Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d-2; Order Approving Proposed Amended Plan for the Allocation of Regulatory Responsibilities Between the Financial Industry Regulatory Authority, Inc. and the NYSE Chicago, Inc., 29923-29925 [2019-13464]

Download as PDF Federal Register / Vol. 84, No. 122 / Tuesday, June 25, 2019 / Notices to Rule 19b–4(f)(6)(iii),13 the Commission may 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 the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because doing so will allow the Pilot Program to continue without interruption in a manner that is consistent with the Commission’s prior approval of the extension and expansion of the Pilot Program.14 Accordingly, the Commission designates the proposed rule change as operative upon filing with the Commission.15 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 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: For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Vanessa A. Countryman, Acting Secretary. [FR Doc. 2019–13410 Filed 6–24–19; 8:45 am] Electronic Comments BILLING CODE 8011–01–P • Use the Commission’s internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– MRX–2019–13 on the subject line. SECURITIES AND EXCHANGE COMMISSION Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should refer to File Number SR–MRX–2019–13. This file number should be included on the khammond on DSKBBV9HB2PROD with NOTICES 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 (http://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 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. Persons submitting comments are cautioned that we do not redact or 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–MRX–2019–13 and should be submitted on or before July 16, 2019. 13 17 CFR 240.19b–4(f)(6)(iii). Securities Exchange Release No. 61061 (November 24, 2009), 74 FR 62857) (December 1, 2009) (SR–NYSEARCA–2009–44). 15 For purposes only of waiving the operative delay for this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 14 See VerDate Sep<11>2014 20:35 Jun 24, 2019 Jkt 247001 [Release No. 34–86161; File No. 4–274] Program for Allocation of Regulatory Responsibilities Pursuant to Rule 17d– 2; Order Approving Proposed Amended Plan for the Allocation of Regulatory Responsibilities Between the Financial Industry Regulatory Authority, Inc. and the NYSE Chicago, Inc. June 20, 2019. On May 8, 2019, the Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) and the NYSE Chicago, Inc. (‘‘NYSE Chicago’’) (together with FINRA, the ‘‘Parties’’) filed with the Securities and Exchange Commission 16 17 PO 00000 CFR 200.30–3(a)(12). Frm 00085 Fmt 4703 Sfmt 4703 29923 (‘‘Commission’’) a plan for the allocation of regulatory responsibilities, dated May 7, 2019 (‘‘Amended 17d–2 Plan’’ or the ‘‘Amended Plan’’). The Amended Plan was published for comment on May 30, 2019.1 The Commission received no comments on the Amended Plan. This order approves and declares effective the Amended Plan. I. Introduction Section 19(g)(1) of the Act,2 among other things, requires every selfregulatory organization (‘‘SRO’’) registered as either a national securities exchange or national securities association to examine for, and enforce compliance by, its members and persons associated with its members with the Act, the rules and regulations thereunder, and the SRO’s own rules, unless the SRO is relieved of this responsibility pursuant to Section 17(d) or Section 19(g)(2) of the Act.3 Without this relief, the statutory obligation of each individual SRO could result in a pattern of multiple examinations of broker-dealers that maintain memberships in more than one SRO (‘‘common members’’). Such regulatory duplication would add unnecessary expenses for common members and their SROs. Section 17(d)(1) of the Act 4 was intended, in part, to eliminate unnecessary multiple examinations and regulatory duplication.5 With respect to a common member, Section 17(d)(1) authorizes the Commission, by rule or order, to relieve an SRO of the responsibility to receive regulatory reports, to examine for and enforce compliance with applicable statutes, rules, and regulations, or to perform other specified regulatory functions. To implement Section 17(d)(1), the Commission adopted two rules: Rule 17d–1 and Rule 17d–2 under the Act.6 Rule 17d–1 authorizes the Commission to name a single SRO as the designated examining authority (‘‘DEA’’) to examine common members for compliance with the financial responsibility requirements imposed by the Act, or by Commission or SRO 1 See Securities Exchange Act Release No. 85921 (May 23, 2019), 84 FR 25105. 2 15 U.S.C. 78s(g)(1). 