Federal Register / Vol. 88, No. 177 / Thursday, September 14, 2023 / Notices 63165 

28 17 CFR 200.30–3(a)(12), (59). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

4See NYSE American Rule 900.2NY Definitions. 

5The Exchange has announced that, pending 

regulatory approval, it will begin migrating 

Exchange-listed options to Pillar on October 23, 

2023, available here: https://www.nyse.com/traderupdate/history#110000530919. See also, e.g., 

Securities Exchange Act Release Nos. 97297 (April 

13, 2023), 88 FR 24225 (April 19, 2023) (SR– 

NYSEAMER–2023–16) (Notice of Filing and 

Immediate Effectiveness of Proposed Change to 

Modify Rule 900.2NY and to Adopt New Rules 

964NYP, 964.1NYP, and 964.2NYP); 97739 (June 

15, 2023), 88 FR 40893 (June 22, 2023) (SR– 

NYSEAMER–2023–17) (Notice of Filing of 

Amendment No. 1 and Order Granting Accelerated 

Approval of a Proposed Rule Change, as Modified 

by Amendment No. 1, to Adopt New Exchange Rule 

980NYP and Amend Exchange Rule 935NY); 97869 

(July 10, 2023), 88 FR 45730 (July 17, 2023) (SR– 

NYSEAMER–2023–34) (Notice of Filing and 

Immediate Effectiveness of Proposed New Rules 

900.3NYP, 925.1NYP, 928NYP, 928.1NYP, and 

952NYP and Amendments to Rules 900.3NY, 

925NY, 925.1NY, 928NY, 952NY, 953.1NY, 967NY, 

967.1NY, and 985NY); 97938 (July 18, 2023), 88 FR 

47536 (July 24, 2023) (NYSEAMER–2023–35) 

(Notice of Filing and Immediate Effectiveness of 

Proposed Change for New Rule 971.1NYP). 

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 (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

MEMX–2023–19 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–MEMX–2023–19. 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–MEMX–2023–19 and should be 

submitted on or before October 5, 2023. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.28

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–19845 Filed 9–13–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98332; File No. SR– 

NYSEAMER–2023–43] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Change To Modify the NYSE American 

Options Fee Schedule 

September 8, 2023. 

Pursuant to section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 2 and Rule 19b–4 thereunder,3

notice is hereby given that, on August 

29, 2023, NYSE American LLC (‘‘NYSE 

American’’ 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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to modify the 

NYSE American Options Fee Schedule 

(‘‘Fee Schedule’’) to provide for certain 

temporary fee changes in connection 

with the Exchange’s migration to the 

Pillar trading platform. The Exchange 

proposes to implement the fee changes 

effective August 29, 2023. 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 purpose of this filing to amend 

the Fee Schedule to provide for certain 

temporary changes in connection with 

the Exchange’s migration to a new 

trading platform known as Pillar. 

Currently, the Exchange conducts 

options trading on an electronic 

platform known as ‘‘the Exchange 

System,’’ which refers to the Exchange’s 

electronic order delivery, execution, and 

reporting system for designated option 

issues through which orders and quotes 

of users are consolidated for execution 

and/or display.4 On or about October 

23, 2023, the Exchange anticipates 

beginning the migration of its options 

trading to the Pillar technology 

platform.5


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63166 Federal Register / Vol. 88, No. 177 / Thursday, September 14, 2023 / Notices 

6The Exchange notes that its affiliated exchange 

NYSE Arca Options implemented a similar fee 

change in connection with its migration to the Pillar 

technology platform in 2022. See Securities 

Exchange Act Release No. 94125 (February 1, 2022), 

87 FR 6910 (February 7, 2022) (SR–NYSEArca– 

2022–05) (providing for continuity of OTP Holders’ 

eligibility for certain tiers, incentives, and discounts 

in connection with NYSE Arca Options Pillar 

migration). 

7See Fee Schedule, Sections I.C.; I.E. through 

I.H.; and I.M. 

