Federal Register / Vol. 87, No. 32 / Wednesday, February 16, 2022 / Notices 8901 

10 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 93851 

(Dec. 22, 2021), 86 FR 74180 (Dec. 29, 2021) 

(‘‘Notice’’). 

4See, e.g., NYSE American Rule 902NY(e). 

5The first sentence of proposed NYSE Rule 37(b) 

would be based on NYSE American Rule 902NY(c) 

and NYSE Arca Rule 6.2–O(c). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.10

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–03279 Filed 2–15–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94217; File No. SR–NYSE– 

2021–73] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Order 

Approving a Proposed Rule Change To 

Amend NYSE Rule 37 To Incorporate 

Standards of Conduct for the 

Exchange’s Trading Floor 

February 10, 2022. 

I. Introduction 

On December 13, 2021, New York 

Stock Exchange LLC (‘‘NYSE’’ or the 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’), pursuant to Section 

19(b)(1) of the Securities Exchange Act 

of 1934 (‘‘Exchange Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to amend NYSE Rule 37 to 

incorporate standards of conduct for the 

Exchange’s Trading Floor. The proposed 

rule change was published for comment 

in the Federal Register on December 29, 

2021.3 The Commission has received no 

comments on the proposed rule change. 

This order approves the proposed rule 

change. 

II. Description of Proposed Rule Change 

The Exchange proposes to amend 

NYSE Rule 37 to incorporate standards 

of conduct for the Exchange’s Trading 

Floor that are modeled on rules of the 

Exchange’s affiliates NYSE American 

LLC and NYSE Arca, Inc., and to add 

amended NYSE Rule 37 to the list of 

minor rule violations in NYSE Rule 

9217. Proposed NYSE Rule 37 would be 

administered by the Exchange’s 

regulatory staff. 

a. Proposed Amendments to NYSE Rule 

37 

First, NYSE Rule 37 would be 

renamed ‘‘Admission and Conduct on 

the Trading Floor’’ similar to the NYSE 

American and NYSE Arca options rules, 

except that it would use the term 

‘‘Trading Floor.’’ 

Second, the existing text of NYSE 

Rule 37 governing admissions would be 

relocated to a new subsection (a) titled 

‘‘Admission,’’ once again similar to the 

NYSE American and NYSE Arca options 

rules.4 The existing text of NYSE Rule 

37 would be unchanged. 

Third, the Exchange would adopt a 

new subsection (b) titled ‘‘Conduct on 

the Trading Floor’’ that would be 

substantially similar to NYSE American 

Rule 902NY(b) and NYSE Arca Rule 

6.2–O(b). The proposed rule would 

provide that while on the Trading Floor, 

all members are required to act in a 

manner consistent with a fair and 

orderly market and with the 

maintenance of public confidence in the 

Exchange.5 The proposed rule would 

further provide that upon the 

determination that a member’s conduct 

on the Floor is such as to impair the 

maintenance of a fair and orderly 

market, or to impair public confidence 

in the operations of the Exchange, or 

that a member has otherwise violated 

the proposed rule, a member may be 

disciplined in accordance with the 

NYSE Rule 9000 Series, the Exchange’s 

disciplinary rules. Proposed NYSE Rule 

37(b) would also apply to a member’s 

failure to adequately supervise an 

employee or guest of the member to 

ensure compliance with the proposed 

rule. Unlike the NYSE American and 

NYSE Arca rules, proposed NYSE Rule 

37(b) would explicitly include as 

sanctionable conduct under the 

proposed rule the failure to adequately 

supervise the guest of a member. 

Because violations of proposed NYSE 

Rule 37 would be subject to discipline 

pursuant to the NYSE Rule 9000 Series, 

in paragraph (b) the Exchange proposes 

to include the phrase ‘‘or that a member 

has otherwise violated this rule.’’ Unlike 

the NYSE American and NYSE Arca 

rules, proposed NYSE 37(b) would not 

include text that: (1) States that fines 

imposed would not preclude further 

disciplinary action by the Exchange; or 

(2) refers to Exchange Trading Officials 

because, unlike their options market 

counterparts, they are not regulatory 

employees. 

