[Federal Register Volume 69, Number 50 (Monday, March 15, 2004)]
[Notices]
[Pages 12188-12190]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-5787]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-49376; File No. SR-NASD-2004-038]


Self-Regulatory Organizations; Notice of Filing and Immediate 
Effectiveness of Proposed Rule Change by the National Association of 
Securities Dealers, Inc. To Extend the Pilot Program for Nasdaq 
PostData and Fees Presently Available Under NASD Rule 7010(s)

March 9, 2004.
    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 March 1, 2004, 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. Nasdaq filed 
this proposal pursuant to section 19(b)(3)(A) of the Act \3\ and Rule 
19b-4(f)(6) thereunder,\4\

[[Page 12189]]

which renders the proposal 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).
    \4\ 17 CFR 240.19b-4(f)(6). Nasdaq provided the Commission with 
written notice of its intention to file the proposed rule change on 
February 23, 2004.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Nasdaq proposes to extend for one year the pilot program for Nasdaq 
PostData presently available under NASD Rule 7010(s). Nasdaq is making 
no substantive changes to the pilot, other than to extend its operation 
through March 31, 2005. The text of the proposed rule change is 
available at the NASD and at the Commission.

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
    On January 11, 2002, the Commission approved, as a 12-month pilot, 
the creation of Nasdaq PostData, a voluntary trading data distribution 
facility, accessible to NASD members, buy-side institutions and market 
data vendors through the NasdaqTrader.com Web site.\5\ Nasdaq extended 
this pilot on a number of occasions, most recently through March 31, 
2004.\6\ Nasdaq hereby proposes to extend the pilot period for PostData 
for an additional year, through March 31, 2005.
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    \5\ See Securities Exchange Act Release No. 45270 (January 11, 
2002), 67 FR 2712 (January 18, 2002) (SR-NASD-99-12).
    \6\ See Securities Exchange Act Release Nos. 48576 (September 
30, 2003), 68 FR 57946 (October 7, 2003) (SR-NASD-2003-142); 47634 
(April 4, 2003), 68 FR 17714 (April 10, 2003) (SR-NASD-2003-60) 
(extending pilot through September 30, 2003); 47503 (March 14, 
2003), 68 FR 13745 (March 20, 2003) (SR-NASD-2003-35) (extending 
pilot through March 31, 2003); and 47210 (January 17, 2003), 68 FR 
3912 (January 27, 2003) (SR-NASD-2003-02) (extending pilot through 
February 28, 2003).
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    At its launch on March 18, 2002, PostData consisted of three 
reports provided in a single package: (1) Daily Share Volume Report, 
which provides subscribers with T+1 daily share volume in each Nasdaq 
security, listing the volume by any NASD member firm that voluntarily 
permits the dissemination of this information; (2) Daily Issue Data, 
which contains a summary of the previous day's activity for every 
Nasdaq issue; and (3) Monthly Summaries, which provide monthly trading 
volume statistics for the top 50 market participants sorted by industry 
sector, security, or type of trading (e.g., block or total).
    On August 5, 2002, Nasdaq expanded the information made available 
to PostData subscribers to include four additional reports: Buy Volume 
Report, Sell Volume Report, Crossed Volume Report, and Consolidated 
Activity Volume Report.\7\ Each report offers information regarding 
total Nasdaq reported buy (or sell, or cross, or consolidated) volume 
in the security, as well as rankings of registered market makers based 
upon various aspects of their activity in Nasdaq. The reports also 
provide recipients with information about the number and character of 
each market maker's trades. Finally, the reports provide the 
information described above with respect to block volume, be it buy, 
sell, cross or consolidated interest.
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    \7\ See Securities Exchange Act Release No. 46316 (August 6, 
2002), 67 FR 52504 (August 12, 2002) (SR-NASD-2002-90).
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    Under the pilot extension, Nasdaq would continue to make PostData 
accessible to NASD members, buy-side institutions and market data 
vendors through the NasdaqTrader.com website. In addition, PostData 
would continue to consist of the same seven reports that are currently 
made available to subscribers.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of section 15A(b)(5) \8\ and 15A(b)(6) \9\ of the Act. 
Section 15A(b)(5) requires the equitable allocation of reasonable fees 
and charges among members and other users of facilities operated or 
controlled by a national securities association. Section 15A(b)(6) 
requires rules that foster cooperation and coordination with persons 
engaged in facilitating transactions in securities and that are not 
designed to permit unfair discrimination between customers, issuers, 
brokers or dealers.
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    \8\ 15 U.S.C. 78o-3(b)(5).
    \9\ 15 U.S.C. 78o-3(b)(6).
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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

    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

    Because the foregoing proposed rule change does not:
    (i) Significantly affect the protection of investors or the public 
interest;
    (ii) Impose any significant burden on competition; and
    (iii) Become operative for 30 days from the date on which it was 
filed, or such shorter time as the Commission may designate, it has 
become effective pursuant to section 19(b)(3)(A) of the Act \10\ and 
Rule 19b-4(f)(6) thereunder.\11\ 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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    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 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 proposal 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-2004-038. This file number should be included on the subject line 
if e-mail is used. To help the Commission 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 subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the

[[Page 12190]]

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 the principal office of the 
NASD. All submissions should refer to file number SR-NASD-2004-038 and 
should be submitted by April 5, 2004.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\12\
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    \12\ 17 CFR 200.30-3(a)(12).
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Jill M. Peterson,
Assistant Secretary.
[FR Doc. 04-5787 Filed 3-12-04; 8:45 am]
BILLING CODE 8010-01-P