Federal Register, Volume 68 Issue 79 (Thursday, April 24, 2003)

[Federal Register Volume 68, Number 79 (Thursday, April 24, 2003)]
[Notices]
[Pages 20197-20198]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-10101]



[[Page 20197]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-47692; File No. SR-NASD-2003-66]


Self-Regulatory Organizations; Notice of Filing of Proposed Rule 
Change by the National Association of Securities Dealers, Inc. to 
Rebate Certain Past Primex Auction System Logon Charges for Certain 
Participants

April 17, 2003.
    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 April 2, 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 Nasdaq has prepared. 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

    Nasdaq proposes to modify NASD rule 7010(r) to enable Nasdaq to 
waive all Primex Auction System (``Primex'') logon charges for the 
period of August 2002 through November 2002 for those Primex 
participants that, in connection with their participation in Primex 
during that period, were customers of the Brass Service Bureau and 
Order Management System (``Brass''). Nasdaq will implement the proposed 
rule change as soon as practicable after the Commission approves it.
    The text of the proposed rule change is below. Proposed new text is 
italicized.
* * * * *

Rule 7010(r). Nasdaq Application of the Primex Auction 
System^TM

    (1) No change.
    (2) No change.
    (3) Waiver of Logon Fees
    All monthly logon fees for the period of August 2002 through 
November 2002 are waived for those Primex Auction System participants 
that, in connection with their participation in the Primex Auction 
System during such period, were customers of the Brass Service Bureau 
and Order Management System.
* * * * *

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
    Certain Primex participants are also users of Brass. The Brass 
system is integrated with such participants' internal order management 
system, and these participants rely on Brass for routing their 
respective orders to Primex. Due to Brass' delay in completing the 
needed interfaces, participants that expected to use Brass for routing 
their Primex orders were unable to do so, yet they were being charged 
the Primex logon fees. The proposed rule change would waive the logon 
fees during the period August 2002 through November 2002 for the 
affected participants.
    The proposed waiver would apply to all logon charges, including 
each participant's logons for access via Brass as well as such a 
participant's logons for direct access not involving Brass. Generally, 
participants that intend to route their Primex orders through Brass 
also maintain separate Primex logons for direct access via the Primex 
Workstation, which can be used in conjunction with the Brass service in 
order to view transactions in Primex. Such Primex Workstation logons 
were of limited utility to those participants that intended, but were 
unable to, access Primex through Brass during the August 2002 through 
November 2002 period. Consequently, Nasdaq believes that waiving all 
logon charges for the affected participants would be fair and 
equitable. However, the waiver would not apply to network charges, 
because such charges arose from Nasdaq's obligations to third party 
network providers, which Nasdaq incurred specifically for the benefit 
of the participants.
2. Statutory Basis
    Nasdaq believes that the proposed rule change is consistent with 
the provisions of section 15A of the Act,\3\ in general and with 
section 15A(b)(5) of the Act,\4\ in particular, which requires that the 
rules of the NASD provide for 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. The 
proposed waiver of certain Primex logon charges ensures that the Primex 
charges are allocated reasonably and equitably.
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    \3\ 15 U.S.C. 78o-3.
    \4\ 15 U.S.C. 78o-3(b)(5).
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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

    Within 35 days of the date of publication of this notice in the 
Federal Register or within such longer period (i) as the Commission may 
designate up to 90 days of such date if it finds such longer period to 
be appropriate and publishes its reasons for so finding or (ii) as to 
which NASD consents, the Commission will:
    (A) By order approve the proposed rule change, or
    (B) Institute proceedings to determine whether the proposed rule 
change should be 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. Persons making written submissions 
should file six copies thereof with the Secretary, Securities and 
Exchange Commission, 450 Fifth Street, NW., Washington, DC 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

[[Page 20198]]

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 also will be available for 
inspection and copying at the principal office of the NASD. All 
submissions should refer to File No. SR-NASD-2003-66 and should be 
submitted by May 15, 2003.

    For the Commission, by the Division of Market Regulation, 
pursuant to delegated authority.\5\
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    \5\ 17 CFR 200.30-3(a)(12).
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Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 03-10101 Filed 4-23-03; 8:45 am]
BILLING CODE 8010-01-P