[14871]
July 3, 2002
TO: EQUITY MARKETS ADVISORY COMMITTEE No. 14-02
RE: SEC ABROGATES RULE FILINGS ON MARKET DATA REBATE PROGRAMS
The Securities and Exchange Commission has abrogated proposals by several markets to
extend rebates of market data revenues to market participants.1 In particular, the SEC’s press
release announcing the abrogations (a copy of which is attached) states that the Commission is
concerned that “the availability of large market data revenue rebates in certain markets may be
creating incentives for traders to engage in transactions with no economic purpose other than to
receive market data fees.” The press release further states that the Commission believes that
such trades may be distorting the actual volume of trading in these securities and that the
structure and size of market data revenue rebates may be distorting the reporting of trades.
Ari Burstein
Associate Counsel
Attachment
Attachment (in .pdf format)
1 Specifically, the SEC abrogated proposals filed by the NASD, the Cincinnati Stock Exchange and the Pacific
Exchange.