Federal Register / Vol. 88, No. 239 / Thursday, December 14, 2023 / Notices 86693 

37 15 U.S.C. 78s(b)(3)(A)(iii). 

38 17 CFR 240.19b–4(f)(6). 

39Rule 19b–4(f)(6)(iii) requires a self-regulatory 

organization to give the Commission written notice 

of its 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. 

40 17 CFR 240.19b–4(f)(6). 

41 17 CFR 240.19b–4(f)(6)(iii). 

42 15 U.S.C. 78s(b)(2)(B). 43 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. 

19(b)(3)(A)(iii) of the Act 37 and Rule 

19b–4(f)(6) thereunder.38 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 

prior to 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 and Rule 19b–4(f)(6)(iii) 

thereunder.39

A proposed rule change filed under 

Rule 19b–4(f)(6) 40 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b4(f)(6)(iii),41 the Commission 

may designate a shorter time if such 

action is consistent with the protection 

of investors and the public interest. 

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) 42 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– 

NYSENAT–2023–28 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–NYSENAT–2023–28. 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–NYSENAT–2023–28 and 

should be submitted on or before 

January 4, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.43

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–27404 Filed 12–13–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99122; File No. SR– 

NYSEARCA–2023–82] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Harmonize Rules 

10.9261 and 10.9830 

December 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 

November 27, 2023, NYSE Arca, Inc. 

(‘‘NYSE Arca’’ 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 harmonize 

Rules 10.9261 and 10.9830 with recent 

changes by the Financial Industry 

Regulatory Authority, Inc. (‘‘FINRA’’) 

that allow for video conference hearings 

under specified conditions. 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. 


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4See Securities Exchange Act Release No. 85639 

(April 12, 2019), 84 FR 16346 (April 18, 2019) (SR– 

NYSEArca–2019–15) (Notice of Filing and 

Immediate Effectiveness of Proposed Rule Change 

To Adopt Investigation, Disciplinary, Sanction, and 

Other Procedural Rules Modeled on the Rules of the 

Exchange’s Affiliate NYSE American LLC) (‘‘2019 

Notice’’). 

5See NYSE Arca Equities RB–19–060 & NYSE 

Arca Options RB–19–02 (April 26, 2019). 

6See 2019 Notice, 84 FR at 16365 & 16373–4. 

7See Securities Exchange Act Release Nos. 83289 

(September 2, 2020), 85 FR 55712 (September 9, 

2020) (SR–FINRA–2020–027). FINRA also proposed 

to temporarily amend FINRA Rules 1015 and 9524. 

FINRA Rule 1015 governs the process by which an 

applicant for new or continuing membership can 

appeal a decision rendered by FINRA’s Department 

of Member Supervision under FINRA Rule 1014 or 

1017 and request a hearing which would be 

conducted by a subcommittee of the NAC. See id. 

The Exchange has not adopted FINRA Rule 1015. 

FINRA Rule 9524 governs the process by which a 

statutorily disqualified member firm or associated 

person can appeal the Department’s 

recommendation to deny a firm or sponsoring firm’s 

application to the NAC. See id. Under the 

Exchange’s version of Rule 9524, if the Chief 

Regulatory Officer rejects the application, the 

member organization or applicant may request a 

review by the Exchange Board of Directors. This 

differs from FINRA’s process, which provides for a 

hearing before the NAC and further consideration 

by the FINRA Board of Directors. 

8See 85 FR at 55713. 

9See id. 

10FINRA’s OHO administers all aspects of 

Exchange adjudications, including assigning 

hearing officers to serve as NYSE Arca hearing 

officers. A hearing officer from OHO will, among 

other things, preside over the disciplinary hearing, 

select and chair the hearing panel, and prepare and 

issue written decisions. The Chief or Deputy 

Hearing Officer for all Exchange disciplinary 

hearings are currently drawn from OHO and are all 

FINRA employees. The Exchange believes that OHO 

will utilize the same video conference protocol and 

processes for Exchange matters under the RSA as 

it proposes for FINRA matters. 

