Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change in Connection With the Proposed Termination of the Amended and Restated Trust Agreement, Dated as of November 13, 2013 and Amended on June 2, 2014 By and Among NYSE Holdings LLC, a Delaware Limited Liability Company, NYSE Group, Inc., a Delaware Corporation, Wilmington Trust Company, as Delaware Trustee, and Each of Jacques de Larosière de Champfeu, Alan Trager and John Shepard Reed, as Trustees, 63201-63204 [2014-25078]
Download as PDF
Federal Register / Vol. 79, No. 204 / Wednesday, October 22, 2014 / Notices
members deliver a prospectus to
investors purchasing newly issued
Shares prior to or concurrently with the
confirmation of a transaction; and (f)
trading information.
(5) For initial and continued listing,
the Funds will be in compliance with
Rule 10A–3 under the Exchange Act.
(6) A Fund may hold up to an
aggregate amount of 15% of its net
assets (calculated at the time of
investment) in assets deemed illiquid by
the Adviser, consistent with
Commission guidance.
(7) A minimum of 100,000 Shares of
each Fund will be outstanding at the
commencement of trading on the
Exchange.
(8) With respect to their investments
in exchange-listed common stocks and
Depositary Receipts, the International
Funds will invest at least 90% of their
assets invested in such securities in
exchange-listed common stocks and
Depositary Receipts that trade in
markets that are members of the ISG or
are parties to a comprehensive
surveillance sharing agreement with the
Exchange.
(9) All of the debt securities held by
the Funds will be rated investment
grade.
This approval order is based on all of
the Exchange’s representations and
description of the Funds, including
those set forth above and in Amendment
No. 3.
For the foregoing reasons, the
Commission finds that the proposed
rule change, as modified by Amendment
No. 3, is consistent with Section 6(b)(5)
of the Act and the rules and regulations
thereunder applicable to a national
securities exchange.
III. Solicitation of Comments on
Amendment No. 3
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether Amendment No. 3 is
consistent with the Act. Comments may
be submitted by any of the following
methods:
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Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
BATS–2014–026 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE.,
Washington, DC 20549–1090.
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18:22 Oct 21, 2014
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All submissions should refer to File
Number SR–BATS–2014–026. 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 Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–BATS–
2014–026 and should be submitted on
or before November 12, 2014.
IV. Accelerated Approval of Proposed
Rule Change, as Modified by
Amendment No. 3
The Commission finds good cause to
approve the proposed rule change, as
modified by Amendment No. 3, prior to
the thirtieth day after the date of
publication of notice of Amendment No.
3 in the Federal Register. Amendment
No. 3 supplements the proposed rule
change by, among other things: (1)
Clarifying the holdings of the Funds; (2)
providing additional information
regarding the NAV valuation of certain
of the Funds’ holdings; (3) and
supplemented the description of the
Exchange’s surveillance capabilities.19
This additional information has aided
the Commission’s analysis of the intraday trading of the Shares and has
clarified the Exchange’s ability to obtain
trading information regarding the
underlying assets and thereby monitor
trading in the Shares. Accordingly, the
Commission finds good cause, pursuant
to Section 19(b)(2) of the Act, to approve
the proposed rule change, as modified
19 See
PO 00000
note 5, supra.
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63201
by Amendment No. 3, on an accelerated
basis.20
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act, that the
proposed rule change (SR–BATS–2014–
026), as modified by Amendment No. 3,
be, and it hereby is, approved on an
accelerated basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–25081 Filed 10–21–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73372; File No. SR–
NYSEMKT–2014–83]
Self-Regulatory Organizations; NYSE
MKT LLC; Notice of Filing of Proposed
Rule Change in Connection With the
Proposed Termination of the Amended
and Restated Trust Agreement, Dated
as of November 13, 2013 and Amended
on June 2, 2014 By and Among NYSE
Holdings LLC, a Delaware Limited
Liability Company, NYSE Group, Inc., a
Delaware Corporation, Wilmington
Trust Company, as Delaware Trustee,
`
and Each of Jacques de Larosiere de
Champfeu, Alan Trager and John
Shepard Reed, as Trustees
October 16, 2014.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on October
8, 2014, NYSE MKT LLC (the
‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes this rule filing
in connection with the proposed
20 This approval order is based on all of the
Exchange’s representations and description of the
Funds set forth above and in Amendment No. 3.
21 17 CFR 200.30–3(a)(57).
1 15 U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
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Federal Register / Vol. 79, No. 204 / Wednesday, October 22, 2014 / Notices
termination of the Amended and
Restated Trust Agreement, dated as of
November 13, 2013 and amended on
June 2, 2014 (the ‘‘Trust Agreement’’),
by and among NYSE Holdings LLC, a
Delaware limited liability company
(‘‘NYSE Holdings’’), NYSE Group, Inc.,
a Delaware corporation (‘‘NYSE
Group’’), Wilmington Trust Company,
as Delaware Trustee, and each of
`
Jacques de Larosiere de Champfeu, Alan
Trager and John Shepard Reed, as
Trustees. The text of the proposed rule
change is available on the Exchange’s
Web site at www.nyse.com, at the
principal office of the Exchange, and at
the Commission’s Public Reference
Room.
