[Federal Register Volume 85, Number 99 (Thursday, May 21, 2020)]
[Notices]
[Pages 31017-31019]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-10935]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-88891; File No. SR-NYSE-2020-45]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Extend the Temporary Period for Commentaries to Rules 7.35, 7.35A,
7.35B, and 7.35C
May 15, 2020.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act''),\2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that on May 15, 2020, New York Stock Exchange LLC (``NYSE'' or
``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 self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 15 U.S.C. 78a.
\3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to extend the temporary period for
Commentaries to Rules 7.35, 7.35A, 7.35B, and 7.35C to end on the
earlier of the reopening of the Trading Floor facilities or after the
Exchange closes on May 22, 2020. 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
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to modify the temporary period for
Commentaries to Rules 7.35, 7.35A, 7.35B, and 7.35C to end on the
earlier of the reopening of the Trading Floor facilities or after the
Exchange closes on May 22, 2020. The current temporary period that
these Rules are in effect ends on the earlier of the reopening of the
Trading Floor facilities or after the Exchange closes on May 15, 2020.
To slow the spread of COVID-19 through social-distancing measures,
on March 18, 2020, the CEO of the Exchange made a determination under
Rule 7.1(c)(3) that, beginning March 23, 2020, the Trading Floor
facilities located at 11 Wall Street in New York City would close and
the Exchange would move, on a temporary basis, to fully electronic
trading.\4\ Pursuant to Rule 7.1(e), the CEO notified the Board of
Directors of the Exchange of this determination.
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\4\ The Exchange's current rules establish how the Exchange will
function fully-electronically. The CEO also closed the NYSE American
Options Trading Floor, which is located at the same 11 Wall Street
facilities, and the NYSE Arca Options Trading Floor, which is
located in San Francisco, CA. See Press Release, dated March 18,
2020, available here: https://ir.theice.com/press/press-releases/all-categories/2020/03-18-2020-204202110.
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For the period while the Trading Floor is temporarily closed, the
Exchange has modified the rules governing Auctions to add the following
Commentaries that are in effect until the earlier of the reopening of
the Trading Floor facilities or after the Exchange closes on May 15,
2020:
Commentary .01 to Rule 7.35C; \5\
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\5\ See Securities Exchange Act Release No. 88413 (March 18,
2020), 85 FR 16713 (March 24, 2020) (SR-NYSE-2020-19).
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Commentary .01 to Rule 7.35A; Commentary .01 to Rule
7.35B; and Commentary .02 to Rule 7.35C; \6\
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\6\ See Securities Exchange Act Release No. 88444 (March 20,
2020), 85 FR 17141 (March 26, 2020) (SR-NYSE-2020-22).
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Commentary .02 to Rule 7.35A; \7\
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\7\ See Securities Exchange Act Release No. 88488 (March 26,
2020), 85 FR 18286 (April 1, 2020) (SR-NYSE-2020-23).
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Commentary .03 to Rule 7.35A; \8\
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\8\ See Securities Exchange Act Release No. 88546 (April 2,
2020), 85 FR 19782 (April 8, 2020) (SR-NYSE-2020-28).
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Commentary .03 to Rule 7.35C; \9\
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\9\ See Securities Exchange Act Release No. 88562 (April 3,
2020), 85 FR 20002 (April 9, 2020) (SR-NYSE-2020-29).
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Commentary .04 to Rule 7.35A; \10\
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\10\ See Securities Exchange Act Release No. 88705 (April 21,
2020), 85 FR 23413 (April 27, 2020) (SR-NYSE-2020-35).
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Commentary .01 to Rule 7.35; \11\ and
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\11\ See Securities Exchange Act Release No. 88725 (April 22,
2020), 85 FR 23583 (April 28, 2020) (SR-NYSE-2020-37).
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Commentary .02 to Rule 7.35B. \12\
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\12\ See Securities Exchange Act Release No. 88829 (May 6,
2020), 85 FR 28115 (May 12, 2020) (SR-NYSE-2020-41). The rule text
filed with this proposed rule change unintentionally changed the end
date of Commentary .01 to Rule 7.35B to May 29, 2020 instead of May
15, 2020. With this proposed rule change, the end date for all
Commentaries will be the same.
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The Exchange proposes to amend the above-listed Commentaries to
extend the end date of such temporary rules to May 22, 2020, which is
the last day when the Trading Floor facilities will be fully closed.
