Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Eliminate Expired and Obsolete Provisions in Connection With Nasdaq's Transition to an All-Inclusive Annual Fee Program, Rename Certain Existing Annual Fees as All-Inclusive Annual Listing Fees, and Make Other Related Changes, 60522-60526 [2018-25736]

Download as PDF 60522 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices redemptions, and Deposit Instruments and Redemption Instruments will be valued in the same manner as those investment positions currently held by the Funds. Applicants also seek relief from the prohibitions on affiliated transactions in section 17(a) to permit a Fund to sell its shares to and redeem its shares from a Fund of Funds, and to engage in the accompanying in-kind transactions with the Fund of Funds.3 The purchase of Creation Units by a Fund of Funds directly from a Fund will be accomplished in accordance with the policies of the Fund of Funds and will be based on the NAVs of the Funds. 9. Applicants also request relief to permit a Feeder Fund to acquire shares of another registered investment company managed by the Adviser having substantially the same investment objectives as the Feeder Fund (‘‘Master Fund’’) beyond the limitations in section 12(d)(1)(A) and permit the Master Fund, and any principal underwriter for the Master Fund, to sell shares of the Master Fund to the Feeder Fund beyond the limitations in section 12(d)(1)(B). 10. Section 6(c) of the Act permits the Commission to exempt any persons or transactions from any provision of the Act if such exemption is necessary or appropriate in the public interest and consistent with the protection of investors and the purposes fairly intended by the policy and provisions of the Act. Section 12(d)(1)(J) of the Act provides that the Commission may exempt any person, security, or transaction, or any class or classes of persons, securities, or transactions, from any provision of section 12(d)(1) if the exemption is consistent with the public interest and the protection of investors. Section 17(b) of the Act authorizes the Commission to grant an order permitting a transaction otherwise prohibited by section 17(a) if it finds that (a) the terms of the proposed transaction are fair and reasonable and do not involve overreaching on the part of any person concerned; (b) the proposed transaction is consistent with the policies of each registered investment company involved; and (c) the proposed transaction is consistent with the general purposes of the Act. 3 The requested relief would apply to direct sales of shares in Creation Units by a Fund to a Fund of Funds and redemptions of those shares. Applicants, moreover, are not seeking relief from section 17(a) for, and the requested relief will not apply to, transactions where a Fund could be deemed an Affiliated Person, or a Second-Tier Affiliate, of a Fund of Funds because an Adviser or an entity controlling, controlled by or under common control with an Adviser provides investment advisory services to that Fund of Funds. VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 For the Commission, by the Division of Investment Management, under delegated authority. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018–25594 Filed 11–23–18; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–84634; File No. SR– NASDAQ–2018–092] Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Eliminate Expired and Obsolete Provisions in Connection With Nasdaq’s Transition to an All-Inclusive Annual Fee Program, Rename Certain Existing Annual Fees as All-Inclusive Annual Listing Fees, and Make Other Related Changes November 20, 2018. 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 November 13, 2018, The Nasdaq Stock Market LLC (‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I and II 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. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to eliminate expired and obsolete provisions in connection with Nasdaq’s transition to an all-inclusive annual fee program for all listed companies effective January 1, 2018; clarify that Linked Securities, SEEDS, Other Securities and Exchange Traded Products are also subject to an all-inclusive annual fee applicable to such issues; and modify existing fee waiver rules related to listing transfers in light of differences between Nasdaq’s all-inclusive annual fee and the listing fees of other exchanges. The text of the proposed rule change is available on the Exchange’s website at https://nasdaq.cchwallstreet.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. 1 15 2 17 PO 00000 U.S.C. 78s(b)(1). CFR 240.19b–4. Frm 00132 Fmt 4703 Sfmt 4703 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 In 2014, Nasdaq adopted an allinclusive annual listing fee schedule to simplify, clarify and enhance transparency around the annual fee to which listed companies are subject.3 The new annual fee schedule became operative on January 1, 2015, and applied to all companies listed after that date. Companies already listed at that time could voluntarily elect the new fee schedule, but were not then required to do so. Effective January 1, 2018, however, all listed companies became subject to the all-inclusive annual fee schedule and the standard annual fee schedule has ceased to have applicability or effect. Accordingly, as a result of the completion as of January 1, 2018, of the transition of all listed companies from the standard annual fee schedule to the all-inclusive annual fee schedule, Nasdaq is proposing to revise the listing rules to delete obsolete and out of date references to the standard annual fee schedule, the transition to the allinclusive annual fee schedule, and other listing fees no longer in effect. In addition, Nasdaq is proposing other clarifying and conforming adjustments necessitated by completion of the transition, including relocating and renumbering revised rules as applicable. As of January 1, 2018, the allinclusive annual listing fee program completely supersedes and replaces the standard annual fee, which is no longer applicable to any listed company.4 Accordingly, Nasdaq is proposing to 3 Securities Exchange Act Release No. 73647 (November 19, 2014), 79 FR 70232 (November 25, 2014) (SR–NASDAQ–2014–87). 4 Entry fees are not encompassed by the AllInclusive Annual Listings Fee. Accordingly, Nasdaq is not proposing to revise or amend the entry fees set forth in the Rule 5900 Series. E:\FR\FM\26NON1.SGM 26NON1 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices delete the obsolete language in Rules 5910(c)–(f) and 5920(c)–(e) that describes and sets forth the standard annual fee as well as language in IM– 5900–1, IM–5900–4, IM–5900–5(b) and IM–5900–6 that refers to the standard annual fee and to rules about the standard annual fee that Nasdaq is proposing to delete. The all-inclusive annual listing fee program also encompasses the additional shares fee, which is also no longer applicable to any listed company. Thus, Nasdaq is proposing to delete Rules 5910(b) and 5920(b), which describe and set forth the additional shares fee. The allinclusive annual listing fee program, however, does not encompass the annual fee for convertible debentures, which remains in effect. Therefore, Nasdaq is proposing to relocate the provision for the annual fee for convertible debentures, formerly in Rule 5920(c)(2), to new Rule 5920(b)(2)(F). The provisions that refer to the transition from the standard annual fee to the all-inclusive annual listing fee program are also obsolete. Accordingly, to reflect completion of this transition, Nasdaq is proposing to delete references to the transition in IM–5900–6(b)(1), Rule 5901, and IM–5910–1 and IM– 5920–1. With respect to the remaining provisions in IM–5910–1 and IM–5920– 1, which relate to the all-inclusive annual listing fee, Nasdaq is proposing to relocate them to Rule 5910(b) and 5920(b). Therefore, as a result of these changes, the Exchange is also proposing to delete IM–5910–1 and IM–5920–1. Certain other fees previously applicable to listed companies have been superseded by the all-inclusive annual fee program. Accordingly, Nasdaq is proposing to delete references to these listing fees, which include the record-keeping fee, substitution listing fee, request for written interpretation fee, and compliance plan review fee. These fees are referenced in Rules 5250(e), 5250(e)(3)(A) and (B), 5250(e)(4), 5602(a)–(d), 5810(c)(2)(A), 5901, 5910(e) and (f), IM–5910–1(c), 5920(d) and (e), and IM–5920–1(c). Nasdaq also proposes to relocate into Rule 5602(a) provisions currently in Rule 5602(c) and (f), which specify that applicants and certain companies in the delisting process can request a written interpretation of the Listing Rules, and delete the provision for listed companies to request an expedited response in Rule 5602(b). To reflect the proposed changes to Rule 5602, Nasdaq is proposing to renumber the paragraphs of that rule that remain applicable. Nasdaq endeavors to respond to all requests for written interpretations of the Listing Rules in as timely a manner VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 as possible. Thus, notwithstanding that Nasdaq is proposing to delete the provision for listed companies to request an expedited response to such requests, a Company may nonetheless request an expedited response and Nasdaq will respond as promptly as practicable. Listed companies, however, remain subject to the fees described in Rules 5815(a)(3) and 5820(a) that apply to review by a Hearings Panel or the Nasdaq Listing and Hearing Review Council, respectively, of a Staff Delisting Determination or Public Reprimand Letter. Listed companies also remain subject to the entry fees described in Rules 5910(a) and 5920(a) relating to the listing of an additional class of securities of the listed company.5 In addition, Nasdaq is proposing to renumber certain of the rules regarding the authority of the Nasdaq Board of Directors or its designee, in its discretion, to defer or waive all or any part of the annual fee prescribed therein. The authority to defer or waive the annual fee, which is currently set forth in Rules 5910(c)(2), 5910(d)(5), 5920(c)(4), 5930(b)(2) and 5940(b)(3) [sic], is generally exercised only in limited cases, under circumstances that are not likely to be frequently replicated and where requiring payment of an annual fee would be inequitable.6 To Nasdaq’s knowledge, it has never used this authority to defer an annual fee. The Exchange represents it would do so only under the same circumstances as it would to waive an annual fee. Because Nasdaq, as described above, is proposing to delete the language in Rules 5910(c)–(f) and 5920(c)–(e) that describes and sets forth the standard annual fee, which encompasses Rules 5910(c)(2), 5910(d)(5) and 5920(c)(4) that set forth the authority of the Nasdaq Board of directors or its designees to defer or waive all or any part of the annual fee, Nasdaq is proposing, 5 Listing Rules 5910(a) and 5920(a) provide that a Company that submits an application to list any class of its securities shall pay to Nasdaq an entry fee. Equity Investment Tracking Stocks listed pursuant to Rule 5222 are subject to the entry fees described in Rules 5910(a) and 5920(a). 