8See Fee Schedule, Section III.E. ((Floor Broker 

Incentive and Rebate Programs). 

9See Fee Schedule, Section II. Monthly Excessive 

Bandwidth Utilization Fees. 

10The Exchange notes that its affiliated exchange 

NYSE Arca Options adopted a similar cap in 

connection with its migration to the Pillar 

technology platform in 2022. See Securities 

Exchange Act Release No. 94095 (January 28, 2022), 

87 FR 6216 (February 3, 2022) (SR–NYSEArca2022–04) (providing for a temporary waiver of the 

Ratio Threshold Fee in connection with the NYSE 

Arca Options Pillar migration). 

Specifically, the Exchange proposes to 

(1) provide ATP Holders and ATP Firms 

(collectively, ‘‘ATP Holders’’) with 

certainty regarding their eligibility for 

certain tiers, incentives, and discounts 

during the migration to Pillar; (2) waive 

Monthly Excessive Bandwidth 

Utilization Fees (‘‘EBUF’’) during the 

migration to Pillar and for a six-month 

period thereafter; and (3) cap certain 

port fees during the migration to Pillar. 

The Exchange proposes to implement 

the rule changes on August 29, 2023. 

Tiers, Incentives, and Discounts 

The Exchange currently offers various 

volume- and performance-based 

incentives and discounts to encourage 

ATP Holders to use the Exchange as 

their primary venue for order routing 

and execution and for market making 

activity. Many of these incentive and 

discount programs include multiple 

tiers, which are intended to encourage 

greater participation in the programs 

and to incent ATP Holders to 

continually grow their business on the 

Exchange in order to qualify for the 

benefits offered in a higher tier. 

In advance of the Exchange’s 

migration to the Pillar platform, the 

Exchange has noted concern among 

ATP Holders regarding their ability to 

achieve various volume qualifications 

and thresholds during the migration. 

Specifically, because ATP Holders may 

choose to moderate their order flow and 

quotation sizes to reduce risk as they 

familiarize themselves with the new 

trading platform, they may not achieve 

the tier(s), incentive(s), and discount(s) 

they qualified for pre-migration. 

Accordingly, the Exchange believes that 

providing ATP Holders with certainty 

with respect to certain pricing they 

would receive during the transition to 

Pillar would provide ATP Holders with 

an opportunity to adjust to new 

functionality and new order handling 

mechanisms without taking on an 

additional financial burden. 

To this end, the Exchange proposes to 

amend Section I of the Fee Schedule to 

provide that, for the month during 

which the Exchange commences its 

migration to the Pillar platform (the 

‘‘Migration Month’’), ATP Holders will 

receive the tier(s), incentive(s), and 

discount(s) they achieved in the month 

prior to the Migration Month or the 

tier(s), incentive(s), and discount(s) 

achieved during the Migration Month, 

whichever are better. Specifically, the 

Exchange will compare an ATP Holder’s 

performance in each of the programs set 

forth below during the Migration Month 

and during the month prior (currently 

anticipated to be September 2023) and 

will bill the ATP Holder for the 

Migration Month at the most favorable 

rates based on each qualification level 

achieved.6

The following tiers, incentives, and 

discount programs would be covered by 

the proposed change: 7

• NYSE American Options Market 

Maker Sliding Scale—Electronic 

• American Customer Engagement 

(‘‘ACE’’) Program 

• QCC Billable Bonus rebate 

• CUBE Auction Fees and Credits 

• Professional Step-Up Incentive 

• BOLD Mechanism Fees & Credits 

The Exchange also proposes the same 

modification to Section III.E. of the Fee 

Schedule,8 which would apply to the 

Manual Billable Rebate Qualification, 

the QCC Billable Bonus Rebate 

Qualification, and the Floor Broker 

Manual Billable Incentive Program for 

Floor Brokers. 

