Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Change To Amend Rules 7.4E, 64, 236, and 257, as Well as Sections 510, 512, and 521 of the NYSE American LLC Company Guide, 24049-24051 [2024-07220]
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Federal Register / Vol. 89, No. 67 / Friday, April 5, 2024 / Notices
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 the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–CboeEDGA–2024–009 and should
be submitted on or before April 26,
2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024–07223 Filed 4–4–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
Self-Regulatory Organizations; NYSE
American LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Change To Amend Rules 7.4E, 64, 236,
and 257, as Well as Sections 510, 512,
and 521 of the NYSE American LLC
Company Guide
khammond on DSKJM1Z7X2PROD with NOTICES
April 1, 2024.
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 March 25,
2024, NYSE American LLC (‘‘NYSE
American’’ 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
19 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
16:44 Apr 04, 2024
• Section 512 of the NYSE American
LLC Company Guide (Ex-Dividend
Procedure)
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
Rules 7.4E, 64, 236, and 257, as well as
Sections 510, 512, and 521 of the NYSE
American LLC Company Guide, to
conform to amendments to Rule 15c6–
1(a) of the Act to shorten the standard
settlement cycle for most broker-dealer
transactions from two business days
after the trade date (‘‘T+2’’) to one
business day after the trade date
(‘‘T+1’’). 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.
Proposed Rule Change
The Exchange proposes the following
changes to reflect a T+1 settlement
cycle.
• Rule 7.4E currently provides that
transactions in stocks traded regular
way are generally ‘‘ex-dividend’’ or ‘‘exrights’’ on the business day preceding
the record date or the date of the closing
of transfer books, or else on the second
preceding business day when the record
date or closing of transfer books occurs
on a non-business day. To reflect
settlement on T+1 rather than T+2, the
Exchange proposes to amend this rule to
provide that transactions would be exdividend or ex-rights on the record date
or date of the closing of transfer books,
or on the preceding business day when
the record date or closing of transfer
books occurs on a non-business day.
• Current Rule 64(a)(i) defines regular
way delivery as occurring on the second
business day following the day of the
contract. To conform with the transition
to a T+1 settlement cycle, the Exchange
proposes to amend Rule 64(a)(i) to
delete the word ‘‘second,’’ such that the
rule would provide that regular way
delivery occurs on the business day
following the day of the contract.4
• Current Rule 236 5 provides that exwarrant trading will begin on the
business day preceding the date of
expiration of the warrants, except that
when expiration occurs on a nonbusiness day, it will begin on the second
business day preceding expiration. To
conform with a T+1 settlement cycle,
the Exchange proposes to delete the
phrase ‘‘the business day preceding,’’
such that the rule would provide that
these transactions would be ex-warrants
on the date of expiration, and the word
‘‘second,’’ such that the rule would
provide for expiration on the business
day preceding expiration when
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.
1. Purpose
On March 6, 2023, the Commission
adopted amendments to Rule 15c6–1(a)
of the Act to shorten the standard
settlement cycle for most broker-dealer
transactions from T+2 to T+1.3
Accordingly, the Exchange proposes to
amend the rules identified below to
conform with the amendments to Rule
15c6–1(a) and reflect a standard
settlement cycle of T+1:
• Rule 7.4E (Ex-Dividend or Ex-Rights
Dates)
• Rule 64 (Equities. Bonds, Rights and
100-Share-Unit Stocks)
• Rule 236 (Equities.Ex-Warrants)
• Rule 257 (Equities. Deliveries After
‘Ex’ Date)
• Section 510 of the NYSE American
LLC Company Guide (Two Day
Delivery Plan)
3 See Securities Exchange Act Release No. 96930,
88 FR 13872 (March 6, 2023) (‘‘T+1 Adopting
Release’’).
