Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices 67775 

35For the purposes only of accelerating the 

operative date of this proposal, the Commission has 

considered the proposed rule change’s impact on 

efficiency, competition, and capital formation. See 

15 U.S.C. 78c(f). 

36See SR–MSRB–2018–10. 

37 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

public interest.35 According to the 

MSRB, the Series 54 examination 

content outline is designed to ensure 

that individuals are sufficiently 

qualified to supervise municipal 

advisory activities.36 The Commission 

believes that designating the proposed 

rule change operative upon filing is 

consistent with the protection of 

investors and the public interest 

because it will allow individuals to 

prepare for the Series 54 examination 

without delay. In addition, the proposed 

rule change is not proposing any textual 

changes to MSRB rules. Therefore, the 

Commission hereby designates the 

proposed rule change operative upon 

filing. 

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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

MSRB–2018–10 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549. 

All submissions should refer to File 

Number SR–MSRB–2018–10. 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 MSRB. 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–MSRB–2018–10 and should 

be submitted on or before January 22, 

2019. 

For the Commission, pursuant to delegated 

authority.37

Brent J. Fields, 

Secretary. 

[FR Doc. 2018–28398 Filed 12–28–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–84935; File No. SR–NYSE– 

2018–64] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend 

Chapter 9 of the NYSE Listed Company 

Manual Relating to Fees for Business 

Development Companies 

December 21, 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 December 

20, 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 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 amend 

Chapter 9 of the NYSE Listed Company 

Manual (the ‘‘Manual’’) to provide that 

business development companies will 

be subject to the same fee schedule as 

domestic operating companies and no 

longer treated as closed-end funds for 

fee purposes. 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 

Section 902.04 of the Manual sets 

forth listing fees applicable to all listed 

closed-end funds. Along with all other 

closed-end funds, these fees are applied 

to any closed-end fund that elects to be 

taxed as a business development 

company (‘‘BDC’’) and is listed under 

Section 102.04B of the Manual. 

The purpose and operation of a 

business development company is very 

different from that of a non-BDC closedend fund. A non-BDC closed-end fund 

is a vehicle for the passive investment 

in securities and the role of its 

management is limited to choosing 

when to buy and sell securities in the 

fund’s portfolio. By contrast, a condition 

to obtaining and retaining business 

development company status is that the 

business development company must 

make available management assistance 

to the companies in which it has made 

investments. As such, in the Exchange’s 

opinion, the purpose and operation of a 

business development company is 

therefore more analogous to that of an 


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67776 Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices 

4All listed BDCs are domestic companies, as only 

domestic entities can register under the Investment 

Company Act. 

5A BDC will also be charged $0.004 per share: 

At the time it first lists, an issuer lists one or more 

classes of preferred stock or warrants, whether or 

not common shares are also listed at that time; 

Once listed, an issuer lists a new class of 

preferred stock or warrants. 

These types of listings are not subject to the 

special charge or to the minimum or maximum 

Listing Fees applicable to an initial listing of 

common shares. 

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

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

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

operating company than to a non-BDC 

closed-end fund. 

In light of the Exchange’s opinion that 

BDCs function more like operating 

companies than they do like other 

closed-end funds, the Exchange believes 

it would be more consistent to subject 

them to the same fee requirements as are 

applied to domestic operating 

companies than to continue to apply to 

them the fees applicable to closed-end 

funds.4 Consequently, the Exchange 

proposes to amend Sections 902.02, 

902.03 and 903.04 of the Manual to state 

that BDCs will not be subject to the 

closed-end fund fee schedule in Section 

902.04, but rather, that for all purposes 

in Chapter 9, BDCs listed under Section 

102.04B will be treated the same as 

domestic operating companies 

(including the fees applicable to 

domestic operating companies set forth 

in Section 902.03) and will not be 

subject to the fees for closed-end funds 

as set forth in Section 902.04. 

Under Section 902.04, a BDC is 

charged initial listing fees when it first 

lists a class of common stock, or first 

lists a class of preferred stock in a case 

where common stock is not already 

listed, according to a tiered schedule. 

Under this tiered schedule, a BDC pays 

$20,000 (for up to and including 10 

million shares), $30,000 (for over 10 

million up to and including 20 million 

shares) or $40,000 (for over 20 million 

shares). By comparison, under the 

operating company fee schedule, a BDC 

will pay listing fees the first time it lists 

a class of common shares at a rate of 

$0.004 per share. The first time that an 

issuer lists a class of common shares, 

the issuer is also subject to a one-time 

special charge of $50,000, in addition to 

fees calculated according to the Listing 

Fee schedule.5 The minimum and 

maximum listing fees applicable the 

first time an issuer lists a class of 

common shares under the operating 

company fee schedule are $150,000 and 

$295,000, respectively, which amounts 

include the special charge of $50,000. In 

light of the minimum payment of 

$150,000, newly-listed BDCs will in all 

instances be subject to higher initial 

listing fees under the amended fee 

schedule than under the closed-end 

fund schedule as currently in effect. The 

Exchange believes it is reasonable to bill 

BDCs under the operating company 

initial listing fee schedule rather than 

the closed-end fund initial listing fee 

schedule because: (i) In the Exchange’s 

opinion, BDCs function more like 

operating companies than like other 

closed-end funds; and (ii) BDCs are 

generally subject to the same corporate 

governance requirements as operating 

companies, so the Exchange expends 

regulatory resources in determining the 

initial listing qualification of a BDC that 

are comparable to the effort involved in 

listing an operating company and 

significantly greater than in the case of 

a closed-end fund. 

