Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Expiration Date of the Temporary Amendments Concerning Video Conference Hearings, 49635-49637 [2022-17222]
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Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices
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
The foregoing rule change is effective
upon filing pursuant to Section
19(b)(3)(A) 19 of the Act and
subparagraph (f)(2) of Rule 19b–4 20
thereunder, because it establishes a due,
fee, or other charge imposed by the
Exchange.
At any time within 60 days of the
filing of such 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
under Section 19(b)(2)(B) 21 of the Act 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:
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Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
NYSE–2022–36 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–2022–36. 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/
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(2).
21 15 U.S.C. 78s(b)(2)(B).
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–2022–36 and should
be submitted on or before September 1,
2022.
by the Exchange. The Exchange has
designated the proposed rule change as
constituting a ‘‘non-controversial’’ rule
change under paragraph (f)(6) of Rule
19b–4 under the Act,3 which renders
the proposal effective upon receipt of
this filing by the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.22
J. Matthew DeLesDernier,
Deputy Secretary.
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.
[FR Doc. 2022–17226 Filed 8–10–22; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–95435; File No. SR–Phlx–
2022–32]
Self-Regulatory Organizations; Nasdaq
PHLX LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Extend the Expiration
Date of the Temporary Amendments
Concerning Video Conference
Hearings
August 5, 2022.
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 July 26,
2022, Nasdaq PHLX LLC (‘‘Phlx’’ 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
19 15
22 17
20 17
1 15
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CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
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I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to extend the
expiration date of the temporary
amendments in SR–Phlx–2020–53 from
July 31, 2022, to October 31, 2022.4 The
proposed rule change would not make
any changes to the text of the Exchange
rules.
The text of the proposed rule change
is available on the Exchange’s website at
https://listingcenter.nasdaq.com/
rulebook/phlx/rules, 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
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to continue to
harmonize Exchange Rule General 3,
Section 16 with recent changes by the
Financial Industry Regulatory
Authority, Inc. (‘‘FINRA’’) to its Rule
1015 in response to the COVID–19
global health crisis and the
corresponding need to restrict in-person
3 17
CFR 240.19b–4(f)(6).
the Exchange seeks to provide additional
temporary relief from the rule requirements
identified in this proposed rule change beyond
October 31, 2022, the Exchange will submit a
separate rule filing to further extend the temporary
extension of time. The amended Exchange rules
will revert to their original form at the conclusion
of the temporary relief period and any extension
thereof.
4 If
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Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices
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activities.5 The Exchange originally
filed proposed rule change SR–Phlx–
2020–53, which allows the Exchange
Review Council (‘‘ERC’’) to conduct
hearings in connection with appeals of
Membership Application Program
decisions, on a temporary basis, by
video conference, if warranted by the
current COVID–19-related public health
risks posed by an in-person hearing. In
March 2022, the Exchange filed a
proposed rule change, SR–Phlx–2022–
15, to extend the expiration date of the
temporary amendments in SR–Phlx–
2020–53 from March 31, 2022, to July
31, 2022.6 Even though it has been more
than two years since the World Health
Organization declared COVID–19 a
pandemic, uncertainty still remains
around this disease. The continued
presence of COVID–19 variants
including the quickly emerging
Omicron BA.4 and BA.5 subvariants,
dissimilar vaccination rates throughout
the United States, and the current
medium to high COVID–19 community
levels in many states indicate that
COVID–19 remains an active and real
public health concern.7 Due to the
uncertainty and the lack of a clear
timeframe for a sustained and
5 See Securities Exchange Act Release No. 95281
(July 14, 2022), 87 FR 43335 (July 20, 2022) (Notice
of Filing and Immediate Effectiveness of File No.
SR–FINRA–2022–018) (‘‘FINRA Filing’’). The
Exchange notes that the FINRA Filing also proposed
to temporarily amend FINRA Rules 9261, 9524, and
9830, which govern hearings in connection with
appeals of disciplinary actions, eligibility
proceedings, and temporary and permanent cease
and desist orders. The Exchange’s Rules 9261, 9524,
and 9830 incorporate by reference The Nasdaq
Stock Market LLC rules, which are the subject of a
separate filing. See SR–NASDAQ–2022–044.