1 15
VerDate Sep<11>2014
publishing this notice to solicit
comments on the proposed rule change
from interested persons.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
[Release No. 34–99872; File No. SR–
NYSEAMER–2024–23]
Jkt 262001
24049
PO 00000
Frm 00089
Fmt 4703
Sfmt 4703
4 The Exchange also proposes to delete the
obsolete parenthetical reference to Rule 14 in
current Rule 64(a)(i), as Rule 14 is not applicable
to trading on the Pillar platform. See Securities
Exchange Act Release No. 82212 (December 4,
2017), 82 FR 58036 (December 8, 2017) (SR–
NYSEAMER–2017–34) (Notice of Filing and
Immediate Effectiveness of Proposed Rule Change
To Amend Exchange Rules To Delete Obsolete Cash
Equities Rules That Are Not Applicable to Trading
on the Pillar Trading Platform and To Delete Other
Obsolete Rules). The Exchange further proposes to
delete Rules 64(a)(ii), 64(b), and 64(c), as the nonregular way settlement options described in such
rules are no longer available on the Exchange. See
id. The Exchange also proposes non-substantive
conforming changes in Rule 64(a) to reflect the
deletion of Rules 64(a)(ii), 64(b), and 64(c).
5 The Exchange also proposes to amend the
section header above Rule 236 to conform it with
the current title and substance of Rule 236.
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Federal Register / Vol. 89, No. 67 / Friday, April 5, 2024 / Notices
khammond on DSKJM1Z7X2PROD with NOTICES
expiration occurs on a non-business
day.6
• Current Rule 257 provides that
when a security is sold before it is exdividend or ex-rights and delivery is
made too late to enable the buyer to
obtain transfer in time to become a
holder of record to receive the
distribution to be made with respect to
such security, the seller shall pay or
deliver the distribution to the buyer as
set forth in this rule. In the case of stock
dividends or rights to subscribe, the
seller must deliver to the buyer within
two days after the record date either the
dividend or rights (or due-bill for the
same). In the case of cash dividends, the
seller must deliver to the buyer within
two days after the record date a due-billcheck for the amount of the dividend.
The Exchange proposes to amend Rule
257 to replace the references to ‘‘two
days after the record date’’ with
references to ‘‘one day after the record
date,’’ to conform with the transition to
a T+1 settlement cycle.7
• Section 510 of the NYSE American
LLC Company Guide provides that
transactions effected regular way on the
Exchange are due for settlement in two
business days. To conform with the
transition from T+2 to T+1 settlement,
the Exchange proposes to amend
Section 510 to provide that transactions
on the Exchange will be settled in one
business day and are due for settlement
on the business day after the transaction
date. The Exchange further proposes to
amend the days of the week in the
example provided in Section 510 from
Tuesday to Monday and from
Wednesday to Tuesday, to reflect the
shortened settlement cycle.
• Section 512 of the NYSE American
LLC Company Guide currently provides
that transactions are ex-dividend on the
business day preceding the record date,
except that if the record date is not a
business day, the transaction would be
ex-dividend on the second preceding
business day. To conform with T+1
settlement, the Exchange proposes to
amend Section 512 to provide that
transactions would be ex-dividend on
the record date or, if the record date is
a non-business day, on the preceding
business day.8
6 The Exchange also proposes to delete the
parenthetical reference to Rule 14 because, as noted
above, Rule 14 is no longer applicable to trading on
the Exchange. See note 4, supra.
7 The Exchange further proposes to delete the
reference to Rule 14 because, as noted above, Rule
14 is no longer applicable to trading on the
Exchange. See note 4, supra.
8 The Exchange also proposes to delete references
to cash transactions in Section 521 as obsolete. See
note 4, supra.
VerDate Sep<11>2014
16:44 Apr 04, 2024
Jkt 262001
Implementation
The Exchange proposes that the
operative date of this proposed rule
change will be Tuesday, May 28, 2024,
which is the compliance date specified
in the T+1 Adopting Release, or such
later date as may be announced by the
Commission for compliance with the
amendments to Rule 15c6–1(a) set forth
in the T+1 Adopting Release.9 With the
implementation of the T+1 settlement
cycle and as described in the proposed
changes outlined above, the ex-dividend
date for ‘‘normal’’ distributions will be
the same business day as the record
date. Accordingly, the Exchange
proposes that Wednesday, May 29, 2024
would be the first date to which the
proposed rules described herein would
apply (i.e., the first record date to which
the new ex-dividend date rationale will
be applied). During the implementation
of the T+1 settlement cycle, the
Exchange proposes that the ex-dividend
dates will be as follows:
Record date
May 24, 2024 ............
May 28, 2024 ............
May 29, 2024 ............
Ex-dividend date
May 23, 2024.
May 24, 2024.
May 29, 2024.
