Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Implementation Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to SR-FINRA-2015-036, 15473-15476 [2023-05041]

Download as PDF Federal Register / Vol. 88, No. 48 / Monday, March 13, 2023 / Notices comprehensive than the provision it would replace and would set forth additional detail regarding the compensation that directors may receive, such as whether expenses for attending board meetings may be paid, whether directors may receive compensation on a per-meeting basis or as a salary, and what form of compensation may be granted, and would clarify that payment does not preclude a director from serving the Exchange in another capacity. The Exchange believes that the greater additional detail would add transparency and clarity to the Exchange’s governing documents and would not be inconsistent with the public interest and the protection of investors because investors will not be harmed and in fact would benefit from increased transparency and clarity, thereby reducing potential confusion. Finally, the proposed non-substantive technical and conforming changes would remove impediments to and perfect the mechanism of a free and open market by ensuring that persons subject to the Exchange’s jurisdiction, regulators, and the investing public can more easily navigate and understand the governing documents. The proposed non-substantive amendments also would not be inconsistent with the public interest and the protection of investors because investors will not be harmed and in fact would benefit from increased transparency and clarity, thereby reducing potential confusion. 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 Exchange Act. The proposed rule change is not intended to address competitive issues but rather is concerned solely with the corporate governance of the Exchange. ddrumheller on DSK120RN23PROD with NOTICES1 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 Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on VerDate Sep<11>2014 19:32 Mar 10, 2023 Jkt 259001 which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 23 and Rule 19b– 4(f)(6) thereunder.24 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) 25 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– NYSE–2023–13 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–2023–13. 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 23 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). In addition, Rule 19b– 4(f)(6)(iii) 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. 25 15 U.S.C. 78s(b)(2)(B). 24 17 PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 15473 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–2023–13, and should be submitted on or before April 3, 2023. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.26 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2023–05038 Filed 3–10–23; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–97062; File No. SR–FINRA– 2023–002] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Extend the Implementation Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to SR–FINRA– 2015–036 March 7, 2023. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on February 24, 2023, the Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by FINRA. FINRA has designated the proposed rule change as constituting a ‘‘non-controversial’’ rule change under paragraph (f)(6) of 26 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\13MRN1.SGM 13MRN1 15474 Federal Register / Vol. 88, No. 48 / Monday, March 13, 2023 / Notices Rule 19b–4 under the Act,3 which renders the proposal effective upon receipt of this filing by the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change FINRA is proposing to extend, to October 25, 2023, the implementation date of the amendments to FINRA Rule 4210 (Margin Requirements) pursuant to SR–FINRA–2015–036, other than the amendments pursuant to SR–FINRA– 2015–036 that were implemented on December 15, 2016. The proposed rule change would not make any changes to the text of FINRA rules. The text of the proposed rule change is available on FINRA’s website at https://www.finra.org, at the principal office of FINRA 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, FINRA included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. FINRA has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change ddrumheller on DSK120RN23PROD with NOTICES1 1. Purpose On October 6, 2015, FINRA filed with the Commission proposed rule change SR–FINRA–2015–036, which proposed to amend FINRA Rule 4210 to establish margin requirements for (1) To Be Announced (‘‘TBA’’) transactions, inclusive of adjustable rate mortgage (‘‘ARM’’) transactions; (2) Specified Pool Transactions; and (3) transactions in Collateralized Mortgage Obligations (‘‘CMOs’’), issued in conformity with a program of an agency or GovernmentSponsored Enterprise (‘‘GSE’’), with forward settlement dates, as defined more fully in the filing (collectively, ‘‘Covered Agency Transactions’’). The Commission approved SR–FINRA– 3 17 CFR 240.19b–4(f)(6). VerDate