Fourth, the Exchange proposes a new 

subsection (c) titled ‘‘Standards of Dress 

and Conduct’’ that is also substantially 

similar to NYSE American Rule 

902NY(c) and NYSE Arca Rule 6.2–O(c). 

Proposed NYSE Rule 37(c) would 

provide that all persons on the Floor 

must comply with the standards of dress 

and conduct set forth in proposed NYSE 

Rule 37(c)(1)(A)–(C). 

Proposed NYSE Rule 37(c)(1) would 

be titled ‘‘Standards of Dress’’ and 

would provide that all persons on the 

Floor, whether members, employees of 

member organizations, or visitors, must 

at all times, whether prior to, during, or 

after trading sessions, be dressed in a 

manner appropriate for business 

purposes and in accordance with good 

taste and professional standards. Like 

the NYSE American and NYSE Arca 

rules, proposed NYSE Rule 37(c)(1) 

would provide that the term ‘‘good 

taste’’ will be interpreted in a 

conservative manner. In addition, 

proposed NYSE Rule 37(c)(1) would set 

forth the following requirements and 

prohibitions: 

• Proposed NYSE Rule 37(c)(1)(A) 

would provide that personal attire must 

be neat, clean, and presentable. 

• Proposed NYSE Rule 37(c)(1)(B) 

would provide that all members and 

employees of member organizations 

must wear trading jackets and/or suit or 

sport coats while present on the Floor. 

• Proposed NYSE Rule 37(c)(1)(C) 

would provide that the Exchange may 

impose additional standards of dress or 

otherwise modify these standards of 

dress by means of a written policy that 

will be distributed to all members and 

member organizations. 

Proposed NYSE Rule 37(c)(2) would 

be titled ‘‘Standards of Conduct.’’ 

Proposed subsection (A) of NYSE Rule 

37(c)(2) would provide that all persons 

on the Floor are required to conduct 

themselves in accordance with a seemly 

and professional standard of behavior. 

Specifically, the proposed Rule would 

specify that no person while on the 

Floor shall: 

• Engage in any act or practice that 

may be detrimental to the interest or 

welfare of the Exchange (proposed 

NYSE Rule 37(c)(2)(A)(i)); 

• engage in any act or practice that 

may serve to disrupt or hinder the 

ordinary and efficient conduct of 

business (proposed NYSE Rule 

37(c)(2)(A)(ii)); 

• engage in any act or practice that 

may serve to jeopardize the safety or 

welfare of any other individual 

(proposed NYSE Rule 37(c)(2)(A)(iii)); 

or 

• act in a disorderly manner, which 

includes, but is not limited to, use of 

abusive or indecorous language and the 

display or circulation of written 

material or graphic images that are 

harassing, inappropriate, offensive, and/ 

or lewd (proposed NYSE Rule 

37(c)(2)(A)(iv)). 

Proposed subsection (B) of NYSE Rule 

37(c)(2) would provide that entry and 


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8902 Federal Register / Vol. 87, No. 32 / Wednesday, February 16, 2022 / Notices 

6NYSE Rule 303(a) provides that members who 

execute orders on the Floor must be provided with 

an identification badge and must wear the same 

while on the Floor, and that every member’s badge 

must contain his or her name and a number and the 

name of his or her member organization. 

7See NYSE American Rule 9217(i)(14) (violation 

of rules related to floor decorum); (i)(15) (disruptive 

action involving physical contact while on the 

Trading Floor); NYSE American Rule 9217(i)(16) 

(ATP Holder used abusive language on the trading 

floor); NYSE American Rule 9217(i)(20) (violation 

of rules on visitors to the options floor); NYSE 

American Rule 9217(i)(21) (misuse of ATP Holder 

badge or identification); and (i)(25) (abusing 

exchange property). See also NYSE Arca Rule 

10.9217(e)(16) (violation of rules related to floor 

decorum); NYSE Arca Rule 10.9217(e)(17) 

(disruptive action involving physical contact while 

on the trading floor); NYSE Arca Rule 

10.9217(e)(19) (OTP Holder used abusive language 

on the trading floor); NYSE Arca Rule 

10.9217(e)(31) (violation of rules on visitors to the 

options floor); NYSE Arca Rule 10.9217(e)(32) 

(misuse of OTP Holder badge or OTP Firm 

identification); and NYSE Arca Rule 10.9217 (e)(36) 

(abusing exchange property). 

