Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change To Amend Section 907.00 of the Manual To Extend the Period of Time for the Entitlement of Certain Eligible Issuers To Receive Complimentary Products and Services Under That Rule, 76129-76131 [2020-26143]
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Federal Register / Vol. 85, No. 229 / Friday, November 27, 2020 / Notices
Affiliated Funds, the other Regulated
Funds or any affiliated person of the
Affiliated Funds or the Regulated Funds
will receive any additional
compensation or remuneration of any
kind as a result of or in connection with
a Co-Investment Transaction other than
(i) in the case of the Regulated Funds
and the Affiliated Funds, the pro rata
transaction fees described above and
fees or other compensation described in
Condition 2(c)(iii)(B)(z), (ii) brokerage or
underwriting compensation permitted
by section 17(e) or 57(k), or (iii) in the
case of the Advisers, investment
advisory compensation paid in
accordance with investment advisory
agreements between the applicable
Regulated Fund(s) or Affiliated Fund(s)
and its Adviser.
15. Independence. If the Holders own
in the aggregate more than 25 percent of
the Shares of a Regulated Fund, then the
Holders will vote such Shares in the
same percentages as the Regulated
Fund’s other shareholders (not
including the Holders) when voting on
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any other matter under either the Act or
applicable State law affecting the
Board’s composition, size or manner of
election.
For the Commission, by the Division of
Investment Management, under delegated
authority.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–26227 Filed 11–25–20; 8:45 am]
BILLING CODE 8011–01–P
[Release No. 34–90466; File No. SR–NYSE–
2020–94]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing of Proposed Rule Change To
Amend Section 907.00 of the Manual
To Extend the Period of Time for the
Entitlement of Certain Eligible Issuers
To Receive Complimentary Products
and Services Under That Rule
jbell on DSKJLSW7X2PROD with NOTICES
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that, on
November 6, 2020, New York Stock
Exchange LLC (‘‘NYSE’’ or the
‘‘Exchange’’) filed with the Securities
and Exchange Commission (the
1 15
U.S.C. 78s(b)(1).
U.S.C. 78a.
3 17 CFR 240.19b–4.
2 15
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Section 907.00 of the Manual to modify
the entitlement of eligible issuers to
complimentary products and services
under that rule. The proposed rule
change is available on the Exchange’s
website at www.nyse.com, at the
principal office of the Exchange, and at
the Commission’s Public Reference
Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
self-regulatory organization included
statements concerning the purpose of,
and basis for, the proposed rule change
and discussed any comments it received
on the proposed rule change. The text
of those statements may be examined at
the places specified in Item IV below.
The Exchange has prepared summaries,
set forth in sections A, B, and C below,
of the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
SECURITIES AND EXCHANGE
COMMISSION
November 20, 2020.
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III below, which Items have been
prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
1. Purpose
Section 907.00 of the Manual sets
forth complimentary products and
services that issuers are entitled to
receive in connection with their NYSE
listing. The Exchange offers certain
complimentary products and services
and access to discounted third-party
products and services through the NYSE
Market Access Center to currently and
newly listed issuers. The Exchange also
provides complimentary market
surveillance products and services (with
a commercial value of approximately
$55,000 annually), web-hosting
products and services (with a
commercial value of approximately
$16,000 annually), web-casting services
(with a commercial value of
approximately $6,500 annually), market
analytics products and services (with a
commercial value of approximately
$30,000 annually), and news
distribution products and services (with
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76129
a commercial value of approximately
$20,000 annually) to Eligible New
Listings 4 and Eligible Transfer
Companies 5 based on the following
tiers: 6
Tier A: For Eligible New Listings and
Eligible Transfer Companies with a global
market value of $400 million or more, in each
case calculated as of the date of listing on the
Exchange, the Exchange offers market
surveillance, market analytics, web-hosting,
webcasting, and news distribution products
and services for a period of 24 calendar
months.