Sep<11>2014 19:32 Mar 10, 2023 Jkt 259001 2015–036 on June 15, 2016 (the ‘‘Approval Date’’).4 Pursuant to Partial Amendment No. 3 to SR–FINRA–2015–036, FINRA announced in Regulatory Notice 16–31 that the rule change would become effective on December 15, 2017, 18 months from the Approval Date, except that the risk limit determination requirements as set forth in paragraphs (e)(2)(F), (e)(2)(G) and (e)(2)(H) of Rule 4210 and in new Supplementary Material .05, each as respectively amended or established by SR–FINRA– 2015–036 (collectively, the ‘‘risk limit determination requirements’’), would become effective on December 15, 2016, six months from the Approval Date.5 Industry participants sought clarification regarding the implementation of the requirements pursuant to SR–FINRA–2015–036. Industry participants also requested additional time to make system changes necessary to comply with the requirements, including time to test the system changes, and requested additional time to update or amend margining agreements and related documentation. In response, FINRA made available a set of Frequently Asked Questions & Guidance 6 and, pursuant to SR–FINRA–2017–029,7 extended the implementation date of the requirements of SR–FINRA–2015–036 to June 25, 2018, except for the risk limit determination requirements, which, as announced in Regulatory Notice 16–31, became effective on December 15, 2016. 4 See Securities Exchange Act Release No. 78081 (June 15, 2016), 81 FR 40364 (June 21, 2016) (Notice of Filing of Amendment No. 3 and Order Granting Accelerated Approval to a Proposed Rule Change to Amend FINRA Rule 4210 (Margin Requirements) to Establish Margin Requirements for the TBA Market, as Modified by Amendment Nos. 1, 2, and 3; File No. SR–FINRA–2015–036). 5 See Partial Amendment No. 3 to SR–FINRA– 2015–036 and Regulatory Notice 16–31 (August 2016), both available at: <www.finra.org>. 6 See Responses to Frequently Asked Questions Regarding Covered Agency Transactions Under FINRA Rule 4210, at: <https://www.finra.org/rulesguidance/guidance/faqs/responses-frequentlyasked-questions-regarding-covered-agencytransactions-under-finra-rule>. Further, staff of the SEC’s Division of Trading and Markets made available a set of Frequently Asked Questions regarding Exchange Act Rule 15c3–1 and Rule 15c3–3 in connection with Covered Agency Transactions under FINRA Rule 4210, also available at: <https://www.finra.org/rules-guidance/ guidance/faqs/responses-frequently-askedquestions-regarding-covered-agency-transactionsunder-finra-rule>. 7 See Securities Exchange Act Release No. 81722 (September 26, 2017), 82 FR 45915 (October 2, 2017) (Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Delay the Implementation Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to SR– FINRA–2015–036; File No. SR–FINRA–2017–029); see also Regulatory Notice 17–28 (September 2017). PO 00000 Frm 00106 Fmt 4703 Sfmt 4703 Industry participants requested that FINRA reconsider the potential impact of certain requirements pursuant to SR– FINRA–2015–036 on smaller and midsized firms. Industry participants also requested that FINRA extend the implementation date pending such reconsideration. In response to these concerns, FINRA further extended the implementation date of the requirements of SR–FINRA–2015–036, other than the risk limit determination requirements, most recently to April 24, 2023 (the ‘‘April 24, 2023 implementation date’’),8 and, informed by extensive dialogue, both with industry participants and other regulators, including the staff of the SEC and the Federal Reserve System, FINRA proposed amendments to the requirements of SR–FINRA–2015–036 (the ‘‘Proposed Amendments’’).9 The SEC, pursuant to delegated authority, approved the Proposed Amendments on January 20, 2022; 10 however, the Commission has stated that, in accordance with Rule 431(e) of the Commission’s Rules of Practice, the delegated action approving the Proposed Amendments is stayed until the Commission orders otherwise (the ‘‘stay’’).11 FINRA believes it is appropriate, in the interest of regulatory clarity pending the stay, to adjust the 8 See Securities Exchange Act Release No. 95456 (August 9, 2022), 87 FR 50130 (August 15, 2022) (Notice of Filing and Immediate Effectiveness of a Proposed Rule Change to Extend the Implementation Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to SR– FINRA–2015–036; File No. SR–FINRA–2022–023). 9 See Securities Exchange Act Release No. 91937 (May 19, 2021), 86 FR 28161 (May 25, 2021) (Notice of Filing of a Proposed Rule Change to Amend the Requirements for Covered Agency Transactions Under FINRA Rule 4210 (Margin Requirements) as Approved Pursuant to SR–FINRA–2015–036; File No. SR–FINRA–2021–010). See also Partial Amendment No. 1 to SR–FINRA–2021–010, and Letter from Adam Arkel, Associate General Counsel, Office of General Counsel, FINRA, to Vanessa Countryman, Secretary, SEC, dated September 16, 2021, both available at: <www.finra.org>. 