3 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), respectively. 4 15 U.S.C. 78q(d)(1). 5 See Securities Act Amendments of 1975, Report of the Senate Committee on Banking, Housing, and Urban Affairs to Accompany S. 249, S. Rep. No. 94– 75, 94th Cong., 1st Session 32 (1975). 6 17 CFR 240.17d–1 and 17 CFR 240.17d–2, respectively. E:\FR\FM\25JNN1.SGM 25JNN1 29924 Federal Register / Vol. 84, No. 122 / Tuesday, June 25, 2019 / Notices rules.7 When an SRO has been named as a common member’s DEA, all other SROs to which the common member belongs are relieved of the responsibility to examine the firm for compliance with the applicable financial responsibility rules. On its face, Rule 17d–1 deals only with an SRO’s obligations to enforce member compliance with financial responsibility requirements. Rule 17d–1 does not relieve an SRO from its obligation to examine a common member for compliance with its own rules and provisions of the federal securities laws governing matters other than financial responsibility, including sales practices and trading activities and practices. To address regulatory duplication in these and other areas, the Commission adopted Rule 17d–2under the Act.8 Rule 17d–2permits SROs to propose joint plans for the allocation of regulatory responsibilities with respect to their common members. Under paragraph (c) of Rule 17d–2, the Commission may declare such a plan effective if, after providing for appropriate notice and comment, it determines that the plan is necessary or appropriate in the public interest and for the protection of investors; to foster cooperation and coordination among the SROs; to remove impediments to, and foster the development of, a national market system and a national clearance and settlement system; and is in conformity with the factors set forth in Section 17(d) of the Act. Commission approval of a plan filed pursuant to Rule 17d–2 relieves an SRO of those regulatory responsibilities allocated by the plan to another SRO. khammond on DSKBBV9HB2PROD with NOTICES II. Proposed Amended Plan On September 26, 1978, the Commission approved the Plan allocating regulatory responsibilities pursuant to Rule 17d–2 on a provisional basis.9 Under the Plan, the predecessor to FINRA was responsible, in part, for conducting on-site examination of each dual member for which it was the DEA. On February 20, 1980, the Commission noticed for comment an amendment to the Plan, which provided, in part, for the handling of customer complaints, the review of dual members’ advertising, and the arbitration of 7 See Securities Exchange Act Release No. 12352 (April 20, 1976), 41 FR 18808 (May 7, 1976). 8 See Securities Exchange Act Release No. 12935 (October 28, 1976), 41 FR 49091 (November 8, 1976). 9 See Securities Exchange Act Release No. 15191 (September 26, 1978), 43 FR 46093 (October 5, 1978). VerDate Sep<11>2014 20:35 Jun 24, 2019 Jkt 247001 disputes under the Plan.10 On May 30, 1980, the Commission approved the Plan, as amended.11 On September 8, 2010, the Commission approved an amendment to replace the previous Plan in its entirety.12 On May 8, 2019, the Parties submitted a proposed amendment to the Plan. The primary purpose of the amendment is to the extent that it becomes a member of the exchange, allocate regulatory responsibility to FINRA for NYSE Chicago’s affiliated routing brokerdealer, Archipelago Securities LLC. III. Discussion The Commission finds that the proposed Amended Plan is consistent with the factors set forth in Section 17(d) of the Act 13 and Rule 17d–2(c) thereunder 14 in that the proposed Amended Plan is necessary or appropriate in the public interest and for the protection of investors, fosters cooperation and coordination among SROs, and removes impediments to and fosters the development of the national market system. In particular, the Commission believes that the proposed Amended Plan should reduce unnecessary regulatory duplication by allocating to FINRA certain examination and enforcement responsibilities for common members that would otherwise be performed by FINRA and NYSE Chicago. Accordingly, the proposed Amended Plan promotes efficiency by reducing costs to common members. Furthermore, because NYSE Chicago and FINRA will coordinate their regulatory functions in accordance with the Amended Plan, the Amended Plan should promote investor protection. The Commission notes that, under the Amended Plan, NYSE Chicago and FINRA have allocated regulatory responsibility for those NYSE Chicago rules, set forth in the Certification, that are substantially similar to the applicable FINRA rules in that examination for compliance with such provisions and rules would not require FINRA to develop one or more new examination standards, modules, procedures, or criteria in order to analyze the application of the rule, or a common member’s activity, conduct, or output in relation to such rule. In addition, under the Amended Plan, 10 See Securities Exchange Act Release No. 16591 (February 20, 1980), 45 FR 12573 (February 26, 1980). 