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
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.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
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NYSE MKT seeks approval for its
100% direct parent, NYSE Group, and
its 100% indirect parent, NYSE
Holdings, to terminate the Trust
Agreement.4 NYSE MKT believes that
the regulatory considerations that led to
the implementation of the Trust
Agreement in 2007 are now moot as a
result of the sale by Intercontinental
4 ICE, a public company listed on the New York
Stock Exchange, LLC (the ‘‘NYSE’’), owns 100% of
Intercontinental Exchange Holdings, Inc., a
Delaware corporation (‘‘ICE Holdings’’), which in
turn owns 100% of NYSE Holdings. Through ICE
Holdings, NYSE Holdings and NYSE Group, ICE
indirectly owns (1) 100% of the equity interest of
three registered national securities exchanges and
self-regulatory organizations (together, the ‘‘NYSE
Exchanges’’)—the Exchange, NYSE Arca, Inc.
(‘‘NYSE Arca’’) and the NYSE—and (2) 100% of the
equity interest of NYSE Market (DE), Inc. (‘‘NYSE
Market’’), NYSE Regulation, Inc. (‘‘NYSE
Regulation’’), NYSE Arca L.L.C., NYSE Arca
Equities, Inc. and NYSE Amex Options LLC. See
Exchange Act Release No. 70210 (August 15, 2013)
(SR–NYSEMKT–2013–50), 78 FR 51758 (August 21,
2013) (approving proposed rule change relating to
a corporate transaction in which NYSE Euronext
will become a wholly owned subsidiary of
IntercontinentalExchange Group, Inc.).
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18:22 Oct 21, 2014
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Exchange, Inc., a Delaware corporation
(‘‘ICE’’), of Euronext N.V. (‘‘Euronext’’)
in June 2014 and certain changes in the
corporate governance of ICE, ICE
Holdings and NYSE Holdings that
occurred upon such sale.5
Background
In 2007, NYSE Group, which is the
100% owner of NYSE MKT, combined
with Euronext (the ‘‘Combination’’). The
new parent company formed in the
Combination, NYSE Euronext, operated
several regulated entities in the United
States and various jurisdictions in
Europe. In the Commission’s notice
relating to the proposed Combination,
NYSE MKT emphasized the importance
of continuing to regulate marketplaces
locally:
A core aspect of the structure of the
Combination is continued local regulation of
the marketplaces. Accordingly, the
Combination is premised on the notion that
. . . [c]ompanies listing their securities only
on markets operated by Euronext and its
subsidiaries will not become newly subject to
U.S. laws or regulation by the SEC as a result
of the Combination, and companies listing
their securities only on the Exchange or
NYSE Arca, will not become newly subject
to European rules or regulation as a result of
the Combination.6
In connection with obtaining
regulatory approval of the Combination,
NYSE Euronext implemented certain
special arrangements consisting of two
standby structures, one involving a
Dutch foundation (Stichting) and one
involving a Delaware trust. The Dutch
foundation was empowered to take
actions to mitigate the effects of any
material adverse change in U.S. law that
had an ‘‘extraterritorial’’ impact on nonU.S. issuers listed on Euronext markets,
non-U.S. financial services firms that
were members of Euronext markets or
holders of exchange licenses with
respect to the Euronext markets. The
Delaware trust was empowered to take
actions to mitigate the effects of any
material adverse change in European
law that had an ‘‘extraterritorial’’ impact
on the non-European issuers listed on
NYSE Group securities exchanges, nonEuropean financial services firms that
were members of any NYSE Group
securities market or holders of exchange
licenses with respect to the NYSE Group
securities exchanges.
The current form of the Trust
Agreement is attached as Exhibit 5A,
5 The Exchange’s affiliates, the NYSE and NYSE
Arca, have also submitted the same proposed rule
change to terminate the Trust Agreement. See SR–
NYSEArca–2014–112 and SR–NYSE–2014–53.
6 See Exchange Act Release No. 55026 (Dec. 29,
2006) (SR–NYSE–2006–120), 72 FR 814, 816–817
(January 8, 2007) (the ‘‘NYSE Euronext Notice’’).
NYSE Euronext acquired NYSE MKT in 2008.
PO 00000
Frm 00125
Fmt 4703
Sfmt 4703
and a form of unanimous written
consent of all parties to, or otherwise
bound by, the Trust Agreement
resolving that the Delaware trust be
terminated is attached as Exhibit 5B.
