Federal Register / Vol. 83, No. 240 / Friday, December 14, 2018 / Notices 64391 

for, and the requested relief will not apply to, 

transactions where a Fund could be deemed an 

Affiliated Person, or a Second-Tier Affiliate, of a 

Fund of Funds because an investment adviser to the 

Funds is also an investment adviser to a Fund of 

Funds. 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

The purchase of Creation Units by a 

Fund of Funds directly from a Fund will 

be accomplished in accordance with the 

policies of the Fund of Funds and will 

be based on the NAVs of the Funds. 

9. Applicants also request relief to 

permit a Feeder Fund to acquire shares 

of another registered investment 

company managed by the Adviser 

having substantially the same 

investment objectives as the Feeder 

Fund (‘‘Master Fund’’) beyond the 

limitations in section 12(d)(1)(A) and 

permit the Master Fund, and any 

principal underwriter for the Master 

Fund, to sell shares of the Master Fund 

to the Feeder Fund beyond the 

limitations in section 12(d)(1)(B). 

10. Section 6(c) of the Act permits the 

Commission to exempt any persons or 

transactions from any provision of the 

Act if such exemption is necessary or 

appropriate in the public interest and 

consistent with the protection of 

investors and the purposes fairly 

intended by the policy and provisions of 

the Act. Section 12(d)(1)(J) of the Act 

provides that the Commission may 

exempt any person, security, or 

transaction, or any class or classes of 

persons, securities, or transactions, from 

any provision of section 12(d)(1) if the 

exemption is consistent with the public 

interest and the protection of investors. 

Section 17(b) of the Act authorizes the 

Commission to grant an order 

permitting a transaction otherwise 

prohibited by section 17(a) if it finds 

that (a) the terms of the proposed 

transaction are fair and reasonable and 

do not involve overreaching on the part 

of any person concerned; (b) the 

proposed transaction is consistent with 

the policies of each registered 

investment company involved; and (c) 

the proposed transaction is consistent 

with the general purposes of the Act. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2018–27128 Filed 12–13–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–84775; File No. SR–NYSE– 

2018–57] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend 

Certain of Its Listing Fees 

December 10, 2018. 

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 

November 29, 2018, New York Stock 

Exchange LLC (‘‘NYSE’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (the 

‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

certain of its listing fees. The proposed 

rule change is available on the 

Exchange’s website at www.nyse.com, at 

the principal office of the Exchange, and 

at the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization included 

statements concerning the purpose of, 

and basis for, the proposed rule change 

and discussed any comments it received 

on the proposed rule change. The text 

of those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to amend 

certain of its listing fees set forth in 

Chapter 9 of the Manual, in each case 

with effect from the beginning of the 

calendar year commencing on January 1, 

2019. 

The annual fee set forth in Section 

902.03 of the Manual will increase from 

$0.00108 per share to $0.0011 per share 

for each of the following: A primary 

class of common shares (including 

Equity Investment Tracking Stocks); 

each additional class of common shares 

(including tracking stock), a primary 

class of preferred stock (if no class of 

common shares is listed); each 

additional class of preferred stock 

(whether the primary class is common 

or preferred stock); and each class of 

warrants. In addition, the minimum 

annual fee will be increased from 

$65,000 to $68,000 for each of (i) a 

primary class of common shares 

(including Equity Investment Tracking 

Stocks) and (ii) a primary class of 

preferred stock (if no class of common 

shares is listed). 

The Exchange proposes to amend the 

annual fee schedule for structured 

products set forth in Section 902.05 of 

the Manual and for short term securities 

set forth in Section 902.06. In each case, 

the annual fee per share will increase 

from $0.00108 to $0.0011 per share. The 

minimum annual fee will increase from 

$25,000 to $35,000 for securities listed 

under Sections 902.05 and 902.06 

(except for warrants to purchase equity 

securities, which will remain $5,000). In 

addition, the Exchange proposes to 

amend the provision in Section 902.02 

relating to the $500,000 Total Maximum 

Fee by including annual fees paid for all 

structured products in calculating the 

Total Maximum Fee. The Exchange 

notes that retail debt securities are 

already included in the Total Maximum 

Fee calculation. Historically many listed 

structured products were financial 

products issued by banks and other 

financial institutions so there was a 

reasonable basis for excluding them 

from the benefits of the Total Maximum 

Fee provision. Today, however, most 

structured products listed on the 

Exchange are issued by listed 

companies for similar financing reasons 

to those for which they issue retail debt, 

so it is reasonable to treat them the same 

for purposes of the Total Maximum Fee 

calculation. 

