Notice2025-20526
Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Remove the Exchange's Dedicated GPS Antenna Service Under General 8, Section 1(d)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 21, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 223 (Friday, November 21, 2025)</title>
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[Federal Register Volume 90, Number 223 (Friday, November 21, 2025)]
[Notices]
[Pages 52748-52750]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-20526]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104205; File No. SR-GEMX-2025-28]
Self-Regulatory Organizations; Nasdaq GEMX, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Remove the
Exchange's Dedicated GPS Antenna Service Under General 8, Section 1(d)
November 18, 2025.
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 September 30, 2025, Nasdaq GEMX, LLC (``GEMX'' or ``Exchange''),
filed with the Securities and Exchange Commission (``SEC'' or
``Commission'') the proposed rule change as described in Items I, II,
and III, below, which Items have been prepared by the Exchange. 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
The Exchange proposes to remove the Exchange's dedicated GPS
antenna service under General 8, Section 1(d) (Co-Location Services),
as discussed further below.
The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings">https://listingcenter.nasdaq.com/rulebook/nasdaq/rulefilings</a>, and at the principal office of the Exchange.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange 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. The Exchange 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
The Exchange offers a Global Positioning System (``GPS'') antenna,
which allows customers that co-locate their servers and equipment
within the Exchange's data center (``NY 11'') in Carteret, NJ to
synchronize their time recording systems to the U.S. Government's GPS
network time (the ``Service''). GPS network time is the atomic time
scale implemented by the atomic clocks in the GPS ground control
stations and GPS satellites. Each GPS satellite contains multiple
atomic clocks that contribute precise time data to the GPS signals. GPS
receivers decode these signals, synchronizing the receivers to the
atomic clocks. A GPS antenna serves as a time signal receiver and feeds
a primary clock device the GPS network time using precise time data.
Firms can use the precise time data provided by the GPS antenna to
time-stamp transactional information. Time synchronization services are
well established in the U.S. and utilized in many areas of the U.S.
economy and infrastructure. The Service is not novel to the securities
markets, or to the Exchange.
Historically, the Exchange has offered connectivity to a GPS
antenna via two options--over shared infrastructure or a dedicated
antenna. The shared infrastructure provides GPS services through Nasdaq
installed shared cables and hardware located within the data center,
whereas the dedicated antenna requires the firm to supply their own
privately owned antenna hardware. The installation fee for the shared
connection is $900, and the monthly fee is $600. The installation fee
for the dedicated connection is $1,500 and the monthly fee is $600.
Firms may choose to purchase multiple time synchronization services for
resiliency or otherwise.\3\ The Exchange offers the Service as a
convenience to firms to provide them with the ability to synchronize
their own primary clock devices to GPS time via a shared GPS timing
signal and time-stamp transactional information.\4\ Firms do not
[[Page 52749]]
receive an advantage by purchasing the Service from Nasdaq.
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\3\ Of the Exchange's co-location customers that subscribe to
the Service, approximately 5% of such co-location customers purchase
both the dedicated and the shared options of the Service.
\4\ In offering the Service as a convenience to firms, the
Exchange incurs certain costs, including costs related to the data
center facility, hardware and equipment, and personnel.
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The Exchange proposes to remove the dedicated GPS antenna service
from its co-location service offering. The decision to remove the
dedicated GPS service option is consistent with the Exchange's project
to equalize certain connections across its entire data center campus,
including both its existing NY11 facility and the NY11-4 expansion (the
``Equalization Project'') and maintain adequate controls of all cables
that run throughout the data center.\5\ The Exchange has identified a
risk where customers with a dedicated GPS antenna, which is located on
the roof of the data center, may be able to circumvent the equalized
infrastructure. In accordance with the Equalization Project's goal of
ensuring that customers do not bypass the integrity of the equalized
connections maintained throughout the data center, the Exchange is no
longer allowing customers to order dedicated GPS antenna service as of
September 30, 2025. Service for existing customers with a dedicated GPS
antenna will terminate as of April 1, 2026, and all dedicated GPS
antennas must be removed by such date. Customers that want to continue
to utilize the Service can request the shared GPS antenna.
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\5\ See Securities and Exchange Act Release No. 34-101078 (Sept.
18, 2024), 89 FR 77937 (September 24, 2024) (SR-NASDAQ-2024-054)
(``Co-Location Expansion Proposal'').
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Currently, approximately 49% of the Exchange's co-location
customers subscribe to the Service, most of which opt for the shared
option. The Service is an optional product available to any firm that
chooses to subscribe. Firms may cancel their subscription at any time.