The terms of the Dutch foundation and
the Delaware trust are complex. An
explanation of the terms is included in
the NYSE Euronext Notice. Subsequent
modifications to the arrangements, to
the extent relevant to the proposed rule
change, are described herein. The Dutch
foundation and the Delaware trust
remained in effect after the merger of
ICE Holdings (then known as
IntercontinentalExchange, Inc.) and
NYSE Euronext in 2013 under ICE (then
known as IntercontinentalExchange
Group, Inc.) as a new public holding
company. However, in connection with
ICE’s announced plan to sell the
Euronext securities exchanges in an
initial public offering, the Dutch
Ministry of Finance permitted
modifications of the terms of the
governing document of the Dutch
foundation under which the powers of
the Dutch foundation would cease to
apply to ICE and its affiliates at such
time as ICE ceased to hold a
‘‘controlling interest’’ in Euronext, with
‘‘controlling interest’’ defined by
reference to the definition of ‘‘control’’
under Rule 10 of the International
Financial Reporting Standards (‘‘IFRS
10’’).7 In June 2014 ICE announced that
it had sold all but approximately 6% of
the ownership interest in Euronext in an
underwritten public offering outside the
United States.8 Upon application by
ICE, the Dutch Ministry of Finance
confirmed on July 16, 2014 that the
conditions to the cessation of the
application of the Dutch foundation to
ICE had been satisfied or waived.9 As a
result, ICE and its subsidiaries are no
longer subject to the provisions of the
Dutch foundation.
In the 2013 merger, NYSE Euronext
was succeeded by the entity now known
as NYSE Holdings, which is currently a
party to the Trust Agreement. At that
time, references to the nominating and
governance committee of the board of
directors of NYSE Euronext, which
selected the Trustees of the Delaware
trust, were replaced by references to the
7 Excerpts from the Further Amended and
Restated Governance and Option Agreement, dated
March 21, 2014, among the Dutch foundation,
Euronext Group N.V. and ICE are attached as
Exhibit 5C.
8 ICE’s press release dated June 24, 2014 is
available at the following link: https://ir.theice.com/
investors-and-media/press/press-releases/pressrelease-details/2014/Intercontinental-ExchangeAnnounces-Closing-of-Euronext-Initial-PublicOffering/default.aspx.
9 An English translation of the Dutch Ministry of
Finance’s letter is attached as Exhibit 5D.
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nominating and governance committee
of the board of directors of ICE.10 Other
provisions of the Trust Agreement are
substantially unchanged.11
In connection with the Combination
of NYSE Group and Euronext in 2007
and the establishment of the Dutch
foundation and the Delaware trust, the
Certificate of Incorporation and Bylaws
of NYSE Euronext included several
provisions relating to representation of
European interests on the board of
directors and other provisions requiring
the board to give due consideration to
European regulatory requirements and
the interests of identified categories of
European stakeholders. These
provisions are summarized in the NYSE
Euronext Notice. Each such provision
was subject to automatic revocation in
the event that NYSE Euronext no longer
held a controlling interest in Euronext
or certain of its subsidiaries. For this
purpose, ‘‘controlling interest’’ was
defined to mean 50% or more of the
outstanding shares of each class of
voting securities and of the combined
voting power of outstanding voting
securities entitled to vote generally in
the election of directors. Substantially
identical provisions were added to the
Certificate of Incorporation and Bylaws
of ICE and ICE Holdings, and were
retained in the Operating Agreement of
NYSE Holdings, when ICE acquired
NYSE Euronext in 2013, except that the
‘‘controlling interest’’ test was modified
to become a ‘‘control’’ test under IFRS
10, as described above with respect to
the Dutch foundation. As a result of the
initial public offering of Euronext, ICE
has established that it no longer controls
Euronext within the meaning of IFRS
10, and the provisions of the constituent
documents of ICE, ICE Holdings and
NYSE Holdings have automatically and
without further action become void and
are of no further force and effect.
Proposed Rule Change
NYSE MKT requests approval to
terminate the Delaware trust because it
believes that the regulatory
considerations that led to the
implementation of the Trust Agreement
in 2007 have been mooted by the sale
of Euronext in June 2014, the automatic
revocation of corporate governance
provisions applicable to ICE, ICE
Holdings and NYSE Holdings that
occurred upon such sale, and the fact
10 See
note 4, supra.
Exchange Act Release No. 72158 (May 13,
2014) (SR–NYSE–2014–23), 79 FR 28784 (May 19,
2014) (notice of filing and immediate effectiveness
of proposed rule change relating to name changes
of the Exchange’s ultimate parent) (revising Trust
Agreement to reflect name changes of ICE and ICE
Holdings).
11 See
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18:22 Oct 21, 2014
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that the Dutch which functioned as a
European analog to the Delaware trust,
ceased to have any authority over ICE
and its subsidiaries upon the closing of
the sale of Euronext.12 NYSE MKT
believes that the prospect for any
material adverse change in European
law that would have an
‘‘extraterritorial’’ impact on the nonEuropean issuers listed on NYSE Group
securities exchanges, non-European
financial services firms that are
members of any NYSE Group securities
market or holders of exchange licenses
with respect to the NYSE Group
securities exchanges is now remote.
