Federal Register / Vol. 80, No. 8 / Tuesday, January 13, 2015 / Notices 1687 

33 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3The Bylaws define ‘‘Non-Affiliated Directors’’ as 

U.S. Persons who are not members of the Board of 

Directors of Intercontinental Exchange, Inc. (‘‘ICE’’) 

and qualify as independent under NYSE 

Regulation’s director independence policy. See 

Bylaws of NYSE Regulation, Inc., Article III, Section 

1(A); see also Securities Exchange Act Release No. 

67564 (August 1, 2012), 77 FR 47161 (August 7, 

2012) (SR–NYSE–2012–17; SR–NYSEArca–2012– 

59; SR–NYSEMKT–2012–07) (approving NYSE 

Regulation’s director independence policy). The 

Bylaws require that a majority of NYSE Regulation’s 

Board of Directors consist of Non-Affiliated 

Directors. The remaining directors are NYSE 

Regulation’s Chief Executive Officer (‘‘CEO’’) and 

members of the ICE Board of Directors that qualify 

as independent under NYSE Regulation’s director 

independence policy. The Exchange represents that 

the Bylaws do not require any affiliated directors 

other than the NYSE Regulation CEO. 

4See Securities Exchange Act Release No. 53382 

(February 27, 2006), 71 FR 11251 (March 6, 2006) 

(SR–NYSE–2005–77) (approving NYSE’s business 

combination with Archipelago Holdings, Inc.). The 

Exchange has posted a copy of the Delegation 

Agreement on its public Web site at www.nyse.com. 

5See Securities Exchange Act Release No. 73657 

(November 20, 2014), 79 FR 70608 (SR–NYSE– 

2014–62). 

6 In approving this proposed rule change, the 

Commission notes that it has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 

7 15 U.S.C. 78f(b)(1). 

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

9 17 CFR 200.30–3(a)(12). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.33

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–00295 Filed 1–12–15; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 74010; File No. SR–NYSE– 

2014–62] 

Self-Regulatory Organizations; New 

York Stock Exchange LLC; Order 

Approving Proposed Rule Change 

Amending the Bylaws of New York 

Stock Exchange LLC’s Wholly-Owned 

Subsidiary, NYSE Regulation, Inc., To 

Provide That Non-Affiliated Directors 

of NYSE Regulation, Inc. Would Not Be 

Removed for Cause If They Are Acting 

in Good Faith in Exercising Their 

Responsibilities as Directors Related 

to NYSE Regulation’s Functions and 

Responsibilities Delegated to It Under 

the Delegation Agreement Between 

New York Stock Exchange LLC, NYSE 

Regulation and NYSE Market (DE), Inc. 

January 7, 2015. 

On November 7, 2014, the New York 

Stock Exchange LLC (‘‘NYSE’’ or 

‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’), pursuant to Section 

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

of 1934 (‘‘Act’’),1 and Rule 19b–4 

thereunder,2 a proposed rule change to 

amend the Sixth Amended and Restated 

Bylaws (‘‘Bylaws’’) of its wholly-owned 

subsidiary, NYSE Regulation, Inc. 

(‘‘NYSE Regulation’’), to provide that 

non-affiliated directors of NYSE 

Regulation (‘‘Non-Affiliated 

Directors’’) 3 would not be removed for 

cause if they are acting in good faith in 

exercising their responsibilities as 

directors related to NYSE Regulation’s 

functions and responsibilities delegated 

to it under the delegation agreement 

between the Exchange, NYSE 

Regulation, and NYSE Market (DE), Inc. 

(‘‘Delegation Agreement’’).4 The 

proposed rule change was published for 

comment in the Federal Register on 

November 26, 2014.5 The Commission 

did not receive any comment letters 

regarding the proposal. This order 

approves the proposed rule change. 

The Exchange proposes to amend 

Article III, Section 4 of the Bylaws to 

provide that Non-Affiliated Directors 

would not be removed for cause if they 

are acting in good faith in exercising 

their responsibilities as directors related 

to the functions and responsibilities of 

NYSE Regulation delegated to it under 

the Delegation Agreement. The 

Exchange also proposes to make a 

conforming change to the Bylaws so that 

the title of the Bylaws would read 

‘‘Seventh Amended and Restated 

Bylaws of NYSE Regulation, Inc.’’ 

Currently, Article III, Section 4 of the 

Bylaws provides that the Exchange may 

only remove Non-Affiliated Directors for 

‘‘cause.’’ The Exchange proposes to 

amend Article III, Section 4 so that 

‘‘cause’’ would not encompass 

‘‘decisions or actions taken in good faith 

by a Non-Affiliated Director in his or 

her capacity as a Director of [NYSE 

Regulation] and related’’ to NYSE 

Regulation’s delegated regulatory 

functions and responsibilities under the 

Delegation Agreement. The Exchange 

stated that this proposed amendment to 

the Bylaws would make explicit that 

conduct consistent with a NonAffiliated Director’s duties and 

responsibilities related to NYSE 

Regulation’s delegated functions and 

responsibilities would not constitute 

grounds for removal. 

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.6 In particular, the 

Commission finds that the proposed 

rule change is consistent with Section 

6(b)(1) of the Act,7 which requires an 

exchange to be so organized and have 

the capacity to carry out the purposes of 

the Act and to comply, and to enforce 

compliance by its members and persons 

associated with its members, with the 

Act, the rules and regulations 

thereunder, and the rules of the 

exchange. The Commission also finds 

that the proposed rule change is 

consistent with Section 6(b)(5) of the 

Act,8 which requires that the rules of an 

exchange be designed, among other 

things, to prevent fraudulent and 

manipulative acts and practices, 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 notes that the 

proposed amendment to the Bylaws 

would make explicit that conduct 

consistent with a Non-Affiliated 

Director’s duties and responsibilities 

related to NYSE Regulation’s delegated 

functions and responsibilities would not 

constitute grounds for such director’s 

removal from NYSE Regulation’s Board 

of Directors. The Exchange stated that 

the proposed amendment to the Bylaws 

would provide Non-Affiliated Directors 

of NYSE Regulation with reasonable 

assurances that actions or decisions, 

which were consistent with their 

fiduciary duty and which such NonAffiliated Directors believed, in good 

faith, to be the proper exercise of NYSE 

Regulation’s delegated functions and 

responsibilities, could not be used as a 

basis to remove those directors from 

office. The Exchange believes that the 

proposal would remove uncertainty 

surrounding this issue and would 

contribute to a more effective, efficient, 

and orderly decision-making process by 

NYSE Regulation’s Board of Directors. 

Based on the foregoing, the Commission 

believes the proposed rule change is 

consistent with the Act. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act, that the 

proposed rule change (SR–NYSE–2014– 

62) be, and it hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.9

Brent J. Fields, 

Secretary. 

[FR Doc. 2015–00294 Filed 1–12–15; 8:45 am] 

BILLING CODE 8011–01–P 


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