Freedom of Exchanges to Set Market Data Fees - We Aren’t Done Yet

The U.S. Court of Appeals for the District of Columbia Circuit ruled that the Dodd-Frank Act stripped the court of jurisdiction to review the SEC's failure to suspend an automatically effective SRO market data fee filing. As a result, the Court dismissed the petition brought by NetCoalition and the Securities Industry and Financial Markets Association ("SIFMA").

The Court's decision is largely procedural, however, as the Court also made clear that Section 19(d) of the Exchange Act provides the petitioners with the right to seek SEC review of the fees, and that, in conducting such review, the SEC would be required, pursuant to Section 19(f) of the Exchange Act, to ensure that the challenged rule is "consistent with the purposes" of the Exchange Act and does not "impose[] any burden on competition not necessary or appropriate in furtherance of the purposes of" the Exchange Act. The Court also stated that any person aggrieved by the SEC's decision in such matter "undoubtedly may obtain judicial review of that disposition in the court of appeals."

As petitioner's counsel has already made clear, the challenge to the market data fees at issue now shifts from the court to the SEC. Stay tuned.

See: NetCoalition v. SEC, 10-1421, U.S. Court of Appeals for the District of Columbia (Washington).See also: SIFMA Petitions and Petitions and Petitions and Petitions the SEC to Disapprove the NYSE's New Fees.Questions on this matter may be directed to Glen Barrentine.