Tier B: For Eligible New Listings and
Eligible Transfer Companies with a global
market value of less than $400 million, in
each case calculated as of the date of listing
on the Exchange, the Exchange offers webhosting, market analytics, web-casting, and
news distribution products and services for
a period of 24 calendar months.
Currently, the Exchange provides all
of the additional complimentary
products and services to Eligible New
Listings and Eligible Transfer
Companies for a period of 24 months.
The Exchange now proposes to extend
this period for the additional services
provided to Eligible New Listings and
Eligible Transfer Companies from 24
months to 48 months.7 The proposed
amendment would be applicable to
Eligible New Listings and Eligible
Transfer Companies that list on or after
the date of SEC approval of the
proposal. The Exchange believes that
this amendment would assist it in the
competition for new listings, as well as
in attracting transfers of issuers from
other exchanges. The market for new
4 For the purposes of Section 907.00, the term
‘‘Eligible New Listing’’ means (i) any U.S. company
that lists common stock on the Exchange for the
first time and any non-U.S. company that lists an
equity security on the Exchange under Section
102.01 or 103.00 of the Manual for the first time,
regardless of whether such U.S. or non-U.S.
company conducts an offering and (ii) any U.S. or
non-U.S. company emerging from a bankruptcy,
spinoff (where a company lists new shares in the
absence of a public offering), and carve-out (where
a company carves out a business line or division,
which then conducts a separate initial public
offering).
5 For purposes of Section 907.00, the term
‘‘Eligible Transfer Company’’ means any U.S. or
non-U.S. company that transfers its listing of
common stock or equity securities, respectively, to
the Exchange from another national securities
exchange. For purposes of Section 907.00, an
‘‘equity security’’ means common stock or common
share equivalents such as ordinary shares, New
York shares, global shares, American Depository
Receipts, or Global Depository Receipts.
6 Section 907.00 provides for separate service
entitlements for Acquisition Companies listed
under Section 102.06 and the issuers of Equity
Investment Tracking Stocks listed under Section
102.07.
7 Eligible New Listings and Eligible Transfer
Companies will continue to be entitled to
complimentary whistleblower services for 24
months, as is the case with all eligible listed
companies.
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jbell on DSKJLSW7X2PROD with NOTICES
listings and for the retention and
transfer of listed companies is intensely
competitive and the provision of
attractive service offerings is a
significant aspect of that competition.
The Exchange notes that the Nasdaq
Stock Market, Inc. (‘‘Nasdaq’’) already
provides four years of complimentary
services to companies transferring from
the NYSE to Nasdaq Global Market that
have a market capitalization of at least
$750 million, while providing two years
of services to other newly listed
companies.8
The specific tools and services offered
to Eligible New Listings and Eligible
Transfer Companies as part of the
complimentary offering limited to those
categories of issuers under Section
907.00 are provided solely by thirdparty vendors. Issuers are not forced or
required as a condition of listing to
utilize the complimentary products and
services available to them pursuant to
Section 907.00 and some issuers have
selected competing products and
services. In deciding which
complimentary products and services to
provide, the NYSE considers the quality
of competing products and services and
the needs of its listed issuers in
selecting the vendors. The NYSE may
change vendors from time to time based
on this ongoing review of the products
and services provided by current
vendors and its willingness to change
vendors is consistent with competition
for vendor services. The Exchange does
not believe that the proposed rule
change would impose any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act. In this regard,
NYSE notes that it may choose to use
multiple vendors for the same type of
product or service. The NYSE notes
that, from time to time, issuers elect to
purchase products and services from
other vendors at their own expense
instead of accepting the products and
services described above offered by the
Exchange.
The Exchange also proposes to delete
two separate passages of rule text that
no longer have any substantive effect as
they relate to entitlements that have
ceased to be relevant as the periods of
time for which they existed have ended.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Securities Exchange Act of 1934
(the ‘‘Act’’) generally.9 Section 6(b)(4) 10
requires that exchange rules provide for
Nasdaq Marketplace Rules IM–5900–7.