11 See Securities Exchange Act Release No. 16858 (May 30, 1980), 45 FR 37927 (June 5, 1980). 12 See Securities Exchange Act Release No. 62866 (September 8, 2010), 75 FR 55833 (September 14, 2010). 13 15 U.S.C. 78q(d). 14 17 CFR 240.17d–2(c). PO 00000 Frm 00086 Fmt 4703 Sfmt 4703 FINRA would assume regulatory responsibility for certain provisions of the federal securities laws and the rules and regulations thereunder that are set forth in the Certification. The common rules covered by the Amended Plan are specifically listed in the Certification, as may be amended by the parties from time to time. According to the Amended Plan, NYSE Chicago will review the Certification at least annually, or more frequently if required by changes in either the rules of NYSE Chicago or FINRA, and, if necessary, submit to FINRA an updated list of common rules to add NYSE Chicago rules not included on the then-current list of common rules that are substantially similar to FINRA rules; delete NYSE Chicago rules included in the then-current list of common rules that no longer qualify as common rules; and confirm that the remaining rules on the list of common rules continue to be NYSE Chicago rules that qualify as common rules.15 FINRA will then confirm in writing whether the rules listed in any updated list are common rules as defined in the Amended Plan. Under the Amended Plan, NYSE Chicago also will provide FINRA with a current list of common members and shall update the list no less frequently than once each quarter.16 The Commission believes that these provisions are designed to provide for continuing communication between the parties to ensure the continued accuracy of the scope of the proposed allocation of regulatory responsibility. In addition, as noted above, the primary purpose of the amendment is to the extent that it becomes a member of the exchange, allocate regulatory responsibility to FINRA for Chicago’s affiliated routing broker-dealer, Archipelago Securities LLC. The Commission does not believe that the amendment to the plan raises any new regulatory issues that the Commission has not previously considered. The Commission is hereby declaring effective an Amended Plan that, among other things, allocates regulatory responsibility to FINRA for the oversight and enforcement of all NYSE Chicago rules that are substantially similar to the rules of FINRA for common members of FINRA and NYSE Chicago. Therefore, modifications to the Certification need not be filed with the Commission as an amendment to the Amended Plan, provided that the parties are only adding to, deleting from, or confirming changes to NYSE Chicago rules in the Certification in 15 See 16 See E:\FR\FM\25JNN1.SGM paragraph 2 of the Amended Plan. paragraph 3 of the Amended Plan. 25JNN1 Federal Register / Vol. 84, No. 122 / Tuesday, June 25, 2019 / Notices conformance with the definition of common rules provided in the Amended Plan. However, should the parties decide to add a NYSE Chicago rule to the Certification that is not substantially similar to a FINRA rule; delete a NYSE Chicago rule from the Certification that is substantially similar to a FINRA rule; or leave on the Certification a NYSE Chicago rule that is no longer substantially similar to a FINRA rule, then such a change would constitute an amendment to the Amended Plan, which must be filed with the Commission pursuant to Rule 17d–2 under the Act.17 IV. Conclusion This order gives effect to the Amended Plan filed with the Commission in File No. 4–274. The parties shall notify all members affected by the Amended Plan of their rights and obligations under the Amended Plan. It is therefore ordered, pursuant to Section 17(d) of the Act, that the Amended Plan in File No. 4–274, between FINRA and NYSE Chicago, filed pursuant to Rule 17d–2 under the Act, hereby is approved and declared effective. It is further ordered that NYSE Chicago is relieved of those responsibilities allocated to FINRA under the Amended Plan in File No. 4–274. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Vanessa A. Countryman, Acting Secretary. [FR Doc. 2019–13464 Filed 6–24–19; 8:45 am] BILLING CODE 8011–01–P will attend the closed meeting. Certain staff members who have an interest in the matters also may be present. In the event that the time, date, or location of this meeting changes, an announcement of the change, along with the new time, date, and/or place of the meeting will be posted on the Commission’s website at https:// www.sec.gov. No earlier notice of this meeting was practicable. The General Counsel of the Commission, or his designee, has certified that, in his opinion, one or more of the exemptions set forth in 5 U.S.C. 552b(c)(3), (5), (6), (7), (8), 9(B) and (10) and 17 CFR 200.402(a)(3), (a)(5), (a)(6), (a)(7), (a)(8), (a)(9)(ii) and (a)(10), permit consideration of the scheduled matters at the closed meeting. The subject matters of the closed meeting will consist of the following topics: Institution and settlement of injunctive actions; Institution and settlement of administrative proceedings; Resolution of litigation claims; and Other matters relating to enforcement proceedings. At times, changes in Commission priorities require alterations in the scheduling of meeting agenda items that may consist of adjudicatory, examination, litigation, or regulatory matters. CONTACT PERSON FOR MORE INFORMATION: For further information; please contact Vanessa A. Countryman from the Office of the Secretary at (202) 551–5400. Dated: June 20, 2019. Vanessa A. Countryman, Acting Secretary. [FR Doc. 2019–13529 Filed 6–21–19; 11:15 am] SMALL BUSINESS ADMINISTRATION 10:00 a.m. on Wednesday, June 26, 2019. PLACE: The meeting will be held at the Commission’s headquarters, 100 F Street NE, Washington, DC 20549. STATUS: This meeting will be closed to the public. MATTERS TO BE CONSIDERED: Commissioners, Counsel to the Commissioners, the Secretary to the Commission, and recording secretaries Reporting and Recordkeeping Requirements Under OMB Review khammond on DSKBBV9HB2PROD with NOTICES TIME AND DATE: 17 The addition to or deletion from the Certification of any federal securities laws, rules, and regulations for which FINRA would bear responsibility under the Amended Plan for examining, and enforcing compliance by, common members, also would constitute an amendment to the Amended Plan. 18 17 CFR 200.30–3(a)(34). Jkt 247001 Solicitation of Public Comments Title: Surety Bond Guarantees Assistance. Description of Respondents: Surety Companies. Form Number: SBA Forms 990, 991, 994, 994B, 994F, 994H. Estimated Annual Responses: 1,026. Estimated Annual Hour Burden: 13,983. Curtis Rich, Management Analyst. Sunshine Act Meetings 20:35 Jun 24, 2019 Comments should refer to the information collection by name and/ or OMB Control Number and should be sent to: Agency Clearance Officer, Curtis Rich, Small Business Administration, 409 3rd Street SW, 5th Floor, Washington, DC 20416; and SBA Desk Officer, Office of Information and Regulatory Affairs, Office of Management and Budget, New Executive Office Building, Washington, DC 20503. FOR FURTHER INFORMATION CONTACT: Curtis Rich, Agency Clearance Officer, (202) 205–7030 curtis.rich@sba.gov. Copies: A copy of the Form OMB 83–1, supporting statement, and other documents submitted to OMB for review may be obtained from the Agency Clearance Officer. SUPPLEMENTARY INFORMATION: Small Business Administration Surety Bond Guarantee Program was created to encourage surety companies to issue bonds for small contractors. The information collected on these forms from Small Business contractors or surety companies/agents is used to evaluate the eligibility of program application. One form is used by surety companies to request claims payments or report recoveries related to defaulted contractors. ADDRESSES: BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION VerDate Sep<11>2014 29925 [FR Doc. 2019–13491 Filed 6–24–19; 8:45 am] BILLING CODE 8025–01–P AGENCY: DEPARTMENT OF STATE ACTION: [Public Notice: 10802] Small Business Administration. 30-Day notice. The Small Business Administration (SBA) is publishing this notice to comply with requirements of the Paperwork Reduction Act (PRA) requires agencies to submit proposed reporting and recordkeeping requirements to OMB for review and approval, and to publish a notice in the Federal Register notifying the public that the agency has made such a submission. This notice also allows an additional 30 days for public comments. DATES: Submit comments on or before July 25, 2019. SUMMARY: PO 00000 Frm 00087 Fmt 4703 Sfmt 4703 Certification Pursuant to Section 7041(F)(3) of the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2019 By virtue of the authority vested in me pursuant to section 7041(f)(3) of the Department of State, Foreign Operations, and Related Programs Appropriations Act, 2019 (Div. F, Pub. L. 116–6) and Department of State Delegation of Authority 245–2, I hereby certify that Libya’s Government of National Accord is cooperating with E:\FR\FM\25JNN1.SGM 25JNN1