The Exchange proposes to make an 

adjustment to the Investment 

Management Entity Group Fee Discount 

set forth in Section 902.02 of the 

Manual. The Investment Management 

Entity Group Fee Discount is currently 

based on all annual and listing fees paid 

by the Investment Management Entity 

and its Eligible Portfolio Companies in 

the applicable calendar year. The 

Exchange proposes to amend the 


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64392 Federal Register / Vol. 83, No. 240 / Friday, December 14, 2018 / Notices 

4The Investment Management Entity Group Fee 

Discount is limited to $500,000 per year for any 

Investment Management Entity and its Eligible 

Portfolio Companies and, in the Exchange’s 

experience, each group of companies utilizing the 

discount has benefited from the maximum $500,000 

amount. The Exchange expects that all groups of 

companies utilizing the discount will continue to 

benefit from the maximum discount in the future 

based solely on their annual fee obligations. 

5Under the current rule, a company qualifies for 

the Investment Management Entity Group Fee 

Discount in any calendar year by submitting 

satisfactory proof to the Exchange no later than 

December 31 that it has met the ownership 

requirements specified above for the entire period 

between January 1 and September 30 of that year. 

6 15 U.S.C. 78f(b). 

7 15 U.S.C. 78f(b)(4). 

8 15 U.S.C. 78f(b)(5). 

discount by applying it only to annual 

fees incurred as of January 1 of the 

applicable year.4 The current approach 

is logistically difficult for Exchange staff 

and the benefitting companies, as the 

size and proportionate share of the 

discount received by each company 

cannot be calculated until year-end, as 

it must reflect the effect of supplemental 

listing fees incurred for issuances of 

new shares during the course of the year 

in addition to annual fees. A discount 

based on annual fee bills incurred on 

January 1 will be more transparent and 

predictable and will enable the 

Exchange to reduce the benefiting 

companies’ bills at the beginning of the 

year rather than charging them in full 

and giving them a credit for the 

discount at year-end. In connection with 

this modification, the Exchange also 

proposes to modify the manner in 

which a company qualifies as an 

Eligible Portfolio Company to reflect the 

fact that the benefits—and therefore 

Eligible Portfolio Company Status—will 

be determined at the beginning of the 

applicable year. As such, for calendar 

2019 and subsequent years, a company 

will be an Eligible Portfolio Company if 

it was listed on the Exchange as of the 

first trading day of such calendar year. 

In order to qualify for the Investment 

Management Entity Group Fee Discount 

in calendar 2019 or any subsequent 

year, an issuer must submit satisfactory 

proof to the Exchange no later than the 

first trading day of such calendar year 

that it meets the ownership 

requirements specified above.5

As described below, the Exchange 

proposes to make the aforementioned 

fee increases to better reflect the 

Exchange’s costs related to listing equity 

securities and the corresponding value 

of such listing to issuers. 

The Exchange also proposes to 

remove a number of references in 

Chapter 9 to fees that are no longer 

applicable as they were superseded by 

new fee rates specified in the rule text 

or refer to fees that are no longer 

applicable. 

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

Section 6(b) of the Act,6 in general, and 

furthers the objectives of Section 

6(b)(4) 7 of the Act, in particular, in that 

it is designed to provide for the 

equitable allocation of reasonable dues, 

fees, and other charges. The Exchange 

also believes that the proposed rule 

change is consistent with Section 6(b)(5) 

of the Act,8 in that it is designed to 

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 

facilitating transactions in securities, to 

remove impediments to and perfect the 

mechanism of a free and open market 

and a national market system, and, in 

general, to protect investors and the 

public interest and is not designed to 

permit unfair discrimination between 

customers, issuers, brokers, or dealers. 

The Exchange believes that it is not 

unfairly discriminatory and represents 

an equitable allocation of reasonable 

fees to amend Chapter Nine of the 

Manual to increase the various listing 

fees as set forth above because of the 

increased costs incurred by the 

Exchange since it established the 

current rates. In that regard, the 

Exchange notes that its general costs 

have increased since its most recent fee 

adjustments, including due to price 

inflation. In addition, the Exchange 

continues to improve and increase the 

services it provides to listed companies. 

These improvements include the 

continued development and 

enhancement of an interactive webbased platform designed to improve 

communication between the Exchange 

and listed companies, the availability to 

listed companies of the Exchange’s new 

state-of-the-art conference facilities at 11 

Wall Street, and continued development 

of an investor relations tool available to 

all listed companies which provides 

companies with information enabling 

them to better understand the trading 

and ownership of their securities and 

the cost of providing content for 

inclusion in that tool. 