The Service simply provides time synchronization that may be utilized
by firms to adjust their own time systems and time-stamp transactional
information. The GPS antenna is offered on a completely voluntary
basis. No customer is required to purchase the GPS antenna. Potential
subscribers may subscribe to the Service only if they voluntarily
choose to do so. It is a business decision of each firm whether to
subscribe to the Service or not. Customers do not receive an advantage
by purchasing the Service from Nasdaq; the Exchange is merely providing
access to GPS signals.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\6\ in general, and furthers the objectives of Sections
6(b)(4) and 6(b)(5) of the Act,\7\ in particular, in that it provides
for the equitable allocation of reasonable dues, fees and other charges
among members and issuers and other persons using any facility, and is
not designed to permit unfair discrimination between customers,
issuers, brokers, or dealers.
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\6\ 15 U.S.C. 78f(b).
\7\ 15 U.S.C. 78f(b)(4) and (5).
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The Exchange's proposed change to its connectivity service offering
is reasonable in several respects. As a threshold matter, the Exchange
is subject to significant competitive forces in the market for equity
securities transaction services that constrain its pricing
determinations in that market. The fact that this market is competitive
has long been recognized by the courts. In NetCoalition v. Securities
and Exchange Commission, the D.C. Circuit stated as follows: ``[n]o one
disputes that competition for order flow is `fierce.' . . . As the SEC
explained, `[i]n the U.S. national market system, buyers and sellers of
securities, and the broker-dealers that act as their order-routing
agents, have a wide range of choices of where to route orders for
execution'; [and] `no exchange can afford to take its market share
percentages for granted' because `no exchange possesses a monopoly,
regulatory or otherwise, in the execution of order flow from broker
dealers'. . . .'' \8\
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\8\ NetCoalition v. SEC, 615 F.3d 525, 539 (D.C. Cir. 2010)
(quoting Securities Exchange Act Release No. 59039 (December 2,
2008), 73 FR 74770, 74782-83 (December 9, 2008) (SR-NYSEArca-2006-
21)).
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The Commission and the courts have repeatedly expressed their
preference for competition over regulatory intervention in determining
prices, products, and services in the securities markets. In Regulation
NMS, while adopting a series of steps to improve the current market
model, the Commission highlighted the importance of market forces in
determining prices and SRO revenues and, also, recognized that current
regulation of the market system ``has been remarkably successful in
promoting market competition in its broader forms that are most
important to investors and listed companies.'' \9\
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\9\ Securities Exchange Act Release No. 51808 (June 9, 2005), 70
FR 37496, 37499 (June 29, 2005) (``Regulation NMS Adopting
Release'').
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The Exchange believes that it is reasonable and equitable to remove
the dedicated GPS antenna service and fee from its connectivity
offerings because the service does not align with the Exchange's
Equalization Project and the goal of maintaining the integrity of
equalization within the Exchange's data center. The removal of the
dedicated antenna is unlikely to burden the market because the purchase
of the Service is optional for all categories of co-location customers
and customers can discontinue the use of the Service at any time.
Additionally, customers will maintain the option of utilizing the
Service via the shared GPS antenna. Additionally, the proposed change
is not unfairly discriminatory because the dedicated GPS service will
be removed for all market participants and the option to utilize the
shared Service will also be available for all market participants. As
discussed above, approximately 49% of the Exchange's co-location
customers subscribe to the Service and most of them opt for the shared
antenna.
The Exchange believes that it is reasonable to provide existing
customers with at least six months lead time to prepare to remove their
dedicated antenna from the data center's roof before the service
terminates. This provides co-location customers with sufficient time to
remove their antennas from the data center and switch to the shared GPS
antenna service before the direct GPS antenna service is terminated.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. Nothing in the proposal imposes
any burden on the ability of customers or other exchanges to compete.
The Exchange operates in a highly competitive market in which exchanges
and other vendors offer co-location services as a means to facilitate
the trading and other market activities of those market participants
who believe that co-location enhances the efficiency of their
operations. Eliminating the dedicated GPS antenna services will not
cause any burden on inter-market competition. Additionally, there is no
burden to intra-market competition because the direct GPS antenna
service is being terminated for all customers and the Exchange has
provided all customers with the same timeline to terminate or convert
to the shared GPS antenna service on a non-discriminatory basis. Use of
any co-location service is completely voluntary, and each market
participant can determine whether to use co-location services based on
the requirements of its business operations.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
[[Page 52750]]
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A)(ii) of the Act.\10\
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\10\ 15 U.S.C. 78s(b)(3)(A)(ii).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is: (i)
necessary or appropriate in the public interest; (ii) for the
protection of investors; or (iii) otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission shall institute proceedings to determine whether the
proposed rule should be approved or 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. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#7d0f081118501e1210101813090e3d0e181e531a120b"><span class="__cf_email__" data-cfemail="2052554c450d434f4d4d454e5453605345430e474f56">[email protected]</span></a>. Please include
file number SR-GEMX-2025-28 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-GEMX-2025-28. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number SR-GEMX-2025-28 and should be submitted on
or before December 12, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\11\
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\11\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-20526 Filed 11-20-25; 8:45 am]
BILLING CODE 8011-01-P
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