Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Rule 313, 15106-15108 [2023-04876]
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15106
Federal Register / Vol. 88, No. 47 / Friday, March 10, 2023 / Notices
Application] and RI 30–3 [Information
for a Competency Determination].
DATES: Comments are encouraged and
will be accepted until April 10, 2023.
ADDRESSES: Written comments and
recommendations for the proposed
information collection should be sent
within 30 days of publication of this
notice to https://www.reginfo.gov/public/
do/PRAMain. Find this particular
information collection by selecting
‘‘Currently under Review—Open for
Public Comments’’ or by using the
search function.
FOR FURTHER INFORMATION CONTACT: A
copy of this ICR with applicable
supporting documentation, may be
obtained by contacting the Retirement
Services Publications Team, Office of
Personnel Management, 1900 E Street
NW, Room 3316–L, Washington, DC
20415, Attention: Cyrus S. Benson, or
may be obtained by sending an email to
Cyrus.Benson@opm.gov or by fax to
(202) 606–0910 or via telephone at (202)
606–4808.
SUPPLEMENTARY INFORMATION: As
required by the Paperwork Reduction
Act of 1995, Public Law 104–13, 109
Stat. 163 (44 U.S.C. 35) as amended by
the Clinger-Cohen Act of 1996, Public
Law 104–106, 110 Stat. 642 (40 U.S.C.
1401 et seq.), OPM is soliciting
comments for this collection (OMB No.
3206–0140). The Office of Management
and Budget is particularly interested in
comments that:
1. Evaluate whether the proposed
collection of information is necessary
for the proper performance of functions
of the agency, including whether the
information will have practical utility;
2. Evaluate the accuracy of the
agency’s estimate of the burden of the
proposed collection of information,
including the validity of the
methodology and assumptions used;
3. Enhance the quality, utility, and
clarity of the information to be
collected; and
4. Minimize the burden of the
collection of information on those who
are to respond, including through the
use of appropriate automated,
electronic, mechanical, or other
technological collection techniques or
other forms of information technology,
e.g., permitting electronic submissions
of responses.
Form RI 20–7 is used by the Civil
Service Retirement System (CSRS) and
the Federal Employees Retirement
System (FERS) to collect information
from persons who apply to be
fiduciaries for annuitants or survivor
annuitants who appear to be incapable
of handling their own funds or for
minor children. RI 30–3 is an enclosure
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to RI 20–7 and is needed for adult
annuitants who are alleged to be
incompetent. RI 30–3 collects medical
information regarding the annuitant’s
competency for OPM’s use in evaluating
the annuitant’s condition.
Analysis
Agency: Retirement Services, Office of
Personnel Management.
Title: Representative Payee
Application/Information Necessary for a
Competency Determination.
OMB Number: 3206–0140.
Frequency: On occasion.
Affected Public: Individuals or
Organizations.
Number of Respondents: 12,480 [RI
20–7] and 250 [RI 30–3].
Estimated Time per Respondent: 30
minutes [RI 20–7] and 1 hour [RI 30–3].
Total Burden Hours: 6,240 [RI 20–7]
and 250 [RI 30–3].
Office of Personnel Management.
Kellie Cosgrove Riley,
Director, Office of Privacy and Information
Management.
[FR Doc. 2023–04940 Filed 3–9–23; 8:45 am]
BILLING CODE 6325–38–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–97048; File No. SR–NYSE–
2023–15]
Self-Regulatory Organizations; New
York Stock Exchange LLC; Notice of
Filing and Immediate Effectiveness of
Proposed Rule Change To Amend Rule
313
March 6, 2023.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on February
27, 2023, New York Stock Exchange
LLC (‘‘NYSE’’ or the ‘‘Exchange’’) filed
with the Securities and Exchange
Commission (the ‘‘Commission’’) the
proposed rule change as described in
Items I 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 to amend
Rule 313 to eliminate text reflecting
outdated requirements. The proposed
1 15
2 17
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00137
Fmt 4703
Sfmt 4703
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 to amend
Rule 313 to delete the current text of
Supplementary Material .22 and
designate Rule 313.22 as ‘‘Reserved.’’