Continuance of the Trust Agreement
when it no longer furthers the purposes
of Section 6(b) of the Exchange Act 13
also imposes certain administrative
burdens and costs upon NYSE MKT and
its affiliates, and may cause investor
uncertainty, that create impediments to
a free and open market. Specifically, the
Trust Agreement imposes
administrative burdens on ICE and the
nominating and governance committee
of its board of directors, such as the
need to periodically consider and vote
on Trustees; the need to consider
whether any proposed action requires
approval under the Trust Agreement
and, if so, the obligation to prepare
materials for consideration and vote by
the Trustees; and the need to consider
whether any proposed action requires
an amendment to the Trust Agreement
and, if so, the additional obligation to
submit such amendment to the
Commission for approval under Rule
19b–4.14 The Trust Agreement results in
out-of-pocket costs to NYSE MKT and
its affiliates including the fees of the
individual Trustees and the Delaware
Trustee as well as fees of counsel
incurred in connection with review of
proposed amendments and assistance
with the SEC approval process. NYSE
MKT also believes that some analysts
and institutional investors may not fully
understand the purpose of the Delaware
trust and may not have appreciated that,
even when ICE controlled Euronext and
European regulatory considerations
played a substantial role in ICE’s
corporate governance, the likelihood of
the Delaware trust’s substantive
provisions ever being invoked was, by
design, extremely remote. In light of the
sale of Euronext, the revocation of the
governance provisions relating to
European considerations, and the
cessation of application of the Dutch
foundation to ICE and its affiliates, ICE
12 As noted above, this has been confirmed by the
Dutch Ministry of Finance.
13 15 U.S.C. 78f(b).
14 17 CFR 240.19b–4.
PO 00000
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Fmt 4703
Sfmt 4703
63203
believes it is appropriate to terminate
the Delaware trust in order to avoid any
future need to reassure analysts and
investors that the trust does not impact
the daily operations or valuations of
ICE’s national securities exchanges.
Termination of the Delaware trust
would be implemented through a
unanimous written consent of all parties
to, or otherwise bound by, the Trust
Agreement in the form attached as
Exhibit 5B.
References to the Delaware trust also
would be deleted from, and related
conforming changes would be made to,
the constituent documents of NYSE
Holdings, NYSE Group, NYSE MKT, the
Exchange, NYSE Market and NYSE
Regulation. In particular:
NYSE Holdings. The Fifth Amended
and Restated Limited Liability Company
Agreement of NYSE Holdings would be
further amended and restated to
eliminate the definition of the term
‘‘Trust’’ in Section 1.1 and the
references to the Delaware trust in
Section 7.2. See Exhibit 5E.
NYSE Group. The Third Amended
and Restated Certificate of Incorporation
of NYSE Group would be further
amended and restated to eliminate
references to the Delaware trust in
Article IV, Section 4(a) and (b). See
Exhibit 5F.
The Exchange. The Sixth Amended
and Restated Operating Agreement of
the Exchange would be further amended
and restated to eliminate references to
the Delaware trust in Section 3.03. See
Exhibit 5G.
NYSE MKT. The Fifth Amended and
Restated Operating Agreement of NYSE
MKT would be further amended and
restated to eliminate references to the
Delaware trust in Section 3.03. See
Exhibit 5H.
NYSE Market. The Second Amended
and Restated Certificate of Incorporation
of NYSE Market would be further
amended and restated to eliminate
references to the Delaware trust in
Article IV, Section 2. See Exhibit 5I.
NYSE Regulation. The Restated
Certificate of Incorporation of NYSE
Regulation would be further amended
and restated to eliminate references to
the Delaware trust in Article V. See
Exhibit 5J.
2. Statutory Basis
NYSE MKT believes that the proposed
rule change is consistent with Section
6(b) of the Exchange Act 15 in general,
and with Section 6(b)(1) 16 in particular,
in that it enables NYSE MKT to be so
organized as to have the capacity to be
15 15
16 15
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U.S.C. 78f(b).
U.S.C. 78f(b)(1).
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able to carry out the purposes of the
Exchange Act and to comply, and to
enforce compliance by its exchange
members and persons associated with
its exchange members, with the
provisions of the Exchange Act, the
rules and regulations thereunder, and
the rules of NYSE MKT. The Delaware
trust was implemented in response to
potential concerns arising under nonU.S. law and regulation at a time when
NYSE MKT was owned by a company
with substantial holdings of non-U.S.
securities exchanges, substantial nonU.S. board representation, and explicit
obligations on the part of its board to
give due consideration to matters of
non-U.S. law and the interests of nonU.S. stakeholders. In light of the
elimination of these concerns as
discussed above, NYSE MKT believes
that termination of the Delaware trust is
consistent with Section 6(b)(1).
