[Federal Register Volume 84, Number 220 (Thursday, November 14, 2019)]
[Notices]
[Pages 61944-61946]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-24699]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-87491; File No. SR-NASDAQ-2019-088]


Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Rule 4759

November 7, 2019.
    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 1, 2019, 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 prepared by the Exchange. 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 Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Rule 4759, as described below. While 
these amendments are effective upon filing, the Exchange has designated 
the proposed amendments to be operative on November 4, 2019.
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaq.cchwallstreet.com, at the principal office of 
the Exchange, 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, the Exchange 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. The Exchange 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 Exchange proposes to amend Rule 4759, which lists the 
proprietary and network processor feeds that the Exchange utilizes for 
the handling, routing, and execution of orders, as well as for the 
regulatory compliance processes related to those functions. Presently, 
the Exchange's trading system utilizes proprietary market data as the 
Primary Source of quotation data for the following markets that provide 
a reliable direct feed: NYSE American, Nasdaq BX, CBOE EDGA, CBOE EDGX, 
CHX, NYSE, NYSE Arca, Nasdaq, Nasdaq PSX, CBOE BYX, and CBOE BZX. For 
each of these markets, the Exchange uses SIP data as the Secondary 
Source of quotation data.\3\ For other markets,

[[Page 61945]]

namely NYSE National, FINRA ADF, and IEX, the Exchange utilizes SIP 
data as the Primary Source; there is no Secondary Source for those 
markets. The Exchange proposes to amend Rule 4759 to state that going 
forward, the Exchange will utilize SIP data, rather than a direct feed, 
as its Primary Source of data for CHX (now known as NYSE Chicago \4\), 
with no Secondary Source utilized for that data. The Exchange proposes 
this amendment to reflect the fact that NYSE Chicago is migrating to a 
new technology platform and that, after November 1, 2019, it has 
announced that it will cease offering the NYSE Chicago Book Feed that 
currently serves as its direct feed to the Exchange.\5\ Although the 
Exchange understands that NYSE Chicago plans to offer new data feeds to 
replace the NYSE Chicago Book Feed, the Exchange has yet to decide 
whether it will utilize them.\6\
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    \3\ Pursuant to Rule 4759, the Primary Source of data is used 
unless it is delayed by a configurable amount compared to the 
Secondary Source of data. The Exchange reverts to the Primary Source 
of data once the delay has been resolved.
    \4\ The Exchange also proposes to update the Rule to reflect the 
fact that the Chicago Stock Exchange is now known as NYSE Chicago.
    \5\ See https://www.nyse.com/market-data/real-time#chicago.
    \6\ See id. If and when the Exchange decides to subscribe to 
these replacement NYSE Chicago direct data feed products, the 
Exchange will file a proposal to amend Rule 4759 accordingly.
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2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\7\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\8\ in particular, in that it is designed to promote 
just and equitable principles of trade, to remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system, and, in general to protect investors and the public interest.
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    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that it is necessary to amend its Rules to 
account for the fact that, after November 1, 2019, NYSE Chicago will no 
longer offer the direct feed to which the Exchange currently 
subscribes. The Exchange notes that it already utilizes the SIP as its 
sole source of quote data for NYSE National and IEX--as well as the 
FINRA ADF, without issue. In the event that the Exchange determines 
that its proposal to utilize SIP data is inadequate for its purposes, 
then the Exchange may choose to subscribe to one or more of the 
replacement proprietary data feeds that NYSE Chicago plans to offer 
beginning on November 4, 2019.
    Lastly, the Exchange believes that it is consistent with the public 
interest and the protection of investors to update the names of the 
exchanges listed in Rule 4759 as this change will make it easier for 
market participants to identify the exchanges for which the Exchange 
uses the direct feed and/or SIP for the purposes described in the Rule.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Act. The proposed rule change is not 
designed to address any competitive issue; instead, it is merely 
intended to reflect the fact that the Exchange will no longer consume 
the NYSE Chicago Book Feed, which NYSE Chicago plans to discontinue 
after November 1, 2019. The Exchange does not expect that its decision 
to utilize the SIP, going forward, to obtain NYSE Chicago quote data 
will have any competitive impacts. As noted above, the Exchange 
presently utilizes the SIP as its sole source of quote data for several 
other exchanges, including NYSE National and IEX.

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

    No written comments were either solicited or received.

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 \9\ and Rule 19b-
4(f)(6) thereunder.\10\
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    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give 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, or such shorter time as designated by the Commission. 
The Exchange has requested that the Commission waive the pre-filing 
requirement. The Commission hereby waives that requirement.
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    A proposed rule change filed under Rule 19b-4(f)(6) \11\ normally 
does not become operative for 30 days from the date of filing. However, 
Rule 19b-4(f)(6)(iii) \12\ permits the Commission to designate a 
shorter time if such action is consistent with the protection of 
investors and the public interest. The Exchange has requested that the 
Commission waive the 30-day operative delay so that the Exchange can 
amend Rule 4759 prior to the discontinuation of the NYSE Chicago Book 
Feed. The Exchange states that waiver of the operative delay would 
prevent Rule 4759 from being inaccurate and causing confusion among 
investors and the public. For these reasons, the Commission believes 
that waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest. Accordingly, the 
Commission hereby waives the 30-day operative delay and designates the 
proposed rule change operative upon filing.\13\
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    \11\ 17 CFR 240.19b-4(f)(6).
    \12\ 17 CFR 240.19b-4(f)(6)(iii).
    \13\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend 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. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule change should be approved or 
disapproved.

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 email to [email protected]. Please include 
File Number SR-NASDAQ-2019-088 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NASDAQ-2019-088. This 
file number should be included on the subject line if email is used. To 
help the Commission process and review your comments more efficiently, 
please use

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only one method. The Commission will post all comments on the 
Commission's internet website (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 website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549, on official business days between the hours of 10:00 a.m. and 
3:00 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. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NASDAQ-2019-088 and should be submitted 
on or before December 5, 2019.
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    \14\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-24699 Filed 11-13-19; 8:45 am]
 BILLING CODE 8011-01-P