U.S.C. 78f(b).
10 15 U.S.C. 78f(b)(4).
the equitable allocation of reasonable
dues, fees, and other charges among its
members and issuers and other persons
using the facilities of an exchange.
Section 6(b)(5) 11 requires, among other
things, that exchange rules promote just
and equitable principles of trade and
that they are not designed to permit
unfair discrimination between issuers,
brokers or dealers. Section 6(b)(8) 12
prohibits any exchange rule from
imposing any burden on competition
that is not necessary or appropriate in
furtherance of the purposes of the Act.
The NYSE faces competition in the
market for listing services, and
competes, in part, by offering valuable
services to companies. The Exchange
believes that it is reasonable to offer
complimentary services to attract and
retain listings as part of this
competition. Notably, Nasdaq currently
provides four years of complimentary
services to NYSE companies with a
market capitalization of at least $750
million transferring to Nasdaq Global
Market.
The Exchange does not believe that
the proposal to extend the period for
which it provides certain
complimentary products and services to
Eligible New Listings and Eligible
Transfer Companies harms the market
for the complimentary products and
services in a way that constitutes a
burden on competition or an inequitable
allocation of fees, or fails to promote
just and equitable principles of trade, in
a manner inconsistent with the Act. The
specific tools and services offered to
Eligible New Listings and Eligible
Transfer Companies as part of the
complimentary offering limited to those
categories of issuers under Section
907.00 are provided solely by thirdparty vendors. As noted above, issuers
are not required to utilize the
complimentary products and services
and some issuers have selected
competing products and services. The
NYSE believes that its consideration of
quality and the needs of its listed
issuers in selecting the vendors and its
willingness to change vendors is
consistent with competition for vendor
services. In this regard, the NYSE notes
that it may choose to use multiple
vendors for the same type of product or
service. The NYSE notes that, from time
to time, issuers elect to purchase
products and services from other
vendors at their own expense instead of
accepting the products and services
described above offered by the
Exchange.
8 See
9 15
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11 15
12 15
PO 00000
U.S.C. 78f(b)(5).
U.S.C. 78f(b)(8).
Frm 00127
Fmt 4703
Sfmt 4703
Further, the NYSE believes that it is
appropriate to offer complimentary
products and services for a longer
period to Eligible New Listings and
Eligible Transfer Companies that list
after approval of this proposal than the
period for which such products and
services are provided to companies
already listed on the NYSE. The
purpose of the proposal is to attract
future new listings and transfers and
that this competitive purpose would not
be served by providing the
complimentary products and services
for an extended period to companies
that are already listed. In addition, the
Exchange expects that companies that
consider listing on the NYSE after the
proposal is approved will take the
enhanced offering into account when
budgeting for their needs that are met by
the complimentary products and
services, while existing listed
companies will have undertaken their
financial planning on the basis of the
current services offering and will not in
any way be harmed by the proposed
change. Based on the above, the
Exchange believes that, upon approval
of this proposal, the complimentary
products and services will be equitably
allocated among issuers as required by
Section 6(b)(4) of the Act and the
proposal does not unfairly discriminate
among issuers as required by Section
6(b)(5) of the Act.
The non-substantive changes to
eliminate non-applicable history from
the rule text will improve the rule’s
readability and thereby remove an
impediment to a free and open market
and a national market system and help
to better protect investors.
Finally, the Exchange also believes it
is reasonable to balance its need to
remain competitive with other listing
venues, while at the same time ensuring
adequate revenue to meet is regulatory
responsibilities. The Exchange notes
that no other company will be required
to pay higher fees as a result of this
proposal and it represents that
providing the proposed services will
have no impact on the resources
available for its regulatory programs.
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. As noted
above, the Exchange faces competition
in the market for listing services, and
competes, in part, by offering valuable
services to companies. The proposed
rule change reflects that competition,
but it does not impose any burden on
E:\FR\FM\27NON1.SGM
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Federal Register / Vol. 85, No. 229 / Friday, November 27, 2020 / Notices
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the competition with other exchanges.