NYSE MKT also believes that this
filing furthers the objectives of Section
6(b)(5) of the Exchange Act 17 because
the proposed rule change would be
consistent with and facilitate a
governance and regulatory structure that
is designed to prevent fraudulent and
manipulative acts and practices, to
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
regulating, clearing, settling, processing
information with respect to, and
facilitating transactions in securities, to
remove impediments to, and perfect the
mechanism of a free and open market
and a national market system and, in
general, to protect investors and the
public interest. As discussed above, the
Exchange believes that termination of
the Delaware trust will remove
impediments to the operation of NYSE
MKT by eliminating certain expenses
and administrative burdens as well as
the potential for uncertainty among
analysts and investors as to the practical
implications of the Delaware trust on
NYSE MKT as a marketplace and as a
significant asset of ICE. For the same
reasons, the proposed rule change is
also designed to protect investors as
well as the public interest.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
NYSE MKT does not believe that the
proposed rule change will impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Exchange Act.
Indeed, the proposed rule change would
eliminate an earlier arrangement
intended in part to address potential
competitive issues in the European
17 15
U.S.C. 78f(b)(5).
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18:22 Oct 21, 2014
Jkt 235001
securities markets that have abated as a
result of ICE’s sale of the Euronext
securities exchanges in June 2014. The
proposed rule change results in no
concentration or other changes of
ownership of exchanges.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or within such longer period
up to 90 days after publication (i) as the
Commission may designate if it finds
such longer period to be appropriate
and publishes its reasons for so finding
or (ii) as to which the self-regulatory
organization consents, the Commission
will:
(A) by order approve or disapprove
the proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be 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
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NYSEMKT–2014–83 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities
and Exchange Commission, 100 F Street
NE., Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSEMKT–2014–83. 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 Web site (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
PO 00000
Frm 00127
Fmt 4703
Sfmt 4703
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for Web site viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE.,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change;
the Commission does not edit personal
identifying information from
submissions. You should submit only
information that you wish to make
available publicly. All submissions
should refer to File Number SR–
NYSEMKT–2014–83 and should be
submitted on or before November 12,
2014.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–25078 Filed 10–21–14; 8:45 am]
BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
National Women’s Business Council
(NWBC); Data Collection Available for
Public Comments
National Women’s Business
Council, Small Business
Administration.
ACTION: 60-day notice and request for
comments.
AGENCY:
The National Women’s
Business Council (NWBC) intends to
request approval, from the Office of
Management and Budget (OMB) for the
collection of information described
below. The Paperwork Reduction Act
(PRA) of 1995, 44 U.S.C. Chapter 35
requires federal agencies to publish a
notice in the Federal Register
concerning each proposed collection of
information before submission to OMB,
and to allow 60 days for public
comment in response to the notice. This
notice complies with that requirement.
DATES: Submit comments on or before
December 22, 2014.
ADDRESSES: Send all comments to Erin
Kelley, Director of Research and Policy,
SUMMARY:
18 17
E:\FR\FM\22OCN1.SGM
CFR 200.30–3(a)(12).
22OCN1
Agencies
[Federal Register Volume 79, Number 204 (Wednesday, October 22, 2014)]
[Notices]
[Pages 63201-63204]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-25078]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73372; File No. SR-NYSEMKT-2014-83]
Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of
Proposed Rule Change in Connection With the Proposed Termination of the
Amended and Restated Trust Agreement, Dated as of November 13, 2013 and
Amended on June 2, 2014 By and Among NYSE Holdings LLC, a Delaware
Limited Liability Company, NYSE Group, Inc., a Delaware Corporation,
Wilmington Trust Company, as Delaware Trustee, and Each of Jacques de
Larosi[egrave]re de Champfeu, Alan Trager and John Shepard Reed, as
Trustees
October 16, 2014.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on October 8, 2014, NYSE MKT LLC (the ``Exchange'' or
``NYSE MKT'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. 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\ 15 U.S.C. 78a.
\3\ 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 this rule filing in connection with the
proposed
[[Page 63202]]
termination of the Amended and Restated Trust Agreement, dated as of
November 13, 2013 and amended on June 2, 2014 (the ``Trust
Agreement''), by and among NYSE Holdings LLC, a Delaware limited
liability company (``NYSE Holdings''), NYSE Group, Inc., a Delaware
corporation (``NYSE Group''), Wilmington Trust Company, as Delaware
Trustee, and each of Jacques de Larosi[egrave]re de Champfeu, Alan
Trager and John Shepard Reed, as Trustees. The text of the proposed
rule change is available on the Exchange's Web site at www.nyse.com, at
the principal office of the Exchange, and at the Commission's Public
Reference Room.