11See Securities Exchange Act Release No. 90088 

(October 5, 2020), 85 FR 64186 (October 9, 2020) 

(SR–NYSEArca–2020–85). 

12See Securities Exchange Act Release No. 90619 

(December 9, 2020), 85 FR 81250 (December 15, 

2020) (SR–FINRA–2020–042); Securities Exchange 

Act Release No. 91495 (April 7, 2021), 86 FR 19306 

(April 13, 2021) (SR–FINRA–2021–006); Securities 

Exchange Act Release No. 92685 (August 17, 2021), 

86 FR 47169 (August 23, 2021) (SR–FINRA–2021– 

019); Securities Exchange Act Release No. 93758 

(December 13, 2021), 86 FR 71695 (December 17, 

2021) (SR–FINRA–2021–31); Securities Exchange 

Act Release No. 94430 (March 16, 2022), 87 FR 

16262 (March 22, 2022) (SR–FINRA–2022–004); 

Securities Exchange Act Release No. 95281 (July 14, 

2022), 87 FR 43335 (July 20, 2022) (SR–FINRA– 

2022–018); Securities Exchange Act Release No. 

96107 (October 19, 2022), 87 FR 64526 (October 25, 

2022) (SR–FINRA–2022–029); and Securities 

Exchange Act Release No. 96746 (January 25, 2023), 

88 FR 6346 (January 31, 2023) (SR–FINRA–2023– 

001). 

13See Securities Exchange Act Release No. 90820 

(December 30, 2020), 86 FR 647 (January 6, 2021) 

(SR–NYSEArca–2020–116); Securities Exchange 

Act Release No. 91633 (April 22, 2021), 86 FR 

22474 (April 28, 2021) (SR–NYSEArca–2021–27); 

Securities Exchange Act Release No. 92909 

(September 9, 2021), 86 FR 51415 (September 15, 

2021) (SR–NYSEArca–2021–76); Securities 

Exchange Act Release No. 93918 (January 6, 2022), 

87 FR 1810 (January 12, 2022) (SR–NYSEArca– 

2021–107); Securities Exchange Act Release No. 

94663 (April 11, 2022), 87 FR 22587 (April 15, 

2022) (SR–NYSEArca–2022–18); Securities 

Exchange Act Release No. 95475 (August 11, 2022), 

87 FR 50673 (August 17, 2022) (SR–NYSEArca– 

2022–44); Securities Exchange Act Release No. 

96259 (November 8, 2022), 87 FR 68536 (November 

15, 2022) (SR–NYSEArca–2022–73); and Securities 

Exchange Act Release No. 96871 (February 9, 2023), 

88 FR 9915 (February 15, 2023) (SR–NYSEArca– 

2023–10). 

14See Securities Exchange Act Release No. 96871 

(February 9, 2023), 88 FR 9915 (February 15, 2023) 

(SR–NYSEArca–2023–10) (extending the expiration 

date of the temporary rule amendments to, among 

other rules, FINRA Rules 9261 and 9830 from 

January 31, 2023 to April 30, 2023). The temporary 

amendments expired on April 30, 2023, because the 

Exchange did not file another proposed rule change 

again extending the temporary amendments beyond 

that date. See id. at 9916. 

15See Securities Exchange Act Release Nos. 

98029 (August 4, 2023), 88 FR 51879 (August 4, 

2023) (SR–FINRA–2023–008) (Order Approving a 

Proposed Rule Change To Amend FINRA Rules 

1015, 9261, 9341, 9524, 9830 and Funding Portal 

Rule 900 (Code of Procedure) To Permit Hearings 

Under Those Rules To Be Conducted by Video 

Conference) (‘‘FINRA Approval Order’’). 

