Self-Regulatory Organizations; NYSE National, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Extending the Expiration Date of the Temporary Amendments to Rules 10.9261 and 10.9830, 50668-50672 [2022-17666]
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50668
Federal Register / Vol. 87, No. 158 / Wednesday, August 17, 2022 / Notices
prior to 30 days from the date on which
it was filed, or such shorter time as the
Commission may designate, if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)(iii)
thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) 35 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b4(f)(6)(iii),36 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 agrees with
FINRA that the COVID–19 related
health concerns necessitating this relief
will not meaningfully subside by July
31, 2022.37 The Exchange also states
that extending the temporary relief
provided in SR–NYSEAMER–2020–69
immediately upon filing and without a
30-day operative delay will allow the
Exchange to continue critical
adjudicatory and review processes so
that the Exchange may continue to
operate effectively and meet its critical
investor protection goals, while also
protecting the health and safety of
hearing participants.38 The Commission
also notes that this proposal extends
without change the temporary relief
previously provided by SR–
NYSEAMER–2020–69.39 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.40 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
35 17
CFR 240.19b–4(f)(6).
CFR 240.19b–4(f)(6)(iii).
37 See supra Item II; see also SR–FINRA–2022–
018, 87 FR 43335, at 43336.
38 See 87 FR 43335, 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).
39 See supra note 4.
40 See supra note 5. 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.
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36 17
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operative delay and designates the
proposal operative upon filing.41
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) 42 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:
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–
NYSEAMER–2022–34 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–NYSEAMER–2022–34. 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
41 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).
42 15 U.S.C. 78s(b)(2)(B).
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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–NYSEAMER–2022–34 and
should be submitted on or before
September 7, 2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.43
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022–17664 Filed 8–16–22; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–95476; File No. SR–
NYSENAT–2022–14]
Self-Regulatory Organizations; NYSE
National, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change Extending the Expiration
Date of the Temporary Amendments to
Rules 10.9261 and 10.9830
August 11, 2022.
Pursuant to Section 19(b)(1) 1 of the
Securities Exchange Act of 1934
(‘‘Act’’) 2 and Rule 19b–4 thereunder,3
notice is hereby given that on July 29,
2022, NYSE National Inc. (‘‘NYSE
National’’ or the ‘‘Exchange’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the self-regulatory
organization. The Commission is
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes extending the
expiration date of the temporary
amendments to Rules 10.9261 and
10.9830 as set forth in SR–NYSENAT–
43 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 15 U.S.C. 78a.
3 17 CFR 240.19b–4.
1 15
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Federal Register / Vol. 87, No. 158 / Wednesday, August 17, 2022 / Notices
2020–31 from July 31, 2022, to October
31, 2022, in conformity with recent
changes by the Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’).
The proposed rule change would not
make any changes to the text of NYSE
National Rules 10.9261 and 10.9830.
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
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The Exchange proposes extending the
expiration date of the temporary
amendments as set forth in SR–
NYSENAT–2020–31 4 to Rules 10.9261
(Evidence and Procedure in Hearing)
and 10.9830 (Hearing) from July 31,
2022, to October 31, 2022 to harmonize
with recent changes by FINRA to extend
the expiration date of the temporary
amendments to its Rules 9261 and 9830.
SR–NYSENAT–2020–31 temporarily
granted to the Chief or Deputy Chief
Hearing Officer the authority to order
that hearings be conducted by video
conference if warranted by public health
risks posed by in-person hearings
during the ongoing COVID–19
pandemic. The proposed rule change
would not make any changes to the text
of Exchange Rules 10.9261 and
10.9830.5
4 See Securities Exchange Act Release No. 90137
(October 8, 2020), 85 FR 65087 (October 14, 2020)
(SR–NYSENAT–2020–31) (‘‘SR–NYSENAT–2020–
31’’).
5 The Exchange may submit a separate rule filing
to extend the expiration date of the proposed
extension beyond October 31, 2022 if the Exchange
requires additional temporary relief from the rule
requirements identified in SR–NYSENAT–2020–31.
The amended NYSE National rules will revert back
to their original state at the conclusion of the
temporary relief period and any extension thereof.
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Background
In 2018, NYSE National adopted
disciplinary rules that are, with certain
exceptions, substantially the same as the
disciplinary rules of its affiliate NYSE
American LLC, which are in turn
substantially similar to the FINRA Rule
8000 Series and Rule 9000 Series, and
which set forth rules for conducting
investigations and enforcement actions.6
In adopting disciplinary rules
modeled on FINRA’s rules, NYSE
National adopted the hearing and
evidentiary processes set forth in Rule
10.9261 and in Rule 10.9830 for
hearings in matters involving temporary
and permanent cease and desist orders
under the Rule 10.9800 Series. As
adopted, the text of Rule 10.9261 and
Rule 10.9830 are substantially the same
as the FINRA rules with certain
modifications.7
In response to the COVID–19 global
health crisis and the corresponding
need to restrict in-person activities, on
August 31, 2020, FINRA filed with the
Commission a proposed rule change for
immediate effectiveness, SR–FINRA–
2020–027, which allowed FINRA’s
Office of Hearing Officers (‘‘OHO’’) to
conduct hearings, on a temporary basis,
by video conference, if warranted by the
current COVID–19-related public health
risks posed by an in-person hearing.