Rule 313 sets forth certain corporate,
limited liability company, or
partnership documents that each
member organization must submit to the
Exchange to enter into and continue in
NYSE membership. The Rule also sets
forth certain restrictions on capital
withdrawals and distributions
applicable to member corporations and
partnerships.
Rule 313.22 currently provides that
the certificate of incorporation of a
member corporation must contain
provisions authorizing the corporation
to redeem or convert outstanding shares
of voting stock to a fixed income
security when such shares are owned by
any person required to be approved by
the Board of Directors of the Exchange
as a member or approved person and
such person fails or ceases to be so
approved, as may be necessary to reduce
such party’s ownership of voting stock
in the member corporation below the
level that would enable such party to
exercise controlling influence over the
management or policies of such member
corporation.
Rule 313.22 also provides that, if the
certificate of incorporation of a member
corporation subject to Rule 325 provides
that a stockholder may compel the
redemption of his stock, such certificate
must provide that, unless such
stockholder has prior written approval
of the Exchange, the redemption may
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only be effected on a date not less than
six months after receipt by the member
corporation of a written request for
redemption, given no sooner than six
months after the date of the original
issuance of such shares (or any
predecessor shares). Rule 313.22 also
requires a member corporation to
promptly notify the Exchange of the
receipt of any request for redemption of
any stock or if any redemption is not
made because prohibited under the
provisions of Rule 15c3–1.3
Finally, Rule 313.22 provides that
each stock certificate of a member
corporation must state, on its face, the
restrictions set forth in Rule 15c3–1(e)
relating to the redemption of stock or a
full summary thereof.
Proposed Rule Change
The Exchange proposes to delete the
text of Rule 313.22 and designate Rule
313.22 as ‘‘Reserved.’’
The Exchange believes that Rule
313.22, which was adopted in 1970 and
last amended in 1976 to incorporate
references to then newly adopted Rule
15c3–1,4 requiring a member
corporation’s certificate of incorporation
to contain specific provisions relating to
the redemption and conversion of stock
and requiring a member corporation’s
stock certificate to include the
restrictions set forth in Rule 15c3–1(e)
relating to the redemption of stock no
longer serves a regulatory, business or
investor protection purpose and in fact
poses an unnecessary obstacle for
prospective applicants for Exchange
membership. Specifically, the Exchange
believes that the provisions of Rule
313.22 are duplicative of the
requirements of Rule 15c3–1, as well as
other Exchange and Financial Industry
Regulatory Authority, Inc. (‘‘FINRA’’)
rules adopted subsequent to the
implementation of Rule 313.22. The
Exchange notes that the proposed
change relates only to Rule 313.22’s
requirements concerning the contents of
a member organization’s certificate of
incorporation or stock certificate and
would not otherwise impact a member
organization’s continuing obligation to
comply with the net capital
requirements of Rule 15c3–1, including
pursuant to NYSE Rule 4110 and, for
the large number of member
organizations that are also members of
FINRA, FINRA Rule 4110. Both NYSE
Rule 4110 and FINRA Rule 4110
require, among other things, that a
3 See
17 CFR 240.15c3–1.
SR–NYSE–75–11. Prior to the change,
proprietors had been able to withdraw all of their
capital even where such action would result in a
capital ratio or minimum dollar capital in violation
of the net capital rule.
4 See
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member organization must suspend
business operations during any period
in which it is not in compliance with
applicable net capital requirements set
forth in Rule 15c3–1 and that no equity
capital of a member organization may be
withdrawn for a period of one year from
the date such equity capital is
contributed.5
The Exchange believes that the
elimination of the requirements set forth
in current Rule 313.22 would simplify
the membership application process
without impacting the Exchange’s
ability to ensure that member
organizations are qualified for Exchange
membership and would be held to the
requirements of Exchange rules.