6 For example, the Exchange granted a waiver to a company that was removed during the first week of January pursuant to a decision of a Nasdaq Listing Qualifications Panel, where the Panel had all the information necessary to make its decision in the prior year. The Exchange also granted a waiver to a company thet [sic] intended to voluntarily delist prior to the end of a calendar year but was delayed until early in January, where there was clear evidence of the company’s intent to delist before the end of the year and there was limited trading prior to the delisting. In each of these cases, the Exchange believed it would be inequitable to subject the company to the annual fee. PO 00000 Frm 00133 Fmt 4703 Sfmt 4703 60523 without substantive changes, to renumber these rules in proposed new Rules 5910(b)(3)(G) and 5920(b)(3)(G) that apply to the all-inclusive annual listing fee.7 To fully reflect these proposed changes, Nasdaq is proposing to eliminate cross references to these rules and other similar provisions contained in IM–5900–1 and IM–5900– 4. Nasdaq is also proposing revisions to Rules 5930(b)(1) and 5940(b)(1) and (2) and to add new Rules 5930(b)(4) and 5940(b)(5) to provide that Linked Securities, SEEDS, Other Securities and Exchange Traded Products are subject to an all-inclusive annual listing fee applicable to such issues. Currently, Linked Securities, SEEDS, and Other Securities are subject to the annual fee set forth in Rule 5930(b) and Exchange Traded Products are subject to the annual fee set forth in Rule 5940(b). Previously, Nasdaq eliminated the fees for record-keeping changes and substitution listing events charged to these entities 8 and they are not subject to the compliance plan or additional shares fees.9 Under these circumstances, and to promote clarity, consistency and uniformity, Nasdaq is proposing to rename the annual fee for Linked Securities, SEEDS, Other Securities and Exchange Traded Products to make clear that these securities are subject to an allinclusive annual listing fee applicable to such issues.10 Nasdaq also proposes to remove a January 1, 2018 effective date contained in current IM–5910–1(d)(5) and IM– 5920–1(d)(5) because that date has passed and these rules are now effective and to clarify that the annual fee referred to in those rules is the allinclusive annual listing fee. Finally, given completion of Nasdaq’s transition to the all-inclusive annual listing fee, Nasdaq is also proposing revisions to IM–5900–4 to account for differences between Nasdaq’s all7 Nasdaq is not proposing to renumber Rules 5930(b)(2) and 5940(b)(3) [sic]. These rules remain unchanged by this proposal and the authority to defer or waive an annual fee set forth therein will continue to apply. 8 Securities Exchange Act Release No. 78047 (June 13, 2016), 81 FR 39736 (June 17, 2016) (SR– NASDAQ–2016–077). 9 Rule 5810(c)(2)(A) currently does not require the compliance plan fee for plans submitted for failure to meet a continued listing standard contained in the Rule 5700 Series, which includes continued listing standards for those securities charged fees under Rules 5930 and 5940. 10 Because Linked Securities, SEEDS, Other Securities and Exchange Traded Products are now subject to an all-inclusive annual listing fee applicable to such issues, consistent with the treatment of equity securities, Nasdaq proposes to no longer subject the issuer of these securities to the written interpretation fee. E:\FR\FM\26NON1.SGM 26NON1 60524 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices inclusive annual fee and the fees of other listing exchanges. Specifically, IM–5900–4 currently provides for the waiver of a portion of the applicable annual fee for a company whose securities: (i) Are listed on a national securities exchange but not listed on Nasdaq, if the issuer of such securities transfers their listing exclusively to Nasdaq; or (ii) are listed on the New York Stock Exchange and Nasdaq, if the issuer of such securities ceases to maintain their listing on the New York Stock Exchange and the securities instead are designated under the plan governing Nasdaq securities. This waiver is provided as a pro-rated credit in the amount of any annual listing fees paid to the prior exchange applicable to the period of time after the transfer. The purpose of this waiver is to remove a disincentive for companies to switch markets when they had already paid an annual fee in that year.11 While Nasdaq’s all-inclusive annual listing fee remains lower in most cases than the annual fee of competitor exchanges, in limited cases it can be higher than just the annual fee charged by a competitor exchange, which (unlike Nasdaq’s allinclusive annual listing fee) does not include fees that the competitor exchange separately charges for additional shares or other events such as record keeping changes or substitution listing events. To ensure uniform treatment and simplify application of this waiver given these structural differences between Nasdaq’s allinclusive annual fee and the potential range of other fees encompassed by the all-inclusive annual fee that a company may have also paid to the competitor exchange in the year of the switch in addition to the annual fee, Nasdaq proposes to modify the rule to waive the entire all-inclusive annual listing fee in the year of transfer. Nasdaq acknowledges the possibility that the all-inclusive annual listing fee it charges may be higher in some cases than the annual fee charged by a competitor exchange and that in such cases an issuer that transfers its listing may receive a relatively greater benefit than other issuers that transfer their listings where the all-inclusive annual listing fee is lower than the annual fee charged by a competitor exchange. However, Nasdaq does not believe that this possibility is unfairly discriminatory. Nasdaq anticipates that there will be few instances where Nasdaq’s all-inclusive annual listing fee 11 Securities Exchange Act Release No. 53696 (April 21, 2006), 71 FR 25273 (April 28, 2006) (SR– NASD–2006–47) (adopting the predecessor to IM– 5900–4). VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 is higher than the annual fee charged by a competitor exchange. Further, by simplifying these provisions, they are transparent to issuers and the public, ensure consistent application, and limit any unnecessary burdens related to the administration and implementation of these provisions. Nasdaq represents that this proposed modification will have no impact on the resources available for its regulatory programs or Nasdaq’s ability to enforce its listing standards and protect investors. proposal does not reduce the resources available for Nasdaq’s regulatory program or otherwise hinder or limit the ability of Nasdaq to enforce its listing standards and protect investors. The proposal’s clarification in Rules 5930 and 5940 that Linked Securities, SEEDS, Other Securities and Exchange Traded Products are also subject to an all-inclusive annual fee applicable to such issues is similarly consistent with Section 6(b) of the Act. In this regard, by adding clarity to the rules regarding the fees applicable to these products, 2. Statutory Basis the proposal simplifies and adds The Exchange believes that its transparency to Nasdaq’s rule book, proposal, by eliminating obsolete or including by fully reflecting the fact unnecessary provisions from its rule that, as noted above, these products are book and, thus, simplifying and adding not subject to fees for Record Keeping, clarity to the fees charged by the Substitution Listing Events and Exchange, is consistent with Section compliance plans.14 This proposed 6(b) of the Act,12 in general, and furthers change does not change the listing fees the objectives of Sections 6(b)(4) and to which these products are subject. 6(b)(5) of the Act,13 in particular, in that Instead, it ensures the rules reflect that it provides for the equitable allocation these products, like all other listings, are of reasonable dues, fees and other subject to an all-inclusive annual fee. charges among members and issuers and Also, because the proposal does not other persons using its facilities. For the change the fees to which these listings same reasons, the Exchange also are subject, the proposal does not believes its proposal is designed to reduce the resources available for promote just and equitable principles of Nasdaq’s regulatory program or trade, to remove impediments to and otherwise hinder or limit the ability of perfect the mechanism of a free and Nasdaq to enforce its listing standards open market and a national market and protect investors. As such, Nasdaq system, and, in general to protect believes these changes are consistent investors and the public interest; and is with the Section 6(b)(4) of the Act in not designed to permit unfair that they provide for the equitable discrimination between customers, allocation of reasonable dues, fees and issuers, brokers, or dealers. other charges among members and Except as described below with issuers and other persons using its respect to the proposed changes to IM– facilities. For the same reasons, they are 5900–4, the proposal does not change also consistent with the investor the listing fees to which listed protection objectives of Section 6(b)(5) companies are subject. Rather, Nasdaq is of the Act. making this proposal to make certain The proposed modifications to IM– 5900–4 are similarly consistent with the the rules fully reflect completion of the Act because they are designed to phased transition from the standard simplify and clarify application of the annual fee schedule to the all-inclusive annual fee schedule. Completion of this pre-existing annual fee waiver to companies that transfer their listing transition rendered certain existing fee from a national securities exchange to provisions obsolete, unnecessary or out Nasdaq or, if they are already listed on of date and necessitated their deletion Nasdaq, cease to be listed on the New or modification. Completion of the York Stock Exchange. This change was transition also necessitated other necessitated because the all-inclusive clarifying and conforming adjustments, annual fee schedule may not, in certain including relocating or renumbering cases, be directly equivalent or certain rules. Nasdaq believes that comparable to other listing exchanges’ updating Nasdaq’s rules to eliminate annual fees because it includes a range obsolete provisions and make related of fees, such as for listing additional clarifications and conforming changes shares, record keeping changes and will simplify Nasdaq’s rule book and substitution listing events, that other add transparency. As noted above, listing exchanges charge separately in except as described below with respect to the changes to IM–5900–4, it will not addition to an annual listing fee. As such, while most companies under the change the listing fees to which listed all-inclusive annual fee schedule incur companies are subject. Thus, the lower fees in comparison to the annual 12 15 13 15 PO 00000 U.S.C. 78f(b). U.S.C. 78f(b)(4) and (5). Frm 00134 Fmt 4703 Sfmt 4703 14 See, E:\FR\FM\26NON1.SGM supra, notes 8 and 9. 