A record date of Friday, May 24, 2024
would be a date prior to the effective
date of the amendments to Rule 15c6–
1(a) of the Act to shorten the standard
settlement cycle for most broker-dealer
transactions from T+2 to T+1.10 The
rules described above would apply to
this record date in their current form
and, thus, the ‘‘ex-dividend date’’ would
be the first business day preceding the
record date or Thursday, May 23, 2024.
Monday, May 27, 2024 is Memorial Day,
which is an Exchange holiday;
accordingly, there would be no record
date on a holiday. A record date of
Tuesday, May 28, 2024 would also fall
under the Exchange’s current rules, and
the first business day preceding such
record date would be Friday, May 24,
2024. On Wednesday, May 29, 2024, the
proposed rules described above would
apply, such that, for the record date of
May 29, 2024, the ‘‘ex-dividend date’’
would be the same business day.
The Exchange will issue a Trader
Notice regarding the implementation of
the proposed rule change and T+1
settlement cycle, which date would
correspond with the industry-led
transition to a T+1 standard settlement,
and the compliance date of the
Commission’s amendment of Rule
15c6–1(a) of the Act to require standard
settlement no later than T+1.
9 See
note 3, supra.
note 3, supra.
Frm 00090
Fmt 4703
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
proposed change is not designed to
address any competitive issue, but
rather to support the industry’s
transition to a T+1 regular-way
settlement cycle in conformity with the
Commission’s amendment of Rule
15c6–1(a). The proposed change amends
the Exchange’s rules pertaining to
securities settlement, which rules would
apply uniformly to all contracts for the
purchase or sale of a security (other than
exempted securities) that provide for
payment of funds and delivery of
securities that occur on the Exchange or
11 15
10 See
PO 00000
2. Statutory Basis
The Exchange believes that the
proposed rule change is consistent with
Section 6(b) of the Act,11 in general, and
furthers the objectives of Section 6(b)(5)
of the Act,12 in particular, because it is
designed to prevent fraudulent and
manipulative acts and practices,
promote just and equitable principles of
trade, to foster cooperation and
coordination with persons engaged in
regulating, clearing, settling, processing
information with respect to, and 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.
In particular, the proposed rule
change would amend the Exchange’s
rules to reflect a standard settlement
cycle of T+1, in support of the industryled initiative to shorten the settlement
cycle to one business day. Moreover, the
proposed rule change is consistent with
the Commission’s amendments to Rule
15c6–1(a) of the Act to require standard
settlement no later than T+1. The
Exchange believes that the proposed
rule change would provide regulatory
certainty to facilitate the industry-led
move to a T+1 settlement cycle. The
Exchange further believes that, by
shortening the time period for
settlement of most securities
transactions, the proposed rule change
would protect investors and the public
interest by reducing the number of
unsettled trades in the clearance and
settlement system at any given time,
thereby reducing the risk inherent in
settling securities transactions to
clearing corporations, their members,
and public investors.
12 15
Sfmt 4703
E:\FR\FM\05APN1.SGM
U.S.C. 78f(b).
U.S.C. 78f(b)(5).
05APN1
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Federal Register / Vol. 89, No. 67 / Friday, April 5, 2024 / Notices
other self-regulatory organizations and
is intended to facilitate the industrywide transition to a T+1 settlement
cycle. The Exchange also believes that
the proposed rule change will serve to
promote clarity and consistency in its
rules, thereby reducing burdens on the
marketplace and facilitating investor
protection. Accordingly, the Exchange
believes that the proposed changes do
not impose any burden on competition
other than that necessary to implement
the amendments to Rule 15c6–1(a) of
the Act as set forth in the T+1 Adopting
Release.13
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 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 and Rule 19b–4(f)(6) thereunder.
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.
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:
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–2024–23. 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 the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–NYSEAMER–2024–23 and should
be submitted on or before April 26,
2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024–07220 Filed 4–4–24; 8:45 am]
BILLING CODE 8011–01–P
khammond on DSKJM1Z7X2PROD with NOTICES
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–2024–23 on the subject
line.
13 See
note 3, supra.
VerDate Sep<11>2014
16:44 Apr 04, 2024
[Release No. 34–99877; File No. SR–
CboeEDGX–2024–018]
Self-Regulatory Organizations; Cboe
EDGX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Amend Rule
2.8 Regarding Voluntary Termination
of Rights as an Exchange Member
April 1, 2024.
