[Federal Register Volume 64, Number 80 (Tuesday, April 27, 1999)]
[Notices]
[Pages 22664-22665]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10517]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-41314; File No. SR-NASD-99-17]
April 20, 1999
Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Proposed Rule Change by the National Association of
Securities Dealers, Inc. Relating to SelectNet Fees
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 24, 1999, the National Association of Securities Dealers, Inc.
(``NASD'' or ``Association''), through its wholly-owned subsidiary the
Nasdaq Stock Market, Inc. (``Nasdaq''), filed with the Securities and
Exchange Commission (``Commission'' or ``SEC'') the proposed rule
change as described in Items I, II, and III below, which Items have
been prepared by Nasdaq.
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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 NASD is submitting this proposed rule change to extend, through
March 31, 2000, the fees currently charged under NASD Rule 7010(l) for
the execution of transactions in Select Net as discussed below. If no
further action is taken, SelectNet fees will revert to their original
per-side level on April 1, 2000.\3\
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\3\ Nasdaq notes that it recently filed with the Commission a
rule proposal to, in part, return SelectNet to a pure order delivery
and negotiation facility. See SR-NASD-99-11. Notwithstanding the one
year extension of reduced fees contemplated here, Nasdaq reserves
the right to adjust its SelectNet pricing by proposed rule change
pending the approval of SR-NASD-99-11.
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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.
Nasdaq has prepared summaries, set forth below in Sections A, B, and C
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
Nasdaq is proposing to again extend its current reduced SelectNet
fees. The reasons for Nasdaq's prevailing SelectNet fee structure were
fully explained in its original fee structure proposal filed with the
Commission in February of 1998.\4\ Since then, SelectNet usage has
continued at significantly elevated levels. As such, Nasdaq believes
that an extension of these reduced fees, through March 31, 2000, is
warranted. Under the proposed extension, SelectNet fees would continue
to be assessed in the following manner: (1) $1.00 will be charged for
each SelectNet order entered and directed to one particular market
participant that is subsequently executed in whole or in part, (2) no
fee will be charged to a member who receives and executes a directed
SelectNet order, (3) the existing $2.50 fee will remain in effect for
both sides of executed SelectNet orders that result from broadcast
messages; and (4) a $0.25 fee will remain in effect for any member who
cancels a SelectNet order. Nasdaq will continue to monitor and review
SelectNet activity to determine if further extensions of its reduced
SelectNet fee structure are appropriate. If no further action is taken,
SelectNet fees will revert to their original $2.50 per-side level on
April 1, 2000.
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\4\ See Securities Exchange Act Release No. 39641 (February 10,
1998), 63 FR 8241 (February 18, 1998). Nasdaq's current reduced fee
structure was originally approved for a 90 day trial period,
commencing the day that the proposal was published in the Federal
Register. The reduced fees were extended in May, September and
November of 1998 and would expire on March 31, 1999, if not extended
by this filing. See Securities Exchange Act Release No. 40783
(December 11, 1998), 63 FR 70177 (December 18, 1998).
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For the reason set forth above, Nasdaq believes that the proposed
rule change is consistent with Section 15A(b)(5) of the Act,\5\ 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 or system which the NASD
operates or controls.
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\5\ 15 U.S.C. 78o-3(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The NASD believes that the proposed rule change will not 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
Comments were neither solicited nor received.
[[Page 22665]]
III. Date of Effectiveness of the Proposed Rule Change and Timing
for Commission Action
This filing applies to the assessment of SelectNet fees to NASD
members, and thus the proposed rule change is effective immediately
upon filing pursuant to Section 19(b)(3)(A)(ii) of the Act \6\ and
subparagraph (f)(2) of Rule 19b-4 \7\ under the Act because the
proposal is establishing or changing a due, fee or other charge.
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\6\ 15 U.S.C. 78s(b)(3)(A)(ii).
\7\ 17 CFR 240.19b-4(f)(2).
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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, N.W., Washington, D.C. 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 will also be
available for inspection and copying at the principal office of the
NASD. All submissions should refer to File No. SR-NASD-99-17 and should
be submitted by May 18, 1999.
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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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-10517 Filed 4-26-99; 8:45 am]
BILLING CODE 8010-01-M