Therefore, the Exchange is not proposing to adopt
that aspect of the FINRA Filing.
6 See Securities Exchange Act Release No. 94611
(April 5, 2022), 87 FR 21230 (April 11, 2022)
(Notice of Filing and Immediate Effectiveness of
File No. SR–Phlx–2022–15); see also Securities
Exchange Act Release No. 93853 (December 22,
2021), 86 FR 74164 (December 29, 2021) (Notice of
Filing and Immediate Effectiveness of File No. SR–
Phlx–2021–75); Securities Exchange Act Release
No. 92906 (September 9, 2021), 86 FR 51404
(September 15, 2021) (Notice of Filing and
Immediate Effectiveness of File No. SR–Phlx–2021–
49); Securities Exchange Act Release No. 91766
(May 4, 2021), 86 FR 25014 (May 10, 2021) (Notice
of Filing and Immediate Effectiveness of File No.
SR–Phlx–2021–27); Securities Exchange Act
Release No. 90758 (December 21, 2020), 85 FR
85782 (December 29, 2020) (Notice of Filing and
Immediate Effectiveness of File No. SR–Phlx–2020–
053).
7 For example, there has been a notable upward
trend in the number of daily COVID–19 cases in the
United States since April 1, 2022. See https://
covid.cdc.gov/covid-data-tracker/#trends_
dailycases. In addition, on June 9, 2022, the Biden
Administration announced its operational plan for
COVID–19 vaccinations for children under the age
of five. See https://www.whitehouse.gov/briefingroom/statements-releases/2022/06/09/factsheetbiden-administration-announces-operationalplan-for-covid-19-vaccinations-for-children-under5/.
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widespread abatement of COVID–19related health concerns and
corresponding restrictions,8 the
Exchange believes that there is a
continued need for temporary relief
beyond July 31, 2022. Accordingly, the
Exchange proposes to extend the
expiration date of the temporary rule
amendments in SR–Phlx–2020–53 from
July 31, 2022, to October 31, 2022.
As set forth in SR–Phlx–2020–53, the
Exchange also relies on COVID–19 data
and criteria to determine whether the
current public health risks presented by
an in-person hearing may warrant a
hearing by video conference. Based on
that data and criteria, the Exchange does
not believe the COVID–19-related health
concerns necessitating this relief will
meaningfully subside by July 31, 2022,
and believes that there will be a
continued need for this temporary relief
beyond that date. Accordingly, the
Exchange proposes to extend the
expiration date of the temporary rule
amendments originally set forth in SR–
Phlx–2020–53 from July 31, 2022, to
October 31, 2022. The extension of the
temporary amendments allowing for
specified ERC hearings to proceed by
video conference will allow the
Exchange’s critical adjudicatory
functions to continue to operate
effectively in these extraordinary
circumstances—enabling the Exchange
to fulfill its statutory obligations to
protect investors and maintain fair and
orderly markets—while also protecting
the health and safety of hearing
participants.
The Exchange has filed the proposed
rule change for immediate effectiveness
and has requested that the SEC waive
the requirement that the proposed rule
change not become operative for 30 days
after the date of the filing, so the
Exchange can implement the proposed
rule change immediately.
2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act,9 in general, and furthers the
8 For instance, the Centers for Disease Control
(‘‘CDC’’) recommends that people wear a mask in
public indoor settings in areas with a high COVID–
19 community level regardless of vaccination status
or individual risk. See https://www.cdc.gov/
coronavirus/2019-ncov/prevent-getting-sick/aboutface-coverings.html. The CDC also recommends that
people wear a mask in indoor areas of public
transportation and transportation hubs to protect
themselves and those around them and help keep
travel and public transportation safer for everyone.
See https://www.cdc.gov/coronavirus/2019-ncov/
travelers/masks-public-transportation.html.
Furthermore, numerous states currently have mask
mandates in certain settings, such as healthcare and
correctional facilities.
9 15 U.S.C. 78f(b).