The inclusion of all structured 

products in the Total Maximum Fee 

calculation is not unfairly 

discriminatory and represents an 

equitable allocation of reasonable fees, 

as retail debt securities are already 

included in the Total Maximum Fee 

calculation. Most listed structured 

products are issued by listed companies 

for similar financing reasons to those for 

which they issue retail debt, so it is 

reasonable, equitable and not unfairly 

discriminatory to treat them the same 

for purposes of the Total Maximum Fee 

calculation. 

The adjustments to the Investment 

Management Entity Group Fee Discount 

are not unfairly discriminatory and 

represent an equitable allocation of 

reasonable fees, because a discount 

based on annual fee bills incurred on 

January 1 will be more transparent and 

predictable and will enable the 

Exchange to reduce the benefitting 

companies’ bills at the beginning of the 

year rather than charging them in full 

and giving them a credit for the 

discount at year-end. The proposed 

amendment is not unfairly 

discriminatory because the eligible fees 

and the test for receiving the benefits of 

the discount will be the same for all 

listed companies. 

The above fee changes are not unfairly 

discriminatory because the same fee 

schedule will apply to all listed issuers. 

Further, the Exchange operates in a 

competitive environment and its fees 

are constrained by competition in the 

marketplace. Other venues currently list 

all of the categories of securities covered 

by the proposed fees and if a company 

believes that the Exchange’s fees are 

unreasonable it can decide either not to 

list its securities or to list them on an 

alternative venue. 

The proposed removal of text relating 

to fees that are no longer applicable is 

ministerial in nature and has no 

substantive effect. 

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 rule change is designed to 

ensure that the fees charged by the 

Exchange accurately reflect the services 

provided and benefits realized by listed 

companies. The market for listing 

services is extremely competitive. Each 

listing exchange has a different fee 

schedule that applies to issuers seeking 

to list securities on its exchange. Issuers 

have the option to list their securities on 

these alternative venues based on the 

fees charged and the value provided by 

each listing. Because issuers have a 

choice to list their securities on a 

different national securities exchange, 

the Exchange does not believe that the 

proposed fee changes impose a burden 

on competition. 


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Federal Register / Vol. 83, No. 240 / Friday, December 14, 2018 / Notices 64393 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 CFR 240.19b–4(f)(2). 

11 15 U.S.C. 78s(b)(2)(B). 

12 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3 15 U.S.C. 78s(b)(3)(A). 

4 17 CFR 240.19b–4(f)(2) and (f)(4). 

5Capitalized terms used herein and not otherwise 

defined shall have the meaning assigned to such 

terms in the Rules, available at http://dtcc.com/∼/ 

media/Files/Downloads/legal/rules/nscc_rules.pdf. 

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 foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 9 of the Act and 

subparagraph (f)(2) of Rule 19b–4 10

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

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) 11 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NYSE–2018–57 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–2018–57. 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–2018–57 and should 

be submitted on or before January 4, 

2019. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2018–27084 Filed 12–13–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No 34–84771; File No. SR–NSCC– 

2018–012] 

Self-Regulatory Organizations; 

National Securities Clearing 

Corporation; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Certain Fees 

Relating to Mutual Fund Services, and 

Insurance and Retirement Processing 

Services 

December 10, 2018. 

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 November 

26, 2018, National Securities Clearing 

Corporation (‘‘NSCC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II and III 

below, which Items have been prepared 

by the clearing agency. NSCC filed the 

proposed rule change pursuant to 

Section 19(b)(3)(A) of the Act 3 and 

Rules 19b–4(f)(2) and (f)(4) thereunder.4

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change from interested 

persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

The proposed rule change consists of 

modifications to Addendum A (Fee 

Structure) (‘‘Addendum A’’) of NSCC’s 

Rules & Procedures (‘‘Rules’’) in order to 

make certain adjustments and 

clarifications in the fee provisions for 

NSCC’s Mutual Fund Services (‘‘MFS’’) 

and Insurance and Retirement 

Processing Services (‘‘I&RS’’), as 

described below.5

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, the 

clearing agency 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. The 

clearing agency has prepared 

summaries, set forth in sections A, B, 

and C below, of the most significant 

aspects of such statements. 

(A) Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

1. Purpose 

The purpose of this proposed rule 

change is to reduce certain fees for MFS 

and I&RS set forth in Addendum A as 

described below, in order to better align 

fees with the costs of services provided 

by NSCC by reducing the fees so that the 

revenue received by NSCC would be 

closer to the costs of providing the 

services. In addition, certain fee 

reductions as described below are also 

intended to incentivize greater use of 

certain MFS and I&RS products. The 

proposed rule change would also clarify 

the description of certain fees as 

described below to improve clarity and 

transparency of the Rules. NSCC expects 

the proposed rule change would result 

in a decrease in revenue of 


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