Rather, the Exchange believes the
proposed changes will enhance
competition for listings, as it will
increase the competition for new
listings and the listing of companies that
are currently listed on other exchanges.
Other exchanges can also offer similar
services to companies, thereby
increasing competition to the benefit of
those companies and their shareholders.
Accordingly, the Exchange does not
believe the proposed rule change will
impose any burden on competition that
is not necessary or appropriate in
furtherance of the purposes of the Act.
In addition, the Exchange does not
believe that the proposal to extend the
period for which it provides certain
complimentary products and services to
Eligible New Listings and Eligible
Transfer Companies will impose any
burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. In this
regard, the NYSE notes that the specific
tools and services offered to Eligible
New Listings and Eligible Transfer
Companies as part of the complimentary
offering limited to those categories of
issuers under Section 907.00 are
provided solely by third-party vendors.
In addition, the NYSE may choose to
use multiple vendors for the same type
of product or service. The NYSE also
notes that currently listed and newly
listed companies would not be required
to accept the offered products and
services from the NYSE, and an issuer’s
receipt of an NYSE listing is not
conditioned on the issuer’s acceptance
of such products and services. In
addition, the NYSE notes that, from
time to time, issuers elect to purchase
products and services from other
vendors at their own expense instead of
accepting the products and services
described above offered by the
Exchange.
Moreover, the number of companies
eligible for the complimentary products
and services for a longer period of time
(i.e., companies newly listing on the
NYSE) will be very small in comparison
to the total number of companies that
comprise the target market for the
services (i.e., all public companies), so
that there can be no competitively
meaningful foreclosure of similar
services offered by third parties if the
proposed rule is approved.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
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19:29 Nov 25, 2020
Jkt 253001
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of
publication of this notice in the Federal
Register or up to 90 days (i) as the
Commission may designate if it finds
such longer period to be appropriate
and publishes its reasons for so finding
or (ii) as to which the self-regulatory
organization consents, the Commission
will:
(A) By order approve or disapprove
the proposed rule change, or
(B) institute proceedings to determine
whether the proposed rule change
should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
76131
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–NYSE–2020–94 and should
be submitted on or before December 18,
2020.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020–26143 Filed 11–25–20; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–90473; File No. PCAOB–
2020–01]
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–
NYSE–2020–94 on the subject line.
Paper Comments
• Send paper comments in triplicate
to: Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to File
Number SR–NYSE–2020–94. 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 the
filing also will be available for
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Public Company Accounting Oversight
Board; Notice of Filing of Proposed
Rules on Amendments to PCAOB
Interim Independence Standards and
PCAOB Rules To Align With
Amendments to Rule 2–01 of
Regulation S–X
November 20, 2020.
Pursuant to Section 107(b) of the
Sarbanes-Oxley Act of 2002 (the ‘‘Act’’
or ‘‘Sarbanes-Oxley Act’’), notice is
hereby given that on November 20,
2020, the Public Company Accounting
Oversight Board (the ‘‘Board’’ or
‘‘PCAOB’’) filed with the Securities and
Exchange Commission (the
‘‘Commission’’ or ‘‘SEC’’) the proposed
rules described in Items I and II below,
which items have been prepared by the
Board. The Commission is publishing
this notice to solicit comments on the
proposed rules from interested persons.
I. Board’s Statement of the Terms of
Substance of the Proposed Rules
On November 19, 2020, the Board
adopted amendments to the PCAOB’s
interim independence standards and
PCAOB rules to align with amendments
by the SEC to Rule 2–01 of Regulation
S–X (collectively, the ‘‘proposed rules’’).
The text of the proposed rules appears
in Exhibit A to the SEC Filing Form
19b–4 and is available on the Board’s
website at https://pcaobus.org/
Rulemaking/Pages/Docket047.aspx and
at the Commission’s Public Reference
Room.