26NON1 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices fee charged by other exchanges, in some cases a company’s fee under the allinclusive annual fee schedule may be higher. In these cases, the existing waiver under the rules of a pro rata portion of the annual fee paid to the other listing exchange may not give the company full credit for other fees paid to the other exchange and may not completely remove the disincentive to transferring listing attributable to the fact that the company has already paid the annual fee for that year. Under the proposed change, all companies switching their listing will have the entire annual fee waived in the year of the switch. As noted above, Nasdaq acknowledges the possibility that the all-inclusive annual listing fee it charges may be higher in some cases than the annual fee charged by a competitor exchange and that in such cases an issuer that transfers its listing may receive a relatively greater benefit than other issuers that transfer their listings where the all-inclusive annual listing fee is lower than the annual fee charged by a competitor exchange. However, for several reasons, Nasdaq does not believe that this possibility is unfairly discriminatory. First, Nasdaq anticipates that there will be few instances where Nasdaq’s all-inclusive annual listing fee is higher than the annual fee charged by a competitor exchange. Second, as described above, the waiver is intended to remove a disincentive to transfer and Nasdaq does not believe that the possibility that the all-inclusive annual listing fee is higher than the annual fee charged by a competitor exchange would have a material impact on a decision to transfer or not. Third, by simplifying these provisions, they are transparent to issuers and the public, ensure consistent application, and limit any unnecessary burdens related to the administration and implementation of these provisions. For these reasons, Nasdaq believes that this proposed change is consistent with Section 6(b)(4) of the Act. Nasdaq also believes this proposed change is similarly consistent with Section 6(b)(5) of the Act in that it is designed to promote just and equitable principles of trade, to remove impediments to and perfect the mechanism of a free and open market and a national market system, and is not designed to permit unfair discrimination between customers, issuers, brokers, or dealers. Further, given the limited number of listings transfers each year, it is not expected that this waiver would materially impact the resources available for Nasdaq’s regulatory program or otherwise hinder or limit the VerDate Sep<11>2014 17:28 Nov 23, 2018 Jkt 247001 ability of Nasdaq to enforce its listing standards and protect investors. As such, Nasdaq believes these changes are consistent with the investor protection objectives of Section 6(b)(5) of the Act. 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. The market for listing services is extremely competitive and listed companies may freely choose alternative venues based on the aggregate fees assessed and the value provided by each listing. As such, because this proposal does not change the listing fees to which listed companies are subject, but merely reflects the completion of the phased transition from the prior standard annual fee schedule to the all-inclusive annual listing fee schedule, the application of an all-inclusive annual listing fee schedule to Linked Securities, SEEDS, Other Securities and Exchange Traded Products, and refinement and clarification of the operation of certain existing waivers based on the introduction of the all-inclusive listing fee schedule, Nasdaq believes that this proposed rule change does not encumber the competition for listings with other listing venues, which are similarly free to set their fees. Rather, it reflects the competition among listing venues and will further enhance such competition. 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. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 15 and Rule 19b– 4(f)(6) thereunder.16 15 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) requires a self-regulatory organization to give the Commission written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing 16 17 PO 00000 Frm 00135 Fmt 4703 Sfmt 4703 60525 A proposed rule change filed pursuant to Rule 19b–4(f)(6) under the Act 17 normally does not become operative for 30 days after the date of its filing. However, Rule 19b–4(f)(6)(iii) 18 permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that its rules may fully reflect completion of the transition to the all-inclusive annual fee program, thereby providing clarity to this fee program and making the rule book simpler and more transparent. The Exchange represents that, as of January 1, 2018, all listed companies are subject to the all-inclusive annual listing fee program, which has completely superseded and replaced the standard annual fee. For these reasons, the Commission believes that waiver of the 30-day operative delay is consistent with the protection of investors and the public interest. Therefore, the Commission hereby waives the operative delay and designates the proposal as operative upon filing.19 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 necessary or appropriate in the public interest, for the protection of investors, or 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 change 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 • 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– NASDAQ–2018–092 on the subject line. of the proposed rule change, or such shorter time as designated by the Commission. The Exchange has satisfied this requirement. 17 17 CFR 240.19b–4(f)(6). 18 17 CFR 240.19b–4(f)(6)(iii). 19 For purposes only of waiving the 30-day operative delay, the Commission also has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). E:\FR\FM\26NON1.SGM 26NON1 60526 Federal Register / Vol. 83, No. 227 / Monday, November 26, 2018 / Notices 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–NASDAQ–2018–092. 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 (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 website 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 such filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change. Persons submitting comments are cautioned that we do not redact or edit personal identifying information from comment submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–NASDAQ–2018–092, and should be submitted on or before December 17, 2018. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.20 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018–25736 Filed 11–23–18; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 20549–2736 Extension: Form 18 SEC File No. 270–105, OMB Control No. 3235–0121. SECURITIES AND EXCHANGE COMMISSION Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. Form 18 (17 CFR 249.218) is a registration form used by a foreign government or political subdivision to register securities for listing on a U.S. exchange. The information collected is intended to ensure that the information required by the Commission to be filed permits verification of compliance with securities law requirements and assures the public availability of the information. Form 18 takes approximately 8 hours per response and is filed by approximately 5 respondents for a total of 40 annual burden hours (8 hours per response x 5 responses). Written comments are invited on: (a) Whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency’s estimate of the burden imposed by the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collections of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. Please direct your written comments to Charles Riddle, Acting Director/Chief Information Officer, Securities and Exchange Commission, c/o Candace Kenner, 100 F Street, NE, Washington, DC 20549 or send an email to: PRA_ Mailbox@sec.gov. Proposed Collection; Comment Request Dated: November 20, 2018. Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018–25682 Filed 11–23–18; 8:45 am] 20 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 17:28 Nov 23, 2018 BILLING CODE 8011–01–P Jkt 247001 PO 00000 Frm 00136 Fmt 4703 Sfmt 4703 Upon Written Request Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 20549–2736 Extension: Form T–2 SEC File No. 270–122, OMB Control No. 3235–0111 Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. Form T–2 (17 CFR 269.2) is a statement of eligibility of an individual trustee under the Trust Indenture Act of 1939. The information is used to determine whether the individual is qualified to serve as a trustee under the indenture. Form T–2 takes approximately 9 hours per response to prepare and is filed by 9 respondents. We estimate that 25% of the 9 burden hours (2 hours per responses) is prepared by the filer for a total reporting burden of 18 hours (2 hours per response × 9 responses). Written comments are invited on: (a) Whether this proposed collection of information is necessary for the performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency’s estimate of the burden imposed by the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. Please direct your written comment to Charles Riddle, Acting Director/Chief Information Officer, Securities and Exchange Commission, c/o Candace Kenner, 100 F Street NE, Washington, E:\FR\FM\26NON1.SGM 26NON1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 83, Number 227 (Monday, November 26, 2018)]
[Notices]
[Pages 60522-60526]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-25736]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-84634; File No. SR-NASDAQ-2018-092]


Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Eliminate Expired and Obsolete Provisions in Connection With Nasdaq's 
Transition to an All-Inclusive Annual Fee Program, Rename Certain 
Existing Annual Fees as All-Inclusive Annual Listing Fees, and Make 
Other Related Changes

November 20, 2018.
    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 November 13, 2018, The Nasdaq Stock Market LLC (``Nasdaq'' or 
``Exchange'') filed with the Securities and Exchange Commission 
(``SEC'' or ``Commission'') the proposed rule change as described in 
Items I and II 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to eliminate expired and obsolete provisions 
in connection with Nasdaq's transition to an all-inclusive annual fee 
program for all listed companies effective January 1, 2018; clarify 
that Linked Securities, SEEDS, Other Securities and Exchange Traded 
Products are also subject to an all-inclusive annual fee applicable to 
such issues; and modify existing fee waiver rules related to listing 
transfers in light of differences between Nasdaq's all-inclusive annual 
fee and the listing fees of other exchanges.
    The text of the proposed rule change is available on the Exchange's 
website at https://nasdaq.cchwallstreet.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 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
    In 2014, Nasdaq adopted an all-inclusive annual listing fee 
schedule to simplify, clarify and enhance transparency around the 
annual fee to which listed companies are subject.\3\ The new annual fee 
schedule became operative on January 1, 2015, and applied to all 
companies listed after that date. Companies already listed at that time 
could voluntarily elect the new fee schedule, but were not then 
required to do so. Effective January 1, 2018, however, all listed 
companies became subject to the all-inclusive annual fee schedule and 
the standard annual fee schedule has ceased to have applicability or 
effect.
---------------------------------------------------------------------------