Agencies

[Federal Register Volume 84, Number 122 (Tuesday, June 25, 2019)]
[Notices]
[Pages 29923-29925]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-13464]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-86161; File No. 4-274]


Program for Allocation of Regulatory Responsibilities Pursuant to 
Rule 17d-2; Order Approving Proposed Amended Plan for the Allocation of 
Regulatory Responsibilities Between the Financial Industry Regulatory 
Authority, Inc. and the NYSE Chicago, Inc.

June 20, 2019.
    On May 8, 2019, the Financial Industry Regulatory Authority, Inc. 
(``FINRA'') and the NYSE Chicago, Inc. (``NYSE Chicago'') (together 
with FINRA, the ``Parties'') filed with the Securities and Exchange 
Commission (``Commission'') a plan for the allocation of regulatory 
responsibilities, dated May 7, 2019 (``Amended 17d-2 Plan'' or the 
``Amended Plan''). The Amended Plan was published for comment on May 
30, 2019.\1\ The Commission received no comments on the Amended Plan. 
This order approves and declares effective the Amended Plan.
---------------------------------------------------------------------------

    \1\ See Securities Exchange Act Release No. 85921 (May 23, 
2019), 84 FR 25105.
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I. Introduction

    Section 19(g)(1) of the Act,\2\ among other things, requires every 
self-regulatory organization (``SRO'') registered as either a national 
securities exchange or national securities association to examine for, 
and enforce compliance by, its members and persons associated with its 
members with the Act, the rules and regulations thereunder, and the 
SRO's own rules, unless the SRO is relieved of this responsibility 
pursuant to Section 17(d) or Section 19(g)(2) of the Act.\3\ Without 
this relief, the statutory obligation of each individual SRO could 
result in a pattern of multiple examinations of broker-dealers that 
maintain memberships in more than one SRO (``common members''). Such 
regulatory duplication would add unnecessary expenses for common 
members and their SROs.
---------------------------------------------------------------------------

    \2\ 15 U.S.C. 78s(g)(1).
    \3\ 15 U.S.C. 78q(d) and 15 U.S.C. 78s(g)(2), respectively.
---------------------------------------------------------------------------

    Section 17(d)(1) of the Act \4\ was intended, in part, to eliminate 
unnecessary multiple examinations and regulatory duplication.\5\ With 
respect to a common member, Section 17(d)(1) authorizes the Commission, 
by rule or order, to relieve an SRO of the responsibility to receive 
regulatory reports, to examine for and enforce compliance with 
applicable statutes, rules, and regulations, or to perform other 
specified regulatory functions.
---------------------------------------------------------------------------

    \4\ 15 U.S.C. 78q(d)(1).
    \5\ See Securities Act Amendments of 1975, Report of the Senate 
Committee on Banking, Housing, and Urban Affairs to Accompany S. 
249, S. Rep. No. 94-75, 94th Cong., 1st Session 32 (1975).
---------------------------------------------------------------------------

    To implement Section 17(d)(1), the Commission adopted two rules: 
Rule 17d-1 and Rule 17d-2 under the Act.\6\ Rule 17d-1 authorizes the 
Commission to name a single SRO as the designated examining authority 
(``DEA'') to examine common members for compliance with the financial 
responsibility requirements imposed by the Act, or by Commission or SRO

[[Page 29924]]

rules.\7\ When an SRO has been named as a common member's DEA, all 
other SROs to which the common member belongs are relieved of the 
responsibility to examine the firm for compliance with the applicable 
financial responsibility rules. On its face, Rule 17d-1 deals only with 
an SRO's obligations to enforce member compliance with financial 
responsibility requirements. Rule 17d-1 does not relieve an SRO from 
its obligation to examine a common member for compliance with its own 
rules and provisions of the federal securities laws governing matters 
other than financial responsibility, including sales practices and 
trading activities and practices.
---------------------------------------------------------------------------