The Exchange believes that, to the 

extent ATP Holders choose to modify 

their trading activity during the 

Migration Month, the proposed change 

would mitigate the impact of potential 

pricing disruption by providing ATP 

Holders with certainty regarding the 

tier(s), incentive(s), and discount(s) they 

would be eligible for in the Migration 

Month, which would in turn encourage 

ATP Holders to continue to send orders 

and quotes to the Exchange during the 

transition to Pillar. 

In addition, by offering ATP Holders 

the better pricing of the month before 

the Migration Month or the Migration 

Month, the Exchange believes ATP 

Holders will be incented to take full 

advantage of new Pillar functionality 

and possibly even increase their volume 

and participation during the migration. 

The Exchange is not proposing any 

changes to the underlying tiers, 

incentives, or discounts covered by the 

proposed change described above. 

Monthly Excessive Bandwidth 

Utilization Fees 

Section II of the Fee Schedule 

describes two alternative fees that are 

charged for exceeding the ratio of orders 

or messages sent to the Exchange 

compared to the number of executions 

or contracts traded and are intended to 

deter ATP Holders from submitting an 

excessive number of orders that are not 

executed.9

The Exchange proposes to amend 

Section II of the Fee Schedule to specify 

that the Monthly Excessive Bandwidth 

Utilization Fees (‘‘EBUF’’) assessed to 

ATP Holders will be waived for the 

duration of the migration and for six 

months after the completion of the 

migration.10 Specifically, the Exchange 

proposes that the waiver of the EBUF 

take effect for the month during which 

the migration begins and remain in 

effect for six months following the 

month in which the migration is 

completed (the ‘‘Waiver Period’’). The 

Exchange believes that waiving EBUF 

during the Waiver Period will give both 

ATP Holders and the Exchange an 

opportunity to adjust to new 

functionality and new order handling 

mechanisms without imposing a 

financial burden on ATP Holders based 

on their order to execution ratios or 

messages to contracts traded ratios 

during the Pillar transition. In addition, 

during the Waiver Period, the Exchange 

intends to work closely with ATP 

Holders to monitor traffic rates and their 

order and message to execution ratios as 

they adapt to trading on the Pillar 

platform. 

Cap on Port Fees 

The Exchange proposes to adopt a cap 

on the monthly fees assessed for the use 

of certain ports connecting to the 

Exchange, which will go into effect on 

the day the Exchange commences its 

migration to the Pillar platform and 

remain in effect until the end of the 

month in which the migration is 

completed (the ‘‘Migration Period’’). 

Specifically, the Exchange proposes to 

cap the monthly fees charged to an ATP 

Holder for the use of Order/Quote Entry 

Ports, Quote Takedown Ports, and Drop 

Copy Ports (collectively, the ‘‘Port 

Fees’’) during the Migration Period (the 

‘‘Migration Cap’’). The Migration Cap 

will be based on the number of ports an 

ATP Holder is billed for in the month 

preceding the beginning of the 

Exchange’s migration to the Pillar 

platform, except that if an ATP Holder 

reduces the number of ports used during 

the Migration Period (i.e., incurs Port 

Fees below the Migration Cap), the ATP 


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Federal Register / Vol. 88, No. 177 / Thursday, September 14, 2023 / Notices 63167 

11The Exchange notes that its affiliated exchange 

NYSE Arca Options adopted a similar fee cap in 

connection with its migration to the Pillar 

technology platform in 2022. See Securities 

Exchange Act Release No. 94017 (January 20, 2022), 

87 FR 4095 (January 26, 2022) (SR–NYSEArca2022–03) (providing for a temporary cap on 

monthly fees for use of ports in connection with the 

NYSE Arca Options Pillar migration). 

12 15 U.S.C. 78f(b). 

13 15 U.S.C. 78f(b)(4) and (5). 

14See Securities Exchange Act Release No. 51808 

(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005) 

(S7–10–04) (‘‘Reg NMS Adopting Release’’). 

15The OCC publishes options and futures volume 

in a variety of formats, including daily and monthly 

volume by exchange, available here: https://

www.theocc.com/Market-Data/Market-DataReports/Volume-and-Open-Interest/MonthlyWeekly-Volume-Statistics. 