    \3\ Securities Exchange Act Release No. 73647 (November 19, 
2014), 79 FR 70232 (November 25, 2014) (SR-NASDAQ-2014-87).
---------------------------------------------------------------------------

    Accordingly, as a result of the completion as of January 1, 2018, 
of the transition of all listed companies from the standard annual fee 
schedule to the all-inclusive annual fee schedule, Nasdaq is proposing 
to revise the listing rules to delete obsolete and out of date 
references to the standard annual fee schedule, the transition to the 
all-inclusive annual fee schedule, and other listing fees no longer in 
effect. In addition, Nasdaq is proposing other clarifying and 
conforming adjustments necessitated by completion of the transition, 
including relocating and renumbering revised rules as applicable.
    As of January 1, 2018, the all-inclusive annual listing fee program 
completely supersedes and replaces the standard annual fee, which is no 
longer applicable to any listed company.\4\ Accordingly, Nasdaq is 
proposing to

[[Page 60523]]

delete the obsolete language in Rules 5910(c)-(f) and 5920(c)-(e) that 
describes and sets forth the standard annual fee as well as language in 
IM-5900-1, IM-5900-4, IM-5900-5(b) and IM-5900-6 that refers to the 
standard annual fee and to rules about the standard annual fee that 
Nasdaq is proposing to delete. The all-inclusive annual listing fee 
program also encompasses the additional shares fee, which is also no 
longer applicable to any listed company. Thus, Nasdaq is proposing to 
delete Rules 5910(b) and 5920(b), which describe and set forth the 
additional shares fee. The all-inclusive annual listing fee program, 
however, does not encompass the annual fee for convertible debentures, 
which remains in effect. Therefore, Nasdaq is proposing to relocate the 
provision for the annual fee for convertible debentures, formerly in 
Rule 5920(c)(2), to new Rule 5920(b)(2)(F).
---------------------------------------------------------------------------

    \4\ Entry fees are not encompassed by the All-Inclusive Annual 
Listings Fee. Accordingly, Nasdaq is not proposing to revise or 
amend the entry fees set forth in the Rule 5900 Series.
---------------------------------------------------------------------------