13 17
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27NON1
]]>Agencies
[Federal Register Volume 85, Number 229 (Friday, November 27, 2020)]
[Notices]
[Pages 76129-76131]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-26143]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-90466; File No. SR-NYSE-2020-94]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing of Proposed Rule Change To Amend Section 907.00 of the
Manual To Extend the Period of Time for the Entitlement of Certain
Eligible Issuers To Receive Complimentary Products and Services Under
That Rule
November 20, 2020.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on November 6, 2020, New York Stock Exchange LLC (``NYSE''
or the ``Exchange'') filed with the Securities and Exchange Commission
(the ``Commission'') the proposed rule change as described in Items I,
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 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 amend Section 907.00 of the Manual to
modify the entitlement of eligible issuers to complimentary products
and services under that rule. The proposed rule change is available on
the Exchange's website at www.nyse.com, at the principal office of the
Exchange, and at the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
included statements concerning the purpose of, and basis for, the
proposed rule change and discussed any comments it received on the
proposed rule change. The text of those statements may be examined at
the places specified in Item IV below. The Exchange has prepared
summaries, set forth in sections A, B, and C below, of the most
significant parts of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change
1. Purpose
Section 907.00 of the Manual sets forth complimentary products and
services that issuers are entitled to receive in connection with their
NYSE listing. The Exchange offers certain complimentary products and
services and access to discounted third-party products and services
through the NYSE Market Access Center to currently and newly listed
issuers. The Exchange also provides complimentary market surveillance
products and services (with a commercial value of approximately $55,000
annually), web-hosting products and services (with a commercial value
of approximately $16,000 annually), web-casting services (with a
commercial value of approximately $6,500 annually), market analytics
products and services (with a commercial value of approximately $30,000
annually), and news distribution products and services (with a
commercial value of approximately $20,000 annually) to Eligible New
Listings \4\ and Eligible Transfer Companies \5\ based on the following
tiers: \6\
---------------------------------------------------------------------------
\4\ For the purposes of Section 907.00, the term ``Eligible New
Listing'' means (i) any U.S. company that lists common stock on the
Exchange for the first time and any non-U.S. company that lists an
equity security on the Exchange under Section 102.01 or 103.00 of
the Manual for the first time, regardless of whether such U.S. or
non-U.S. company conducts an offering and (ii) any U.S. or non-U.S.
company emerging from a bankruptcy, spinoff (where a company lists
new shares in the absence of a public offering), and carve-out
(where a company carves out a business line or division, which then
conducts a separate initial public offering).
\5\ For purposes of Section 907.00, the term ``Eligible Transfer
Company'' means any U.S. or non-U.S. company that transfers its
listing of common stock or equity securities, respectively, to the
Exchange from another national securities exchange. For purposes of
Section 907.00, an ``equity security'' means common stock or common
share equivalents such as ordinary shares, New York shares, global
shares, American Depository Receipts, or Global Depository Receipts.
\6\ Section 907.00 provides for separate service entitlements
for Acquisition Companies listed under Section 102.06 and the
issuers of Equity Investment Tracking Stocks listed under Section
102.07.
Tier A: For Eligible New Listings and Eligible Transfer
Companies with a global market value of $400 million or more, in
each case calculated as of the date of listing on the Exchange, the
Exchange offers market surveillance, market analytics, web-hosting,
webcasting, and news distribution products and services for a period
of 24 calendar months.
Tier B: For Eligible New Listings and Eligible Transfer
Companies with a global market value of less than $400 million, in
each case calculated as of the date of listing on the Exchange, the
Exchange offers web-hosting, market analytics, web-casting, and news
distribution products and services for a period of 24 calendar
months.