Among the rules FINRA amended were
Rules 9261 and 9830.8
Given that that FINRA and OHO
administers disciplinary hearings on the
Exchange’s behalf, and that the public
health concerns addressed by FINRA’s
amendments apply equally to Exchange
disciplinary hearings, on September 29,
2020, the Exchange filed to temporarily
amend Rule 10.9261 and Rule 10.9830
to permit FINRA to conduct virtual
hearings on its behalf.9 In December
2020, FINRA filed a proposed rule
change, SR–FINRA–2020–042, to extend
the expiration date of the temporary
amendments in SR–FINRA–2020–027
from December 31, 2020, to April 30,
2021.10 On December 22, 2020, the
Exchange similarly filed to extend the
temporary amendments to Rule 10.9261
and Rule 10.9830 to April 30, 2021.11
6 See Securities Exchange Act Release No. 83289
(May 17, 2018), 83 FR 23968, 23976 (May 23, 2018)
(SR–NYSENAT–2018–02) (‘‘2018 Approval Order’’).
7 See id.
8 See Securities Exchange Act Release No. 89737
(September 2, 2020), 85 FR 55712 (September 9,
2020) (SR–FINRA–2020–027) (‘‘SR–FINRA–2020–
027’’).
9 See note 3, supra.
10 See Securities Exchange Act Release No. 90619
(December 9, 2020), 85 FR 81250 (December 15,
2020) (SR–FINRA–2020–042).
11 See Securities Exchange Act Release No. 90822
(December 30, 2020), 86 FR 627 (January 6, 2021)
(SR–NYSENAT–2020–39).
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50669
On April 1, 2021, FINRA filed a
proposed rule change, SR–FINRA–
2021–006, to extend the expiration date
of the temporary rule amendments to,
among other rules, FINRA Rule 9261
and 9830 from April 30, 2021, to August
31, 2021.12 On April 20, 2021, the
Exchange filed to extend the temporary
amendments to Rule 10.9261 and Rule
10.9830 to August 31, 2021.13 On
August 13, 2021, FINRA filed a
proposed rule change, SR–FINRA–
2021–019, to extend the expiration date
of the temporary amendments to, among
other rules, FINRA Rule 9261 and 9830
from August 31, 2021, to December 31,
2021.14 On August 27, 2021, the
Exchange filed to extend the temporary
amendments to Rule 10.9261 and Rule
10.9830 to December 31, 2021.15 On
December 7, 2021, FINRA filed a
proposed rule change, SR–FINRA–
2021–031, to extend the expiration date
of the temporary amendments in both
SR–FINRA–2020–015 and SR–FINRA–
2020–027 from December 31, 2021, to
March 31, 2022.16 On December 27,
2021, the Exchange filed to extend the
temporary amendments to Rule 10.9261
and Rule 10.9830 to March 31, 2022,
after which the temporary amendments
will expire absent another proposed rule
change filing by the Exchange.17 On
March 7, 2022, FINRA filed to extend
the expiration date of the temporary rule
amendments to, among other rules,
FINRA Rule 9261 and 9830 from March
31, 2022, to July 31, 2022.18 On March
29, 2022, the Exchange filed to extend
the temporary amendments to Rule 9261
and Rule 9830 to July 31, 2022, after
which the temporary amendments will
expire absent another proposed rule
change filing by the Exchange.19
Even though it has been more than
two years since the World Health
Organization declared COVID–19 a
pandemic, FINRA has determined that
12 See Securities Exchange Act Release No. 91495
(April 7, 2021), 86 FR 19306 (April 13, 2021) (SR–
FINRA–2021–006).
13 See Securities Exchange Act Release No. 91634
(April 22, 2021), 86 FR 22477 (April 28, 2021) (SR–
NYSENAT–2021–11).
14 See Securities Exchange Act Release No. 92685
(August 17, 2021), 86 FR 47169 (August 23, 2021)
(SR–FINRA–2021–019).
15 See Securities Exchange Act Release No. 92908
(September 9, 2021), 86 FR 51424 (September 15,
2021) (SR–NYSENAT–2021–16).
16 See Securities Exchange Act Release No. 93758
(December 13, 2021), 86 FR 71695 (December 17,
2021) (SR–FINRA–2021–31).
17 See Securities Exchange Act Release No. 93919
(January 6, 2022), 87 FR 1804 (January 12, 2022)
(SR–NYSENAT–2021–25).
18 See Securities Exchange Act Release No. 94430
(March 16, 2022), 87 FR 16262 (March 22, 2022)
(SR–FINRA–2022–004).
19 See Securities Exchange Act Release No. 94662
(April 11, 2022), 87 FR 22601 (April 15, 2022) (SR–
NYSENAT–2022–03).