8 In approving this proposed rule change, the 

Commission has considered the proposed rule’s 

impact on efficiency, competition, and capital 

formation. See 15 U.S.C. 78c(f). 9 15 U.S.C. 78f(b)(5). 

10 15 U.S.C. 78f(b)(1) and 78f(b)(6). 

11 17 CFR 240.19d–1(c)(2). 

consumption of food or drink on the 

Trading Floor may be permitted at the 

discretion of the Exchange and that food 

or drink should only be consumed at the 

booth or post. Finally, proposed NYSE 

Rule 37(c)(2)(B) would provide that 

alcoholic beverages may not be 

consumed on the Trading Floor during 

business hours as defined in NYSE Rule 

7.1 (Hours of Business). The proposed 

Rule differs slightly from the NYSE 

American and NYSE Arca rules, which 

prohibit consumption of alcoholic 

beverages at any time. 

Proposed subsection (C) of NYSE Rule 

37(c)(2) would prohibit smoking in any 

form, any kind of tobacco use, or any 

expectorating on the Floor and clarify 

that this prohibition would apply at all 

times. The proposed Rule is identical to 

the NYSE American and NYSE Arca 

versions. 

Proposed subsection (D) of NYSE Rule 

37(c)(2) would prohibit running on the 

Trading Floor, which the proposed Rule 

would define as any movement at a 

degree of speed which may disrupt 

other occupants of the Floor. Once 

again, the proposed Rule is identical to 

the NYSE American and NYSE Arca 

versions. 

Proposed subsection (E) of NYSE Rule 

37(c)(2) would prohibit standing on 

chairs, furniture, booths, ladders, stools, 

and similar items. The proposed Rule is 

the same as NYSE American Rule 

902NY(c)(2)(E) and NYSE Arca Rule 

6.2–O(c)(2)(E). 

Proposed subsection (F) of NYSE Rule 

37(c)(2) would provide that no object of 

any kind may be placed in the trading 

post areas, including all chairs, stools, 

or other furniture, if it could obstruct 

the flow of people in or out of the 

Trading Floor. Unlike the NYSE 

American and NYSE Arca rules, NYSE 

Rule 37(c)(2)(F) would not include any 

references to the trading crowd. 

Fifth and finally, the Exchange 

proposes a new subsection (d) to NYSE 

Rule 37 titled ‘‘Trading Floor Badges.’’ 

NYSE Rule 303 (Limitation on Access to 

Floor) currently requires members on 

the Floor to be provided with a badge 

that must be worn while on the Floor.6

Proposed NYSE Rule 37(d) would 

supplement NYSE Rule 303 by 

specifying, similar to NYSE American 

Rule 902NY(d) and NYSE Arca Rule 

6.2–O(d), that admission to the Floor 

will be by Exchange-issued badge only 

and that Exchange-issued badges must 

be appropriately displayed, with the 

photo visible, at all times while on the 

Floor. The proposed Rule would also 

specify that use of an Exchange-issued 

badge belonging to another member or 

Floor employee to enter or exit the Floor 

is prohibited. In addition, the proposed 

Rule would provide that authorized 

persons seeking admission to the Floor 

without a badge must show proper 

identification and obtain a temporary 

badge from the Security Office. Finally, 

proposed NYSE Rule 37(d) would 

provide that visitor’s badges are not 

acceptable identification cards for Floor 

employees. 

b. Fines for Minor Rule Violations 

NYSE Rule 9217 sets forth the list of 

rules under which a member 

organization or covered person may be 

subject to a fine under NYSE Rule 

9216(b). NYSE Rule 9217 permits the 

Exchange to impose a fine of up to 

$5,000 on any member or covered 

person for a minor violation of an 

eligible rule. 

