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Thursday, May 10, 2012

Equity Trader Alert #2012 - 19
NASDAQ OMX BX Eliminates Registered Representative Fee and Establishes Equities Regulatory Fee

Markets Impacted:

Contact Information:

What you need to know:

  • Subject to Securities and Exchange Commission (SEC) approval, NASDAQ OMX BXSM (BXSM) will eliminate the current Registered Representative Fee of $60 for initial registration, the transfer fee of $40.00 and the annual $50 system processing fee (currently waived), collectively known as Registration Fees, effective June 1, 2012.
  • BX will establish an annual Equities Regulatory Fee (ERF) based on the Historical Daily Orders on BX.
  • Historical Daily Orders will be based on the average orders placed on BX by a member participant during the prior calendar year.

What is changing?

BX currently assesses a Registered Representative Fee for initial registration of $60.00 and a transfer fee of $40.00 for each Registered Representative of a member participant to cover a portion of the cost of the exchange's regulatory programs. In addition, BX has a $50 annual system processing fee, which is currently waived, assessed for each firm's registered representatives and principal.

Effective June 1, 2012, BX will eliminate the current system and introduce the annual ERF to align fees with the regulatory effort required to monitor firms based on their exchange activity.

What is the new ERF?

The ERF is an annual fee that will be tiered based on the Historical Daily Orders placed on the exchange during the prior calendar year for each registered member.

What are the tiers?

The tier schedule for the ERF will be as follows:

Daily Order Tiers Annual ERF Pro-Rated ERF (7-months)
>=50,000 orders $4,000 $2,333
>=1,000 orders, but <50,000 orders $2,500 $1,458
< 1,000 orders $0$0

How will the fee be assessed for 2012?

The ERF tier assigned to each member firm will be based on the Average Daily Orders for calendar year 2011. Since the ERF will be implemented beginning on June 1st, NASDAQ OMX® will prorate the ERF for 2012 for the seven months remaining in the year. The ERF will appear on your June BX invoice from NASDAQ OMX Transaction Services that will be produced on or around July 10, 2012.

Will the ERF be charged to new BX members?

Since new BX members will not have a Historical Daily Order value, they will not be assessed the fee until the next annual billing cycle in January 2013.

Where can I find more information?


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