    The provisions that refer to the transition from the standard 
annual fee to the all-inclusive annual listing fee program are also 
obsolete. Accordingly, to reflect completion of this transition, Nasdaq 
is proposing to delete references to the transition in IM-5900-6(b)(1), 
Rule 5901, and IM-5910-1 and IM-5920-1. With respect to the remaining 
provisions in IM-5910-1 and IM-5920-1, which relate to the all-
inclusive annual listing fee, Nasdaq is proposing to relocate them to 
Rule 5910(b) and 5920(b). Therefore, as a result of these changes, the 
Exchange is also proposing to delete IM-5910-1 and IM-5920-1.
    Certain other fees previously applicable to listed companies have 
been superseded by the all-inclusive annual fee program. Accordingly, 
Nasdaq is proposing to delete references to these listing fees, which 
include the record-keeping fee, substitution listing fee, request for 
written interpretation fee, and compliance plan review fee. These fees 
are referenced in Rules 5250(e), 5250(e)(3)(A) and (B), 5250(e)(4), 
5602(a)-(d), 5810(c)(2)(A), 5901, 5910(e) and (f), IM-5910-1(c), 
5920(d) and (e), and IM-5920-1(c). Nasdaq also proposes to relocate 
into Rule 5602(a) provisions currently in Rule 5602(c) and (f), which 
specify that applicants and certain companies in the delisting process 
can request a written interpretation of the Listing Rules, and delete 
the provision for listed companies to request an expedited response in 
Rule 5602(b). To reflect the proposed changes to Rule 5602, Nasdaq is 
proposing to renumber the paragraphs of that rule that remain 
applicable.
    Nasdaq endeavors to respond to all requests for written 
interpretations of the Listing Rules in as timely a manner as possible. 
Thus, notwithstanding that Nasdaq is proposing to delete the provision 
for listed companies to request an expedited response to such requests, 
a Company may nonetheless request an expedited response and Nasdaq will 
respond as promptly as practicable.
    Listed companies, however, remain subject to the fees described in 
Rules 5815(a)(3) and 5820(a) that apply to review by a Hearings Panel 
or the Nasdaq Listing and Hearing Review Council, respectively, of a 
Staff Delisting Determination or Public Reprimand Letter. Listed 
companies also remain subject to the entry fees described in Rules 
5910(a) and 5920(a) relating to the listing of an additional class of 
securities of the listed company.\5\
---------------------------------------------------------------------------

    \5\ Listing Rules 5910(a) and 5920(a) provide that a Company 
that submits an application to list any class of its securities 
shall pay to Nasdaq an entry fee. Equity Investment Tracking Stocks 
listed pursuant to Rule 5222 are subject to the entry fees described 
in Rules 5910(a) and 5920(a).
---------------------------------------------------------------------------

    In addition, Nasdaq is proposing to renumber certain of the rules 
regarding the authority of the Nasdaq Board of Directors or its 
designee, in its discretion, to defer or waive all or any part of the 
annual fee prescribed therein. The authority to defer or waive the 
annual fee, which is currently set forth in Rules 5910(c)(2), 
5910(d)(5), 5920(c)(4), 5930(b)(2) and 5940(b)(3) [sic], is generally 
exercised only in limited cases, under circumstances that are not 
likely to be frequently replicated and where requiring payment of an 
annual fee would be inequitable.\6\ To Nasdaq's knowledge, it has never 
used this authority to defer an annual fee. The Exchange represents it 
would do so only under the same circumstances as it would to waive an 
annual fee.
---------------------------------------------------------------------------

    \6\ For example, the Exchange granted a waiver to a company that 
was removed during the first week of January pursuant to a decision 
of a Nasdaq Listing Qualifications Panel, where the Panel had all 
the information necessary to make its decision in the prior year. 
The Exchange also granted a waiver to a company thet [sic] intended 
to voluntarily delist prior to the end of a calendar year but was 
delayed until early in January, where there was clear evidence of 
the company's intent to delist before the end of the year and there 
was limited trading prior to the delisting. In each of these cases, 
the Exchange believed it would be inequitable to subject the company 
to the annual fee.
---------------------------------------------------------------------------

    Because Nasdaq, as described above, is proposing to delete the 
language in Rules 5910(c)-(f) and 5920(c)-(e) that describes and sets 
forth the standard annual fee, which encompasses Rules 5910(c)(2), 
5910(d)(5) and 5920(c)(4) that set forth the authority of the Nasdaq 
Board of directors or its designees to defer or waive all or any part 
of the annual fee, Nasdaq is proposing, without substantive changes, to 
renumber these rules in proposed new Rules 5910(b)(3)(G) and 
5920(b)(3)(G) that apply to the all-inclusive annual listing fee.\7\ To 
fully reflect these proposed changes, Nasdaq is proposing to eliminate 
cross references to these rules and other similar provisions contained 
in IM-5900-1 and IM-5900-4.
---------------------------------------------------------------------------

    \7\ Nasdaq is not proposing to renumber Rules 5930(b)(2) and 
5940(b)(3) [sic]. These rules remain unchanged by this proposal and 
the authority to defer or waive an annual fee set forth therein will 
continue to apply.
---------------------------------------------------------------------------

    Nasdaq is also proposing revisions to Rules 5930(b)(1) and 
5940(b)(1) and (2) and to add new Rules 5930(b)(4) and 5940(b)(5) to 
provide that Linked Securities, SEEDS, Other Securities and Exchange 
Traded Products are subject to an all-inclusive annual listing fee 
applicable to such issues. Currently, Linked Securities, SEEDS, and 
Other Securities are subject to the annual fee set forth in Rule 
5930(b) and Exchange Traded Products are subject to the annual fee set 
forth in Rule 5940(b). Previously, Nasdaq eliminated the fees for 
record-keeping changes and substitution listing events charged to these 
entities \8\ and they are not subject to the compliance plan or 
additional shares fees.\9\ Under these circumstances, and to promote 
clarity, consistency and uniformity, Nasdaq is proposing to rename the 
annual fee for Linked Securities, SEEDS, Other Securities and Exchange 
Traded Products to make clear that these securities are subject to an 
all-inclusive annual listing fee applicable to such issues.\10\
---------------------------------------------------------------------------

    \8\ Securities Exchange Act Release No. 78047 (June 13, 2016), 
81 FR 39736 (June 17, 2016) (SR-NASDAQ-2016-077).
    \9\ Rule 5810(c)(2)(A) currently does not require the compliance 
plan fee for plans submitted for failure to meet a continued listing 
standard contained in the Rule 5700 Series, which includes continued 
listing standards for those securities charged fees under Rules 5930 
and 5940.
    \10\ Because Linked Securities, SEEDS, Other Securities and 
Exchange Traded Products are now subject to an all-inclusive annual 
listing fee applicable to such issues, consistent with the treatment 
of equity securities, Nasdaq proposes to no longer subject the 
issuer of these securities to the written interpretation fee.
---------------------------------------------------------------------------