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Federal Register / Vol. 87, No. 158 / Wednesday, August 17, 2022 / Notices
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.20
Due to the uncertainty and the lack of
a clear timeframe for a sustained and
widespread abatement of COVID–19related health concerns and
corresponding restrictions,21 FINRA
believes that there is a continued need
for temporary relief beyond July 31,
2022.22 On July 8, 2022, FINRA
accordingly filed to extend the
expiration date of the temporary rule
amendments to, among other rules,
FINRA Rule 9261 and 9830 from July
31, 2022, to October 31, 2022.23
JSPEARS on DSK121TN23PROD with NOTICES
Proposed Rule Change
Consistent with FINRA’s recent
proposal, the Exchange proposes to
extend the expiration date of the
temporary rule amendments to NYSE
National Rules 10.9261 and 10.9830 as
set forth in SR–NYSENAT–2020–31
from July 31, 2022, to October 31, 2022.
As set forth in SR–FINRA 2022–018,
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
20 See Securities Exchange Act Release No. 95281
(July 14, 2022), 87 FR 43335 (July 20, 2022) (SR–
FINRA–2022–018) (‘‘SR–FINRA–2022–018’’).
FINRA noted that, 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/statementsreleases/2022/06/09/fact-sheetbidenadministration-announces-operational-plan-forcovid-19-vaccinations-for-children-under-5/. See
SR–FINRA–2022–018, 87 FR at 43335, n. 6.
21 For instance, FINRA noted that the Centers for
Disease Control and Prevention (‘‘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. See SR–FINRA–2022–018, 87
FR at 43335, n.7.
22 See SR–FINRA–2022–018, 87 FR 43336.
23 See SR–FINRA–2022–018, 87 FR 43335–36.
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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.24 Due to the
uncertainty and the lack of a clear
timeframe for a sustained and
widespread abatement of COVID–19related health concerns and
corresponding restrictions,25 FINRA
believes that there is a continued need
for temporary relief beyond July 31,
2022.26 FINRA accordingly proposed to
extend the expiration date of the
temporary rule amendments from July
31, 2022, to October 31, 2022.
The Exchange proposes to similarly
extend the expiration date of the
temporary rule amendments to NYSE
National Rules 10.9261 and 10.9830 as
set forth in SR–NYSENAT–2020–31
from July 31, 2022, to October 31, 2022.
The Exchange agrees with FINRA that,
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 Exchange also
agrees that, 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, for the
reasons set forth in SR–FINRA–2022–
018, there is a continued need for this
temporary relief beyond July 31, 2022.
The proposed change would permit
OHO to continue to assess, based on
critical COVID–19 data and criteria and
the guidance of health and security
consultants, whether an in-person
hearing would compromise the health
and safety of the hearing participants
such that the hearing should proceed by
video conference. As noted in SR–
FINRA–2022–018, in deciding whether
to schedule a hearing by video
conference, OHO may consider a variety
of other factors in addition to COVID–
19 trends. Similarly, as noted in SR–
FINRA–2022–018, in SR–FINRA–2020–
027, FINRA provided a non-exhaustive
list of other factors OHO may take into
consideration, including a hearing
participant’s individual health concerns
and access to the connectivity and
technology necessary to participate in a
video conference hearing.27 The
Exchange believes that this is a
reasonable procedure to continue to
24 See
note 20, supra.
note 21, supra.
26 See SR–FINRA–2022–018, 87 FR at 43337.
27 See SR–FINRA–2022–018, 87 FR at 43337, n.
16.
follow for hearings under Rules 10.9261
and 10.9830 chaired by a FINRA
employee.
As noted below, 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 proposed rule change is
consistent with Section 6(b) of the
Act,28 in general, and furthers the
objectives of Section 6(b)(5),29 in
particular, because it is designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade, to foster
cooperation and coordination with
persons engaged in facilitating
transactions in securities, to remove
impediments to, and perfect the
mechanism of, a free and open market
and a national market system and, in
general, to protect investors and the
public interest. Additionally, the
Exchange believes the proposed rule
change is designed to provide a fair
procedure for the disciplining of
members and persons associated with
members, consistent with Sections
6(b)(7) and 6(d) of the Act.30
The Exchange believes that the
proposed rule change supports the
objectives of the Act by providing
greater harmonization between
Exchange rules and FINRA rules of
similar purpose, resulting in less
burdensome and more efficient
regulatory compliance. As such, the
proposed rule change will foster
cooperation and coordination with
persons engaged in facilitating
transactions in securities and will
remove impediments to and perfect the
mechanism of a free and open market
and a national market system.
The proposed rule change, which
extends the expiration date of the
temporary amendments to Exchange
rules consistent with FINRA’s extension
to its Rules 9261 and 9830 as set forth
in SR–FINRA–2022–018, will permit the
Exchange to continue to effectively
conduct hearings during the COVID–19
pandemic. 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
25 See
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28 15
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
30 15 U.S.C. 78f(b)(7) & 78f(d).