10 See Securities Exchange Act Release No. 94013 (January 20, 2022), 87 FR 4076 (January 26, 2022) (Order Granting Approval of a Proposed Rule Change, as Modified by Amendment No. 1, to Amend the Requirements for Covered Agency Transactions Under FINRA Rule 4210 (Margin Requirements) as Approved Pursuant to SR– FINRA–2015–036). 11 See Letter from J. Matthew DeLesDernier, Assistant Secretary, SEC, to Adam Arkel, Associate General Counsel, FINRA, dated January 27, 2022, available at: >sec.gov<. See also Securities Exchange Act Release No. 94724 (April 14, 2022), 87 FR 23287 (April 19, 2022) (Order Granting Petition for Review and Scheduling Filing of Statements; In the Matter of Financial Industry Regulatory Authority, Inc. Regarding an Order Granting the Approval of Proposed Rule Change, as Modified by Amendment No. 1, To Amend the Requirements for Covered Agency Transactions Under FINRA Rule 4210 (Margin Requirements) as Approved Pursuant to SR–FINRA–2015–036). E:\FR\FM\13MRN1.SGM 13MRN1 Federal Register / Vol. 88, No. 48 / Monday, March 13, 2023 / Notices implementation of the requirements pursuant to SR–FINRA–2015–036. As such, FINRA is proposing to extend the April 24, 2023 implementation date to October 25, 2023. FINRA notes that the stay on the delegated action approving the Proposed Amendments applies only to the Proposed Amendments and does not affect the amendments approved pursuant to SR–FINRA–2015–036. FINRA further notes that the risk limit determination requirements pursuant to SR–FINRA–2015–036 became effective on December 15, 2016, and, as such, are not affected by the proposed rule change. FINRA has filed the proposed rule change for immediate effectiveness and has requested that the Commission waive the requirement that the proposed rule change not become operative for 30 days after the date of the filing. The operative date will be the date of filing of the proposed rule change. 2. Statutory Basis FINRA believes that the proposed rule change is consistent with the provisions of Section 15A(b)(6) of the Act,12 which requires, among other things, that FINRA rules must be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. FINRA believes that the proposed rule change serves the interest of regulatory clarity in the Covered Agency Transaction market pending the stay. FINRA believes that this will thereby protect investors and the public interest by helping to promote stability in the Covered Agency Transaction market. B. Self-Regulatory Organization’s Statement on Burden on Competition ddrumheller on DSK120RN23PROD with NOTICES1 FINRA does not believe that the proposed rule change will result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. FINRA believes that extending the April 24, 2023 implementation date to October 25, 2023, pending the stay, will help to provide clarity to industry participants and to promote stability in the Covered Agency Transaction market, thereby benefiting all parties. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. 12 15 U.S.C. 78o–3(b)(6). VerDate Sep<11>2014 19:32 Mar 10, 2023 Jkt 259001 III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the foregoing proposed rule change does not: (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act 13 and Rule 19b– 4(f)(6) thereunder.14 A proposed rule change filed under Rule 19b–4(f)(6) 15 normally does not become operative for 30 days after the date of filing. However, pursuant to Rule 19b–(f)(6)(iii),16 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. FINRA has requested that the Commission waive the 30-day operative delay so that the proposal may become operative upon filing. FINRA has stated that the proposed rule change will help to provide clarity to industry participants and to promote stability in the Covered Agency Transaction market pending further Commission action on the Proposed Amendments. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest because the proposal to extend the implementation date of the amendments to Rule 4210 pursuant to SR–FINRA– 2015–036 (other than the amendments pursuant to SR–FINRA–2015–036 that were implemented on December 15, 2016) does not raise any new or novel issues and will reduce any potential uncertainty in the Covered Agency Transaction market. Therefore, the Commission hereby waives the 30-day operative delay requirement and designates the proposed rule change as operative upon filing.17 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if 13 15 U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). 15 17 CFR 240.19b–4(f)(6) 16 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule 19b–4(f)(6)(iii) 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. FINRA has satisfied this requirement. 17 For purposes of waiving the 30-day operative delay, the Commission has also considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 14 17 PO 00000 Frm 00107 Fmt 4703 Sfmt 4703 15475 it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods: Electronic Comments • Use the Commission’s internet comment form (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– FINRA–2023–002 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–FINRA–2023–002. 