Prospective member organizations
would continue to be subject to the
membership application process, which
calls for applicants to submit materials
including organizational documents,
financial statements, and records
relating to the organization’s designated
supervisors and principals.6 Approved
member organizations are bound to
abide by Exchange rules, and the
Exchange would continue to have the
authority to enforce member
organizations’ obligations under
Exchange rules (including compliance
with relevant net capital requirements
pursuant to Rule 15c3–1, as
applicable).7
The Exchange also believes that the
requirements of Rule 313.22, to the
extent they necessitate modifications to
a member corporation’s certificate of
incorporation or stock certificate, may
be burdensome to prospective member
organizations given the potential
difficulty of amending such documents
and could deter organizations from
seeking Exchange membership. The
Exchange thus believes that eliminating
the requirements of Rule 313.22 could
make the membership application
process more accessible to prospective
member organizations, thereby
5 See NYSE Rule 4110 (Capital Compliance);
FINRA Rule 4110 (Capital Compliance), available
at: https://www.finra.org/rules-guidance/rulebooks/
finra-rules/4110. The Exchange adopted Rule 4110
in 2010 to harmonize its rules with FINRA Rule
4110. See Securities Exchange Act Release No.
61557 (February 22, 2010), 75 FR 9472 (March 2,
2010) (SR–NYSE–2010–10) (Notice of Filing and
Order Granting Accelerated Approval of Proposed
Rule Change by New York Stock Exchange LLC
Changing Certain NYSE Rules and Rule
Interpretations To Correspond With Rule Changes
Filed by the Financial Industry Regulatory
Authority, Inc.).
6 The NYSE membership application is available
at: https://www.nyse.com/publicdocs/nyse/markets/
nyse/NYSE_Application_for_Membership.pdf.
7 The Exchange notes that the proposed change
would likewise have no impact on FINRA’s
authority to enforce its rules with respect to
member organizations that are also FINRA
members.
PO 00000
Frm 00138
Fmt 4703
Sfmt 4703
15107
encouraging additional corporations to
consider and apply for Exchange
membership.
Finally, Rule 313.22 currently
includes a provision referring to
member corporations subject to Rule
325, which rule was designated as
‘‘Reserved’’ in 2010.8 Accordingly, the
Exchange believes that the portion of
Rule 313.22 setting forth requirements
relating to corporations subject to Rule
325 likewise no longer has application.
2. Statutory Basis
The Exchange believes that the
proposed rule change 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, because it is
designed to prevent fraudulent and
manipulative acts and practices,
promote just and equitable principles of
trade, remove impediments to and
perfect the mechanism of a free and
open market and a national market
system, and protect investors and the
public interest.
The Exchange believes that
eliminating the requirements of Rule
313.22 with respect to member
corporations would remove
impediments to and perfect the
mechanism of a free and open market
and a national market system by
simplifying the application process for
prospective member organizations and
in turn encouraging organizations to
apply for Exchange membership. The
Exchange believes that the requirements
of Rule 313.22 do not currently serve a
regulatory or business purpose and do
not further investor protection interests,
particularly since the deletion of the
requirements in Rule 313.22 would not
impact the Exchange’s ability to make
informed decisions with respect to
applicants for Exchange membership or
to require member organizations to
abide by Exchange rules, including rules
relating to their net capital obligations
pursuant to Rule 15c3–1. The Exchange
further believes that the issues that may
have been contemplated when Rule
313.22 was adopted (such as ensuring
that a member organization’s controlling
persons are qualified and that member
organizations comply with the relevant
provisions of Rule 15c3–1) are
adequately addressed by both the
8 See Securities Exchange Act Release No. 61557
(February 22, 2010), 75 FR 9472 (March 2, 2010)
(SR–NYSE–2010–10) (Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule
Change by New York Stock Exchange LLC Changing
Certain NYSE Rules and Rule Interpretations To
Correspond With Rule Changes Filed by the
Financial Industry Regulatory Authority, Inc.).
9 15 U.S.C. 78f(b).
10 15 U.S.C. 78f(b)(5).
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Federal Register / Vol. 88, No. 47 / Friday, March 10, 2023 / Notices
application review process and the
processes in place for the oversight of
member organizations’ compliance with
Exchange rules.