16See FINRA Approval Order, 88 FR at 51880. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The Exchange proposes to harmonize 

Rules 10.9261 (Evidence and Procedure 

in Hearing) and 10.9830 (Hearing) with 

recent changes by FINRA to its Rules 

9261 and 9830 that allow for video 

conference hearings under specified 

conditions. 

Background 

In 2019, NYSE Arca adopted 

disciplinary rules modeled on the text 

of the Rule 8000 and Rule 9000 Series 

of its affiliate NYSE American LLC 

(‘‘NYSE American’’) and the Rule 8000 

Series and Rule 9000 Series of FINRA 

and the New York Stock Exchange 

LLC.4 The NYSE Arca disciplinary rules 

were implemented on May 27, 2019.5

In adopting disciplinary rules 

modeled on FINRA’s rules, NYSE Arca 

adopted the hearing and evidentiary 

processes set forth in Rule 10.9261 and 

in Rule 10.9830 for hearings in matters 

involving temporary and permanent 

cease and desist orders under the Rule 

10.9800 Series. As adopted, the text of 

Rule 10.9261 is identical to the 

counterpart FINRA rule. Rule 10.9830 is 

also identical to FINRA’s counterpart 

rule, except for conforming and 

technical amendments.6

In 2020, given the spread of COVID– 

19 and its effect on FINRA’s 

adjudicatory functions nationwide, 

FINRA filed a temporary rule change to 

grant FINRA’s Office of Hearing Officers 

(‘‘OHO’’) and the National Adjudicatory 

Council (‘‘NAC’’) the authority to 

conduct certain hearings by video 

conference if warranted by the current 

COVID–19-related public health risks 

posed by in-person hearings. Among the 

rules FINRA amended were FINRA 

Rules 9261 and 9830.7

In its filing, FINRA represented that 

its protocol for conducting hearings by 

video conference would ensure that 

such hearings maintain a fair process for 

the parties by, among other things, 

FINRA’s use of a high quality, secure 

and user-friendly video conferencing 

service and provision of thorough 

instructions, training and technical 

support to all hearing participants.8

According to FINRA, the changes were 

a reasonable interim solution to allow 

FINRA’s critical adjudicatory processes 

to continue to function while protecting 

the health and safety of hearing 

participants.9

Given that FINRA and OHO 

administer disciplinary hearings on the 

Exchange’s behalf pursuant to a 

regulatory services agreement 

(‘‘RSA’’),10 and that the public health 

concerns addressed by FINRA’s 

amendments applied equally to the 

Exchange’s disciplinary hearings, in 

2020 the Exchange also temporarily 

amended its disciplinary rules to allow 

virtual hearings.11 Both FINRA 12 and 

the Exchange 13 extended the temporary 

relief several times due to the 

continuing public health risks and 

logistical challenges related to COVID– 

19, including whether hearing 

participants could safely travel and 

abide by state or local quarantine 

requirements. The Exchange’s 

temporary amendments to Rules 

10.9261 and 10.9830 expired on April 

30, 2023.14

Recently, the Commission approved 

FINRA’s proposal to make the 

temporary amendments regarding video 

conference hearings permanent, with 

some modifications, to permit the use of 

video conferences for reasons beyond 

COVID–19.15 Specifically, FINRA 

amended, among other rules, FINRA 

Rules 9261 and 9830 to extend OHO’s 

authority to order hearings by video 

conference to other similar situations in 

which proceeding in person could 

endanger the health or safety of the 

participant or alternatively would be 

impracticable (e.g., an uncommon 

situation or extraordinary circumstances 

such as a natural disaster or terrorist 

attack that caused travel to be cancelled 

for an extended period of time).16 As 

approved, OHO has discretion to 

determine whether the circumstances 

for a video hearing have been met and 

can act quickly if a future unexpected 

event impairs their ability to conduct inVerDate Sep<11>2014 17:39 Dec 13, 2023 Jkt 262001 PO 00000 Frm 00073 Fmt 4703 Sfmt 4703 E:\FR\FM\14DEN1.SGM 14DEN1

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17See id. 