16Based on a compilation of OCC data for 

monthly volume of equity-based options and 

monthly volume of ETF-based options, see id., the 

Exchange’s market share in equity-based options 

decreased from 7.26% for the month of July 2022 

to 7.09% for the month of July 2023. 

Holder would only be billed for the 

actual number of ports used. 

Without this proposed rule change, 

the Fee Schedule provides that ATP 

Holders would be charged for the use of 

both legacy Exchange System platform 

ports and new Pillar platform ports, 

which could significantly increase costs 

to ATP Holders during the Migration 

Period. Thus, the proposed Migration 

Cap is intended to encourage ATP 

Holders to maintain the same levels of 

interaction with Exchange during the 

Migration Period, as well as promptly 

migrate to the more efficient Pillar 

technology platform, without incurring 

additional Port Fees as a result of the 

transition.11

2. Statutory Basis 

The Exchange believes that the 

proposed rule change is consistent with 

section 6(b) of the Act,12 in general, and 

furthers the objectives of sections 6(b)(4) 

and (5) of the Act,13 in particular, 

because it provides for the equitable 

allocation of reasonable dues, fees, and 

other charges among its members, 

issuers and other persons using its 

facilities and does not unfairly 

discriminate between customers, 

issuers, brokers or dealers. 

The Proposed Rule Change Is 

Reasonable 

The Exchange operates in a highly 

competitive market. The Commission 

has repeatedly expressed its preference 

for competition over regulatory 

intervention in determining prices, 

products, and services in the securities 

markets. In Regulation NMS, the 

Commission highlighted the importance 

of market forces in determining prices 

and SRO revenues and, also, recognized 

that current regulation of the market 

system ‘‘has been remarkably successful 

in promoting market competition in its 

broader forms that are most important to 

investors and listed companies.’’ 14

There are currently 16 registered 

options exchanges competing for order 

flow. Based on publicly-available 

information, and excluding index-based 

options, no single exchange has more 

than 16% of the market share of 

executed volume of multiply-listed 

equity and ETF options trades.15

Therefore, currently no exchange 

possesses significant pricing power in 

the execution of multiply-listed equity & 

ETF options order flow. More 

specifically, in July 2023, the Exchange 

had less than 8% market share of 

executed volume of multiply-listed 

equity & ETF options trades.16

The Exchange believes that the evershifting market share among the 

exchanges from month to month 

demonstrates that market participants 

can shift order flow or discontinue or 

reduce use of certain categories of 

products, in response to fee changes. 

Accordingly, competitive forces 

constrain options exchange transaction 

fees. 

The Exchange believes that the 

proposed change is reasonable because 

it is intended to encourage ATP Holders 

to maintain active participation on the 

Exchange during the Pillar migration by 

offering ATP Holders pricing at each of 

the tier(s), incentive(s), and discount(s) 

they qualify for during either the 

Migration Month or in the month prior 

to the Migration Month, whichever is 

more favorable to the ATP Holder, and 

to maintain sufficient active 

connections to the Exchange during its 

migration to Pillar by providing for the 

Migration Cap. Similarly, the Exchange 

believes that the proposed EBUF waiver 

is reasonable because it is intended to 

encourage ATP Holders to maintain 

active participation on the Exchange 

during and after its migration to Pillar. 

The Exchange further believes that the 

proposed change would lessen the 

impact of the migration on ATP Holders 

by enabling them to adapt their trading 

activity as needed to transition to Pillar 

functionality during the migration and 

ensure they have sufficient data 

connections and would thus encourage 

ATP Holders to promptly transition to 

the more efficient Pillar platform. 

To the extent the proposed rule 

change encourages ATP Holders to 

migrate to the new platform while 

maintaining their level of trading 

activity, the Exchange believes the 

proposed change would sustain the 

Exchange’s overall competitiveness and 

its market quality for all market 

participants. In the backdrop of the 

competitive environment in which the 

Exchange operates, the proposed rule 

change is a reasonable attempt by the 

Exchange to mitigate the impact of the 

migration without affecting its 

competitiveness. 