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objectives of Section 6(b)(5) of the Act,10
in particular, 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, in general to protect
investors and the public interest, by
providing greater harmonization
between the Exchange rules and FINRA
rules of similar purpose,11 resulting in
less burdensome and more efficient
regulatory compliance.
The proposed rule change, which
extends the expiration date of the
temporary amendments to the Exchange
rules set forth in SR–Phlx–2020–53, will
continue to aid the Exchange’s efforts to
timely conduct hearings in connection
with its core adjudicatory functions.
Given the current and frequently
changing COVID–19 conditions and the
uncertainty around when those
conditions will see meaningful,
widespread and sustained
improvement, without this relief
allowing ERC hearings to proceed by
video conference, the Exchange might
be required to postpone some or almost
all hearings indefinitely. The Exchange
must be able to perform its critical
adjudicatory functions to fulfill its
statutory obligations to protect investors
and maintain fair and orderly markets.
As such, this relief is essential to the
Exchange’s ability to fulfill its statutory
obligations and allows hearing
participants to avoid the serious
COVID–19-related health and safety
risks associated with in-person hearings.
Among other things, this relief will
allow the ERC to timely provide
members, disqualified individuals and
other applicants an approval or denial
of their applications. As set forth in
detail in SR–Phlx–2020–53, this
temporary relief allowing ERC hearings
to proceed by video conference accounts
for fair process considerations and will
continue to provide fair process while
avoiding the COVID–19-related public
health risks for hearing participants.
Accordingly, the proposed rule change
extending this temporary relief is in the
public interest and consistent with the
Act’s purpose.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the temporary proposed rule change
will impose any burden on competition
not necessary or appropriate in
furtherance of the purposes of the Act.
As set forth in SR–Phlx–2020–53, the
proposed rule change is intended solely
10 15
U.S.C. 78f(b)(5).
supra note 5.
11 See
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Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices
to extend temporary relief necessitated
by the continued impacts of the COVID–
19 outbreak and the related health and
safety risks of conducting in-person
activities. The Exchange believes that
the proposed rule change will prevent
unnecessary impediments to its
operations, including its critical
adjudicatory processes, and its ability to
fulfill its statutory obligations to protect
investors and maintain fair and orderly
markets that would otherwise result if
the temporary amendments were to
expire on July 31, 2022.
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)(iii) of the Act 12 and
subparagraph (f)(6) of Rule 19b–4
thereunder.13
A proposed rule change filed under
Rule 19b–4(f)(6) 14 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b–4(f)(6)(iii),15 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 Exchange has indicated that
there is a continued need to extend the
temporary relief because the Exchange
does not believe the COVID–19 related
health concerns necessitating this relief
will meaningfully subside by July 31,
2022.16 Importantly, extending the
temporary relief provided in SR–Phlx–
2020–53 immediately upon filing and
12 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6). In addition, Rule 19b–
4(f)(6) requires a self-regulatory organization to give
the Commission written notice of its intent to file
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.
14 17 CFR 240.19b–4(f)(6).
15 17 CFR 240.19b–4(f)(6)(iii).
16 See supra Item II.
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13 17
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without a 30-day operative delay will
allow the Exchange to continue critical
adjudicatory and review processes in a
reasonable and fair manner and meet its
critical investor protection goals, while
also following best practices with
respect to the health and safety of
hearing participants.17 The Commission
also notes that this proposal extends
without change the temporary relief
previously provided by SR–Phlx–2020–
53.18 As proposed, the temporary
changes would be in place through
October 31, 2022 and the amended rules
will revert back to their original state at
the conclusion of the temporary relief
period and, if applicable, any extension
thereof.19 For these reasons, the
Commission believes that waiver of the
30-day operative delay for this proposal
is consistent with the protection of
investors and the public interest.
Accordingly, the Commission hereby
waives the 30-day operative delay and
designates the proposal operative upon
filing.20
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:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
17 See FINRA Filing, at 43337–38 (noting the
same in granting FINRA’s request to waive the 30day operative delay so that SR–FINRA–2022–018
would become operative immediately upon filing).