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 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.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
NYSE MKT seeks approval for its 100% direct parent, NYSE Group, and
its 100% indirect parent, NYSE Holdings, to terminate the Trust
Agreement.\4\ NYSE MKT believes that the regulatory considerations that
led to the implementation of the Trust Agreement in 2007 are now moot
as a result of the sale by Intercontinental Exchange, Inc., a Delaware
corporation (``ICE''), of Euronext N.V. (``Euronext'') in June 2014 and
certain changes in the corporate governance of ICE, ICE Holdings and
NYSE Holdings that occurred upon such sale.\5\
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\4\ ICE, a public company listed on the New York Stock Exchange,
LLC (the ``NYSE''), owns 100% of Intercontinental Exchange Holdings,
Inc., a Delaware corporation (``ICE Holdings''), which in turn owns
100% of NYSE Holdings. Through ICE Holdings, NYSE Holdings and NYSE
Group, ICE indirectly owns (1) 100% of the equity interest of three
registered national securities exchanges and self-regulatory
organizations (together, the ``NYSE Exchanges'')--the Exchange, NYSE
Arca, Inc. (``NYSE Arca'') and the NYSE--and (2) 100% of the equity
interest of NYSE Market (DE), Inc. (``NYSE Market''), NYSE
Regulation, Inc. (``NYSE Regulation''), NYSE Arca L.L.C., NYSE Arca
Equities, Inc. and NYSE Amex Options LLC. See Exchange Act Release
No. 70210 (August 15, 2013) (SR-NYSEMKT-2013-50), 78 FR 51758
(August 21, 2013) (approving proposed rule change relating to a
corporate transaction in which NYSE Euronext will become a wholly
owned subsidiary of IntercontinentalExchange Group, Inc.).
\5\ The Exchange's affiliates, the NYSE and NYSE Arca, have also
submitted the same proposed rule change to terminate the Trust
Agreement. See SR-NYSEArca-2014-112 and SR-NYSE-2014-53.
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Background
In 2007, NYSE Group, which is the 100% owner of NYSE MKT, combined
with Euronext (the ``Combination''). The new parent company formed in
the Combination, NYSE Euronext, operated several regulated entities in
the United States and various jurisdictions in Europe. In the
Commission's notice relating to the proposed Combination, NYSE MKT
emphasized the importance of continuing to regulate marketplaces
locally:
A core aspect of the structure of the Combination is continued
local regulation of the marketplaces. Accordingly, the Combination
is premised on the notion that . . . [c]ompanies listing their
securities only on markets operated by Euronext and its subsidiaries
will not become newly subject to U.S. laws or regulation by the SEC
as a result of the Combination, and companies listing their
securities only on the Exchange or NYSE Arca, will not become newly
subject to European rules or regulation as a result of the
Combination.\6\
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\6\ See Exchange Act Release No. 55026 (Dec. 29, 2006) (SR-NYSE-
2006-120), 72 FR 814, 816-817 (January 8, 2007) (the ``NYSE Euronext
Notice''). NYSE Euronext acquired NYSE MKT in 2008.
In connection with obtaining regulatory approval of the
Combination, NYSE Euronext implemented certain special arrangements
consisting of two standby structures, one involving a Dutch foundation
(Stichting) and one involving a Delaware trust. The Dutch foundation
was empowered to take actions to mitigate the effects of any material
adverse change in U.S. law that had an ``extraterritorial'' impact on
non-U.S. issuers listed on Euronext markets, non-U.S. financial
services firms that were members of Euronext markets or holders of
exchange licenses with respect to the Euronext markets. The Delaware
trust was empowered to take actions to mitigate the effects of any
material adverse change in European law that had an
``extraterritorial'' impact on the non-European issuers listed on NYSE
Group securities exchanges, non-European financial services firms that
were members of any NYSE Group securities market or holders of exchange
licenses with respect to the NYSE Group securities exchanges.
The current form of the Trust Agreement is attached as Exhibit 5A,
and a form of unanimous written consent of all parties to, or otherwise
bound by, the Trust Agreement resolving that the Delaware trust be
terminated is attached as Exhibit 5B. The terms of the Dutch foundation
and the Delaware trust are complex. An explanation of the terms is
included in the NYSE Euronext Notice. Subsequent modifications to the
arrangements, to the extent relevant to the proposed rule change, are
described herein. The Dutch foundation and the Delaware trust remained
in effect after the merger of ICE Holdings (then known as
IntercontinentalExchange, Inc.) and NYSE Euronext in 2013 under ICE
(then known as IntercontinentalExchange Group, Inc.) as a new public
holding company. However, in connection with ICE's announced plan to
sell the Euronext securities exchanges in an initial public offering,
the Dutch Ministry of Finance permitted modifications of the terms of
the governing document of the Dutch foundation under which the powers
of the Dutch foundation would cease to apply to ICE and its affiliates
at such time as ICE ceased to hold a ``controlling interest'' in
Euronext, with ``controlling interest'' defined by reference to the
definition of ``control'' under Rule 10 of the International Financial
Reporting Standards (``IFRS 10'').\7\ In June 2014 ICE announced that
it had sold all but approximately 6% of the ownership interest in
Euronext in an underwritten public offering outside the United
States.\8\ Upon application by ICE, the Dutch Ministry of Finance
confirmed on July 16, 2014 that the conditions to the cessation of the
application of the Dutch foundation to ICE had been satisfied or
waived.\9\ As a result, ICE and its subsidiaries are no longer subject
to the provisions of the Dutch foundation.
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\7\ Excerpts from the Further Amended and Restated Governance
and Option Agreement, dated March 21, 2014, among the Dutch
foundation, Euronext Group N.V. and ICE are attached as Exhibit 5C.
