Document ID: SEC-2022-1124-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: NYSE American, LLC
Posted Date: 2022-08-18T04:00Z

[Federal Register Volume 87, Number 159 (Thursday, August 18, 2022)]
[Notices]
[Pages 50894-50896]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17750]

-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-95499; File No. SR-NYSEAMER-2022-35]

Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To Delete 
Current Rule 7.39E

August 12, 2022.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on August 5, 2022, 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 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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to delete current Rule 7.39E governing Off-
Hours Trading. 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 Exchange proposes delete current Rule 7.39E governing Off-Hours 
Trading.
    In 2017, in connection with the transition to the Pillar trading 
platform, the Exchange adopted Rule 7.39E in order to maintain certain 
functionality in its Off-Hours Trading Facility.\3\ Currently, the 
Exchange offers an Off-Hours Trading Facility pursuant to Rule 7.39E 
that only accepts aggregate-price coupled orders.
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release No. 80590 (May 4, 2017), 
82 FR 21843, 21847 (May 10, 2017) (SR-NYSEMKT-2017-01) (Order 
Granting Accelerated Approval of Proposed Rule Change, as Modified 
by Amendment No. 1, To Adopt New Equity Trading Rules To Transition 
Trading on the Exchange From a Floor-Based Market With a Parity 
Allocation Model to a Fully Automated Market With a Price-Time 
Priority Model on the Exchange's New Trading Technology Platform, 
Pillar). Prior to that time, Rules 900--Equities through 907--
Equities governed off-hours trading activity on the Exchange. Rules 
900--Equities through 907--Equities were designated as inapplicable 
to trading on the Pillar trading platform and later deleted. See 
Securities Exchange Act Release No. 82212 (December 4, 2017), 82 FR 
58036 (December 8, 2017) (SR-NYSEAMER-2017-34) (Notice of Filing and 
Immediate Effectiveness of Proposed Rule Change To Amend Exchange 
Rules To Delete Obsolete Cash Equities Rules That Are Not Applicable 
to Trading on the Pillar Trading Platform and To Delete Other 
Obsolete Rules).
---------------------------------------------------------------------------

    NYSE American recently determined to cease offering an after-hours 
crossing session and decommission the Off-Hours Trading Facility. In 
connection with the decommissioning of the Off-Hours Trading Facility, 
the Exchange proposes to delete Rule 7.39E in its entirety. The 
Exchange notes that its affiliate New York Stock Exchange LLC 
(``NYSE'') has filed to adopt a new Rule 7.39 governing its off-hours 
trading facility based on Rule 7.39E that would permit NYSE member 
organizations to enter aggregate-price coupled orders for securities, 
including UTP securities, listed and traded on NYSE.\4\
---------------------------------------------------------------------------

    \4\ See SR-NYSE-2022-37. The NYSE's proposed rule filing would 
permit NYSE member organizations to enter aggregate-price coupled 
orders, defined as orders to buy or sell a group of securities that 
have a total market value of $1 million or more and that are 
comprised of 15 or more securities listed or traded on the NYSE, 
which would include UTP securities.
---------------------------------------------------------------------------

    The Exchange will announce the implementation date by Trader 
Update. The Exchange anticipates that the proposed change will be 
implemented on September 1, 2022.
2. Statutory Basis
    The proposed rule change is consistent with Section 6(b) of the 
Act,\5\ in general, and furthers the objectives of Section 6(b)(5),\6\ 
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.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    Specifically, the Exchange believes that deleting Rule 7.39E 
concomitantly with the decommissioning of the Off-Hours Trading 
Facility would foster cooperation and coordination with persons engaged 
in facilitating transactions in securities and would remove impediments 
to and perfect the mechanism of a free and open market and a national 
market system by deleting obsolete rules, thereby adding clarity, 
transparency and consistency to the Exchange's rulebook. By making the 
proposed change, the Exchange would ensure that its rules are 
consistent with

[[Page 50895]]

the existing functionality offered by the Exchange, thereby promoting 
clarity and transparency in its rules. The Exchange believes that the 
change would not be inconsistent with the public interest and the 
protection of investors because investors will not be harmed and in 
fact would benefit from the increased clarity and transparency that the 
change would introduce, thereby reducing potential confusion.
    The Exchange further believes that the proposed rule change would 
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, because it would remove any potential 
confusion among market participants that may result if the Exchange 
retained rules governing its Off-Hours Trading Facility after the 
Exchange decommissioned it.
    For these reasons, the Exchange believes that the proposal is 
consistent with the Act.

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. Specifically, the Exchange 
believes that decommissioning its Off-Hours Trading Facility would not 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. Pursuant to the NYSE's 
recent filing to adopt a new rule based on NYSE American Rule 7.39E, 
all ETP Holders that are also NYSE member organizations would be able 
to utilize the NYSE's off-hours trading facility to enter aggregate-
price coupled orders for securities, including UTP securities, listed 
and traded on the NYSE.\7\ The Exchange further believes that the 
proposed rule change would not impose any burden on competition that is 
not necessary or appropriate because the proposed change is designed to 
promote clarity and consistency, thereby reducing burdens on the 
marketplace and facilitating investor protection.
---------------------------------------------------------------------------

    \7\ See SR-NYSE-2022-37.
---------------------------------------------------------------------------

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 \8\ and Rule 19b-4(f)(6) thereunder.\9\ 
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 \10\ and Rule 19b-
4(f)(6)(iii) thereunder.\11\
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \9\ 17 CFR 240.19b-4(f)(6).
    \10\ 15 U.S.C. 78s(b)(3)(A).
    \11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
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.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \12\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\13\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest. The Exchange has asked 
the Commission to waive the 30-day operative delay so that the proposal 
may become operative on September 1, 2022.
---------------------------------------------------------------------------

    \12\ 17 CFR 240.19b-4(f)(6).
    \13\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The Commission believes that waiver of the operative delay is 
consistent with the protection of investors and the public interest 
because the Exchange plans to decommission the Off-Hours Trading 
Facility as of September 1, 2022. Accordingly, the Commission hereby 
waives the 30-day operative delay and designates the proposal operative 
on September 1, 2022.\14\
---------------------------------------------------------------------------

    \14\ For purposes only of accelerating the operative date of 
this proposal, the Commission has considered the proposed rule's 
impact on efficiency, competition, and capital formation. 15 U.S.C. 
78c(f).
---------------------------------------------------------------------------

    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) \15\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
---------------------------------------------------------------------------

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

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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NYSEAMER-2022-35 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-2022-35. 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 (http://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 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of the Exchange. All comments 
received will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish

[[Page 50896]]

to make available publicly. All submissions should refer to File Number 
SR-NYSEAMER-2022-35 and should be submitted on or before September 8, 
2022.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\16\
---------------------------------------------------------------------------

    \16\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-17750 Filed 8-17-22; 8:45 am]
BILLING CODE 8011-01-P