[Federal Register Volume 74, Number 208 (Thursday, October 29, 2009)]
[Notices]
[Pages 55874-55875]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-26022]



[[Page 55874]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-60862; File No. SR-NASDAQ-2009-088]


Self-Regulatory Organizations; The NASDAQ Stock Market LLC; 
Notice of Filing and Order Granting Accelerated Approval of Proposed 
Rule Change To Modify Fees for Members Using the NASDAQ Market Center

October 22, 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 October 13, 2009, The NASDAQ Stock Market LLC (``NASDAQ'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been substantially prepared by the Exchange. 
The Commission is publishing this notice to solicit comments on the 
proposed rule change from interested persons, and is approving the 
proposal on an accelerated basis.
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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 proposes to implement this rule change as 
of October 1, 2009. 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 III 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 proposing changes to the fees associated with the use of 
the NASDAQ Market Center. First, NASDAQ is proposing to modify the 
level of activity required to receive NASDAQ's most favorable rate for 
accessing liquidity in securities listed on NASDAQ or the New York 
Stock Exchange (``NYSE''). During the months of August and September 
2009, members paid a fee of $0.0027 per share executed if they had an 
average daily volume during the month of (i) more than 140 million 
shares of liquidity routed, removed and/or provided, and (ii) more than 
35 million shares of liquidity provided. On October 1, 2009, the level 
of liquidity routed, removed and/or provided needed to receive the 
favorable rate had been scheduled to revert automatically to its pre-
August level of 150 million shares. The 140 million share level for 
August and September 2009 had been established to reflect lower trading 
volumes anticipated during those months. Instead of allowing the rate 
to revert to 150 million shares, however, NASDAQ proposes to set the 
level at 145 million shares. As trading volumes revert to higher levels 
with the end of the summer, the change will make it easier for members 
to receive the favorable ``take'' rate. NASDAQ is also deleting 
obsolete fee language referencing NASDAQ Rule 4758(a)(1)(A), portions 
of which had formerly governed ``flash'' orders and were recently 
deleted.\3\ NASDAQ discontinued flash orders at the beginning of 
September 2009.
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    \3\ Securities Exchange Act Release No. 60570 (August 26, 2009), 
74 FR 45504 (September 2, 2009) (SR-NASDAQ-2009-079).
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    Commission approval is required to make the change retroactive to 
the beginning of the month of October. NASDAQ notes that the change to 
the level of liquidity routed, removed and/or provided needed to 
receive a favorable take rate will make it easier for members to obtain 
this rate than would have been the case in the absence of the change. 
Thus, the change effectively constitutes a price reduction for members 
that are able to achieve the 145 million share level but not able to 
achieve the 150 million share level. Accordingly, NASDAQ believes that 
the Commission should approve the filing on an accelerated basis to 
allow the change to be effective for the month of October 2009.
2. Statutory Basis
    NASDAQ believes that the proposed rule change is consistent with 
the provisions of Section 6 of the Act,\4\ in general, and with Section 
6(b)(4) of the Act,\5\ 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. NASDAQ is adjusting the level of 
activity in NASDAQ required to receive its most favorable rate for 
accessing liquidity, making it easier for members to receive this rate.
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    \4\ 15 U.S.C. 78f.
    \5\ 15 U.S.C. 78f(b)(4).
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    The impact of the change upon the net fees paid by a particular 
market participant will depend upon a number of variables, including 
the availability of liquidity at the NASDAQ Market Center, the prices 
of the market participant's quotes and orders, and its overall volume 
of liquidity routed, removed and/or provided through NASDAQ. 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. NASDAQ believes 
that its fees remain competitive with other venues and are reasonable 
and equitably allocated to those members on the basis of whether they 
opt to direct orders to NASDAQ.

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. 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

[[Page 55875]]

     Send an e-mail to [email protected]. Please include 
File Number SR-NASDAQ-2009-088 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-2009-088. 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 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-2009-088 and should be submitted on or before 
November 19, 2009.

IV. Commission's Findings and Order Granting Accelerated Approval of a 
Proposed Rule Change

    The Commission finds that the proposed rule change is consistent 
with the requirements of the Act and the rules and regulations 
thereunder applicable to a national securities exchange.\6\ In 
particular, approval of the retroactive application of the proposal is 
consistent with Section 6(b)(4) of the Act,\7\ which requires that the 
rules of a national securities exchange provide for the equitable 
allocation of reasonable dues, fees, and other charges among its 
members and issuers and other parties using its facilities.
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    \6\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. See 15 U.S.C. 78c(f).
    \7\ 15 U.S.C. 78f(b)(4).
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    The Commission notes that the changes outlined in this proposed 
rule change were also contained in an September 30, 2009 submission by 
NASDAQ for immediate effectiveness pursuant to Section 19(b)(3)(A) \8\ 
of the Act and Rule 19b-4(f)(2) \9\ thereunder; however that submission 
was rejected because it was not filed in accordance with the 
requirements of the Act and the rules and regulations thereunder.\10\ 
The proposed fee changes would otherwise qualify for immediate 
effectiveness pursuant to Section 19(b)(3)(A) \11\ of the Act and Rule 
19b-4(f)(2).\12\ However, because the proposed rule change seeks 
retroactive application of a fee change, NASDAQ filed pursuant to 
Section 19(b)(2) of the Act.\13\
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ See 19 CFR 240.19b-4 and 19 CFR 249.819 Appendix A.
    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 15 U.S.C. 78s(b)(2).
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    The Commission finds good cause, consistent with Section 19(b)(2) 
of the Act,\14\ for approving the proposed rule change before the 
thirtieth day after the date of publication of notice of filing thereof 
in the Federal Register with such approval retroactive to October 1, 
2009. Retroactive approval of this proposal allows the proposed rule 
change to take effect for the month of October 2009.
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    \14\ Id.
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V. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that the proposed rule change (SR-NASDAQ-2009-088) is hereby approved 
on an accelerated basis.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
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    \15\ 17 CFR 200.30-3(a)(12).
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Elizabeth M. Murphy,
Secretary.
[FR Doc. E9-26022 Filed 10-28-09; 8:45 am]
BILLING CODE 8011-01-P