The Exchange also believes that the
proposed change would remove
impediments to and perfect the
mechanism of a free and open market
and a national market system and is
designed to protect investors and the
public interest because it would
improve the efficiency of the
membership application process and the
clarity of the Exchange’s rules by
removing the outdated and
unnecessarily burdensome requirements
that a member corporation’s certificate
of incorporation and stock certificate
contain specific language relating to the
redemption. The Exchange also notes
that the proposed change to no longer
require specific language referencing
Rule 15c3–1 in the certificate of
incorporation and stock certificate
would not impact a member
organization’s obligation to comply with
the relevant net capital requirements of
Rule 15c3–1, including pursuant to
NYSE Rule 4110 and FINRA Rule 4110,
as applicable. The Exchange further
believes that broadening the prospective
Exchange membership pool by
eliminating requirements that no longer
serve regulatory or business purposes
and do not offer a necessary investor
protection would benefit investors and
the public interest by facilitating
increased market participation and
depth at the Exchange.
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B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
Exchange believes that the proposed
rule change could promote competition
by removing an outdated requirement
applicable to prospective member
organizations that are corporations. The
Exchange believes that deleting the
requirements set forth in Rule 313.22
(particularly those calling for
modification of a corporation’s
certificate of incorporation and/or stock
certificate) could result in less
burdensome and more efficient
standards for prospective member
organizations to meet, thereby
encouraging additional corporations to
consider pursuing Exchange
membership. Expanding the prospective
Exchange membership pool by
eliminating a requirement that no longer
appears to serve a business, regulatory,
or other purpose could promote
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competition by increasing market
participation and depth at the Exchange.
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 11 and Rule
19b–4(f)(6) thereunder.12 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 13 and Rule 19b–4(f)(6)(iii)
thereunder.14
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) 15 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:
11 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
13 15 U.S.C. 78s(b)(3)(A).
14 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, along with a brief
description and text of the proposed rule change,
at least five business days prior to the date of filing
of the proposed rule change, or such shorter time
as designated by the Commission. The Exchange
has satisfied this requirement.
15 15 U.S.C. 78s(b)(2)(B).
12 17
PO 00000
Frm 00139
Fmt 4703
Sfmt 9990
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–2023–15 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–2023–15. This file
number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the
filing also will be available for
inspection and copying at the principal
office of the Exchange. All comments
received will be posted without change.
Persons submitting comments are
cautioned that we do not redact or edit
personal identifying information from
comment submissions. You should
submit only information that you wish
to make available publicly. All
submissions should refer to File
Number SR–NYSE–2023–15 and should
be submitted on or before March 31,
2023.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.16
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–04876 Filed 3–9–23; 8:45 am]
BILLING CODE 8011–01–P
16 17
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]]>Agencies
[Federal Register Volume 88, Number 47 (Friday, March 10, 2023)]
[Notices]
[Pages 15106-15108]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-04876]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-97048; File No. SR-NYSE-2023-15]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend Rule 313
March 6, 2023.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on February 27, 2023, New York Stock Exchange LLC (``NYSE'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I 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\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to amend Rule 313 to eliminate text
reflecting outdated requirements. 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 to amend Rule 313 to delete the current text
of Supplementary Material .22 and designate Rule 313.22 as
``Reserved.''
Rule 313 sets forth certain corporate, limited liability company,
or partnership documents that each member organization must submit to
the Exchange to enter into and continue in NYSE membership. The Rule
also sets forth certain restrictions on capital withdrawals and
distributions applicable to member corporations and partnerships.
Rule 313.22 currently provides that the certificate of
incorporation of a member corporation must contain provisions
authorizing the corporation to redeem or convert outstanding shares of
voting stock to a fixed income security when such shares are owned by
any person required to be approved by the Board of Directors of the
Exchange as a member or approved person and such person fails or ceases
to be so approved, as may be necessary to reduce such party's ownership
of voting stock in the member corporation below the level that would
enable such party to exercise controlling influence over the management
or policies of such member corporation.
Rule 313.22 also provides that, if the certificate of incorporation
of a member corporation subject to Rule 325 provides that a stockholder
may compel the redemption of his stock, such certificate must provide
that, unless such stockholder has prior written approval of the
Exchange, the redemption may
[[Page 15107]]
only be effected on a date not less than six months after receipt by
the member corporation of a written request for redemption, given no
sooner than six months after the date of the original issuance of such
shares (or any predecessor shares). Rule 313.22 also requires a member
corporation to promptly notify the Exchange of the receipt of any
request for redemption of any stock or if any redemption is not made
because prohibited under the provisions of Rule 15c3-1.\3\
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\3\ See 17 CFR 240.15c3-1.