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 a.m. and 3 p.m. Copies of such filing also will be available for inspection and copying at the principal office of FINRA. 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 E:\FR\FM\13MRN1.SGM 13MRN1 15476 Federal Register / Vol. 88, No. 48 / Monday, March 13, 2023 / Notices that you wish to make available publicly. All submissions should refer to File Number SR–FINRA–2023–002 and should be submitted on or before April 3, 2023. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.18 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2023–05041 Filed 3–10–23; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–97063; File No. SR–CBOE– 2023–005] Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Designation of a Longer Period for Commission Action on a Proposed Rule Change To Make Permanent the Operation of Its Program That Allows the Exchange To List P.M.-Settled Third Friday-of-theMonth S&P 500 Stock Index (‘‘S&P 500’’) Options (‘‘SPX’’) Series ddrumheller on DSK120RN23PROD with NOTICES1 March 7, 2023. On January 6, 2023, Cboe Exchange, Inc. (‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 a proposed rule change to make permanent the operation of its pilot program that permits the Exchange to list P.M.-settled third Friday-of-themonth SPX options. The proposed rule change was published for comment in the Federal Register on January 24, 2023.3 Section 19(b)(2) of the Act 4 provides that, within 45 days of the publication of notice of the filing of a proposed rule change, or within such longer period up to 90 days as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding, or as to which the self-regulatory organization consents, the Commission shall either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether the proposed rule change should be disapproved. The 45th day after CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 96703 (January 18, 2023), 88 FR 4265. 4 15 U.S.C. 78s(b)(2). publication of the notice for this proposed rule change is March 10, 2023. The Commission is extending this 45day time period. The Commission finds that it is appropriate to designate a longer period within which to take action on the proposed rule change so that it has sufficient time to consider the proposed rule change. Accordingly, the Commission, pursuant to Section 19(b)(2) of the Act,5 designates April 24, 2023, as the date by which the Commission shall either approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change (File No. SR– CBOE–2023–005). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.6 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2023–05042 Filed 3–10–23; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–97052; File No. SR– NYSECHX–2023–09] Self-Regulatory Organizations; NYSE Chicago, Inc.; Notice of Filing of Proposed Rule Change To Adopt New NYSE Chicago Rule 29 To Establish Listing Standards Related To Recovery of Erroneously Awarded IncentiveBased Executive Compensation March 7, 2023. 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 February 22, 2023, NYSE Chicago, Inc. (‘‘NYSE Chicago’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the selfregulatory 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 adopt new Rule 29 to require issuers to develop and implement a policy providing for the recovery of erroneously awarded 18 17 1 15 VerDate Sep<11>2014 19:32 Mar 10, 2023 Jkt 259001 6 17 CFR 200.30–3(a)(31). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 Frm 00108 Fmt 4703 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 On October 26, 2022, the Securities and Exchange Commission (‘‘SEC’’) adopted a new rule and rule amendments 4 to implement Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (‘‘Dodd-Frank Act’’),5 which added Section 10D to the Act.6 In accordance with Section 10D of the Act, the final rules direct the national securities exchanges and associations that list securities to establish listing standards that require each issuer to develop and implement a policy providing for the recovery, in the event of a required accounting restatement, of incentivebased compensation received by current or former executive officers where that compensation is based on the erroneously reported financial information. The listing standards must also require the disclosure of the policy. Additionally, the final rules require a listed issuer to file the policy as an exhibit to its annual report and to include other disclosures in the event a recovery analysis is triggered under the policy. Specifically, the rule amendments the SEC adopted pursuant to Section 10D of the Act 7 require specific disclosure of the listed issuer’s policy on recovery of 4 See Release Nos. 33–11126; 34–96159; IC– 34732; File No. S7–12–15; 87 FR 73076 (November 28, 2022). 5 2 Public Law 111–203, 124 Stat. 1900 (2010). 6 15 U.S.C. 78j–4. 7 See footnote 5 supra. 5 Id. PO 00000 incentive-based compensation received by current or former executive officers. 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. Sfmt 4703 E:\FR\FM\13MRN1.SGM 13MRN1