Currently, the Exchange provides all of the additional
complimentary products and services to Eligible New Listings and
Eligible Transfer Companies for a period of 24 months. The Exchange now
proposes to extend this period for the additional services provided to
Eligible New Listings and Eligible Transfer Companies from 24 months to
48 months.\7\ The proposed amendment would be applicable to Eligible
New Listings and Eligible Transfer Companies that list on or after the
date of SEC approval of the proposal. The Exchange believes that this
amendment would assist it in the competition for new listings, as well
as in attracting transfers of issuers from other exchanges. The market
for new
[[Page 76130]]
listings and for the retention and transfer of listed companies is
intensely competitive and the provision of attractive service offerings
is a significant aspect of that competition. The Exchange notes that
the Nasdaq Stock Market, Inc. (``Nasdaq'') already provides four years
of complimentary services to companies transferring from the NYSE to
Nasdaq Global Market that have a market capitalization of at least $750
million, while providing two years of services to other newly listed
companies.\8\
---------------------------------------------------------------------------
\7\ Eligible New Listings and Eligible Transfer Companies will
continue to be entitled to complimentary whistleblower services for
24 months, as is the case with all eligible listed companies.
\8\ See Nasdaq Marketplace Rules IM-5900-7.
---------------------------------------------------------------------------
The specific tools and services offered to Eligible New Listings
and Eligible Transfer Companies as part of the complimentary offering
limited to those categories of issuers under Section 907.00 are
provided solely by third-party vendors. Issuers are not forced or
required as a condition of listing to utilize the complimentary
products and services available to them pursuant to Section 907.00 and
some issuers have selected competing products and services. In deciding
which complimentary products and services to provide, the NYSE
considers the quality of competing products and services and the needs
of its listed issuers in selecting the vendors. The NYSE may change
vendors from time to time based on this ongoing review of the products
and services provided by current vendors and its willingness to change
vendors is consistent with competition for vendor services. The
Exchange does not believe that the proposed rule change would impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. In this regard, NYSE notes that
it may choose to use multiple vendors for the same type of product or
service. The NYSE notes that, from time to time, issuers elect to
purchase products and services from other vendors at their own expense
instead of accepting the products and services described above offered
by the Exchange.
The Exchange also proposes to delete two separate passages of rule
text that no longer have any substantive effect as they relate to
entitlements that have ceased to be relevant as the periods of time for
which they existed have ended.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Securities Exchange Act of 1934 (the ``Act'') generally.\9\
Section 6(b)(4) \10\ requires that exchange rules provide for the
equitable allocation of reasonable dues, fees, and other charges among
its members and issuers and other persons using the facilities of an
exchange. Section 6(b)(5) \11\ requires, among other things, that
exchange rules promote just and equitable principles of trade and that
they are not designed to permit unfair discrimination between issuers,
brokers or dealers. Section 6(b)(8) \12\ prohibits any exchange rule
from imposing any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(4).
\11\ 15 U.S.C. 78f(b)(5).
\12\ 15 U.S.C. 78f(b)(8).
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The NYSE faces competition in the market for listing services, and
competes, in part, by offering valuable services to companies. The
Exchange believes that it is reasonable to offer complimentary services
to attract and retain listings as part of this competition. Notably,
Nasdaq currently provides four years of complimentary services to NYSE
companies with a market capitalization of at least $750 million
transferring to Nasdaq Global Market.
The Exchange does not believe that the proposal to extend the
period for which it provides certain complimentary products and
services to Eligible New Listings and Eligible Transfer Companies harms
the market for the complimentary products and services in a way that
constitutes a burden on competition or an inequitable allocation of
fees, or fails to promote just and equitable principles of trade, in a
manner inconsistent with the Act. The specific tools and services
offered to Eligible New Listings and Eligible Transfer Companies as
part of the complimentary offering limited to those categories of
issuers under Section 907.00 are provided solely by third-party
vendors. As noted above, issuers are not required to utilize the
complimentary products and services and some issuers have selected
competing products and services. The NYSE believes that its
consideration of quality and the needs of its listed issuers in
selecting the vendors and its willingness to change vendors is
consistent with competition for vendor services. In this regard, the
NYSE notes that it may choose to use multiple vendors for the same type
of product or service. The NYSE notes that, from time to time, issuers
elect to purchase products and services from other vendors at their own
expense instead of accepting the products and services described above
offered by the Exchange.