18 See supra note 6.
19 See supra note 4. As noted above, the Exchange
states that if it requires temporary relief from the
rule requirements identified in this proposal
beyond October 31, 2022, it may submit a separate
rule filing to extend the effectiveness of the
temporary relief under these rules.
20 For purposes only of waiving the 30-day
operative delay, the Commission has considered the
proposed rule change’s impact on efficiency,
competition, and capital formation. See 15 U.S.C.
78c(f).
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49637
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
Phlx–2022–32 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–Phlx–2022–32. 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–Phlx–2022–32 and should
be submitted on or before September 1,
2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.21
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–17222 Filed 8–10–22; 8:45 am]
BILLING CODE 8011–01–P
SMALL BUSINESS ADMINISTRATION
Meeting of the Interagency Task Force
on Veterans Small Business
Development
AGENCY:
Small Business Administration
(SBA).
21 17
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CFR 200.30–3(a)(12).
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]]>Agencies
[Federal Register Volume 87, Number 154 (Thursday, August 11, 2022)]
[Notices]
[Pages 49635-49637]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17222]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-95435; File No. SR-Phlx-2022-32]
Self-Regulatory Organizations; Nasdaq PHLX LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Extend the
Expiration Date of the Temporary Amendments Concerning Video Conference
Hearings
August 5, 2022.
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 July 26, 2022, Nasdaq PHLX LLC (``Phlx'' 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 Exchange has designated the
proposed rule change as constituting a ``non-controversial'' rule
change under paragraph (f)(6) of Rule 19b-4 under the Act,\3\ which
renders the proposal effective upon receipt of this filing by the
Commission. 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.
\3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to extend the expiration date of the
temporary amendments in SR-Phlx-2020-53 from July 31, 2022, to October
31, 2022.\4\ The proposed rule change would not make any changes to the
text of the Exchange rules.
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\4\ If the Exchange seeks to provide additional temporary relief
from the rule requirements identified in this proposed rule change
beyond October 31, 2022, the Exchange will submit a separate rule
filing to further extend the temporary extension of time. The
amended Exchange rules will revert to their original form at the
conclusion of the temporary relief period and any extension thereof.
---------------------------------------------------------------------------
The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/phlx/rules, 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
The Exchange proposes to continue to harmonize Exchange Rule
General 3, Section 16 with recent changes by the Financial Industry
Regulatory Authority, Inc. (``FINRA'') to its Rule 1015 in response to
the COVID-19 global health crisis and the corresponding need to
restrict in-person
[[Page 49636]]
activities.\5\ The Exchange originally filed proposed rule change SR-
Phlx-2020-53, which allows the Exchange Review Council (``ERC'') to
conduct hearings in connection with appeals of Membership Application
Program decisions, on a temporary basis, by video conference, if
warranted by the current COVID-19-related public health risks posed by
an in-person hearing. In March 2022, the Exchange filed a proposed rule
change, SR-Phlx-2022-15, to extend the expiration date of the temporary
amendments in SR-Phlx-2020-53 from March 31, 2022, to July 31, 2022.\6\
Even though it has been more than two years since the World Health
Organization declared COVID-19 a pandemic, uncertainty still remains
around this disease. The continued presence of COVID-19 variants
including the quickly emerging Omicron BA.4 and BA.5 subvariants,
dissimilar vaccination rates throughout the United States, and the
current medium to high COVID-19 community levels in many states
indicate that COVID-19 remains an active and real public health
concern.\7\ Due to the uncertainty and the lack of a clear timeframe
for a sustained and widespread abatement of COVID-19-related health
concerns and corresponding restrictions,\8\ the Exchange believes that
there is a continued need for temporary relief beyond July 31, 2022.
Accordingly, the Exchange proposes to extend the expiration date of the
temporary rule amendments in SR-Phlx-2020-53 from July 31, 2022, to
October 31, 2022.