    Nasdaq also proposes to remove a January 1, 2018 effective date 
contained in current IM-5910-1(d)(5) and IM-5920-1(d)(5) because that 
date has passed and these rules are now effective and to clarify that 
the annual fee referred to in those rules is the all-inclusive annual 
listing fee.
    Finally, given completion of Nasdaq's transition to the all-
inclusive annual listing fee, Nasdaq is also proposing revisions to IM-
5900-4 to account for differences between Nasdaq's all-

[[Page 60524]]

inclusive annual fee and the fees of other listing exchanges. 
Specifically, IM-5900-4 currently provides for the waiver of a portion 
of the applicable annual fee for a company whose securities: (i) Are 
listed on a national securities exchange but not listed on Nasdaq, if 
the issuer of such securities transfers their listing exclusively to 
Nasdaq; or (ii) are listed on the New York Stock Exchange and Nasdaq, 
if the issuer of such securities ceases to maintain their listing on 
the New York Stock Exchange and the securities instead are designated 
under the plan governing Nasdaq securities. This waiver is provided as 
a pro-rated credit in the amount of any annual listing fees paid to the 
prior exchange applicable to the period of time after the transfer. The 
purpose of this waiver is to remove a disincentive for companies to 
switch markets when they had already paid an annual fee in that 
year.\11\ While Nasdaq's all-inclusive annual listing fee remains lower 
in most cases than the annual fee of competitor exchanges, in limited 
cases it can be higher than just the annual fee charged by a competitor 
exchange, which (unlike Nasdaq's all-inclusive annual listing fee) does 
not include fees that the competitor exchange separately charges for 
additional shares or other events such as record keeping changes or 
substitution listing events. To ensure uniform treatment and simplify 
application of this waiver given these structural differences between 
Nasdaq's all-inclusive annual fee and the potential range of other fees 
encompassed by the all-inclusive annual fee that a company may have 
also paid to the competitor exchange in the year of the switch in 
addition to the annual fee, Nasdaq proposes to modify the rule to waive 
the entire all-inclusive annual listing fee in the year of transfer.
---------------------------------------------------------------------------

    \11\ Securities Exchange Act Release No. 53696 (April 21, 2006), 
71 FR 25273 (April 28, 2006) (SR-NASD-2006-47) (adopting the 
predecessor to IM-5900-4).
---------------------------------------------------------------------------

    Nasdaq acknowledges the possibility that the all-inclusive annual 
listing fee it charges may be higher in some cases than the annual fee 
charged by a competitor exchange and that in such cases an issuer that 
transfers its listing may receive a relatively greater benefit than 
other issuers that transfer their listings where the all-inclusive 
annual listing fee is lower than the annual fee charged by a competitor 
exchange. However, Nasdaq does not believe that this possibility is 
unfairly discriminatory. Nasdaq anticipates that there will be few 
instances where Nasdaq's all-inclusive annual listing fee is higher 
than the annual fee charged by a competitor exchange. Further, by 
simplifying these provisions, they are transparent to issuers and the 
public, ensure consistent application, and limit any unnecessary 
burdens related to the administration and implementation of these 
provisions. Nasdaq represents that this proposed modification will have 
no impact on the resources available for its regulatory programs or 
Nasdaq's ability to enforce its listing standards and protect 
investors.
2. Statutory Basis
    The Exchange believes that its proposal, by eliminating obsolete or 
unnecessary provisions from its rule book and, thus, simplifying and 
adding clarity to the fees charged by the Exchange, is consistent with 
Section 6(b) of the Act,\12\ in general, and furthers the objectives of 
Sections 6(b)(4) and 6(b)(5) of the Act,\13\ 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 its 
facilities. For the same reasons, the Exchange also believes its 
proposal is designed to promote just and equitable principles of trade, 
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; and is not designed to permit unfair 
discrimination between customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \12\ 15 U.S.C. 78f(b).
    \13\ 15 U.S.C. 78f(b)(4) and (5).
---------------------------------------------------------------------------

    Except as described below with respect to the proposed changes to 
IM-5900-4, the proposal does not change the listing fees to which 
listed companies are subject. Rather, Nasdaq is making this proposal to 
make certain the rules fully reflect completion of the phased 
transition from the standard annual fee schedule to the all-inclusive 
annual fee schedule. Completion of this transition rendered certain 
existing fee provisions obsolete, unnecessary or out of date and 
necessitated their deletion or modification. Completion of the 
transition also necessitated other clarifying and conforming 
adjustments, including relocating or renumbering certain rules. Nasdaq 
believes that updating Nasdaq's rules to eliminate obsolete provisions 
and make related clarifications and conforming changes will simplify 
Nasdaq's rule book and add transparency. As noted above, except as 
described below with respect to the changes to IM-5900-4, it will not 
change the listing fees to which listed companies are subject. Thus, 
the proposal does not reduce the resources available for Nasdaq's 
regulatory program or otherwise hinder or limit the ability of Nasdaq 
to enforce its listing standards and protect investors.
    The proposal's clarification in Rules 5930 and 5940 that Linked 
Securities, SEEDS, Other Securities and Exchange Traded Products are 
also subject to an all-inclusive annual fee applicable to such issues 
is similarly consistent with Section 6(b) of the Act. In this regard, 
by adding clarity to the rules regarding the fees applicable to these 
products, the proposal simplifies and adds transparency to Nasdaq's 
rule book, including by fully reflecting the fact that, as noted above, 
these products are not subject to fees for Record Keeping, Substitution 
Listing Events and compliance plans.\14\ This proposed change does not 
change the listing fees to which these products are subject. Instead, 
it ensures the rules reflect that these products, like all other 
listings, are subject to an all-inclusive annual fee.
---------------------------------------------------------------------------

    \14\ See, supra, notes 8 and 9.
---------------------------------------------------------------------------