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Finally, Rule 313.22 provides that each stock certificate of a
member corporation must state, on its face, the restrictions set forth
in Rule 15c3-1(e) relating to the redemption of stock or a full summary
thereof.
Proposed Rule Change
The Exchange proposes to delete the text of Rule 313.22 and
designate Rule 313.22 as ``Reserved.''
The Exchange believes that Rule 313.22, which was adopted in 1970
and last amended in 1976 to incorporate references to then newly
adopted Rule 15c3-1,\4\ requiring a member corporation's certificate of
incorporation to contain specific provisions relating to the redemption
and conversion of stock and requiring a member corporation's stock
certificate to include the restrictions set forth in Rule 15c3-1(e)
relating to the redemption of stock no longer serves a regulatory,
business or investor protection purpose and in fact poses an
unnecessary obstacle for prospective applicants for Exchange
membership. Specifically, the Exchange believes that the provisions of
Rule 313.22 are duplicative of the requirements of Rule 15c3-1, as well
as other Exchange and Financial Industry Regulatory Authority, Inc.
(``FINRA'') rules adopted subsequent to the implementation of Rule
313.22. The Exchange notes that the proposed change relates only to
Rule 313.22's requirements concerning the contents of a member
organization's certificate of incorporation or stock certificate and
would not otherwise impact a member organization's continuing
obligation to comply with the net capital requirements of Rule 15c3-1,
including pursuant to NYSE Rule 4110 and, for the large number of
member organizations that are also members of FINRA, FINRA Rule 4110.
Both NYSE Rule 4110 and FINRA Rule 4110 require, among other things,
that a member organization must suspend business operations during any
period in which it is not in compliance with applicable net capital
requirements set forth in Rule 15c3-1 and that no equity capital of a
member organization may be withdrawn for a period of one year from the
date such equity capital is contributed.\5\
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\4\ See SR-NYSE-75-11. Prior to the change, proprietors had been
able to withdraw all of their capital even where such action would
result in a capital ratio or minimum dollar capital in violation of
the net capital rule.
\5\ See NYSE Rule 4110 (Capital Compliance); FINRA Rule 4110
(Capital Compliance), available at: https://www.finra.org/rules-guidance/rulebooks/finra-rules/4110. The Exchange adopted Rule 4110
in 2010 to harmonize its rules with FINRA Rule 4110. See Securities
Exchange Act Release No. 61557 (February 22, 2010), 75 FR 9472
(March 2, 2010) (SR-NYSE-2010-10) (Notice of Filing and Order
Granting Accelerated Approval of Proposed Rule Change by New York
Stock Exchange LLC Changing Certain NYSE Rules and Rule
Interpretations To Correspond With Rule Changes Filed by the
Financial Industry Regulatory Authority, Inc.).
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The Exchange believes that the elimination of the requirements set
forth in current Rule 313.22 would simplify the membership application
process without impacting the Exchange's ability to ensure that member
organizations are qualified for Exchange membership and would be held
to the requirements of Exchange rules. Prospective member organizations
would continue to be subject to the membership application process,
which calls for applicants to submit materials including organizational
documents, financial statements, and records relating to the
organization's designated supervisors and principals.\6\ Approved
member organizations are bound to abide by Exchange rules, and the
Exchange would continue to have the authority to enforce member
organizations' obligations under Exchange rules (including compliance
with relevant net capital requirements pursuant to Rule 15c3-1, as
applicable).\7\
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\6\ The NYSE membership application is available at: https://www.nyse.com/publicdocs/nyse/markets/nyse/NYSE_Application_for_Membership.pdf.
\7\ The Exchange notes that the proposed change would likewise
have no impact on FINRA's authority to enforce its rules with
respect to member organizations that are also FINRA members.
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The Exchange also believes that the requirements of Rule 313.22, to
the extent they necessitate modifications to a member corporation's
certificate of incorporation or stock certificate, may be burdensome to
prospective member organizations given the potential difficulty of
amending such documents and could deter organizations from seeking
Exchange membership. The Exchange thus believes that eliminating the
requirements of Rule 313.22 could make the membership application
process more accessible to prospective member organizations, thereby
encouraging additional corporations to consider and apply for Exchange
membership.