    \6\ 17 CFR 240.17d-1 and 17 CFR 240.17d-2, respectively.
    \7\ See Securities Exchange Act Release No. 12352 (April 20, 
1976), 41 FR 18808 (May 7, 1976).
---------------------------------------------------------------------------

    To address regulatory duplication in these and other areas, the 
Commission adopted Rule 17d-2under the Act.\8\ Rule 17d-2permits SROs 
to propose joint plans for the allocation of regulatory 
responsibilities with respect to their common members. Under paragraph 
(c) of Rule 17d-2, the Commission may declare such a plan effective if, 
after providing for appropriate notice and comment, it determines that 
the plan is necessary or appropriate in the public interest and for the 
protection of investors; to foster cooperation and coordination among 
the SROs; to remove impediments to, and foster the development of, a 
national market system and a national clearance and settlement system; 
and is in conformity with the factors set forth in Section 17(d) of the 
Act. Commission approval of a plan filed pursuant to Rule 17d-2 
relieves an SRO of those regulatory responsibilities allocated by the 
plan to another SRO.
---------------------------------------------------------------------------

    \8\ See Securities Exchange Act Release No. 12935 (October 28, 
1976), 41 FR 49091 (November 8, 1976).
---------------------------------------------------------------------------

II. Proposed Amended Plan

    On September 26, 1978, the Commission approved the Plan allocating 
regulatory responsibilities pursuant to Rule 17d-2 on a provisional 
basis.\9\ Under the Plan, the predecessor to FINRA was responsible, in 
part, for conducting on-site examination of each dual member for which 
it was the DEA. On February 20, 1980, the Commission noticed for 
comment an amendment to the Plan, which provided, in part, for the 
handling of customer complaints, the review of dual members' 
advertising, and the arbitration of disputes under the Plan.\10\ On May 
30, 1980, the Commission approved the Plan, as amended.\11\ On 
September 8, 2010, the Commission approved an amendment to replace the 
previous Plan in its entirety.\12\ On May 8, 2019, the Parties 
submitted a proposed amendment to the Plan. The primary purpose of the 
amendment is to the extent that it becomes a member of the exchange, 
allocate regulatory responsibility to FINRA for NYSE Chicago's 
affiliated routing broker-dealer, Archipelago Securities LLC.
---------------------------------------------------------------------------

    \9\ See Securities Exchange Act Release No. 15191 (September 26, 
1978), 43 FR 46093 (October 5, 1978).
    \10\ See Securities Exchange Act Release No. 16591 (February 20, 
1980), 45 FR 12573 (February 26, 1980).
    \11\ See Securities Exchange Act Release No. 16858 (May 30, 
1980), 45 FR 37927 (June 5, 1980).
    \12\ See Securities Exchange Act Release No. 62866 (September 8, 
2010), 75 FR 55833 (September 14, 2010).
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III. Discussion

    The Commission finds that the proposed Amended Plan is consistent 
with the factors set forth in Section 17(d) of the Act \13\ and Rule 
17d-2(c) thereunder \14\ in that the proposed Amended Plan is necessary 
or appropriate in the public interest and for the protection of 
investors, fosters cooperation and coordination among SROs, and removes 
impediments to and fosters the development of the national market 
system. In particular, the Commission believes that the proposed 
Amended Plan should reduce unnecessary regulatory duplication by 
allocating to FINRA certain examination and enforcement 
responsibilities for common members that would otherwise be performed 
by FINRA and NYSE Chicago. Accordingly, the proposed Amended Plan 
promotes efficiency by reducing costs to common members. Furthermore, 
because NYSE Chicago and FINRA will coordinate their regulatory 
functions in accordance with the Amended Plan, the Amended Plan should 
promote investor protection.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78q(d).
    \14\ 17 CFR 240.17d-2(c).
---------------------------------------------------------------------------

