[Federal Register Volume 68, Number 236 (Tuesday, December 9, 2003)]
[Notices]
[Pages 68682-68684]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-30503]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-48864; File No. SR-NASD-2003-169]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the National Association of 
Securities Dealers, Inc. To Remove Pricing for Tools and Tools Plus 
Products

December 2, 2003.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 \2\ thereunder, notice is hereby given 
that on November 24, 2003, 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 Items have been prepared by Nasdaq. 
Pursuant to section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(3) thereunder,\4\ Nasdaq has designated this proposal as one 
concerned solely with the administration of the self-regulatory 
organization, which renders the proposed rule change effective 
immediately upon filing. 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 is proposing to remove pricing for the Tools and Tools Plus 
products formerly supported by Nasdaq. Nasdaq will implement the 
proposed rule change immediately.
    The text of the proposed rule change is below. Proposed new 
language is in italics; proposed deletions are in [brackets].
* * * * *

7000. Charges for Services and Equipment

7050. Other Services

    (a)-(d) No change.
    [(e) Software Products]
    [(1) The following fees shall be paid by customers of Tools 
TM:]

[(A) Fee Charge]....................  [Price]
[Minimum fee per market participant   [$1,000/month]
 (includes coverage of up to 49
 stocks on an unlimited number of
 Nasdaq Workstation II terminals
 located at a single office)].
[Coverage of each additional block    [$500/month]
 of 25 or fewer stocks].
[Each additional office equipped      [$1,000/month]
 with Tools].
[Aggregate maximum fee per market     [$15,000/month]
 participant].
 

    [B) Customers who also subscribe to Tools Plus\SM\ services shall 
receive the following reduction on fees incurred pursuant to subsection 
(1)(A):]

[Number of Tools Plus Terminals]....  [Discount]
[Five or fewer Tools Plus terminals]  [50%]
[Between six and 15 Tools Plus        [75%]
 terminals].
[Greater than 15 Tools Plus           [100%]
 terminals].
 

    [(2) The following deposits and fees shall be paid by all customers 
of Tools Plus:]
    [(A) Each customer shall pay a deposit at the time it initially 
subscribes to Tools Plus equal to two times the subscriber's aggregate 
monthly Terminal Charge (as defined below), calculated based on the 
number of terminals ordered by the subscriber upon subscribing to Tools 
Plus (the ``Deposit''). The Deposit shall be refunded to the customer 
upon termination of its subscription to Tools Plus after deducting any 
outstanding balances owed Nasdaq.]
    [(B) Terminal Charge]

[Fee Charge]........................  [Price]
[Terminal Charge per full
 functionality terminal equipped
 with Tools Plus]
[(More than 30 terminals if customer  [$500/terminal/month]
 signs two-year contract)].
[(All other situations)]............  [$750/terminal/month]
[Terminal Charge per correspondent/   [$350/terminal/month]
 floor broker terminal equipped with
 Tools Plus].
[Minimum Terminal Charge]...........  [$2,000/month]
 


[(C) Fee Charge]....................  [Price]

[[Page 68683]]

 
[Connection Charge to Nasdaq          [$265/month]
 Computer-to-Computer Interface
 (CTCI)].
[Connection Charge to Nasdaq Service  [$250/month]
 Delivery Platform (SDP) (charged to
 subscribers who handle customer
 orders)].
[Installation Fee] [\1\]
[(one-time charge for Tools Plus and  [$16,000]
 includes up to 15 terminals)].
[(each additional set of up to 15     [$13,000]
 terminals)].
[Port Charges (one-time charge per    [$1,250]
 line)].
[(one-time aggregate charge for two   [$2,500]
 lines)].
[Training Fee on-site at customer]..  [$400/day (plus travel expenses)]
[Training Fee for course at Nasdaq    [$150/course]
 Tools].
[Electronic communication network     [$250/per ECN/month]
 (ECN) maintenance charge (charged
 to subscribers who route orders to
 ECN)].
 
[\1\] [Installation Fee includes two hours of on-site training of customer personnel and all programming costs
  associated with one customized interface for the customer to access its clearing firm.]

    [Market data redistribution charges, which are set by the relevant 
market data provider, are passed through to Tools Plus subscribers at 
cost.]
    [(D) Labor rates for programming customized interfaces and 
maintenance on interfaces for customers of Nasdaq Tools Plus shall be 
billed according to the following rates:]

[Calendar Year 2002]................  [Calendar Year 2003 and thereafter]
[Senior Programmer $175/hour].......  [$200/hour]
[Programmer $125/hour]..............  [$150/hour]
[Junior Programmer $100/hour].......  [$125/hour]
[Project Management $150/hour]......  [$175/hour]
[Network Engineer $125/hour]........  [$150/hour]
[Operations Support $100/hour]......  [$125/hour]
 

* * * * *

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 has discontinued support for the Tools and Tools Plus 
software product lines, effective November 14, 2003 and November 11, 
2003, respectively. Users of these products were informed in the second 
quarter of 2003 of Nasdaq's intention to discontinue support of the 
products in the fourth quarter of 2003. Accordingly, Nasdaq is removing 
the prices for these product lines from the fee schedule in the NASD 
Manual.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of section 15A of the Act.\5\ The proposed rule change 
merely eliminates fees for product lines that are no longer supported 
by Nasdaq.
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    \5\ 15 U.S.C. 78o-3.
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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.

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)(iii) of the Act \6\ and Rule 19b-4(f)(3) thereunder, 
because Nasdaq has designated the proposal as concerned solely with the 
administration of the exchange.\7\ At any time within 60 days of the 
filing of such 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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    \6\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \7\ 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. 
Comments may also be submitted electronically at the following e-mail 
address: [email protected]. All comment letters should refer to 
File No. SR-NASD-2003-169. This file number should be included on the 
subject line if e-mail is used. To help us process and review comments 
more efficiently, comments should be sent in hardcopy or by e-mail but 
not by both methods. Copies of the submission, 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 will also be 
available for inspection and copying at

[[Page 68684]]

the principal office of the NASD. All submissions should refer to File 
No. SR-NASD-2003-169 and should be submitted by December 30, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 03-30503 Filed 12-8-03; 8:45 am]
BILLING CODE 8010-01-P