Agencies

[Federal Register Volume 88, Number 48 (Monday, March 13, 2023)]
[Notices]
[Pages 15473-15476]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-05041]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-97062; File No. SR-FINRA-2023-002]


Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Notice of Filing and Immediate Effectiveness of a 
Proposed Rule Change To Extend the Implementation Date of Certain 
Amendments to FINRA Rule 4210 Approved Pursuant to SR-FINRA-2015-036

March 7, 2023.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on February 24, 2023, the Financial Industry Regulatory Authority, Inc. 
(``FINRA'') filed with the Securities and Exchange Commission (``SEC'' 
or ``Commission'') the proposed rule change as described in Items I and 
II below, which Items have been prepared by FINRA. FINRA has designated 
the proposed rule change as constituting a ``non-controversial'' rule 
change under paragraph (f)(6) of

[[Page 15474]]

Rule 19b-4 under the Act,\3\ which renders the proposal effective upon 
receipt of this filing by the Commission. The Commission is publishing 
this notice to solicit comments on the proposed rule change from 
interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    FINRA is proposing to extend, to October 25, 2023, the 
implementation date of the amendments to FINRA Rule 4210 (Margin 
Requirements) pursuant to SR-FINRA-2015-036, other than the amendments 
pursuant to SR-FINRA-2015-036 that were implemented on December 15, 
2016. The proposed rule change would not make any changes to the text 
of FINRA rules.
    The text of the proposed rule change is available on FINRA's 
website at https://www.finra.org, at the principal office of FINRA 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, FINRA included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. FINRA has prepared summaries, set forth in sections A, 
B, and C below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    On October 6, 2015, FINRA filed with the Commission proposed rule 
change SR-FINRA-2015-036, which proposed to amend FINRA Rule 4210 to 
establish margin requirements for (1) To Be Announced (``TBA'') 
transactions, inclusive of adjustable rate mortgage (``ARM'') 
transactions; (2) Specified Pool Transactions; and (3) transactions in 
Collateralized Mortgage Obligations (``CMOs''), issued in conformity 
with a program of an agency or Government-Sponsored Enterprise 
(``GSE''), with forward settlement dates, as defined more fully in the 
filing (collectively, ``Covered Agency Transactions''). The Commission 
approved SR-FINRA-2015-036 on June 15, 2016 (the ``Approval Date'').\4\
---------------------------------------------------------------------------

    \4\ See Securities Exchange Act Release No. 78081 (June 15, 
2016), 81 FR 40364 (June 21, 2016) (Notice of Filing of Amendment 
No. 3 and Order Granting Accelerated Approval to a Proposed Rule 
Change to Amend FINRA Rule 4210 (Margin Requirements) to Establish 
Margin Requirements for the TBA Market, as Modified by Amendment 
Nos. 1, 2, and 3; File No. SR-FINRA-2015-036).
---------------------------------------------------------------------------