    The Commission notes that, under the Amended Plan, NYSE Chicago and 
FINRA have allocated regulatory responsibility for those NYSE Chicago 
rules, set forth in the Certification, that are substantially similar 
to the applicable FINRA rules in that examination for compliance with 
such provisions and rules would not require FINRA to develop one or 
more new examination standards, modules, procedures, or criteria in 
order to analyze the application of the rule, or a common member's 
activity, conduct, or output in relation to such rule. In addition, 
under the Amended Plan, FINRA would assume regulatory responsibility 
for certain provisions of the federal securities laws and the rules and 
regulations thereunder that are set forth in the Certification. The 
common rules covered by the Amended Plan are specifically listed in the 
Certification, as may be amended by the parties from time to time.
    According to the Amended Plan, NYSE Chicago will review the 
Certification at least annually, or more frequently if required by 
changes in either the rules of NYSE Chicago or FINRA, and, if 
necessary, submit to FINRA an updated list of common rules to add NYSE 
Chicago rules not included on the then-current list of common rules 
that are substantially similar to FINRA rules; delete NYSE Chicago 
rules included in the then-current list of common rules that no longer 
qualify as common rules; and confirm that the remaining rules on the 
list of common rules continue to be NYSE Chicago rules that qualify as 
common rules.\15\ FINRA will then confirm in writing whether the rules 
listed in any updated list are common rules as defined in the Amended 
Plan. Under the Amended Plan, NYSE Chicago also will provide FINRA with 
a current list of common members and shall update the list no less 
frequently than once each quarter.\16\ The Commission believes that 
these provisions are designed to provide for continuing communication 
between the parties to ensure the continued accuracy of the scope of 
the proposed allocation of regulatory responsibility. In addition, as 
noted above, the primary purpose of the amendment is to the extent that 
it becomes a member of the exchange, allocate regulatory responsibility 
to FINRA for Chicago's affiliated routing broker-dealer, Archipelago 
Securities LLC. The Commission does not believe that the amendment to 
the plan raises any new regulatory issues that the Commission has not 
previously considered.
---------------------------------------------------------------------------

    \15\ See paragraph 2 of the Amended Plan.
    \16\ See paragraph 3 of the Amended Plan.
---------------------------------------------------------------------------

    The Commission is hereby declaring effective an Amended Plan that, 
among other things, allocates regulatory responsibility to FINRA for 
the oversight and enforcement of all NYSE Chicago rules that are 
substantially similar to the rules of FINRA for common members of FINRA 
and NYSE Chicago. Therefore, modifications to the Certification need 
not be filed with the Commission as an amendment to the Amended Plan, 
provided that the parties are only adding to, deleting from, or 
confirming changes to NYSE Chicago rules in the Certification in

[[Page 29925]]

conformance with the definition of common rules provided in the Amended 
Plan. However, should the parties decide to add a NYSE Chicago rule to 
the Certification that is not substantially similar to a FINRA rule; 
delete a NYSE Chicago rule from the Certification that is substantially 
similar to a FINRA rule; or leave on the Certification a NYSE Chicago 
rule that is no longer substantially similar to a FINRA rule, then such 
a change would constitute an amendment to the Amended Plan, which must 
be filed with the Commission pursuant to Rule 17d-2 under the Act.\17\
---------------------------------------------------------------------------

    \17\ The addition to or deletion from the Certification of any 
federal securities laws, rules, and regulations for which FINRA 
would bear responsibility under the Amended Plan for examining, and 
enforcing compliance by, common members, also would constitute an 
amendment to the Amended Plan.
---------------------------------------------------------------------------

IV. Conclusion

    This order gives effect to the Amended Plan filed with the 
Commission in File No. 4-274. The parties shall notify all members 
affected by the Amended Plan of their rights and obligations under the 
Amended Plan.
    It is therefore ordered, pursuant to Section 17(d) of the Act, that 
the Amended Plan in File No. 4-274, between FINRA and NYSE Chicago, 
filed pursuant to Rule 17d-2 under the Act, hereby is approved and 
declared effective.
    It is further ordered that NYSE Chicago is relieved of those 
responsibilities allocated to FINRA under the Amended Plan in File No. 
4-274.

    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)(34).
---------------------------------------------------------------------------

Vanessa A. Countryman,
Acting Secretary.
[FR Doc. 2019-13464 Filed 6-24-19; 8:45 am]
 BILLING CODE 8011-01-P