The Proposed Rule Change Is an 

Equitable Allocation of Credits and Fees 

The Exchange believes the proposed 

rule change is an equitable allocation of 

its fees and credits because the more 

favorable tier, incentive, and discount 

eligibility, Migration Cap, and EBUF 

waiver would be available to all ATP 

Holders. In addition, the proposed 

change relating to tiers, incentives, and 

discounts is based on each ATP 

Holder’s activity levels before and 

during the Migration Month, just as the 

Migration Cap is based on each ATP 

Holder’s use of ports before and during 

the Pillar migration. Accordingly, all 

ATP Holders would have the 

opportunity to adapt their trading 

activity and moderate their order flow 

and use of ports as needed to transition 

to Pillar functionality. Thus, the 

Exchange believes the proposed rule 

change would facilitate a smooth 

transition to the Pillar technology 

platform for all market participants on 

the Exchange by encouraging ATP 

Holders to continue to participate 

actively on the Exchange during the 

transition period, thereby promoting 

continued market-wide quality. 

The Proposed Rule Change Is not 

Unfairly Discriminatory 

The Exchange believes the proposed 

rule change is not unfairly 

discriminatory because it would be 

available to all similarly-situated market 

participants on an equal and nondiscriminatory basis. 

All ATP Holders would be eligible for 

the more favorable tier(s), incentive(s), 

and discount(s) they achieve in either 

the Migration Month or the preceding 

month, the Migration Cap, and the 

EBUF waiver. Moreover, the proposed 

change is based on each ATP Holder’s 

achievement of tiers, incentives, and 

discounts prior to and during the 

Migration Month use of ports. The 

proposed change would thus allow ATP 

Holders to adjust their interactions with 

Exchange systems during the migration 

as needed and take advantage of the 

new functionality offered by Pillar by 

mitigating the impact of potential 

pricing disruptions. To the extent the 

proposal encourages ATP Holders to 

maintain or increase their current level 

of activity on the Exchange, such 

activity would result in trading 

opportunities for all market participants 


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63168 Federal Register / Vol. 88, No. 177 / Thursday, September 14, 2023 / Notices 

17See Reg NMS Adopting Release, supra note 14, 

at 37499. 

18See note 15, supra. 

19See note 16, supra. 

20 15 U.S.C. 78s(b)(3)(A). 

21 17 CFR 240.19b–4(f)(2). 22 15 U.S.C. 78s(b)(2)(B). 

and thus would promote just and 

equitable principles of trade, remove 

impediments to and perfect the 

mechanism of a free and open market 

and a national market system and, in 

general, protect investors and the public 

interest. 

Finally, the Exchange believes that it 

is subject to significant competitive 

forces, as described below in the 

Exchange’s statement regarding the 

burden on competition. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with section 6(b)(8) of 

the Act, 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. 

Instead, as discussed above, the 

Exchange believes that the proposed 

changes would encourage the 

submission of additional liquidity to a 

public exchange, thereby promoting 

market depth, price discovery and 

transparency and enhancing order 

execution opportunities for all market 

participants. As a result, the Exchange 

believes that the proposed change 

furthers the Commission’s goal in 

adopting Regulation NMS of fostering 

integrated competition among orders, 

which promotes ‘‘more efficient pricing 

of individual stocks for all types of 

orders, large and small.’’ 17

Intramarket Competition. The 

Exchange does not believe the proposed 

rule change would impose any burden 

on intramarket competition that is not 

necessary or appropriate because it 

would apply equally to all ATP Holders. 

All ATP Holders would be eligible to 

receive the rates under each of the 

tier(s), incentive(s), and discount(s) they 

achieved in the Migration Month or in 

the month prior to the Migration Month, 

whichever are better, and all ATP 

Holders would be eligible for the 

Migration Cap and EBUF waiver. 