    Pursuant to Partial Amendment No. 3 to SR-FINRA-2015-036, FINRA 
announced in Regulatory Notice 16-31 that the rule change would become 
effective on December 15, 2017, 18 months from the Approval Date, 
except that the risk limit determination requirements as set forth in 
paragraphs (e)(2)(F), (e)(2)(G) and (e)(2)(H) of Rule 4210 and in new 
Supplementary Material .05, each as respectively amended or established 
by SR-FINRA-2015-036 (collectively, the ``risk limit determination 
requirements''), would become effective on December 15, 2016, six 
months from the Approval Date.\5\
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    \5\ See Partial Amendment No. 3 to SR-FINRA-2015-036 and 
Regulatory Notice 16-31 (August 2016), both available at: 
<www.finra.org>.
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    Industry participants sought clarification regarding the 
implementation of the requirements pursuant to SR-FINRA-2015-036. 
Industry participants also requested additional time to make system 
changes necessary to comply with the requirements, including time to 
test the system changes, and requested additional time to update or 
amend margining agreements and related documentation. In response, 
FINRA made available a set of Frequently Asked Questions & Guidance \6\ 
and, pursuant to SR-FINRA-2017-029,\7\ extended the implementation date 
of the requirements of SR-FINRA-2015-036 to June 25, 2018, except for 
the risk limit determination requirements, which, as announced in 
Regulatory Notice 16-31, became effective on December 15, 2016.
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    \6\ See Responses to Frequently Asked Questions Regarding 
Covered Agency Transactions Under FINRA Rule 4210, at: <https://www.finra.org/rules-guidance/guidance/faqs/responses-frequently-asked-questions-regarding-covered-agency-transactions-under-finra-rule>. Further, staff of the SEC's Division of Trading and Markets 
made available a set of Frequently Asked Questions regarding 
Exchange Act Rule 15c3-1 and Rule 15c3-3 in connection with Covered 
Agency Transactions under FINRA Rule 4210, also available at: 
<https://www.finra.org/rules-guidance/guidance/faqs/responses-frequently-asked-questions-regarding-covered-agency-transactions-under-finra-rule>.
    \7\ See Securities Exchange Act Release No. 81722 (September 26, 
2017), 82 FR 45915 (October 2, 2017) (Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change to Delay the Implementation 
Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to 
SR-FINRA-2015-036; File No. SR-FINRA-2017-029); see also Regulatory 
Notice 17-28 (September 2017).
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    Industry participants requested that FINRA reconsider the potential 
impact of certain requirements pursuant to SR-FINRA-2015-036 on smaller 
and mid-sized firms. Industry participants also requested that FINRA 
extend the implementation date pending such reconsideration. In 
response to these concerns, FINRA further extended the implementation 
date of the requirements of SR-FINRA-2015-036, other than the risk 
limit determination requirements, most recently to April 24, 2023 (the 
``April 24, 2023 implementation date''),\8\ and, informed by extensive 
dialogue, both with industry participants and other regulators, 
including the staff of the SEC and the Federal Reserve System, FINRA 
proposed amendments to the requirements of SR-FINRA-2015-036 (the 
``Proposed Amendments'').\9\
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    \8\ See Securities Exchange Act Release No. 95456 (August 9, 
2022), 87 FR 50130 (August 15, 2022) (Notice of Filing and Immediate 
Effectiveness of a Proposed Rule Change to Extend the Implementation 
Date of Certain Amendments to FINRA Rule 4210 Approved Pursuant to 
SR-FINRA-2015-036; File No. SR-FINRA-2022-023).
    \9\ See Securities Exchange Act Release No. 91937 (May 19, 
2021), 86 FR 28161 (May 25, 2021) (Notice of Filing of a Proposed 
Rule Change to Amend the Requirements for Covered Agency 
Transactions Under FINRA Rule 4210 (Margin Requirements) as Approved 
Pursuant to SR-FINRA-2015-036; File No. SR-FINRA-2021-010). See also 
Partial Amendment No. 1 to SR-FINRA-2021-010, and Letter from Adam 
Arkel, Associate General Counsel, Office of General Counsel, FINRA, 
to Vanessa Countryman, Secretary, SEC, dated September 16, 2021, 
both available at: <www.finra.org>.
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    The SEC, pursuant to delegated authority, approved the Proposed 
Amendments on January 20, 2022; \10\ however, the Commission has stated 
that, in accordance with Rule 431(e) of the Commission's Rules of 
Practice, the delegated action approving the Proposed Amendments is 
stayed until the Commission orders otherwise (the ``stay'').\11\ FINRA 
believes it is appropriate, in the interest of regulatory clarity 
pending the stay, to adjust the

[[Page 15475]]