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 March 19,
2024, Cboe EDGX Exchange, Inc.
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Exchange filed the
proposal pursuant to Section
19(b)(3)(A)(iii) of the Act 3 and Rule
19b–4(f)(6) thereunder.4 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
Cboe EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) proposes to
amend Rule 2.8, related to the voluntary
termination of rights as an Exchange
Member (‘‘Member’’).5 The text of the
proposed rule change is provided
below.
(Additions are italicized; deletions are
[bracketed])
*
*
*
*
*
*
PO 00000
Frm 00091
Fmt 4703
Sfmt 4703
*
*
*
Rule 2.8. Voluntary Termination of
Rights as a Member
A Member may voluntarily terminate
its rights as a Member only by a written
resignation addressed to the Exchange’s
Secretary or another officer designated
by the Exchange. [Such resignation shall
not take effect until 30 days after all of
the following conditions have been
satisfied: (i) receipt of such written
resignation; (ii) all indebtedness due the
Exchange shall have been paid in full;
(iii) any Exchange investigation or
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A)(iii).
4 17 CFR 240.19b–4(f)(6).
5 See Exchange Rule 1.5(n). The term ‘‘Member’’
is defined as ‘‘any registered broker or dealer that
has been admitted to membership in the Exchange.’’
2 17
CFR 200.30–3(a)(12).
*
Rules of Cboe EDGX Exchange, Inc.
1 15
14 17
Jkt 262001
SECURITIES AND EXCHANGE
COMMISSION
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]]>Agencies
[Federal Register Volume 89, Number 67 (Friday, April 5, 2024)]
[Notices]
[Pages 24049-24051]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-07220]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-99872; File No. SR-NYSEAMER-2024-23]
Self-Regulatory Organizations; NYSE American LLC; Notice of
Filing and Immediate Effectiveness of Proposed Change To Amend Rules
7.4E, 64, 236, and 257, as Well as Sections 510, 512, and 521 of the
NYSE American LLC Company Guide
April 1, 2024.
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 March 25, 2024, NYSE American LLC (``NYSE American'' 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 Rules 7.4E, 64, 236, and 257, as
well as Sections 510, 512, and 521 of the NYSE American LLC Company
Guide, to conform to amendments to Rule 15c6-1(a) of the Act to shorten
the standard settlement cycle for most broker-dealer transactions from
two business days after the trade date (``T+2'') to one business day
after the trade date (``T+1''). 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
On March 6, 2023, the Commission adopted amendments to Rule 15c6-
1(a) of the Act to shorten the standard settlement cycle for most
broker-dealer transactions from T+2 to T+1.\3\ Accordingly, the
Exchange proposes to amend the rules identified below to conform with
the amendments to Rule 15c6-1(a) and reflect a standard settlement
cycle of T+1:
---------------------------------------------------------------------------
\3\ See Securities Exchange Act Release No. 96930, 88 FR 13872
(March 6, 2023) (``T+1 Adopting Release'').
Rule 7.4E (Ex-Dividend or Ex-Rights Dates)
Rule 64 (Equities. Bonds, Rights and 100-Share-Unit Stocks)
Rule 236 (Equities.Ex-Warrants)
Rule 257 (Equities. Deliveries After `Ex' Date)
Section 510 of the NYSE American LLC Company Guide (Two Day
Delivery Plan)
Section 512 of the NYSE American LLC Company Guide (Ex-
Dividend Procedure)
Proposed Rule Change
The Exchange proposes the following changes to reflect a T+1
settlement cycle.
Rule 7.4E currently provides that transactions in stocks
traded regular way are generally ``ex-dividend'' or ``ex-rights'' on
the business day preceding the record date or the date of the closing
of transfer books, or else on the second preceding business day when
the record date or closing of transfer books occurs on a non-business
day. To reflect settlement on T+1 rather than T+2, the Exchange
proposes to amend this rule to provide that transactions would be ex-
dividend or ex-rights on the record date or date of the closing of
transfer books, or on the preceding business day when the record date
or closing of transfer books occurs on a non-business day.
Current Rule 64(a)(i) defines regular way delivery as
occurring on the second business day following the day of the contract.