    Also, because the proposal does not change the fees to which these 
listings are subject, the proposal does not reduce the resources 
available for Nasdaq's regulatory program or otherwise hinder or limit 
the ability of Nasdaq to enforce its listing standards and protect 
investors. As such, Nasdaq believes these changes are consistent with 
the Section 6(b)(4) of the Act in that they provide for the equitable 
allocation of reasonable dues, fees and other charges among members and 
issuers and other persons using its facilities. For the same reasons, 
they are also consistent with the investor protection objectives of 
Section 6(b)(5) of the Act.
    The proposed modifications to IM-5900-4 are similarly consistent 
with the Act because they are designed to simplify and clarify 
application of the pre-existing annual fee waiver to companies that 
transfer their listing from a national securities exchange to Nasdaq 
or, if they are already listed on Nasdaq, cease to be listed on the New 
York Stock Exchange. This change was necessitated because the all-
inclusive annual fee schedule may not, in certain cases, be directly 
equivalent or comparable to other listing exchanges' annual fees 
because it includes a range of fees, such as for listing additional 
shares, record keeping changes and substitution listing events, that 
other listing exchanges charge separately in addition to an annual 
listing fee. As such, while most companies under the all-inclusive 
annual fee schedule incur lower fees in comparison to the annual

[[Page 60525]]

fee charged by other exchanges, in some cases a company's fee under the 
all-inclusive annual fee schedule may be higher. In these cases, the 
existing waiver under the rules of a pro rata portion of the annual fee 
paid to the other listing exchange may not give the company full credit 
for other fees paid to the other exchange and may not completely remove 
the disincentive to transferring listing attributable to the fact that 
the company has already paid the annual fee for that year. Under the 
proposed change, all companies switching their listing will have the 
entire annual fee waived in the year of the switch.
    As noted above, Nasdaq acknowledges the possibility that the all-
inclusive annual listing fee it charges may be higher in some cases 
than the annual fee charged by a competitor exchange and that in such 
cases an issuer that transfers its listing may receive a relatively 
greater benefit than other issuers that transfer their listings where 
the all-inclusive annual listing fee is lower than the annual fee 
charged by a competitor exchange. However, for several reasons, Nasdaq 
does not believe that this possibility is unfairly discriminatory. 
First, Nasdaq anticipates that there will be few instances where 
Nasdaq's all-inclusive annual listing fee is higher than the annual fee 
charged by a competitor exchange. Second, as described above, the 
waiver is intended to remove a disincentive to transfer and Nasdaq does 
not believe that the possibility that the all-inclusive annual listing 
fee is higher than the annual fee charged by a competitor exchange 
would have a material impact on a decision to transfer or not. Third, 
by simplifying these provisions, they are transparent to issuers and 
the public, ensure consistent application, and limit any unnecessary 
burdens related to the administration and implementation of these 
provisions.
    For these reasons, Nasdaq believes that this proposed change is 
consistent with Section 6(b)(4) of the Act. Nasdaq also believes this 
proposed change is similarly consistent with Section 6(b)(5) of the Act 
in that it is designed to promote just and equitable principles of 
trade, to remove impediments to and perfect the mechanism of a free and 
open market and a national market system, and is not designed to permit 
unfair discrimination between customers, issuers, brokers, or dealers. 
Further, given the limited number of listings transfers each year, it 
is not expected that this waiver would materially impact the resources 
available for Nasdaq's regulatory program or otherwise hinder or limit 
the ability of Nasdaq to enforce its listing standards and protect 
investors. As such, Nasdaq believes these changes are consistent with 
the investor protection objectives of Section 6(b)(5) of the Act.

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. The market for listing services 
is extremely competitive and listed companies may freely choose 
alternative venues based on the aggregate fees assessed and the value 
provided by each listing. As such, because this proposal does not 
change the listing fees to which listed companies are subject, but 
merely reflects the completion of the phased transition from the prior 
standard annual fee schedule to the all-inclusive annual listing fee 
schedule, the application of an all-inclusive annual listing fee 
schedule to Linked Securities, SEEDS, Other Securities and Exchange 
Traded Products, and refinement and clarification of the operation of 
certain existing waivers based on the introduction of the all-inclusive 
listing fee schedule, Nasdaq believes that this proposed rule change 
does not encumber the competition for listings with other listing 
venues, which are similarly free to set their fees. Rather, it reflects 
the competition among listing venues and will further enhance such 
competition.

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.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \15\ and Rule 19b-
4(f)(6) thereunder.\16\
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78s(b)(3)(A).
    \16\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the 
Act \17\ normally does not become operative for 30 days after the date 
of its filing. However, Rule 19b-4(f)(6)(iii) \18\ permits the 
Commission to designate a shorter time if such action is consistent 
with the protection of investors and the public interest. The Exchange 
has asked the Commission to waive the 30-day operative delay so that 
its rules may fully reflect completion of the transition to the all-
inclusive annual fee program, thereby providing clarity to this fee 
program and making the rule book simpler and more transparent. The 
Exchange represents that, as of January 1, 2018, all listed companies 
are subject to the all-inclusive annual listing fee program, which has 
completely superseded and replaced the standard annual fee. For these 
reasons, the Commission believes that waiver of the 30-day operative 
delay is consistent with the protection of investors and the public 
interest. Therefore, the Commission hereby waives the operative delay 
and designates the proposal as operative upon filing.\19\
---------------------------------------------------------------------------

    \17\ 17 CFR 240.19b-4(f)(6).
    \18\ 17 CFR 240.19b-4(f)(6)(iii).
    \19\ For purposes only of waiving the 30-day operative delay, 
the Commission also has considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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 necessary or 
appropriate in the public interest, for the protection of investors, or 
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 change 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

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NASDAQ-2018-092 on the subject line.

[[Page 60526]]

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-NASDAQ-2018-092. 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 (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 website 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 such filing also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NASDAQ-2018-092, and should be submitted 
on or before December 17, 2018.
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    \20\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\20\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-25736 Filed 11-23-18; 8:45 am]
 BILLING CODE 8011-01-P

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