implementation of the requirements pursuant to SR-FINRA-2015-036. As 
such, FINRA is proposing to extend the April 24, 2023 implementation 
date to October 25, 2023. FINRA notes that the stay on the delegated 
action approving the Proposed Amendments applies only to the Proposed 
Amendments and does not affect the amendments approved pursuant to SR-
FINRA-2015-036. FINRA further notes that the risk limit determination 
requirements pursuant to SR-FINRA-2015-036 became effective on December 
15, 2016, and, as such, are not affected by the proposed rule change.
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    \10\ See Securities Exchange Act Release No. 94013 (January 20, 
2022), 87 FR 4076 (January 26, 2022) (Order Granting Approval of a 
Proposed Rule Change, as Modified by Amendment No. 1, to Amend the 
Requirements for Covered Agency Transactions Under FINRA Rule 4210 
(Margin Requirements) as Approved Pursuant to SR-FINRA-2015-036).
    \11\ See Letter from J. Matthew DeLesDernier, Assistant 
Secretary, SEC, to Adam Arkel, Associate General Counsel, FINRA, 
dated January 27, 2022, available at: >sec.gov<. See also Securities 
Exchange Act Release No. 94724 (April 14, 2022), 87 FR 23287 (April 
19, 2022) (Order Granting Petition for Review and Scheduling Filing 
of Statements; In the Matter of Financial Industry Regulatory 
Authority, Inc. Regarding an Order Granting the Approval of Proposed 
Rule Change, as Modified by Amendment No. 1, To Amend the 
Requirements for Covered Agency Transactions Under FINRA Rule 4210 
(Margin Requirements) as Approved Pursuant to SR-FINRA-2015-036).
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    FINRA has filed the proposed rule change for immediate 
effectiveness and has requested that the Commission waive the 
requirement that the proposed rule change not become operative for 30 
days after the date of the filing. The operative date will be the date 
of filing of the proposed rule change.
2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the 
provisions of Section 15A(b)(6) of the Act,\12\ which requires, among 
other things, that FINRA rules must be designed to prevent fraudulent 
and manipulative acts and practices, to promote just and equitable 
principles of trade, and, in general, to protect investors and the 
public interest. FINRA believes that the proposed rule change serves 
the interest of regulatory clarity in the Covered Agency Transaction 
market pending the stay. FINRA believes that this will thereby protect 
investors and the public interest by helping to promote stability in 
the Covered Agency Transaction market.
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    \12\ 15 U.S.C. 78o-3(b)(6).
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B. Self-Regulatory Organization's Statement on Burden on Competition

    FINRA does not believe that the proposed rule change will result in 
any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Act. FINRA believes that extending 
the April 24, 2023 implementation date to October 25, 2023, pending the 
stay, will help to provide clarity to industry participants and to 
promote stability in the Covered Agency Transaction market, thereby 
benefiting all parties.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Because the foregoing proposed rule change does not: (i) 
significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
become operative for 30 days from the date on which it was filed, or 
such shorter time as the Commission may designate, it has become 
effective pursuant to Section 19(b)(3)(A) of the Act \13\ and Rule 19b-
4(f)(6) thereunder.\14\
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) \15\ normally 
does not become operative for 30 days after the date of filing. 
However, pursuant to Rule 19b-(f)(6)(iii),\16\ the Commission may 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. FINRA has requested 
that the Commission waive the 30-day operative delay so that the 
proposal may become operative upon filing. FINRA has stated that the 
proposed rule change will help to provide clarity to industry 
participants and to promote stability in the Covered Agency Transaction 
market pending further Commission action on the Proposed Amendments.
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    \15\ 17 CFR 240.19b-4(f)(6)
    \16\ 17 CFR 240.19b-4(f)(6)(iii). In addition, Rule 19b-
4(f)(6)(iii) 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. FINRA has satisfied this requirement.
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    The Commission believes that waiving the 30-day operative delay is 
consistent with the protection of investors and the public interest 
because the proposal to extend the implementation date of the 
amendments to Rule 4210 pursuant to SR-FINRA-2015-036 (other than the 
amendments pursuant to SR-FINRA-2015-036 that were implemented on 
December 15, 2016) does not raise any new or novel issues and will 
reduce any potential uncertainty in the Covered Agency Transaction 
market. Therefore, the Commission hereby waives the 30-day operative 
delay requirement and designates the proposed rule change as operative 
upon filing.\17\
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    \17\ For purposes of waiving the 30-day operative delay, the 
Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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    At any time within 60 days of the filing of the proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings to 
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to sec.gov">[email protected]sec.gov. Please include 
File Number SR-FINRA-2023-002 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-FINRA-2023-002. 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 a.m. and 3 
p.m. Copies of such filing also will be available for inspection and 
copying at the principal office of FINRA.
    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

[[Page 15476]]

that you wish to make available publicly.
    All submissions should refer to File Number SR-FINRA-2023-002 and 
should be submitted on or before April 3, 2023.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
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    \18\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-05041 Filed 3-10-23; 8:45 am]
BILLING CODE 8011-01-P
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