To conform with the transition to a T+1 settlement cycle, the Exchange
proposes to amend Rule 64(a)(i) to delete the word ``second,'' such
that the rule would provide that regular way delivery occurs on the
business day following the day of the contract.\4\
---------------------------------------------------------------------------
\4\ The Exchange also proposes to delete the obsolete
parenthetical reference to Rule 14 in current Rule 64(a)(i), as Rule
14 is not applicable to trading on the Pillar platform. See
Securities Exchange Act Release No. 82212 (December 4, 2017), 82 FR
58036 (December 8, 2017) (SR-NYSEAMER-2017-34) (Notice of Filing and
Immediate Effectiveness of Proposed Rule Change To Amend Exchange
Rules To Delete Obsolete Cash Equities Rules That Are Not Applicable
to Trading on the Pillar Trading Platform and To Delete Other
Obsolete Rules). The Exchange further proposes to delete Rules
64(a)(ii), 64(b), and 64(c), as the non-regular way settlement
options described in such rules are no longer available on the
Exchange. See id. The Exchange also proposes non-substantive
conforming changes in Rule 64(a) to reflect the deletion of Rules
64(a)(ii), 64(b), and 64(c).
---------------------------------------------------------------------------
Current Rule 236 \5\ provides that ex-warrant trading will
begin on the business day preceding the date of expiration of the
warrants, except that when expiration occurs on a non-business day, it
will begin on the second business day preceding expiration. To conform
with a T+1 settlement cycle, the Exchange proposes to delete the phrase
``the business day preceding,'' such that the rule would provide that
these transactions would be ex-warrants on the date of expiration, and
the word ``second,'' such that the rule would provide for expiration on
the business day preceding expiration when
[[Page 24050]]
expiration occurs on a non-business day.\6\
---------------------------------------------------------------------------
\5\ The Exchange also proposes to amend the section header above
Rule 236 to conform it with the current title and substance of Rule
236.
\6\ The Exchange also proposes to delete the parenthetical
reference to Rule 14 because, as noted above, Rule 14 is no longer
applicable to trading on the Exchange. See note 4, supra.
---------------------------------------------------------------------------
Current Rule 257 provides that when a security is sold
before it is ex-dividend or ex-rights and delivery is made too late to
enable the buyer to obtain transfer in time to become a holder of
record to receive the distribution to be made with respect to such
security, the seller shall pay or deliver the distribution to the buyer
as set forth in this rule. In the case of stock dividends or rights to
subscribe, the seller must deliver to the buyer within two days after
the record date either the dividend or rights (or due-bill for the
same). In the case of cash dividends, the seller must deliver to the
buyer within two days after the record date a due-bill-check for the
amount of the dividend. The Exchange proposes to amend Rule 257 to
replace the references to ``two days after the record date'' with
references to ``one day after the record date,'' to conform with the
transition to a T+1 settlement cycle.\7\
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\7\ The Exchange further proposes to delete the reference to
Rule 14 because, as noted above, Rule 14 is no longer applicable to
trading on the Exchange. See note 4, supra.
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Section 510 of the NYSE American LLC Company Guide
provides that transactions effected regular way on the Exchange are due
for settlement in two business days. To conform with the transition
from T+2 to T+1 settlement, the Exchange proposes to amend Section 510
to provide that transactions on the Exchange will be settled in one
business day and are due for settlement on the business day after the
transaction date. The Exchange further proposes to amend the days of
the week in the example provided in Section 510 from Tuesday to Monday
and from Wednesday to Tuesday, to reflect the shortened settlement
cycle.
Section 512 of the NYSE American LLC Company Guide
currently provides that transactions are ex-dividend on the business
day preceding the record date, except that if the record date is not a
business day, the transaction would be ex-dividend on the second
preceding business day. To conform with T+1 settlement, the Exchange
proposes to amend Section 512 to provide that transactions would be ex-
dividend on the record date or, if the record date is a non-business
day, on the preceding business day.\8\
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\8\ The Exchange also proposes to delete references to cash
transactions in Section 521 as obsolete. See note 4, supra.
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Implementation
The Exchange proposes that the operative date of this proposed rule
change will be Tuesday, May 28, 2024, which is the compliance date
specified in the T+1 Adopting Release, or such later date as may be
announced by the Commission for compliance with the amendments to Rule
15c6-1(a) set forth in the T+1 Adopting Release.\9\ With the
implementation of the T+1 settlement cycle and as described in the
proposed changes outlined above, the ex-dividend date for ``normal''
distributions will be the same business day as the record date.
