Federal Register / Vol. 82, No. 201 / Thursday, October 19, 2017 / Notices 48733 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 81469 

(August 23, 2017), 82 FR 41077 (‘‘Notice’’). 

4See id. at 41078. 

5See proposed Rule 14.602. 

6See id. 

7See Notice, supra note 3, at 41078. 

8See proposed Rule 14.602. The provision of any 

products and services from a third-party vendor 

would need to be effected through arrangements 

directly between the listed issuer and the thirdparty vendor, without any subsidy or other 

involvement by the Exchange. See id. 

9See id. 

10See Notice, supra note 3, at 41078. 

11 15 U.S.C. 78f. 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). 

12 15 U.S.C. 78f(b)(4). 

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

14 15 U.S.C. 78f(b)(8). 

15See supra notes 5–7 and accompanying text. 

16The Commission views complimentary 

products and services provided by exchanges to 

listed companies as a discount on the ultimate 

listing fees paid by such companies. See, e.g., 

Securities Exchange Act Release Nos. 65127 

(August 12, 2011), 76 FR 51449 (August 18, 2011) 

(order approving SR–NYSE–2011–20) and 65963 

(December 15, 2011), 76 FR 79262 (December 21, 

2011) (order approving SR–NASDAQ–2011–122). 

17See Notice, supra note 3, at 41079. 

18This representation is also specifically set forth 

in the proposed rule text. 

19See Notice, supra note 3, at 41079. 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81872; File No. SR–IEX– 

2017–20] 

Self-Regulatory Organizations; 

Investors Exchange LLC; Order 

Approving Proposed Rule Change To 

Adopt Rule 14.602 To Describe the 

Complimentary Products and Services 

To Be Made Available to All Listed 

Companies 

October 13, 2017. 

I. Introduction 

On August 10, 2017, the Investors 

Exchange LLC (‘‘IEX’’ or the 

‘‘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 

adopt Rule 14.602 to describe the 

complimentary products and services to 

be made available to all listed 

companies. The proposed rule change 

was published for comment in the 

Federal Register on August 29, 2017.3

No comment letters were received in 

response to the Notice. This order 

approves the proposed rule change. 

II. Description of the Proposed Rule 

Change 

The Exchange has proposed to adopt 

Rule 14.602 to describe the 

complimentary products and services 

that will be offered to all listed 

companies pursuant to a listing program 

that the Exchange intends to begin in 

2017.4

In particular, the Exchange has 

proposed to provide all listed 

companies with the same optional 

complimentary services through access 

to IEX Issuer, a market information 

analytics platform consisting of access 

to a team of market professionals and 

web-based content.5 As described by the 

Exchange in its proposal, the team of 

market professionals will provide 

market intelligence, fundamental and 

technical trading analysis, and real-time 

market information to all listed 

companies.6 The Exchange also stated 

that the web-based portion of IEX Issuer 

will provide similar information that 

will enable all listed companies to 

follow their stock’s trading, competitors, 

and market activity through an online 

interface.7 Further, IEX noted that IEX 

Issuer may, from time to time, provide 

information about products and services 

from third-party vendors that IEX 

determines may be relevant to listed 

issuers, without any subsidy or other 

involvement by the Exchange for such 

products and services.8 The proposed 

rule text states that the Exchange will 

provide a description of all products 

and services available through IEX 

Issuer on its Web site.9

The Exchange represented in its 

proposal that all issuers listed on the 

Exchange will have access to services 

through IEX Issuer on the same basis 

and that the Exchange will not be 

proposing to offer any additional 

products and services to listed 

companies on a tiered or differentiated 

basis.10

III. Discussion and Commission 

Findings 

The Commission has carefully 

reviewed the proposed rule change and 

finds that it is consistent with the 

requirements of Section 6 of the Act.11

Specifically, the Commission finds that 

the proposal is consistent with Sections 

6(b)(4) 12 and 6(b)(5) of the Act 13 in 

particular, in that the proposed rule is 

designed to provide for the equitable 

allocation of reasonable dues, fees, and 

other charges among Exchange 

members, issuers, and other persons 

using the Exchange’s facilities, and is 

not designed to permit unfair 

discrimination between customers, 

issuers, brokers, or dealers. Moreover, 

the Commission finds that the proposed 

rule change is consistent with Section 

6(b)(8) of the Act 14 in that it does not 

impose any burden on competition not 

necessary or appropriate in furtherance 

of the purposes of the Act. 