29 15
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Federal Register / Vol. 87, No. 158 / Wednesday, August 17, 2022 / Notices
JSPEARS on DSK121TN23PROD with NOTICES
allowing OHO to proceed by video
conference, some or all hearings may
have to be postponed. The ability to
conduct hearings by video conference
will permit the adjudicatory functions
of the Exchange’s disciplinary rules to
continue unabated, thereby avoiding
protracted delays. The Exchange
believes that this is especially important
in matters where temporary and
permanent cease and desist orders are
sought because the proposed rule
change would enable those hearings to
continue to proceed without delay,
thereby enabling the Exchange to
continue to take immediate action to
stop significant, ongoing customer
harm, to the benefit of the investing
public.
As set forth in detail in SR–
NYSENAT–2020–31, the temporary
relief to permit hearings to be conducted
via video conference maintains fair
process and will continue to provide
fair process consistent with Sections
6(b)(7) and 6(d) of the Act 31 while
striking an appropriate balance between
providing fair process and enabling the
Exchange to fulfill its statutory
obligations to protect investors and
maintain fair and orderly markets while
avoiding the COVID–19-related public
health risks for hearing participants.
The Exchange notes that this proposal,
like SR–NYSENAT–2020–31, provides
only temporary relief. As proposed, the
changes would be in place through
October 31, 2022. As noted in SR–
NYSENAT–2020–31 and above, the
amended rules will revert back to their
original state at the conclusion of the
temporary relief period and, if
applicable, any extension thereof.
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 proposed temporary rule change
will impose any burden on competition
that is not necessary or appropriate in
furtherance of the purposes of the Act.
The proposed rule change is not
intended to address competitive issues
but is rather intended solely to extend
temporary relief necessitated by the
continued impacts of the COVID–19
pandemic 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 critical
adjudicatory processes and its ability to
fulfill its statutory obligations to protect
31 15
U.S.C. 78f(b)(7) & 78f(d).
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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 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 Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 32 and Rule
19b–4(f)(6) thereunder.33 Because the
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
prior to 30 days from the date on which
it was filed, or such shorter time as the
Commission may designate, if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)(iii)
thereunder.
A proposed rule change filed under
Rule 19b–4(f)(6) 34 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b4(f)(6)(iii),35 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 agrees with
FINRA that the COVID–19 related
health concerns necessitating this relief
will not meaningfully subside by July
31, 2022.36 The Exchange also states
that extending the temporary relief
provided in SR–NYSENAT–2020–31
immediately upon filing and without a
30-day operative delay will allow the
Exchange to continue critical
adjudicatory and review processes so
that the Exchange may continue to
operate effectively and meet its critical
investor protection goals, while also
protecting the health and safety of
32 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
34 17 CFR 240.19b–4(f)(6).
35 17 CFR 240.19b–4(f)(6)(iii).
36 See supra Item II; see also SR–FINRA–2022–
018, 87 FR 43335, at 43336.
33 17
PO 00000
Frm 00073
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50671
hearing participants.37 The Commission
also notes that this proposal extends
without change the temporary relief
previously provided by SR–NYSENAT–
2020–31.38 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.39 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.40
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) 41 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:
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–
NYSENAT–2022–14 on the subject line.
37 See 87 FR 43335, 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).
38 See supra note 4.
39 See supra note 5. 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.
40 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).
41 15 U.S.C. 78s(b)(2)(B).
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Federal Register / Vol. 87, No. 158 / Wednesday, August 17, 2022 / Notices
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–NYSENAT–2022–14. 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–NYSENAT–2022–14 and
should be submitted on or before
September 7, 2022.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.42
J. Matthew DeLesDernier,
Deputy Secretary.
SECURITIES AND EXCHANGE
COMMISSION
contracts would not require any changes
to ICC’s Risk Management Framework.7
[Release No. 34–95472; File No. SR–ICC–
2022–007]
III. Discussion and Commission
Findings
Section 19(b)(2)(C) of the Act directs
the Commission to approve a proposed
rule change of a self-regulatory
organization if it finds that such
proposed rule change is consistent with
the requirements of the Act and the
rules and regulations thereunder
applicable to such organization.8
Section 17A(b)(3)(F) of the Act requires,
among other things, that the rules of ICC
be designed to promote the prompt and
accurate clearance and settlement of
securities transactions and, to the extent
applicable, derivative agreements,
contracts, and transactions, as well as to
assure the safeguarding of securities and
funds which are in the custody or
control of ICC or for which it is
responsible.9
The Commission finds that the
proposed rule change is consistent with
Section 17A(b)(3)(F) of the Act.10 The
Commission has reviewed the terms and
conditions of the additional EM
Contracts proposed for clearing and has
determined that those terms and
conditions are substantially similar to
the terms and conditions of the other
contracts listed in Subchapter 26D of
the ICC Rules, all of which ICC
currently clears, with the key difference
being that the underlying reference
obligations will be issuances by the
Arab Republic of Egypt, Kingdom of
Bahrain, and Sultanate of Oman.