Finally, Rule 313.22 currently includes a provision referring to
member corporations subject to Rule 325, which rule was designated as
``Reserved'' in 2010.\8\ Accordingly, the Exchange believes that the
portion of Rule 313.22 setting forth requirements relating to
corporations subject to Rule 325 likewise no longer has application.
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\8\ See Securities Exchange Act Release No. 61557 (February 22,
2010), 75 FR 9472 (March 2, 2010) (SR-NYSE-2010-10) (Notice of
Filing and Order Granting Accelerated Approval of Proposed Rule
Change by New York Stock Exchange LLC Changing Certain NYSE Rules
and Rule Interpretations To Correspond With Rule Changes Filed by
the Financial Industry Regulatory Authority, Inc.).
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2. Statutory Basis
The Exchange believes that the proposed rule change 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, because it
is designed to prevent fraudulent and manipulative acts and practices,
promote just and equitable principles of trade, remove impediments to
and perfect the mechanism of a free and open market and a national
market system, and protect investors and the public interest.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that eliminating the requirements of Rule
313.22 with respect to member corporations would remove impediments to
and perfect the mechanism of a free and open market and a national
market system by simplifying the application process for prospective
member organizations and in turn encouraging organizations to apply for
Exchange membership. The Exchange believes that the requirements of
Rule 313.22 do not currently serve a regulatory or business purpose and
do not further investor protection interests, particularly since the
deletion of the requirements in Rule 313.22 would not impact the
Exchange's ability to make informed decisions with respect to
applicants for Exchange membership or to require member organizations
to abide by Exchange rules, including rules relating to their net
capital obligations pursuant to Rule 15c3-1. The Exchange further
believes that the issues that may have been contemplated when Rule
313.22 was adopted (such as ensuring that a member organization's
controlling persons are qualified and that member organizations comply
with the relevant provisions of Rule 15c3-1) are adequately addressed
by both the
[[Page 15108]]
application review process and the processes in place for the oversight
of member organizations' compliance with Exchange rules.
The Exchange also believes that the proposed change would remove
impediments to and perfect the mechanism of a free and open market and
a national market system and is designed to protect investors and the
public interest because it would improve the efficiency of the
membership application process and the clarity of the Exchange's rules
by removing the outdated and unnecessarily burdensome requirements that
a member corporation's certificate of incorporation and stock
certificate contain specific language relating to the redemption. The
Exchange also notes that the proposed change to no longer require
specific language referencing Rule 15c3-1 in the certificate of
incorporation and stock certificate would not impact a member
organization's obligation to comply with the relevant net capital
requirements of Rule 15c3-1, including pursuant to NYSE Rule 4110 and
FINRA Rule 4110, as applicable. The Exchange further believes that
broadening the prospective Exchange membership pool by eliminating
requirements that no longer serve regulatory or business purposes and
do not offer a necessary investor protection would benefit investors
and the public interest by facilitating increased market participation
and depth at the Exchange.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange believes that
the proposed rule change could promote competition by removing an
outdated requirement applicable to prospective member organizations
that are corporations. The Exchange believes that deleting the
requirements set forth in Rule 313.22 (particularly those calling for
modification of a corporation's certificate of incorporation and/or
stock certificate) could result in less burdensome and more efficient
standards for prospective member organizations to meet, thereby
encouraging additional corporations to consider pursuing Exchange
membership. Expanding the prospective Exchange membership pool by
eliminating a requirement that no longer appears to serve a business,
regulatory, or other purpose could promote competition by increasing
market participation and depth at the Exchange.
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 \11\ and Rule 19b-4(f)(6) thereunder.\12\
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 \13\ and Rule 19b-
4(f)(6)(iii) thereunder.\14\
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\11\ 15 U.S.C. 78s(b)(3)(A)(iii).
\12\ 17 CFR 240.19b-4(f)(6).
\13\ 15 U.S.C. 78s(b)(3)(A).
\14\ 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, along
with a brief description and text of the proposed rule change, at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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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) \15\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\15\ 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-NYSE-2023-15 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-2023-15. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (https://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NYSE-2023-15 and should be submitted on
or before March 31, 2023.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-04876 Filed 3-9-23; 8:45 am]
BILLING CODE 8011-01-P