With this proposed extension, such Commentaries would be in effect
until the earlier of the reopening of the Trading Floor facilities or
after the Exchange closes on May 22, 2020. The Exchange is not
proposing any substantive changes to these Rules.
[[Page 31018]]
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Act,\13\ in general, and furthers the objectives of Section 6(b)(5) of
the Act,\14\ in particular, in that it is designed to prevent
fraudulent and manipulative acts and practices, to promote just and
equitable principles of trade, to foster cooperation and coordination
with persons engaged in facilitating transactions in securities, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system.
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\13\ 15 U.S.C. 78f(b).
\14\ 15 U.S.C. 78f(b)(5).
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Due to social-distancing measures implemented throughout the
country, including in New York City, to reduce the spread of COVID-19,
the CEO of the Exchange made a determination under Rule 7.1(c)(3) that
beginning March 23, 2020, the Trading Floor facilities located at 11
Wall Street in New York City would close and the Exchange would move,
on a temporary basis, to fully electronic trading.
The Exchange believes that the proposed rule change would remove
impediments to and perfect the mechanism of a free and open market and
a national market system because the Exchange will remain temporarily
closed past May 15, 2020. Accordingly, the Exchange believes that the
temporary rule changes in effect pursuant to the Commentaries to Rules
7.35, 7.35A, 7.35B, and 7.35C, which are intended to be in effect
during the temporary period while the Trading Floor is closed to
prevent the spread of COVID-19. The Exchange is not proposing any
substantive changes to these Rules.
The Exchange believes that, by clearly stating that this relief
will be in effect through the earlier of the reopening of the Trading
Floor facilities or the close of the Exchange on May 22, 2020, market
participants will have advance notice of the temporary period during
which the Commentaries to Rules 7.35, 7.35A, 7.35B, and 7.35C will be
in effect.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change would
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed rule change is
not designed to address any competitive issues but rather would extend
the period during which Commentary .01 to Rule 7.35; Commentaries .01,
.02, .03, and .04 to Rule 7.35A; Commentaries .01 and .02 to Rule
7.35B; and Commentaries .01, .02, and .03 to Rule 7.35C will be in
effect. These Commentaries are intended to be in effect during the
temporary period while the Trading Floor is closed and currently expire
on May 15, 2020. Because the Trading Floor will remain fully closed
until May 22, 2020, the Exchange proposes to extend the temporary
period to be the earlier of earlier of the reopening of the Trading
Floor facilities or after the Exchange closes on May 22, 2020.
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 \15\ and Rule 19b-4(f)(6) thereunder.\16\
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 for 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 \17\ and Rule 19b-
4(f)(6) thereunder.\18\
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\15\ 15 U.S.C. 78s(b)(3)(A)(iii).
\16\ 17 CFR 240.19b-4(f)(6).
\17\ 15 U.S.C. 78s(b)(3)(A).
\18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of the
Exchange's 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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A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally
does not become operative for 30 days after the date of the filing.
However, pursuant to Rule 19b-4(f)(6)(iii),\20\ the Commission may
designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing. The proposal would extend
the period during which Commentary .01 to Rule 7.35; Commentaries .01,
.02, .03, and .04 to Rule 7.35A; Commentaries .01 and .02 to Rule
7.35B; and Commentaries .01, .02, and .03 to Rule 7.35C will be in
effect for one more week, until May 22, 2020, without any substantive
changes to these Commentaries. The Exchange has represented that these
Commentaries are intended to be in effect during the temporary period
while the Trading Floor is closed, and would currently expire on May
15, 2020. The Exchange also has represented that the Trading Floor will
now remain fully closed until May 22, 2020. The Commission notes that,
without a waiver of the operative delay, the Commentaries would cease
to apply while the Exchange's Trading Floor facilities are still
closed. For these reasons, the Commission believes that waiver of the
30-day operative delay is consistent with the protection of investors
and the public interest. Accordingly, the Commission hereby waives the
30-day operative delay and designates the proposal operative upon
filing.\21\
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\19\ 17 CFR 240.19b-4(f)(6).
\20\ 17 CFR 240.19b-4(f)(6)(iii).
\21\ For purposes only of waiving the 30-day operative delay,
the Commission has 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 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 (http://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
File Number SR-NYSE-2020-45 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange
[[Page 31019]]
Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to File Number SR-NYSE-2020-45. 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 (http://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-2020-45, and should be submitted on
or before June 11, 2020.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
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\22\ 17 CFR 200.30-3(a)(12), (59).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-10935 Filed 5-20-20; 8:45 am]
BILLING CODE 8011-01-P