Moreover, after reviewing the Notice
and ICC’s Rules, policies and
procedures, the Commission finds that
ICC would clear the additional EM
Contracts pursuant to its existing
clearing arrangements and related
financial safeguards, protections and
risk management procedures.
In addition, based on its own
experience and expertise, including a
review of data on volume, open interest,
and the number of ICC Clearing
Participants (‘‘CPs’’) that currently trade
in the additional EM Contracts as well
as certain model parameters for the
additional EM Contracts, the
Commission finds that ICC’s rules,
policies, and procedures are reasonably
designed to price and measure the
potential risk presented by the
additional EM Contracts, collect
financial resources in proportion to
such risk, and liquidate this product in
the event of a CP default. This should
Self-Regulatory Organizations; ICE
Clear Credit LLC; Order Approving
Proposed Rule Change Relating to the
Clearance of Additional Credit Default
Swap Contracts
August 11, 2022.
I. Introduction
On June 16, 2022, ICE Clear Credit
LLC (‘‘ICC’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’), pursuant to Section
19(b)(1) of the Securities Exchange Act
of 1934 (the ‘‘Act’’),1 and Rule 19b–4
thereunder,2 a proposed rule change to
revise the ICC Rulebook (the ‘‘Rules’’) 3
to provide for the clearance of
additional Standard Emerging Market
Sovereign 4 CDS contracts (collectively,
the ‘‘EM Contracts’’). The proposed rule
change was published for comment in
the Federal Register on June 22, 2022.5
The Commission did not receive
comments regarding the proposed rule
change. For the reasons discussed
below, the Commission is approving the
proposed rule change.
II. Description of the Proposed Rule
Change
The proposed rule change would
amend Subchapter 26D of the Rules to
provide for the clearance of the
following EM Contracts: the Arab
Republic of Egypt, Kingdom of Bahrain,
and Sultanate of Oman.6 The proposed
rule change would do so by amending
the term ‘‘Eligible SES Reference
Entities’’ in Rule 26D–102 (Definitions)
to include the Arab Republic of Egypt,
Kingdom of Bahrain, and Sultanate of
Oman in the list of specific Eligible SES
Reference Entities to be cleared by ICC.
ICC represents that these additional EM
Contracts have terms consistent with the
other EM Contracts approved for
clearing at ICC and governed by
Subchapter 26D of the Rules, and that
clearance of these additional EM
[FR Doc. 2022–17666 Filed 8–16–22; 8:45 am]
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 Capitalized terms used but not defined herein
have the meanings specified in the Rules.
4 The term ‘‘Standard Emerging Market
Sovereign’’ is abbreviated in the Rules as ‘‘SES,’’ as
used below.
5 Self-Regulatory Organizations; ICE Clear Credit
LLC; Notice of Filing of Proposed Rule Change
Relating to the Clearance of Additional Credit
Default Swap Contracts; Exchange Act Release No.
95139 (June 22, 2022); 87 FR 38435 (June 28, 2022)
(File No. SR–ICC–2022–007) (‘‘Notice’’).
6 The description that follows is excerpted from
the Notice, 87 FR at 38435.
JSPEARS on DSK121TN23PROD with NOTICES
BILLING CODE 8011–01–P
42 17
2 17
CFR 200.30–3(a)(12).
VerDate Sep<11>2014
17:22 Aug 16, 2022
Jkt 256001
PO 00000
Frm 00074
Fmt 4703
Sfmt 4703
7 See
Notice, 87 FR at 38435.
U.S.C. 78s(b)(2)(C).
9 15 U.S.C. 78q–1(b)(3)(F).
10 15 U.S.C. 78q–1(b)(3)(F).
8 15
E:\FR\FM\17AUN1.SGM
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]]>Agencies
[Federal Register Volume 87, Number 158 (Wednesday, August 17, 2022)]
[Notices]
[Pages 50668-50672]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17666]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-95476; File No. SR-NYSENAT-2022-14]
Self-Regulatory Organizations; NYSE National, Inc.; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change Extending
the Expiration Date of the Temporary Amendments to Rules 10.9261 and
10.9830
August 11, 2022.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that on July 29, 2022, NYSE National Inc. (``NYSE National'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I and II
below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\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 extending the expiration date of the
temporary amendments to Rules 10.9261 and 10.9830 as set forth in SR-
NYSENAT-
[[Page 50669]]
2020-31 from July 31, 2022, to October 31, 2022, in conformity with
recent changes by the Financial Industry Regulatory Authority, Inc.
(``FINRA''). The proposed rule change would not make any changes to the
text of NYSE National Rules 10.9261 and 10.9830. 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
The Exchange proposes extending the expiration date of the
temporary amendments as set forth in SR-NYSENAT-2020-31 \4\ to Rules
10.9261 (Evidence and Procedure in Hearing) and 10.9830 (Hearing) from
July 31, 2022, to October 31, 2022 to harmonize with recent changes by
FINRA to extend the expiration date of the temporary amendments to its
Rules 9261 and 9830. SR-NYSENAT-2020-31 temporarily granted to the
Chief or Deputy Chief Hearing Officer the authority to order that
hearings be conducted by video conference if warranted by public health
risks posed by in-person hearings during the ongoing COVID-19 pandemic.