The Exchange proposes to amend 

NYSE Rule 9217 to add a reference to 

the proposed NYSE Rule 37 provisions 

governing floor decorum, disruptive 

actions involving physical contact while 

on the Floor, use of abusive language, 

rules on visitors, abuse of Exchange 

property, and misuse of Exchangeissued badge or identification to the list 

of rules in NYSE Rule 9217 eligible for 

disposition pursuant to a minor fine 

under NYSE Rule 9216(b). Violations of 

the similar provisions under NYSE 

American Rule 902NY and NYSE Arca 

Rule 6.2–O are eligible for minor rule 

fines under those markets’ respective 

versions of NYSE Rule 9217.7

III. Discussion and Commission 

Findings 

After careful review, the Commission 

finds that the proposed rule change is 

consistent with the requirements of the 

Act and the rules and regulations 

thereunder applicable to a national 

securities exchange.8 In particular, the 

Commission finds that the proposed 

rule change is consistent with Section 

6(b)(5) of the Act,9 which requires that 

the rules of an exchange be designed to 

promote just and equitable principles of 

trade, 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. The 

Commission also finds that the proposal 

is consistent with Sections 6(b)(1) and 

6(b)(6) of the Act,10 which require that 

the rules of an exchange enforce 

compliance with, and provide 

appropriate discipline for, violations of 

Commission and Exchange rules. 

Finally, the Commission finds that the 

proposal is consistent with the public 

interest, the protection of investors, or 

otherwise in furtherance of the purposes 

of the Act, as required by Rule 19d– 

1(c)(2) under the Act,11 which governs 

minor rule violation plans. 

As described in detail above, the 

Exchange proposes to amend NYSE 

Rule 37 to add provisions governing 

floor decorum, disruptive actions 

involving physical contact while on the 

Floor, use of abusive language, visitors 

to the Exchange, abuse of Exchange 

property, and misuse of Exchangeissued badge or identification, and to 

also add the proposed NYSE Rule 37 

provisions to the list of rules in NYSE 

Rule 9217 that are eligible for 

disposition pursuant to a minor fine 

under NYSE Rule 9216(b). This 

proposed rule change is modeled on 

rules of the Exchange’s affiliates NYSE 

American and NYSE Arca. 

The Commission finds that adding the 

NYSE Rule 37 amendments to the list of 

rules in NYSE Rule 9217 that are 

eligible for disposition pursuant to a 

minor fine under NYSE Rule 9216(b) is 

consistent with the Act. This proposed 

rule change will align the Exchange’s 

rules regarding Floor conduct and 

decorum with the rules of its affiliates 

that also have trading floors. Because 

this proposal is modeled on conduct 

that is subject to minor rule fines on 

NYSE American and NYSE Arca, it does 

not raise any novel issues for 

consideration. Specifically, the 

Commission believes that NYSE Rule 

9217 provides a reasonable means of 

addressing rule violations that may not 

rise to the level of requiring formal 

disciplinary proceedings, while 


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Federal Register / Vol. 87, No. 32 / Wednesday, February 16, 2022 / Notices 8903 

12 15 U.S.C. 78s(b)(2). 

13 17 CFR 240.19d–1(c)(2). 

14 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Pursuant to Equity 7, Section 118(a), the term 

‘‘Consolidated Volume’’ shall mean the total 

consolidated volume reported to all consolidated 

transaction reporting plans by all exchanges and 

trade reporting facilities during a month in equity 

securities, excluding executed orders with a size of 

less than one round lot. For purposes of calculating 

Consolidated Volume and the extent of a member’s 

trading activity the date of the annual reconstitution 

of the Russell Investments Indexes shall be 

excluded from both total Consolidated Volume and 

the member’s trading activity. For the purposes of 

calculating the extent of a member’s trading activity 

during the month on Nasdaq and determining the 

charges and credits applicable to such member’s 

activity, all M–ELO Orders that a member executes 

on Nasdaq during the month will count as liquidityadding activity on Nasdaq. 

