The NASDAQ Stock Market (NASDAQ) has proposed to adopt an excess order fee commencing on June 1. This fee is intended to reduce the number of non-actionable orders submitted to the NASDAQ market, and thus promote greater order interaction, increase the quality of NASDAQ market data and prevent potentially abusive trading practices.  

NASDAQ will base the excess order fee on an order entry ratio. In general, the order entry ratio will be the ratio between (i) entered orders, weighted by the distance of the order from the national best bid or offer, and (ii) orders that execute in whole or in part. The excess order fee will be imposed on market participant identifiers with an order entry ratio of more than 100. The order entry ratio will be calculated, and the excess order fee will be imposed, on a monthly basis.  

To view the notice of filing of the proposed rule change, click here. To view Exhibit 5 for the language of proposed rule change, click here.