Intermarket Competition. The 

Exchange operates in a highly 

competitive market in which market 

participants can readily favor one of the 

16 competing option exchanges if they 

deem fee levels at a particular venue to 

be excessive. In such an environment, 

the Exchange must continually adjust its 

fees to remain competitive with other 

exchanges and to attract order flow to 

the Exchange. Based on publiclyavailable information, and excluding 

index-based options, no single exchange 

has more than 16% of the market share 

of executed volume of multiply-listed 

equity and ETF options trades.18

Therefore, no exchange possesses 

significant pricing power in the 

execution of multiply-listed equity and 

ETF options order flow. More 

specifically, in July 2023, the Exchange 

had less than 8% market share of 

executed volume of multiply-listed 

equity and ETF options trades.19

The Exchange does not believe the 

proposed rule change would impose any 

burden on intermarket competition that 

is not necessary or appropriate because 

the Exchange operates in a highly 

competitive market in which market 

participants can readily choose to send 

their orders to other exchanges if they 

deem fee levels at those other venues to 

be more favorable. The Exchange 

believes that its fees are constrained by 

the robust competition for order flow 

among exchanges and thus believes that 

the proposed change is reasonably 

designed to encourage ATP Holders to 

transition to the Pillar platform while 

mitigating the risk of a significant 

change to the fees they would be subject 

to during the migration. Accordingly, 

the Exchange believes that the proposed 

change would continue to make the 

Exchange a competitive venue for order 

execution by enabling ATP Holders to 

maintain their current levels of 

interaction with the Exchange (or make 

adjustments as needed) during the 

migration, thus encouraging prompt 

migration to the newer, more efficient 

Pillar technology platform and 

sustained activity on the Exchange 

during the Pillar transition. 

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) 20 of the Act and 

subparagraph (f)(2) of Rule 19b–4 21

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) 22 of the Act to 

determine whether the proposed rule 

change should be approved or 

disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

NYSEAMER–2023–43 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–2023–43. 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 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 88, No. 177 / Thursday, September 14, 2023 / Notices 63169 

23 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)(4). 

5Capitalized terms not defined herein are defined 

in the Rules, By-Laws and Organization Certificate 

of DTC (the ‘‘Rules’’), available at www.dtcc.com/ 

-/media/Files/Downloads/legal/rules/dtc_rules.pdf, 

or in the Recovery & Wind-down Plan of DTC (the 

‘‘Recovery & Wind-down Plan,’’ ‘‘R&W Plan’’ or 

‘‘Plan’’). 

6See Securities Exchange Act Release Nos. 83972 

(Aug. 28, 2018), 83 FR 44964 (Sep. 4, 2018) (SR– 

DTC–2017–021); and 83953 (Aug. 27, 2018), 83 FR 

44381 (Aug. 30, 2018) (SR–DTC–2017–803). 

7 17 CFR 240.17Ad–22(e)(3)(ii). DTC is a ‘‘covered 

clearing agency’’ as defined in Rule 17Ad–22(a)(5) 

under the Act and must comply with paragraph (e) 

of Rule 17Ad–22. 

8See Securities Exchange Act Release No. 91429 

No. (Mar. 29, 2021), 86 FR 17421 (Apr. 2, 2021) 

(SR–DTC–2021–004). 9The Canadian-Link Service provides 

Participants with a single depository interface for 

CAD transactions. The link facilitates Participants’ 

ability to maintain U.S. and Canadian Security 

positions in their DTC accounts for Securities listed 

in both Canada and the United States (i.e., dually 

listed). In recent years, activity at DTC in CAD has 

accounted for less than 0.20 percent of DTC’s 

average daily valued settlement volume. While 

Participants continue to use the Canadian-Link 

Service for custody purposes to position securities 

inventory at CDS Clearing and Depository Services 

Inc., (‘‘CDS’’) through DTC’s CDS account and 

receive related distribution payments, no 

Participants have effectuated a DVP of Securities 

through the Canadian-Link Service since 2018. For 

DTC to continue to maintain access to CDS’s CAD 

settlement services, it would have been necessary 

for DTC to perform systems development in order 

to be able to continue to use this aspect of the 

Canadian-Link service. In DTC’s judgement, it 

would be impractical for DTC to incur the costs to 

undertake such changes, including incurring 

development costs, due to the lack of demand by 

its Participants to use the valued aspect of the 

Canadian Link Service. See Securities Exchange Act 

Release No. 34–91429 (Mar. 29, 2021), 86 FR 17421 

(Apr. 2, 2021) (SR–DTC–2021–004). 