The Commission believes that the 

proposed rule change, which would 

permit the Exchange to provide 

complimentary products and services to 

all listed companies through IEX Issuer, 

as described above,15 is appropriate and 

consistent with the Act. The 

Commission believes that by describing 

in its Rules the products and services 

available to listed companies, the 

Exchange is adding greater transparency 

to its rules and the fees applicable to 

such companies.16 This will help to 

ensure that individual listed companies 

are not given specially negotiated 

packages of products and services to list 

or remain listed that would raise unfair 

discrimination issues under the Act. 

The Commission notes that all listed 

companies will receive access to the 

same services on the same basis without 

any differentiation and the Exchange is 

not proposing to offer any additional 

products and services to listed 

companies on a tiered or differentiated 

basis. Accordingly, the Commission 

believes that the proposed rule change 

is consistent with the requirements of 

the Act and, in particular, that the 

products and services are equitably 

allocated among issuers consistent with 

Section 6(b)(4) of the Act, and the rule 

does not unfairly discriminate between 

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

the Act. 

As described above, the Exchange will 

provide all of the products and services 

and will separately provide information 

about additional products and services 

available from third-party vendors that 

IEX determines may be relevant to listed 

issuers. As noted by the Exchange in its 

proposal, listed companies may elect to 

purchase products and services from 

other vendors, or not to use any such 

products and services, rather than 

accepting the products and services 

offered by the Exchange.17 The 

Exchange stated that the provision of 

any products and services from a thirdparty vendor would need to be effected 

through arrangements directly between 

the listed issuer and the third-party 

vendor, without any subsidy or other 

involvement by the Exchange.18 The 

Exchange further stated that it does not 

have exclusive arrangements with thirdparty vendors with respect to any 

optional access to discounted products 

and services from third-party vendors.19

The Exchange has represented that 

listed companies will not be required to 

accept any discounted products and 


rmajette on DSKBCKNHB2PROD with NOTICES
48734 Federal Register / Vol. 82, No. 201 / Thursday, October 19, 2017 / Notices 

20See id. 

21See id. at 41078. 

22See id. See also Section 907.00 of the NYSE 

Listed Company Manual and Nasdaq Rule IM– 

5900–7. 

23 15 U.S.C. 78f(b)(8). 

24 15 U.S.C. 78s(b)(2). 

25 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)(2) and (f)(4). 

5Each capitalized term not otherwise defined 

herein has its respective meaning as set forth in the 

Rules, By-Laws and Organization Certificate of DTC 

(the ‘‘DTC Rules’’), available at http://

www.dtcc.com/legal/rules-and-procedures.aspx and 

the DTC Distributions Service Guide (‘‘Distributions 

Guide’’), available at http://www.dtcc.com/∼/ 

media/Files/Downloads/legal/service-guides/ 

Service%20Guide%20Distributions.pdf. 

6The Distributions Service includes DTC’s 

announcement, collection, allocation and reporting 

of dividend, interest and certain principal payments 

on behalf of Participants holding Securities at DTC. 

See Distributions Guide, supra note 1 at 9. 

7 Distribution Events covered by Announcements 

include cash dividends, interest, principal, capital 

gains, sale of rights on American depositary 

receipts, return of capital, dividend with option, 

stock splits, stock dividends, automatic dividend 

reinvestments, spinoffs, rights distributions, pay in 

kind, and liquidation. Distributions Guide, supra 

note 1 at 12. 