18See id. 

19See id. 

20See id. 

21As used herein, ‘‘evidentiary hearings’’ refers to 

hearings conducted before OHO under Rules 

10.9261 and 10.9830. See id., 88 FR at 51880, n. 25. 

22See id. at 51881. 

23See id. 

24See text accompanying note 16, supra. 

25See FINRA Approval Order, 88 FR at 51880. 

26See id. 

27See text accompanying notes 8 & 19, supra. 

28See FINRA Approval Order, 88 FR at 51882. 

29See id. 

30See Exchange Act Release No. 97403 (May 4, 

2023), 88 FR 28645 (May 4, 2023) (File No. SR– 

FINRA–2023–008) (Notice of Filing of a Proposed 

Rule Change To Amend FINRA Rules 1015, 9261, 

9341, 9524, 9830 and Funding Portal Rule 900 

(Code of Procedure) To Permit Hearings Under 

Those Rules To Be Conducted by Video 

Conference). 

person hearings safely.17 In addition, 

OHO also has authority to order 

hearings to occur by video conference 

based on a motion, which was not 

permitted under the previous temporary 

amendments to FINRA Rules 9261 and 

9830.18

As the FINRA Approval Order noted, 

FINRA represented that it will utilize 

the same protocols for conducting video 

conference hearings as those employed 

under the temporary amendments, 

including using a high quality, secure, 

user-friendly video conferencing service 

and providing thorough instructions, 

training, and technical support to all 

hearing participants.19 In addition, the 

FINRA Approval Order noted that, 

according to FINRA, the parties could 

file a joint motion requesting the 

hearing to occur, in whole or in part, by 

video conference based on a showing of 

good cause. In-person hearings, 

however, would remain the default 

method for conducting hearings.20

Further, as noted in the FINRA 

Approval Order, given the nature of 

evidentiary hearings,21 which often 

occur over multiple days and generally 

include numerous documents in 

evidence and witness testimony, 

motions for a hearing by video 

conference would need to be joined by 

all parties, and even joint motions could 

be denied if the adjudicator determines 

that good cause has not been shown.22

According to FINRA, OHO would have 

reasonable discretion based on a joint 

motion of the parties to exercise its 

authority to determine whether a 

hearing should occur by video 

conference under the proposed rule 

change.23 Moreover, in deciding 

whether to schedule a hearing by video 

conference, OHO could consider and 

balance a variety of factors including, 

for example and without limitation, a 

hearing participant’s individual health 

concerns and access to the connectivity 

and technology necessary to participate 

in a video conference hearing. 

Additionally, as noted above, OHO may 

consider whether a situation is 

uncommon or there are extraordinary 

circumstances.24

Finally, the FINRA Approval Order 

noted that for approximately two and a 

half years, while the temporary 

amendments were in effect, OHO 

successfully conducted numerous 

hearings by video conference using 

Zoom, a system which was vetted by 

FINRA’s information technology staff.25

FINRA stated that this use of video 

conference technology has been an 

effective and efficient alternative to inperson hearings.26

As discussed below, the Exchange 

proposes to delete the temporary rule 

text in Rule 10.9261 and Rule 10.9830 

permitting video conferences that 

expired earlier this year and replace it 

with rule text based on FINRA’s 

recently approved amendments to its 

Rules 9261 and 9830 permitting video 

conference hearings under specified 

conditions. 

Proposed Rule Change 

NYSE Arca Rule 10.9261(b) provides 

that if a disciplinary hearing is held, a 

party shall be entitled to be heard inperson, by counsel, or by the party’s 

representative. Similarly, NYSE Arca 

Rule 10.9830 outlines the requirements 

for hearings for temporary and 

permanent cease and desist orders. 

