reserved
    [(a) The charge for using Nasdaq terminal equipment shall be $120 
per month for the first terminal and $105 per month for each additional 
terminal where all terminals are located on the same premises.]
    [(b) The charge for using interrogation or display devices which 
are not supplied by Nasdaq, but which utilize a Nasdaq supplied modem, 
shall be $75 per month for the first comparable device and $55 per 
month for each additional comparable device where all devices are 
located on the same premises.]
    [(c) The charge for using interrogation or display devices and 
modems which are not supplied by Nasdaq shall be $50 per month for each 
such device located on the same premises.]
    [(d) Nasdaq subscribers utilizing UNISYS or Tandem personal 
computers (PCs) authorized for emulation of the Harris standard 
terminal may elect to receive maintenance through Nasdaq at the rate of 
$55/PC/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 had 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
    The purpose of this rule filing is to remove several provisions 
from Nasdaq's schedule of charges for service and equipment that 
reflect charges for the discontinued Nasdaq Workstation I service, 
which was replaced by the Nasdaq Workstation II service (``NWII'') 
during the mid-1990s.\5\ The services to which these charges relate are 
no longer provided by Nasdaq, so the fees are being removed from the 
rules. In addition, language relating to a $55 per month computer 
hardware maintenance fee, which remains applicable to NWII, is being 
relocated, with updated terminology being used to describe the fee.
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    \5\ See Securities Exchange Act Release No. 35189 (January 3, 
1995), 60 FR 3014 (January 12, 1995) (SR-NASD-94-76).
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2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of section 15A of the Act,\6\ including section 
15A(b)(5) of the Act,\7\ which requires that the rules of the NASD 
provide for the equitable allocation of reasonable dues, fees and other 
charges among members and issuers and other persons using any facility 
of system which the NASD operates or controls. The proposed rule change 
removes discontinued Nasdaq Workstation I services from Nasdaq's 
schedule of charges, thereby clarifying rule language related to fees.
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    \6\ 15 U.S.C. 78o-3.
    \7\ 15 U.S.C. 78o-3(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    Nasdaq believes that the proposed rule change does not impose any 
burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Nasdaq neither solicited nor received written comments with respect 
to the proposed rule change.

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)(iii) of the Act \8\ and Rule 19b-4(f)(3) thereunder.\9\ At 
any time within 60 days after the filing of this proposed rule change, 
the Commission may summarily abrogate the rule change if it appears to 
the Commission that such action is necessary or appropriate in the 
public interest, for the protection

[[Page 77123]]

of investors, or otherwise in furtherance of the purposes of the Act.
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    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(3).
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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. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 20549-0609. 
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. Copies of such filing also will be 
available for inspection and copying at the principal office of the 
NASD. All submissions should refer to File No. SR-NASD-2002-160 and 
should be submitted by January 6, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\10\
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    \10\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 02-31593 Filed 12-13-02; 8:45 am]
BILLING CODE 8010-01-P