8Available at http://www.dtcc.comn/media/Files/ 

Downloads/legal/fee-guides/dtcfeeguide.pdf?la=en. 

9See Distributions Guide, supra note 5 at 9. 

10The Record Date is the date set by an issuer of 

a security by which an investor must own the 

security in order to be eligible to receive an 

upcoming distribution. 

11See Distributions Guide, supra note 5 at 11–13. 

services as a condition to listing.20 The 

Commission believes that these 

representations should additionally 

help to ensure that individual listed 

companies are not given specially 

negotiated deals, through Exchange 

subsidized discounts on products and 

services from third-party vendors, to list 

or remain listed that would raise unfair 

discrimination issues under the Act . 

The Commission believes that the 

Exchange is responding to competitive 

pressures in the market for listings in 

making this proposal. Specifically, the 

Exchange stated in its proposal that it 

expects to face competition as a new 

entrant in the market for exchange 

listings and that it believes the 

complimentary products and services 

that it offers to listed companies will 

facilitate its ability to attract and retain 

listings.21 In particular, the Exchange 

states that it expects to face significant 

competition from the New York Stock 

Exchange (‘‘NYSE’’) and the Nasdaq 

Stock Market LLC (‘‘Nasdaq’’) for 

listings, both of which offer 

complimentary products and services to 

listed companies.22 Accordingly, the 

Commission believes that the proposed 

rule reflects the current competitive 

environment for exchange listings 

among national securities exchanges, 

and is appropriate and consistent with 

Section 6(b)(8) of the Act.23

IV. Conclusion 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act,24 that the 

proposed rule change (SR–IEX–2017– 

20), be, and hereby is, approved. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.25

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2017–22644 Filed 10–18–17; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–81871; File No. SR–DTC– 

2017–018] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change To Amend the 

DTC Distributions Guide Relating to 

Announcements and Tax Treatment of 

Certain Corporate Action Events and 

To Amend the DTC Fee Schedule 

October 13, 2017. 

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 October 

2, 2017, 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 Rules 19b–4(f)(2) and 

(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 5 would (i) 

revise the Distributions Guide to (A) 

enhance the DTC Announcements 

feature (‘‘Announcements’’) within the 

DTC Distributions Service 

(‘‘Distributions Service’’) 6 by adding 

new corporate action events that do not 

involve the payment of funds or 

distribution of Securities through DTC, 

but which may result in a taxable event 

for holders (‘‘Tax Event’’), as a type of 

distribution covered by Announcements 

(‘‘Distribution Event’’) 7 and (B) make 

technical and conforming changes 

relating to U.S. tax withholding and 

information reporting performed by 

DTC with respect to Tax Events; and (ii) 

add a fee relating to the announcement 

of Tax Events (‘‘New Fee’’) to the DTC 

Fee Schedule (‘‘Fee Schedule’’),8 as 

discussed below. 

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 

The proposed rule change would (i) 

revise the Distributions Guide to (A) 

enhance Announcements by adding Tax 

Events as a Distribution Event and (B) 

make technical and conforming changes 

relating to U.S. tax withholding and 

information reporting performed by 

DTC with respect to Tax Events; and (ii) 

add the New Fee to the Fee Schedule, 

as discussed below. 

A. Distributions Service 

Announcements Feature 

The Distributions Service includes the 

announcement, collection, allocation 

and reporting by DTC, on behalf of its 

Participants, of dividend, interest and 

principal payments for Eligible 

Securities held by Participants at DTC. 

This centralized processing provides 

efficiency for Participants for their 

receipt of (i) payment information and 

(ii) payments on Distribution Events, 

from multiple issuers and agents.9 In 

this regard, Announcements provides 

Participants with information pertaining 

to their record date (‘‘Record Date’’) 10

positions for Distribution Events.11 This 


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