NYSE Arca Rule 10.9830(a), however, 

does not specify that a party shall be 

entitled to be heard in-person, by 

counsel, or by the party’s representative. 

Consistent with FINRA’s temporary 

amendment to FINRA Rules 9261 and 

9830 that expired earlier this year, both 

NYSE Arca rules temporarily granted 

the Chief or Deputy Chief Hearing 

Officer temporary authority to order, 

upon consideration of COVID–19- 

related public health risks presented by 

an in-person hearing, that a hearing 

under those rules be conducted by video 

conference. 

The Exchange proposes to delete the 

temporary amendments to Rules 

10.9261 and 10.9830 and conform these 

rules to FINRA Rules 9261 and 9830 as 

recently amended. The Exchange would 

add text to the rules permitting the 

Chief or Deputy Chief Hearing Officer to 

order the hearing to be conducted in 

whole or in part by video conference 

consistent with the FINRA Approval 

Order either based upon an assessment 

that proceeding in person may endanger 

the health or safety of the participants 

or would be impracticable or upon 

consideration of a joint motion of the 

parties for good cause shown. As noted, 

FINRA has adopted a detailed and 

thorough protocol to ensure that 

hearings conducted by video conference 

will maintain a fair process for the 

parties.27 Moreover, the proposed rule 

change would modernize existing 

procedures and allow parties who 

jointly prefer video conference to 

potentially save travel costs and time. 

As proposed, the use of video 

conferences would be limited and 

controlled, and in-person hearings 

would continue to be the default 

method for conducting hearings.28

Furthermore, the proposed rule includes 

procedural safeguards to ensure 

fairness, such as the requirement for 

evidentiary hearings that any motions 

be joined by all parties and show good 

cause.29 The Exchange believes that this 

is a reasonable procedure to follow in 

hearings under Rules 10.9261 and 

10.9830 chaired by a FINRA employee. 

To effectuate these changes, the 

Exchange proposes to add the following 

deletions (bracketed) and additions 

(italicized) to Rule 10.9261(b): 

If a hearing is held, a Party shall be entitled 

to be heard in person, by counsel, or by the 

Party’s representative. [Upon consideration 

of the current public health risks presented 

by an in-person hearing, the Chief Hearing 

Officer or Deputy Chief Hearing Officer may, 

on a temporary basis, determine that the 

hearing shall be conducted, in whole or in 

part, by video conference.]Upon a 

determination that proceeding in person may 

endanger the health or safety of the 

participants or would be impracticable, or 

upon consideration of a joint motion of the 

Parties for good cause shown, the Chief 

Hearing Officer or Deputy Chief Hearing 

Officer may, in the exercise of reasonable 

discretion, order the hearing to be conducted, 

in whole or in part, by video conference. 

The proposed text is identical to the 

language adopted by FINRA.30

Similarly, the Exchange proposes the 

following deletions and additions to 

Rule 10.9830(a): 

The hearing shall be held not later than 15 

days after service of the notice and filing 

initiating the temporary cease and desist 

proceeding, unless otherwise extended by the 

Chief Hearing Officer or Deputy Chief 

Hearing Officer for good cause shown. If a 

Hearing Officer or Hearing Panelist is recused 

or disqualified, the hearing shall be held not 

later than five days after a replacement 

Hearing Officer or Hearing Panelist is 

appointed. [Upon consideration of the 

current public health risks presented by an 

in-person hearing, the Chief Hearing Officer 

or Deputy Chief Hearing Officer may, on a 

temporary basis, determine that the hearing 

shall be conducted, in whole or in part, by 

video conference.]Upon a determination that 

proceeding in person may endanger the 


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31See id. 

32 15 U.S.C. 78f(b). 

33 15 U.S.C. 78f(b)(5). 

34 15 U.S.C. 78f(b)(7) & 78f(d). 

35See FINRA Approval Order, 88 FR at 51880. 

36See id. at 51881 & n. 36. 