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\5\ See Securities Exchange Act Release No. 95281 (July 14,
2022), 87 FR 43335 (July 20, 2022) (Notice of Filing and Immediate
Effectiveness of File No. SR-FINRA-2022-018) (``FINRA Filing''). The
Exchange notes that the FINRA Filing also proposed to temporarily
amend FINRA Rules 9261, 9524, and 9830, which govern hearings in
connection with appeals of disciplinary actions, eligibility
proceedings, and temporary and permanent cease and desist orders.
The Exchange's Rules 9261, 9524, and 9830 incorporate by reference
The Nasdaq Stock Market LLC rules, which are the subject of a
separate filing. See SR-NASDAQ-2022-044. Therefore, the Exchange is
not proposing to adopt that aspect of the FINRA Filing.
\6\ See Securities Exchange Act Release No. 94611 (April 5,
2022), 87 FR 21230 (April 11, 2022) (Notice of Filing and Immediate
Effectiveness of File No. SR-Phlx-2022-15); see also Securities
Exchange Act Release No. 93853 (December 22, 2021), 86 FR 74164
(December 29, 2021) (Notice of Filing and Immediate Effectiveness of
File No. SR-Phlx-2021-75); Securities Exchange Act Release No. 92906
(September 9, 2021), 86 FR 51404 (September 15, 2021) (Notice of
Filing and Immediate Effectiveness of File No. SR-Phlx-2021-49);
Securities Exchange Act Release No. 91766 (May 4, 2021), 86 FR 25014
(May 10, 2021) (Notice of Filing and Immediate Effectiveness of File
No. SR-Phlx-2021-27); Securities Exchange Act Release No. 90758
(December 21, 2020), 85 FR 85782 (December 29, 2020) (Notice of
Filing and Immediate Effectiveness of File No. SR-Phlx-2020-053).
\7\ For example, there has been a notable upward trend in the
number of daily COVID-19 cases in the United States since April 1,
2022. See https://covid.cdc.gov/covid-data-tracker/#trends_dailycases. In addition, on June 9, 2022, the Biden
Administration announced its operational plan for COVID-19
vaccinations for children under the age of five. See https://www.whitehouse.gov/briefing-room/statements-releases/2022/06/09/fact-sheetbiden-administration-announces-operational-plan-for-covid-19-vaccinations-for-children-under-5/.
\8\ For instance, the Centers for Disease Control (``CDC'')
recommends that people wear a mask in public indoor settings in
areas with a high COVID-19 community level regardless of vaccination
status or individual risk. See https://www.cdc.gov/coronavirus/2019-ncov/prevent-getting-sick/about-face-coverings.html. The CDC also
recommends that people wear a mask in indoor areas of public
transportation and transportation hubs to protect themselves and
those around them and help keep travel and public transportation
safer for everyone. See https://www.cdc.gov/coronavirus/2019-ncov/travelers/masks-public-transportation.html. Furthermore, numerous
states currently have mask mandates in certain settings, such as
healthcare and correctional facilities.
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As set forth in SR-Phlx-2020-53, the Exchange also relies on COVID-
19 data and criteria to determine whether the current public health
risks presented by an in-person hearing may warrant a hearing by video
conference. Based on that data and criteria, the Exchange does not
believe the COVID-19-related health concerns necessitating this relief
will meaningfully subside by July 31, 2022, and believes that there
will be a continued need for this temporary relief beyond that date.
Accordingly, the Exchange proposes to extend the expiration date of the
temporary rule amendments originally set forth in SR-Phlx-2020-53 from
July 31, 2022, to October 31, 2022. The extension of the temporary
amendments allowing for specified ERC hearings to proceed by video
conference will allow the Exchange's critical adjudicatory functions to
continue to operate effectively in these extraordinary circumstances--
enabling the Exchange to fulfill its statutory obligations to protect
investors and maintain fair and orderly markets--while also protecting
the health and safety of hearing participants.
The Exchange has filed the proposed rule change for immediate
effectiveness and has requested that the SEC waive the requirement that
the proposed rule change not become operative for 30 days after the
date of the filing, so the Exchange can implement the proposed rule
change immediately.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\9\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\10\ in particular, 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, in general to protect investors and the public
interest, by providing greater harmonization between the Exchange rules
and FINRA rules of similar purpose,\11\ resulting in less burdensome
and more efficient regulatory compliance.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
\11\ See supra note 5.