Accordingly, the Exchange proposes that Wednesday, May 29, 2024 would
be the first date to which the proposed rules described herein would
apply (i.e., the first record date to which the new ex-dividend date
rationale will be applied). During the implementation of the T+1
settlement cycle, the Exchange proposes that the ex-dividend dates will
be as follows:
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\9\ See note 3, supra.
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Record date Ex-dividend date
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May 24, 2024.............................. May 23, 2024.
May 28, 2024.............................. May 24, 2024.
May 29, 2024.............................. May 29, 2024.
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A record date of Friday, May 24, 2024 would be a date prior to the
effective date of the amendments to Rule 15c6-1(a) of the Act to
shorten the standard settlement cycle for most broker-dealer
transactions from T+2 to T+1.\10\ The rules described above would apply
to this record date in their current form and, thus, the ``ex-dividend
date'' would be the first business day preceding the record date or
Thursday, May 23, 2024. Monday, May 27, 2024 is Memorial Day, which is
an Exchange holiday; accordingly, there would be no record date on a
holiday. A record date of Tuesday, May 28, 2024 would also fall under
the Exchange's current rules, and the first business day preceding such
record date would be Friday, May 24, 2024. On Wednesday, May 29, 2024,
the proposed rules described above would apply, such that, for the
record date of May 29, 2024, the ``ex-dividend date'' would be the same
business day.
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\10\ See note 3, supra.
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The Exchange will issue a Trader Notice regarding the
implementation of the proposed rule change and T+1 settlement cycle,
which date would correspond with the industry-led transition to a T+1
standard settlement, and the compliance date of the Commission's
amendment of Rule 15c6-1(a) of the Act to require standard settlement
no later than T+1.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with Section 6(b) of the Act,\11\ in general, and furthers the
objectives of Section 6(b)(5) of the Act,\12\ in particular, because it
is designed to prevent fraudulent and manipulative acts and practices,
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and 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.
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\11\ 15 U.S.C. 78f(b).
\12\ 15 U.S.C. 78f(b)(5).
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In particular, the proposed rule change would amend the Exchange's
rules to reflect a standard settlement cycle of T+1, in support of the
industry-led initiative to shorten the settlement cycle to one business
day. Moreover, the proposed rule change is consistent with the
Commission's amendments to Rule 15c6-1(a) of the Act to require
standard settlement no later than T+1. The Exchange believes that the
proposed rule change would provide regulatory certainty to facilitate
the industry-led move to a T+1 settlement cycle. The Exchange further
believes that, by shortening the time period for settlement of most
securities transactions, the proposed rule change would protect
investors and the public interest by reducing the number of unsettled
trades in the clearance and settlement system at any given time,
thereby reducing the risk inherent in settling securities transactions
to clearing corporations, their members, and public investors.
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 proposed change is not
designed to address any competitive issue, but rather to support the
industry's transition to a T+1 regular-way settlement cycle in
conformity with the Commission's amendment of Rule 15c6-1(a). The
proposed change amends the Exchange's rules pertaining to securities
settlement, which rules would apply uniformly to all contracts for the
purchase or sale of a security (other than exempted securities) that
provide for payment of funds and delivery of securities that occur on
the Exchange or
[[Page 24051]]
other self-regulatory organizations and is intended to facilitate the
industry-wide transition to a T+1 settlement cycle. The Exchange also
believes that the proposed rule change will serve to promote clarity
and consistency in its rules, thereby reducing burdens on the
marketplace and facilitating investor protection. Accordingly, the
Exchange believes that the proposed changes do not impose any burden on
competition other than that necessary to implement the amendments to
Rule 15c6-1(a) of the Act as set forth in the T+1 Adopting Release.\13\
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\13\ See note 3, supra.
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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 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 and Rule
19b-4(f)(6) thereunder.
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.
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-NYSEAMER-2024-23 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-2024-23. 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 the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-NYSEAMER-2024-23 and should
be submitted on or before April 26, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\14\
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\14\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024-07220 Filed 4-4-24; 8:45 am]
BILLING CODE 8011-01-P