37 15 U.S.C. 78f(b)(7) and 78f(d). 

38 15 U.S.C. 78s(b)(3)(A)(iii). 

39 17 CFR 240.19b–4(f)(6). 

40Rule 19b–4(f)(6)(iii) requires a self-regulatory 

organization to give the Commission written notice 

of its 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. 

41 17 CFR 240.19b–4(f)(6). 

42 17 CFR 240.19b–4(f)(6)(iii). 

health or safety of the participants or would 

be impracticable, or upon consideration of a 

joint motion of the Parties for good cause 

shown, the Chief Hearing Officer or Deputy 

Chief Hearing Officer may, in the exercise of 

reasonable discretion, order the hearing to be 

conducted, in whole or in part, by video 

conference. 

Once again, the proposed language is 

identical to the language adopted by 

FINRA.31

2. Statutory Basis 

The proposed rule change is 

consistent with Section 6(b) of the 

Act,32 in general, and furthers the 

objectives of Section 6(b)(5),33 in 

particular, because 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, 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. Additionally, the 

Exchange believes the proposed rule 

change is designed to provide a fair 

procedure for the disciplining of 

members and persons associated with 

members, consistent with Sections 

6(b)(7) and 6(d) of the Act.34

The Exchange believes that the 

proposed rule changes support the 

objectives of the Act by harmonizing 

Exchange rules modeled on FINRA’s 

rules, resulting in less burdensome and 

more efficient regulatory compliance. 

As previously noted, the additional text 

proposed for Rule 10.9261 and Rule 

10.9830 is identical to the text in the 

counterpart FINRA rules. As such, the 

proposed rule change would facilitate 

rule harmonization among selfregulatory organizations with respect to 

the conduct of video conference 

hearings, thereby fostering cooperation 

and coordination with persons engaged 

in facilitating transactions in securities 

and will remove impediments to and 

perfect the mechanism of a free and 

open market and a national market 

system. 

The Exchange believes that the 

proposed rule change protects investors 

and the public interest by permitting the 

use of broadly available technology to 

allow hearings to proceed by video 

conference under certain circumstances. 

The Exchange’s disciplinary 

proceedings serve a critical role in 

providing investor protection and 

maintaining fair and orderly markets by, 

for example, sanctioning misconduct 

and preventing further customer harm 

by members and associated persons. 

The proposed rule change would 

encourage the prompt resolution of 

these cases while preserving fair 

process. The Exchange believes that this 

is especially important in matters where 

temporary and permanent cease and 

desist orders are sought because the 

proposed rule change would enable 

those hearings to proceed without delay, 

thereby enabling the Exchange to take 

immediate action to stop significant, 

ongoing customer harm, to the benefit of 

the investing public. 

The proposed rule change promotes 

efficiency by permitting hearings to 

occur by video conference in situations 

where the hearings would otherwise be 

postponed for an uncertain period of 

time. Moreover, as noted, FINRA will 

utilize the same protocols for 

conducting video conference hearings as 

those employed under the temporary 

amendments, including using a high 

quality, secure, user-friendly video 

conferencing service and providing 

thorough instructions, training, and 

technical support to all hearing 

participants.35 In addition, the Chief or 

Deputy Chief Hearing Officer may take 

into consideration, among other things, 

a hearing participant’s individual health 

concerns and access to the connectivity 

and technology necessary to participate 

in a video conference hearing.36

For the same reasons, the Exchange 

believes that the proposed changes are 

designed to provide a fair procedure for 

the disciplining of members and 

persons associated with members, 

consistent with Sections 6(b)(7) and 6(d) 

of the Act.37 The Exchange believes that 

the proposed rule change provides a fair 

procedure by allowing hearings to 

proceed by video conference not only 

due to public health or safety reasons, 

but also at a party or the parties’ request 

for reasons particular to them. The Chief 

or Deputy Chief Hearing Officer could 

allow a hearing to proceed by video 

conference in the exercise of reasonable 

discretion and subject to procedural 

safeguards that ensure fairness, 

including the requirement that any 

motions be joined by all parties and 

show good cause. Overall, the proposed 

rule change represents a significant step 

toward modernizing disciplinary 

process procedures in a manner that 

preserves in-person hearings but allows 

for the use of video conference 

technology under certain circumstances. 