The proposed rule change would not make any changes to the text of
Exchange Rules 10.9261 and 10.9830.\5\
---------------------------------------------------------------------------
\4\ See Securities Exchange Act Release No. 90137 (October 8,
2020), 85 FR 65087 (October 14, 2020) (SR-NYSENAT-2020-31) (``SR-
NYSENAT-2020-31'').
\5\ The Exchange may submit a separate rule filing to extend the
expiration date of the proposed extension beyond October 31, 2022 if
the Exchange requires additional temporary relief from the rule
requirements identified in SR-NYSENAT-2020-31. The amended NYSE
National rules will revert back to their original state at the
conclusion of the temporary relief period and any extension thereof.
---------------------------------------------------------------------------
Background
In 2018, NYSE National adopted disciplinary rules that are, with
certain exceptions, substantially the same as the disciplinary rules of
its affiliate NYSE American LLC, which are in turn substantially
similar to the FINRA Rule 8000 Series and Rule 9000 Series, and which
set forth rules for conducting investigations and enforcement
actions.\6\
---------------------------------------------------------------------------
\6\ See Securities Exchange Act Release No. 83289 (May 17,
2018), 83 FR 23968, 23976 (May 23, 2018) (SR-NYSENAT-2018-02)
(``2018 Approval Order'').
---------------------------------------------------------------------------
In adopting disciplinary rules modeled on FINRA's rules, NYSE
National adopted the hearing and evidentiary processes set forth in
Rule 10.9261 and in Rule 10.9830 for hearings in matters involving
temporary and permanent cease and desist orders under the Rule 10.9800
Series. As adopted, the text of Rule 10.9261 and Rule 10.9830 are
substantially the same as the FINRA rules with certain
modifications.\7\
---------------------------------------------------------------------------
\7\ See id.
---------------------------------------------------------------------------
In response to the COVID-19 global health crisis and the
corresponding need to restrict in-person activities, on August 31,
2020, FINRA filed with the Commission a proposed rule change for
immediate effectiveness, SR-FINRA-2020-027, which allowed FINRA's
Office of Hearing Officers (``OHO'') to conduct hearings, on a
temporary basis, by video conference, if warranted by the current
COVID-19-related public health risks posed by an in-person hearing.
Among the rules FINRA amended were Rules 9261 and 9830.\8\
---------------------------------------------------------------------------
\8\ See Securities Exchange Act Release No. 89737 (September 2,
2020), 85 FR 55712 (September 9, 2020) (SR-FINRA-2020-027) (``SR-
FINRA-2020-027'').
---------------------------------------------------------------------------
Given that that FINRA and OHO administers disciplinary hearings on
the Exchange's behalf, and that the public health concerns addressed by
FINRA's amendments apply equally to Exchange disciplinary hearings, on
September 29, 2020, the Exchange filed to temporarily amend Rule
10.9261 and Rule 10.9830 to permit FINRA to conduct virtual hearings on
its behalf.\9\ In December 2020, FINRA filed a proposed rule change,
SR-FINRA-2020-042, to extend the expiration date of the temporary
amendments in SR-FINRA-2020-027 from December 31, 2020, to April 30,
2021.\10\ On December 22, 2020, the Exchange similarly filed to extend
the temporary amendments to Rule 10.9261 and Rule 10.9830 to April 30,
2021.\11\ On April 1, 2021, FINRA filed a proposed rule change, SR-
FINRA-2021-006, to extend the expiration date of the temporary rule
amendments to, among other rules, FINRA Rule 9261 and 9830 from April
30, 2021, to August 31, 2021.\12\ On April 20, 2021, the Exchange filed
to extend the temporary amendments to Rule 10.9261 and Rule 10.9830 to
August 31, 2021.\13\ On August 13, 2021, FINRA filed a proposed rule
change, SR-FINRA-2021-019, to extend the expiration date of the
temporary amendments to, among other rules, FINRA Rule 9261 and 9830
from August 31, 2021, to December 31, 2021.\14\ On August 27, 2021, the
Exchange filed to extend the temporary amendments to Rule 10.9261 and
Rule 10.9830 to December 31, 2021.\15\ On December 7, 2021, FINRA filed
a proposed rule change, SR-FINRA-2021-031, to extend the expiration
date of the temporary amendments in both SR-FINRA-2020-015 and SR-
FINRA-2020-027 from December 31, 2021, to March 31, 2022.\16\ On
December 27, 2021, the Exchange filed to extend the temporary
amendments to Rule 10.9261 and Rule 10.9830 to March 31, 2022, after
which the temporary amendments will expire absent another proposed rule
change filing by the Exchange.\17\ On March 7, 2022, FINRA filed to
extend the expiration date of the temporary rule amendments to, among
other rules, FINRA Rule 9261 and 9830 from March 31, 2022, to July 31,
2022.\18\ On March 29, 2022, the Exchange filed to extend the temporary
amendments to Rule 9261 and Rule 9830 to July 31, 2022, after which the
temporary amendments will expire absent another proposed rule change
filing by the Exchange.\19\
---------------------------------------------------------------------------
\9\ See note 3, supra.