10 DTCC operates on a shared service model with 

respect to DTC and its other affiliated clearing 

Continued 

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–2023–43 and should 

be submitted on or before October 5, 

2023. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.23

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–19842 Filed 9–13–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98330; File No. SR–DTC– 

2023–008] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Recovery and Wind-Down Plan 

September 8, 2023. 

Pursuant to section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1 and Rule 19b–4 thereunder,2

notice is hereby given that on 

September 1, 2023, The Depository 

Trust Company (‘‘DTC’’) 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. DTC filed the 

proposed rule change pursuant to 

section 19(b)(3)(A) of the Act 3 and Rule 

19b–4(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 

amendments to the Recovery and Winddown Plan to reflect business and 

product developments that have taken 

place since the time it was last 

amended, and make certain changes to 

improve the clarity of the Plan and 

make other updates and technical 

revisions, as described in greater detail 

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 

Executive Summary 

The R&W Plan was adopted in August 

2018 6 and is maintained by DTC for 

compliance with Rule 17Ad–22(e)(3)(ii) 

under the Act.7 Rule 17Ad–22(e)(3)(ii) 

requires registered clearing agencies to, 

in short, establish, implement and 

maintain plans for the recovery and 

orderly wind-down of the covered 

clearing agency necessitated by credit 

losses, liquidity shortfalls, losses from 

general business risk, or any other 

losses. The Plan is intended to be used 

by the Board and DTC management in 

the event DTC encounters scenarios that 

could potentially prevent it from being 

able to provide its critical services to the 

marketplace as a going concern. 

The R&W Plan is comprised of two 

primary sections: (i) the ‘‘Recovery 

Plan,’’ which sets out the tools and 

strategies to enable DTC to recover, in 

the event it experiences losses that 

exceed its prefunded resources, and (ii) 

the ‘‘Wind-down Plan,’’ which describes 

the tools and strategies to be used to 

conduct an orderly wind-down of DTC’s 

business in a manner designed to permit 

the continuation of DTC’s critical 

services in the event that its recovery 

efforts are not successful. 

The purpose of the rule proposal is to 

amend the R&W Plan to reflect business 

and product developments that have 

taken place since the time it was last 

amended,8 and make certain changes to 

improve the clarity of the Plan and 

make other updates and technical 

revisions. Some of the business and 

product-related amendments included 

in the proposed rule change are as 

follows (and described in more detail 

below): 

• Changes to reflect the 

discontinuation of the Canadian dollar 

(‘‘CAD’’) settlement feature of the 

Canadian-Link Service.9

• Removal of DTC’s inbound link 

with the Peruvian central securities 

depository, based on its voluntary 

termination. 

• The addition of The Bank of New 

York Mellon as a DTC Pledgee Bank. 

DTC believes that by helping to 

ensure that the R&W Plan reflects 

current business and product 

developments, providing additional 

clarity, and making necessary 

grammatical corrections, that the 

proposed rule change will help DTC 

continue to maintain the Plan in a 

manner that supports the continuity of 

DTC’s critical services and enables 

Participants and Pledgees to maintain 

access to DTC’s services through the 

transfer of its membership in the event 

DTC defaults or the Wind-down Plan is 

ever triggered by the Board. 

Background 

The R&W Plan is managed by the 

Office of Recovery & Resolution 

Planning (referred to in the Plan as the 

‘‘R&R Team’’) of DTC’s parent company, 

the Depository Trust & Clearing 

Corporation (‘‘DTCC’’),10 on behalf of 


lotter on DSK11XQN23PROD with NOTICES1