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 not intended to 

address competitive issues but is rather 

intended solely to create permanent 

rules that would allow video conference 

hearings if OHO determines that 

proceeding in person may endanger the 

health or safety of the participants or 

would be impracticable, or where both 

parties prefer doing so and show good 

cause, thereby providing greater 

harmonization with approved FINRA 

rules. 

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 38 and Rule 

19b–4(f)(6) thereunder.39 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 

prior to 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 and Rule 19b–4(f)(6)(iii) 

thereunder.40

A proposed rule change filed under 

Rule 19b–4(f)(6) 41 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b4(f)(6)(iii),42 the Commission 

may designate a shorter time if such 


lotter on DSK11XQN23PROD with NOTICES1
Federal Register / Vol. 88, No. 239 / Thursday, December 14, 2023 / Notices 86697 

43 15 U.S.C. 78s(b)(2)(B). 

44 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. 

4See Securities Exchange Act Release Nos. 77241 

(February 26, 2016), 81 FR 11311 (March 3, 2016) 

(SR–NYSEMKT–2016–30) (‘‘2016 Notice’’). 

5See NYSE MKT Information Memorandum 16– 

02 (March 14, 2016). 

6See 2016 Notice, 81 FR at 11327 & 11332. 

action is consistent with the protection 

of investors and the public interest. 

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) 43 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–NYSEARCA–2023–82 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–NYSEARCA–2023–82. 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–NYSEARCA–2023–82 and 

should be submitted on or before 

January 4, 2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.44

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–27400 Filed 12–13–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99121; File No. SR– 

NYSEAMER–2023–62] 

Self-Regulatory Organizations; NYSE 

American LLC; Notice of Filing and 

Immediate Effectiveness of Proposed 

Change To Harmonize Rules 9261 and 

9830 

December 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 

November 27, 2023, NYSE American 

LLC (‘‘NYSE American’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission (the 

‘‘Commission’’) the proposed rule 

change as described in Items I, 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 harmonize 

Rules 9261 and 9830 with recent 

changes by the Financial Industry 

Regulatory Authority, Inc. (‘‘FINRA’’) 

that allow for video conference hearings 

under specified conditions. 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 harmonize 

Rules 9261 (Evidence and Procedure in 

Hearing) and 9830 (Hearing) with recent 

changes by FINRA to its Rules 9261 and 

9830 that allow for video conference 

hearings under specified conditions. 

Background 

In 2016, NYSE American (then known 

as NYSE MKT LLC) adopted 

disciplinary rules modeled the Rule 

8000 Series and Rule 9000 Series of 

FINRA and its affiliate the New York 

Stock Exchange LLC, and which set 

forth rules for conducting investigations 

and enforcement actions.4 The NYSE 

American disciplinary rules were 

implemented on April 15, 2016.5

In adopting disciplinary rules 

modeled on FINRA’s rules, NYSE 

American adopted the hearing and 

evidentiary processes set forth in Rule 

9261 and in Rule 9830 for hearings in 

matters involving temporary and 

permanent cease and desist orders 

under the Rule 9800 Series. As adopted, 

the text of Rule 9261 is identical to the 

counterpart FINRA rule. Rule 9830 is 

also identical to FINRA’s counterpart 

rule, except for conforming and 

technical amendments.6

In 2020, given the spread of COVID– 

19 and its effect on FINRA’s 

adjudicatory functions nationwide, 

FINRA filed a temporary rule change to 

grant FINRA’s Office of Hearing Officers 


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