\8\ ICE's press release dated June 24, 2014 is available at the
following link: https://ir.theice.com/investors-and-media/press/press-releases/press-release-details/2014/Intercontinental-Exchange-Announces-Closing-of-Euronext-Initial-Public-Offering/default.aspx.
\9\ An English translation of the Dutch Ministry of Finance's
letter is attached as Exhibit 5D.
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In the 2013 merger, NYSE Euronext was succeeded by the entity now
known as NYSE Holdings, which is currently a party to the Trust
Agreement. At that time, references to the nominating and governance
committee of the board of directors of NYSE Euronext, which selected
the Trustees of the Delaware trust, were replaced by references to the
[[Page 63203]]
nominating and governance committee of the board of directors of
ICE.\10\ Other provisions of the Trust Agreement are substantially
unchanged.\11\
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\10\ See note 4, supra.
\11\ See Exchange Act Release No. 72158 (May 13, 2014) (SR-NYSE-
2014-23), 79 FR 28784 (May 19, 2014) (notice of filing and immediate
effectiveness of proposed rule change relating to name changes of
the Exchange's ultimate parent) (revising Trust Agreement to reflect
name changes of ICE and ICE Holdings).
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In connection with the Combination of NYSE Group and Euronext in
2007 and the establishment of the Dutch foundation and the Delaware
trust, the Certificate of Incorporation and Bylaws of NYSE Euronext
included several provisions relating to representation of European
interests on the board of directors and other provisions requiring the
board to give due consideration to European regulatory requirements and
the interests of identified categories of European stakeholders. These
provisions are summarized in the NYSE Euronext Notice. Each such
provision was subject to automatic revocation in the event that NYSE
Euronext no longer held a controlling interest in Euronext or certain
of its subsidiaries. For this purpose, ``controlling interest'' was
defined to mean 50% or more of the outstanding shares of each class of
voting securities and of the combined voting power of outstanding
voting securities entitled to vote generally in the election of
directors. Substantially identical provisions were added to the
Certificate of Incorporation and Bylaws of ICE and ICE Holdings, and
were retained in the Operating Agreement of NYSE Holdings, when ICE
acquired NYSE Euronext in 2013, except that the ``controlling
interest'' test was modified to become a ``control'' test under IFRS
10, as described above with respect to the Dutch foundation. As a
result of the initial public offering of Euronext, ICE has established
that it no longer controls Euronext within the meaning of IFRS 10, and
the provisions of the constituent documents of ICE, ICE Holdings and
NYSE Holdings have automatically and without further action become void
and are of no further force and effect.
Proposed Rule Change
NYSE MKT requests approval to terminate the Delaware trust because
it believes that the regulatory considerations that led to the
implementation of the Trust Agreement in 2007 have been mooted by the
sale of Euronext in June 2014, the automatic revocation of corporate
governance provisions applicable to ICE, ICE Holdings and NYSE Holdings
that occurred upon such sale, and the fact that the Dutch which
functioned as a European analog to the Delaware trust, ceased to have
any authority over ICE and its subsidiaries upon the closing of the
sale of Euronext.\12\ NYSE MKT believes that the prospect for any
material adverse change in European law that would have an
``extraterritorial'' impact on the non-European issuers listed on NYSE
Group securities exchanges, non-European financial services firms that
are members of any NYSE Group securities market or holders of exchange
licenses with respect to the NYSE Group securities exchanges is now
remote.
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\12\ As noted above, this has been confirmed by the Dutch
Ministry of Finance.
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Continuance of the Trust Agreement when it no longer furthers the
purposes of Section 6(b) of the Exchange Act \13\ also imposes certain
administrative burdens and costs upon NYSE MKT and its affiliates, and
may cause investor uncertainty, that create impediments to a free and
open market. Specifically, the Trust Agreement imposes administrative
burdens on ICE and the nominating and governance committee of its board
of directors, such as the need to periodically consider and vote on
Trustees; the need to consider whether any proposed action requires
approval under the Trust Agreement and, if so, the obligation to
prepare materials for consideration and vote by the Trustees; and the
need to consider whether any proposed action requires an amendment to
the Trust Agreement and, if so, the additional obligation to submit
such amendment to the Commission for approval under Rule 19b-4.\14\ The
Trust Agreement results in out-of-pocket costs to NYSE MKT and its
affiliates including the fees of the individual Trustees and the
Delaware Trustee as well as fees of counsel incurred in connection with
review of proposed amendments and assistance with the SEC approval
process. NYSE MKT also believes that some analysts and institutional
investors may not fully understand the purpose of the Delaware trust
and may not have appreciated that, even when ICE controlled Euronext
and European regulatory considerations played a substantial role in
ICE's corporate governance, the likelihood of the Delaware trust's
substantive provisions ever being invoked was, by design, extremely
remote. In light of the sale of Euronext, the revocation of the
governance provisions relating to European considerations, and the
cessation of application of the Dutch foundation to ICE and its
affiliates, ICE believes it is appropriate to terminate the Delaware
trust in order to avoid any future need to reassure analysts and
investors that the trust does not impact the daily operations or
valuations of ICE's national securities exchanges.