\10\ See Securities Exchange Act Release No. 90619 (December 9,
2020), 85 FR 81250 (December 15, 2020) (SR-FINRA-2020-042).
\11\ See Securities Exchange Act Release No. 90822 (December 30,
2020), 86 FR 627 (January 6, 2021) (SR-NYSENAT-2020-39).
\12\ See Securities Exchange Act Release No. 91495 (April 7,
2021), 86 FR 19306 (April 13, 2021) (SR-FINRA-2021-006).
\13\ See Securities Exchange Act Release No. 91634 (April 22,
2021), 86 FR 22477 (April 28, 2021) (SR-NYSENAT-2021-11).
\14\ See Securities Exchange Act Release No. 92685 (August 17,
2021), 86 FR 47169 (August 23, 2021) (SR-FINRA-2021-019).
\15\ See Securities Exchange Act Release No. 92908 (September 9,
2021), 86 FR 51424 (September 15, 2021) (SR-NYSENAT-2021-16).
\16\ See Securities Exchange Act Release No. 93758 (December 13,
2021), 86 FR 71695 (December 17, 2021) (SR-FINRA-2021-31).
\17\ See Securities Exchange Act Release No. 93919 (January 6,
2022), 87 FR 1804 (January 12, 2022) (SR-NYSENAT-2021-25).
\18\ See Securities Exchange Act Release No. 94430 (March 16,
2022), 87 FR 16262 (March 22, 2022) (SR-FINRA-2022-004).
\19\ See Securities Exchange Act Release No. 94662 (April 11,
2022), 87 FR 22601 (April 15, 2022) (SR-NYSENAT-2022-03).
---------------------------------------------------------------------------
Even though it has been more than two years since the World Health
Organization declared COVID-19 a pandemic, FINRA has determined that
[[Page 50670]]
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.\20\ 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,\21\ FINRA believes that
there is a continued need for temporary relief beyond July 31,
2022.\22\ On July 8, 2022, FINRA accordingly filed to extend the
expiration date of the temporary rule amendments to, among other rules,
FINRA Rule 9261 and 9830 from July 31, 2022, to October 31, 2022.\23\
---------------------------------------------------------------------------
\20\ See Securities Exchange Act Release No. 95281 (July 14,
2022), 87 FR 43335 (July 20, 2022) (SR-FINRA-2022-018) (``SR-FINRA-
2022-018''). FINRA noted that, 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/. See SR-FINRA-2022-018, 87 FR
at 43335, n. 6.
\21\ For instance, FINRA noted that the Centers for Disease
Control and Prevention (``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. See SR-FINRA-2022-018, 87 FR at 43335, n.7.
\22\ See SR-FINRA-2022-018, 87 FR 43336.
\23\ See SR-FINRA-2022-018, 87 FR 43335-36.
---------------------------------------------------------------------------
Proposed Rule Change
Consistent with FINRA's recent proposal, the Exchange proposes to
extend the expiration date of the temporary rule amendments to NYSE
National Rules 10.9261 and 10.9830 as set forth in SR-NYSENAT-2020-31
from July 31, 2022, to October 31, 2022.
As set forth in SR-FINRA 2022-018, 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.\24\ 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,\25\ FINRA believes that
there is a continued need for temporary relief beyond July 31,
2022.\26\ FINRA accordingly proposed to extend the expiration date of
the temporary rule amendments from July 31, 2022, to October 31, 2022.
---------------------------------------------------------------------------
\24\ See note 20, supra.
\25\ See note 21, supra.
\26\ See SR-FINRA-2022-018, 87 FR at 43337.
---------------------------------------------------------------------------
The Exchange proposes to similarly extend the expiration date of
the temporary rule amendments to NYSE National Rules 10.9261 and
10.9830 as set forth in SR-NYSENAT-2020-31 from July 31, 2022, to
October 31, 2022. The Exchange agrees with FINRA that, 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 Exchange also agrees that, 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, for
the reasons set forth in SR-FINRA-2022-018, there is a continued need
for this temporary relief beyond July 31, 2022. The proposed change
would permit OHO to continue to assess, based on critical COVID-19 data
and criteria and the guidance of health and security consultants,
whether an in-person hearing would compromise the health and safety of
the hearing participants such that the hearing should proceed by video
conference. As noted in SR-FINRA-2022-018, in deciding whether to
schedule a hearing by video conference, OHO may consider a variety of
other factors in addition to COVID-19 trends. Similarly, as noted in
SR-FINRA-2022-018, in SR-FINRA-2020-027, FINRA provided a non-
exhaustive list of other factors OHO may take into consideration,
including a hearing participant's individual health concerns and access
to the connectivity and technology necessary to participate in a video
conference hearing.\27\ The Exchange believes that this is a reasonable
procedure to continue to follow for hearings under Rules 10.9261 and
10.9830 chaired by a FINRA employee.