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The proposed rule change, which extends the expiration date of the
temporary amendments to the Exchange rules set forth in SR-Phlx-2020-
53, will continue to aid the Exchange's efforts to timely conduct
hearings in connection with its core adjudicatory functions. Given the
current and frequently changing COVID-19 conditions and the uncertainty
around when those conditions will see meaningful, widespread and
sustained improvement, without this relief allowing ERC hearings to
proceed by video conference, the Exchange might be required to postpone
some or almost all hearings indefinitely. The Exchange must be able to
perform its critical adjudicatory functions to fulfill its statutory
obligations to protect investors and maintain fair and orderly markets.
As such, this relief is essential to the Exchange's ability to fulfill
its statutory obligations and allows hearing participants to avoid the
serious COVID-19-related health and safety risks associated with in-
person hearings.
Among other things, this relief will allow the ERC to timely
provide members, disqualified individuals and other applicants an
approval or denial of their applications. As set forth in detail in SR-
Phlx-2020-53, this temporary relief allowing ERC hearings to proceed by
video conference accounts for fair process considerations and will
continue to provide fair process while avoiding the COVID-19-related
public health risks for hearing participants. Accordingly, the proposed
rule change extending this temporary relief is in the public interest
and consistent with the Act's purpose.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the temporary proposed rule
change will impose any burden on competition not necessary or
appropriate in furtherance of the purposes of the Act. As set forth in
SR-Phlx-2020-53, the proposed rule change is intended solely
[[Page 49637]]
to extend temporary relief necessitated by the continued impacts of the
COVID-19 outbreak and the related health and safety risks of conducting
in-person activities. The Exchange believes that the proposed rule
change will prevent unnecessary impediments to its operations,
including its critical adjudicatory processes, and its ability to
fulfill its statutory obligations to protect investors and maintain
fair and orderly markets that would otherwise result if the temporary
amendments were to expire on July 31, 2022.
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)(iii) of the Act \12\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\13\
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\12\ 15 U.S.C. 78s(b)(3)(A)(iii).
\13\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file 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.
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A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\ 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 Exchange has
indicated that there is a continued need to extend the temporary relief
because the Exchange does not believe the COVID-19 related health
concerns necessitating this relief will meaningfully subside by July
31, 2022.\16\ Importantly, extending the temporary relief provided in
SR-Phlx-2020-53 immediately upon filing and without a 30-day operative
delay will allow the Exchange to continue critical adjudicatory and
review processes in a reasonable and fair manner and meet its critical
investor protection goals, while also following best practices with
respect to the health and safety of hearing participants.\17\ The
Commission also notes that this proposal extends without change the
temporary relief previously provided by SR-Phlx-2020-53.\18\ As
proposed, the temporary changes would be in place through October 31,
2022 and the amended rules will revert back to their original state at
the conclusion of the temporary relief period and, if applicable, any
extension thereof.\19\ For these reasons, the Commission believes that
waiver of the 30-day operative delay for this proposal is consistent
with the protection of investors and the public interest. Accordingly,
the Commission hereby waives the 30-day operative delay and designates
the proposal operative upon filing.\20\
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\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6)(iii).
\16\ See supra Item II.
\17\ See FINRA Filing, at 43337-38 (noting the same in granting
FINRA's request to waive the 30-day operative delay so that SR-
FINRA-2022-018 would become operative immediately upon filing).
\18\ See supra note 6.
\19\ See supra note 4. As noted above, the Exchange states that
if it requires temporary relief from the rule requirements
identified in this proposal beyond October 31, 2022, it may submit a
separate rule filing to extend the effectiveness of the temporary
relief under these rules.
\20\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule change's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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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:
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-Phlx-2022-32 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-Phlx-2022-32. 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-Phlx-2022-32 and should be submitted on
or before September 1, 2022.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\21\
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\21\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-17222 Filed 8-10-22; 8:45 am]
BILLING CODE 8011-01-P