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\13\ 15 U.S.C. 78f(b).
\14\ 17 CFR 240.19b-4.
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Termination of the Delaware trust would be implemented through a
unanimous written consent of all parties to, or otherwise bound by, the
Trust Agreement in the form attached as Exhibit 5B.
References to the Delaware trust also would be deleted from, and
related conforming changes would be made to, the constituent documents
of NYSE Holdings, NYSE Group, NYSE MKT, the Exchange, NYSE Market and
NYSE Regulation. In particular:
NYSE Holdings. The Fifth Amended and Restated Limited Liability
Company Agreement of NYSE Holdings would be further amended and
restated to eliminate the definition of the term ``Trust'' in Section
1.1 and the references to the Delaware trust in Section 7.2. See
Exhibit 5E.
NYSE Group. The Third Amended and Restated Certificate of
Incorporation of NYSE Group would be further amended and restated to
eliminate references to the Delaware trust in Article IV, Section 4(a)
and (b). See Exhibit 5F.
The Exchange. The Sixth Amended and Restated Operating Agreement of
the Exchange would be further amended and restated to eliminate
references to the Delaware trust in Section 3.03. See Exhibit 5G.
NYSE MKT. The Fifth Amended and Restated Operating Agreement of
NYSE MKT would be further amended and restated to eliminate references
to the Delaware trust in Section 3.03. See Exhibit 5H.
NYSE Market. The Second Amended and Restated Certificate of
Incorporation of NYSE Market would be further amended and restated to
eliminate references to the Delaware trust in Article IV, Section 2.
See Exhibit 5I.
NYSE Regulation. The Restated Certificate of Incorporation of NYSE
Regulation would be further amended and restated to eliminate
references to the Delaware trust in Article V. See Exhibit 5J.
2. Statutory Basis
NYSE MKT believes that the proposed rule change is consistent with
Section 6(b) of the Exchange Act \15\ in general, and with Section
6(b)(1) \16\ in particular, in that it enables NYSE MKT to be so
organized as to have the capacity to be
[[Page 63204]]
able to carry out the purposes of the Exchange Act and to comply, and
to enforce compliance by its exchange members and persons associated
with its exchange members, with the provisions of the Exchange Act, the
rules and regulations thereunder, and the rules of NYSE MKT. The
Delaware trust was implemented in response to potential concerns
arising under non-U.S. law and regulation at a time when NYSE MKT was
owned by a company with substantial holdings of non-U.S. securities
exchanges, substantial non-U.S. board representation, and explicit
obligations on the part of its board to give due consideration to
matters of non-U.S. law and the interests of non-U.S. stakeholders. In
light of the elimination of these concerns as discussed above, NYSE MKT
believes that termination of the Delaware trust is consistent with
Section 6(b)(1).
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\15\ 15 U.S.C. 78f(b).
\16\ 15 U.S.C. 78f(b)(1).
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NYSE MKT also believes that this filing furthers the objectives of
Section 6(b)(5) of the Exchange Act \17\ because the proposed rule
change would be consistent with and facilitate a governance and
regulatory structure that is designed to prevent fraudulent and
manipulative acts and practices, to promote just and equitable
principles of trade, to foster cooperation and coordination with
persons engaged in regulating, clearing, settling, processing
information with respect to, and facilitating transactions in
securities, to remove impediments to, and perfect the mechanism of a
free and open market and a national market system and, in general, to
protect investors and the public interest. As discussed above, the
Exchange believes that termination of the Delaware trust will remove
impediments to the operation of NYSE MKT by eliminating certain
expenses and administrative burdens as well as the potential for
uncertainty among analysts and investors as to the practical
implications of the Delaware trust on NYSE MKT as a marketplace and as
a significant asset of ICE. For the same reasons, the proposed rule
change is also designed to protect investors as well as the public
interest.
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\17\ 15 U.S.C. 78f(b)(5).
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B. Self-Regulatory Organization's Statement on Burden on Competition
NYSE MKT does not believe that the proposed rule change will impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Exchange Act. Indeed, the proposed
rule change would eliminate an earlier arrangement intended in part to
address potential competitive issues in the European securities markets
that have abated as a result of ICE's sale of the Euronext securities
exchanges in June 2014. The proposed rule change results in no
concentration or other changes of ownership of exchanges.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days after
publication (i) as the Commission may designate if it finds such longer
period to be appropriate and publishes its reasons for so finding or
(ii) as to which the self-regulatory organization consents, the
Commission will:
(A) by order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be 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
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please
include File Number SR-NYSEMKT-2014-83 on the subject line.
Paper Comments
Send paper comments in triplicate to Brent J. Fields,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSEMKT-2014-83. 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 Web site (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for Web site viewing and
printing in the Commission's Public Reference Room, 100 F Street NE.,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-NYSEMKT-2014-83 and should
be submitted on or before November 12, 2014.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-25078 Filed 10-21-14; 8:45 am]
BILLING CODE 8011-01-P