Further, the NYSE believes that it is appropriate to offer
complimentary products and services for a longer period to Eligible New
Listings and Eligible Transfer Companies that list after approval of
this proposal than the period for which such products and services are
provided to companies already listed on the NYSE. The purpose of the
proposal is to attract future new listings and transfers and that this
competitive purpose would not be served by providing the complimentary
products and services for an extended period to companies that are
already listed. In addition, the Exchange expects that companies that
consider listing on the NYSE after the proposal is approved will take
the enhanced offering into account when budgeting for their needs that
are met by the complimentary products and services, while existing
listed companies will have undertaken their financial planning on the
basis of the current services offering and will not in any way be
harmed by the proposed change. Based on the above, the Exchange
believes that, upon approval of this proposal, the complimentary
products and services will be equitably allocated among issuers as
required by Section 6(b)(4) of the Act and the proposal does not
unfairly discriminate among issuers as required by Section 6(b)(5) of
the Act.
The non-substantive changes to eliminate non-applicable history
from the rule text will improve the rule's readability and thereby
remove an impediment to a free and open market and a national market
system and help to better protect investors.
Finally, the Exchange also believes it is reasonable to balance its
need to remain competitive with other listing venues, while at the same
time ensuring adequate revenue to meet is regulatory responsibilities.
The Exchange notes that no other company will be required to pay higher
fees as a result of this proposal and it represents that providing the
proposed services will have no impact on the resources available for
its regulatory programs.
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. As noted above, the Exchange
faces competition in the market for listing services, and competes, in
part, by offering valuable services to companies. The proposed rule
change reflects that competition, but it does not impose any burden on
[[Page 76131]]
the competition with other exchanges. Rather, the Exchange believes the
proposed changes will enhance competition for listings, as it will
increase the competition for new listings and the listing of companies
that are currently listed on other exchanges. Other exchanges can also
offer similar services to companies, thereby increasing competition to
the benefit of those companies and their shareholders. Accordingly, the
Exchange does not believe the proposed rule change will impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
In addition, the Exchange does not believe that the proposal to
extend the period for which it provides certain complimentary products
and services to Eligible New Listings and Eligible Transfer Companies
will impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. In this regard,
the NYSE notes that the specific tools and services offered to Eligible
New Listings and Eligible Transfer Companies as part of the
complimentary offering limited to those categories of issuers under
Section 907.00 are provided solely by third-party vendors. In addition,
the NYSE may choose to use multiple vendors for the same type of
product or service. The NYSE also notes that currently listed and newly
listed companies would not be required to accept the offered products
and services from the NYSE, and an issuer's receipt of an NYSE listing
is not conditioned on the issuer's acceptance of such products and
services. In addition, the NYSE notes that, from time to time, issuers
elect to purchase products and services from other vendors at their own
expense instead of accepting the products and services described above
offered by the Exchange.
Moreover, the number of companies eligible for the complimentary
products and services for a longer period of time (i.e., companies
newly listing on the NYSE) will be very small in comparison to the
total number of companies that comprise the target market for the
services (i.e., all public companies), so that there can be no
competitively meaningful foreclosure of similar services offered by
third parties if the proposed rule is approved.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Within 45 days of the date of publication of this notice in the
Federal Register or up to 90 days (i) as the Commission may designate
if it finds such longer period to be appropriate and publishes its
reasons for so finding or (ii) as to which the self-regulatory
organization consents, the Commission will:
(A) By order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-NYSE-2020-94 on the subject line.
Paper Comments
Send paper comments in triplicate to: Secretary,
Securities and Exchange Commission, 100 F Street NE, Washington, DC
20549-1090.
All submissions should refer to File Number SR-NYSE-2020-94. 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 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 comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NYSE-2020-94 and should be submitted on
or before December 18, 2020.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-26143 Filed 11-25-20; 8:45 am]
BILLING CODE 8011-01-P