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

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

providing greater flexibility to the 

Exchange in handling certain violations. 

The Commission, however, also 

believes that a violation of any selfregulatory organization’s rules, or of 

Commission rules, is a serious matter. In 

approving this propose rule change, the 

Commission in no way minimizes the 

importance of compliance with the 

Exchange’s rules and all other rules 

subject to fines under NYSE Rule 9217. 

The Commission expects that the 

Exchange will continue to conduct 

surveillance with due diligence and 

make a determination based on its 

findings, on a case-by-case basis, 

whether a fine of more or less than the 

recommended amount is appropriate for 

a violation under NYSE Rule 9217 or 

whether a violation requires formal 

disciplinary action. 

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act 12 and Rule 

19d–1(c)(2) thereunder,13 that the 

proposed rule change (SR–NYSE–2021– 

73) be, and hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.14

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–03281 Filed 2–15–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–94218; File No. SR– 

NASDAQ–2022–013] 

Self-Regulatory Organizations; The 

Nasdaq Stock Market LLC; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

Exchange’s Transaction Credits at 

Equity 7, Section 118 

February 10, 2022. 

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 February 

1, 2022, The Nasdaq Stock Market LLC 

(‘‘Nasdaq’’ or ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(‘‘SEC’’ or ‘‘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 amend the 

Exchange’s transaction credits at Equity 

7, Section 118, as described further 

below. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://listingcenter.nasdaq.com/ 

rulebook/nasdaq/rules, 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 

Exchange 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 

Exchange has prepared summaries, set 

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

the most significant aspects of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

The purpose of the proposed rule 

change is to amend the Exchange’s 

schedule of credits, at Equity 7, Section 

118(a). The Exchange proposes to 

amend an existing credit to its members 

for displayed quotes/orders (other than 

Supplemental Orders or Designated 

Retail Orders) that provide liquidity to 

the Exchange. 

Currently, the Exchange provides a 

credit of $0.0029 per share executed to 

a member that, through one or more of 

its Nasdaq Market Center MPIDs: (i) 

Provides shares of liquidity in all 

securities that represent equal to or 

greater than 0.65% of Consolidated 

Volume 3 during the month; (ii) 

increases its average daily volume of 

Midpoint Extended Life Orders 

executed by 150% or more during the 

month relative to the month of January 

2021; and (iii) executes an average daily 

volume of at least 750,000 shares in 

Midpoint Extended Life Orders for the 

month. The Exchange proposes to 

amend this credit by providing an 

additional means of attaining it. 

Specifically, the Exchange proposes to 

amend the first criterion for the credit 

to state that a member must provide 

shares of liquidity in all securities that 

represent equal to or greater than either 

0.65% of Consolidated Volume or an 

average daily volume of 70 million 

shares during the month. 

By providing an additional means by 

which a member can attain this credit, 

the Exchange intends to increase the 

number of members that strive to and do 

attain it, including by increasing their 

average daily volume of liquidity adding 

activity on the Exchange. To the extent 

that the proposal succeeds in this 

objective, then Exchange will 

experience an increase in liquidity, 

which in turn stands to improve the 

quality of the market, to the benefit all 

participants. 

The Exchange notes that those 

participants that are dissatisfied with 

this new proposal are free to shift their 

order flow to competing venues. 

2. Statutory Basis 

The Exchange believes that its 

proposal is consistent with Section 6(b) 

of the Act,4 in general, and furthers the 

objectives of Sections 6(b)(4) and 6(b)(5) 

of the Act,5 in particular, in that it 

provides for the equitable allocation of 

reasonable dues, fees and other charges 

among members and issuers and other 

persons using any facility, and is not 

designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. The 

proposal is also consistent with Section 

11A of the Act relating to the 

establishment of the national market 

system for securities. 

The Proposal Is Reasonable 

The Exchange’s proposal is reasonable 

in several respects. As a threshold 

matter, the Exchange is subject to 

significant competitive forces in the 

market for equity securities transaction 

services that constrain its pricing 

determinations in that market. The fact 

that this market is competitive has long 


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