Daily Rules, Proposed Rules, and Notices of the Federal Government
NASDAQ is proposing a change to modify the annual fees for companies listed on the Nasdaq Capital Market.
The text of the proposed rule change is below. Proposed new language is in
(a)-(b) No change.
(c) Annual Fee
(A) The issuer of each class of securities that is a domestic or foreign issue, other than American Depositary Receipts (ADRs), listed on the Nasdaq Capital Market shall pay to Nasdaq an annual fee in the amount of [$27,500]
(2)-(8) No change.
(d)-(e) No change.
In its filing with the Commission, the self-regulatory organization 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 those 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 parts of such statements.
Nasdaq proposes to modify the annual fee charged to companies that list securities on the Nasdaq Capital Market ("Capital Market"), effective January 1, 2013. Currently, the annual fee for securities other than American Depositary Receipts ("ADRs") is $27,500. Nasdaq proposes to increase this fee to $32,000. This fee was last changed in 2007.
In addition, the annual fee charged for ADRs is currently tiered, based on the number of ADRs outstanding. Issuers with 10 million or fewer ADRs outstanding pay an annual fee of $17,500, while issuers with more than 10 million ADRs outstanding pay an annual fee of $21,000. Nasdaq has determined that companies that list ADRs on the Capital Market should be charged the same fee as other companies. However, given that these companies currently pay lower annual fees than other companies, Nasdaq proposes to reduce the impact of this change by phasing in the increase over two years. Specifically, Nasdaq proposes that effective January 1, 2013, the annual fee for ADRs will be $25,000 and effective January 1, 2014, the annual fee for ADRs will be $32,000.
Companies currently listed on the Capital Market have already paid their 2012 annual fee. However, any company that lists prior to December 31, 2012 will owe a prorated annual fee based on the existing $27,500 fee schedule or the existing tiered structure applicable to ADRs. The new fees will become effective on January 1, 2013, and companies will be billed their 2013 annual fee based on the new fee schedule shortly thereafter.
Nasdaq believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
Nasdaq believes that the proposed increase in the annual fee for companies listing on the Capital Market is reasonable because the revised fee will better reflect Nasdaq's costs related to companies listed on the Capital Market and the value that such a listing provides to the company. In that regard, Nasdaq notes that it has not increased the annual fees for listing on the Capital Market since January 1, 2007,
Nasdaq also believes that the proposed changes are equitable and not unfairly discriminatory because they would apply equally to all companies listed on the Capital Market. While the increase on ADRs would be implemented over two years, this is also equitable and not unfairly discriminatory because these companies currently pay lower fees based on a recognition that the U.S. listing is not typically their primary listing. While Nasdaq believes it is equitable to charge them the same fee as other companies because they receive the same benefits from their listing, the Exchange also believes that implementing the increase over two years will help reduce its impact and is appropriate given the currently reduced fees that they pay. Nasdaq also notes that other exchanges charge the same annual fee for ADRs as for other securities.
Finally, NASDAQ notes that it operates in a highly competitive market in which market participants can readily switch exchanges if they deem the listing fees excessive.
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. The market for listing services is extremely competitive and listed companies may freely choose alternative venues. For this reason, and the reasons discussed in connection with the statutory basis for the proposed rule change, Nasdaq does not believe that the proposed rule change will result in any burden on competition for listings.
Written comments were neither solicited nor received.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(ii) of the Act.
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:
* Use the Commission's Internet comment form (
* Send an email to
* Send paper comments in triplicate to Elizabeth M. Murphy, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.