---------------------------------------------------------------------------
\27\ See SR-FINRA-2022-018, 87 FR at 43337, n. 16.
---------------------------------------------------------------------------
As noted below, 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 proposed rule change is consistent with Section 6(b) of the
Act,\28\ in general, and furthers the objectives of Section
6(b)(5),\29\ in particular, because it is designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, to foster cooperation and coordination
with persons engaged in facilitating transactions in securities, to
remove impediments to, and perfect the mechanism of, a free and open
market and a national market system and, in general, to protect
investors and the public interest. Additionally, the Exchange believes
the proposed rule change is designed to provide a fair procedure for
the disciplining of members and persons associated with members,
consistent with Sections 6(b)(7) and 6(d) of the Act.\30\
---------------------------------------------------------------------------
\28\ 15 U.S.C. 78f(b).
\29\ 15 U.S.C. 78f(b)(5).
\30\ 15 U.S.C. 78f(b)(7) & 78f(d).
---------------------------------------------------------------------------
The Exchange believes that the proposed rule change supports the
objectives of the Act by providing greater harmonization between
Exchange rules and FINRA rules of similar purpose, resulting in less
burdensome and more efficient regulatory compliance. As such, the
proposed rule change will foster cooperation and coordination with
persons engaged in facilitating transactions in securities and will
remove impediments to and perfect the mechanism of a free and open
market and a national market system.
The proposed rule change, which extends the expiration date of the
temporary amendments to Exchange rules consistent with FINRA's
extension to its Rules 9261 and 9830 as set forth in SR-FINRA-2022-018,
will permit the Exchange to continue to effectively conduct hearings
during the COVID-19 pandemic. 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
[[Page 50671]]
allowing OHO to proceed by video conference, some or all hearings may
have to be postponed. The ability to conduct hearings by video
conference will permit the adjudicatory functions of the Exchange's
disciplinary rules to continue unabated, thereby avoiding protracted
delays. The Exchange believes that this is especially important in
matters where temporary and permanent cease and desist orders are
sought because the proposed rule change would enable those hearings to
continue to proceed without delay, thereby enabling the Exchange to
continue to take immediate action to stop significant, ongoing customer
harm, to the benefit of the investing public.
As set forth in detail in SR-NYSENAT-2020-31, the temporary relief
to permit hearings to be conducted via video conference maintains fair
process and will continue to provide fair process consistent with
Sections 6(b)(7) and 6(d) of the Act \31\ while striking an appropriate
balance between providing fair process and enabling the Exchange to
fulfill its statutory obligations to protect investors and maintain
fair and orderly markets while avoiding the COVID-19-related public
health risks for hearing participants. The Exchange notes that this
proposal, like SR-NYSENAT-2020-31, provides only temporary relief. As
proposed, the changes would be in place through October 31, 2022. As
noted in SR-NYSENAT-2020-31 and above, the amended rules will revert
back to their original state at the conclusion of the temporary relief
period and, if applicable, any extension thereof.
---------------------------------------------------------------------------
\31\ 15 U.S.C. 78f(b)(7) & 78f(d).
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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 proposed temporary rule
change will impose any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Act. The proposed
rule change is not intended to address competitive issues but is rather
intended solely to extend temporary relief necessitated by the
continued impacts of the COVID-19 pandemic 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
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 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 Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \32\ and Rule 19b-4(f)(6) thereunder.\33\
Because the 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 prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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\32\ 15 U.S.C. 78s(b)(3)(A)(iii).
\33\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \34\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b4(f)(6)(iii),\35\ 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 agrees with FINRA that the COVID-19 related health
concerns necessitating this relief will not meaningfully subside by
July 31, 2022.\36\ The Exchange also states that extending the
temporary relief provided in SR-NYSENAT-2020-31 immediately upon filing
and without a 30-day operative delay will allow the Exchange to
continue critical adjudicatory and review processes so that the
Exchange may continue to operate effectively and meet its critical
investor protection goals, while also protecting the health and safety
of hearing participants.\37\ The Commission also notes that this
proposal extends without change the temporary relief previously
provided by SR-NYSENAT-2020-31.\38\ 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.\39\ 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.\40\
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\34\ 17 CFR 240.19b-4(f)(6).
\35\ 17 CFR 240.19b-4(f)(6)(iii).
\36\ See supra Item II; see also SR-FINRA-2022-018, 87 FR 43335,
at 43336.
\37\ See 87 FR 43335, 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).
\38\ See supra note 4.
\39\ See supra note 5. 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.
\40\ 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 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) \41\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\41\ 15 U.S.C. 78s(b)(2)(B).
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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-NYSENAT-2022-14 on the subject line.
[[Page 50672]]
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-NYSENAT-2022-14. 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-NYSENAT-2022-14 and should be submitted
on or before September 7, 2022.
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\42\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\42\
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-17666 Filed 8-16-22; 8:45 am]
BILLING CODE 8011-01-P