Under Section 902.04, BDCs are 

currently subject to annual fees at a rate 

of $0.001025 per share, subject to a 

$25,000 minimum fee. Other than a 

fund family discount for which BDCs 

are not typically qualified (as they are 

not generally part of a family of at least 

three listed funds), Section 902.04 does 

not include a limit on an issuer’s annual 

fee obligations. By comparison, under 

the operating company fee schedule, 

BDCs will be charged $0.0011 per share 

for common shares, preferred shares and 

warrants, subject to a $68,000 minimum 

for the primary class of common shares 

or primary class of preferred stock (if 

there is no class of common shares 

listed), a $20,000 minimum for any 

additional class of common shares, and 

a $5,000 minimum for any class of 

warrants or preferred shares. In addition 

to these minimum payments, BDCs will 

benefit from the $500,000 cap imposed 

on annual fees and listing fees set forth 

in Section 902.02. As a consequence of 

the higher minimum annual fee 

requirements and per share rates 

applicable to operating companies, 

BDCs with smaller numbers of shares 

outstanding will generally pay 

somewhat higher fees as a result of the 

proposed rule change. The Exchange 

believes this is reasonable in light of the 

fact that BDCs are subject to the same 

corporate governance requirements as 

operating companies and require the 

Exchange to expend comparable levels 

of regulatory resources. However, the 

application of the $500,000 fee cap may 

result in certain larger BDCs paying less 

in annual fees than would be the case 

under the closed-end fund schedule, as 

the closed-end fund fee schedule does 

not include a cap on annual fees. The 

Exchange believes this fee limitation is 

reasonable due to the economies of scale 

involved in dealing with large issuers. 

The Exchange does not anticipate any 

reduction in revenues associated with 

the proposed amendments and does not 

expect them to have any effect on its 

ability to appropriately fund its 

regulatory program. 

The proposed rule change will take 

effect as of January 1, 2019. 

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 it is reasonable 

to bill BDCs under the operating 

company initial listing fee schedule 

rather than the closed-end fund initial 

listing fee schedule because: (i) In the 

Exchange’s opinion, BDCs function 

more like operating companies than like 

other closed-end funds; and (ii) BDCs 

are generally subject to the same 

corporate governance requirements as 

operating companies, so the Exchange 

expends regulatory resources in 

determining the initial listing 

qualification of a BDC that are 

comparable to the effort involved in 

listing an operating company and 

significantly greater than in the case of 

a closed-end fund. 

The Exchange believes that it is not 

unfairly discriminatory and represents 

an equitable allocation of reasonable 

fees to charge BDCs the same fees as 

domestic operating companies rather 

than charge them the closed-end fund 

fee schedule, as the Exchange believes 

that the purpose and operation of a BDC 

are more analogous to those of an 

operating company than to a non-BDC 

closed end fund and it is therefore more 

consistent to charge BDCs the same fees 

as are paid by domestic operating 

companies. 

As a consequence of the higher 

minimum annual fee requirements and 

per share rates applicable to operating 


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Federal Register / Vol. 83, No. 249 / Monday, December 31, 2018 / Notices 67777 

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. 

companies, BDCs with smaller numbers 

of shares outstanding will generally pay 

somewhat higher fees as a result of the 

proposed rule change. The Exchange 

believes this is reasonable in light of the 

fact that BDCs are subject to the same 

corporate governance requirements as 

operating companies and require the 

Exchange to expend comparable levels 

of regulatory resources. However, the 

application of the $500,000 fee cap may 

result in certain larger BDCs paying less 

in annual fees than would be the case 

under the closed-end fund schedule, as 

the closed-end fund fee schedule does 

not include a cap on annual fees. The 

Exchange believes this fee limitation is 

reasonable due to the economies of scale 

involved in dealing with large issuers. 

The Exchange does not anticipate any 

reduction in revenues associated with 

the proposed amendments and does not 

expect them to have any effect on its 

ability to appropriately fund its 

regulatory program. 

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. 

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–2018–64 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–2018–64. 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–2018–64 and should 

be submitted on or before January 22, 

2019. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

Brent J. Fields, 

Secretary. 

[FR Doc. 2018–28389 Filed 12–28–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–84941; File No. SR–MRX– 

2018–40] 

Self-Regulatory Organizations; Nasdaq 

MRX, LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend General 8 

December 21, 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 December 

19, 2018, Nasdaq MRX, LLC 

(‘‘Exchange’’) 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 Exchange. 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 delete the 

Exchange’s existing rules on colocation, 

connectivity, and direct connectivity 

(the ‘‘Existing Connectivity Rules’’), 

under General 8, and incorporate by 

reference into General 8 The Nasdaq 

Stock Market LLC’s (‘‘Nasdaq’s’’) rules 

on colocation, connectivity, and direct 

connectivity, which are located in 


khammond on DSK30JT082PROD with NOTICES