Document ID: SEC-2021-1102-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: New York Stock Exchange, LLC
Posted Date: 2021-08-13T04:00Z

[Federal Register Volume 86, Number 154 (Friday, August 13, 2021)]
[Notices]
[Pages 44759-44761]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-17306]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-92615; File No. SR-NYSE-2021-41]

Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Its Price List

August 9, 2021.
    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 August 2, 2021, New York Stock Exchange LLC (``NYSE'' or 
``Exchange'') 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 self-regulatory 
organization. The Commission is publishing this notice to solicit 
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Price List to eliminate the (1) 
underutilized monthly rebate payable to Designated Market Makers 
(``DMM'') with 30 or fewer assigned securities, and (2) expired waivers 
for equipment and related service charges and trading license fees for 
NYSE Trading Floor-based member organizations. The Exchange proposes to 
implement the rule change on August 2, 2021. 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 to amend its Price List to eliminate the (1) 
underutilized monthly rebate payable to DMMs with 30 or fewer assigned 
securities, and (2) expired waivers for equipment and related service 
charges and trading license fees for NYSE Trading Floor-based member 
organizations.

[[Page 44760]]

    The Exchange proposes to implement the rule change on August 2, 
2021.
Proposed Rule Change
    The Exchange proposes to eliminate an underutilized DMM rebate and 
obsolete waivers, as follows.
Underutilized DMM Rebate
    The Exchange currently pays a DMM with 30 or fewer assigned 
securities a monthly rebate of $1,500 per security, up to a maximum of 
$10,000, for each security assigned to such a DMM in the previous month 
(regardless of whether the stock price exceeds $1.00) for which that 
DMM provides quotes at the National Best Bid (``NBB'') and National 
Best Offer (``NBO,'' together the ``NBBO'') at least 25% of the time in 
the applicable month. The monthly rebate is in addition to the current 
rate on transactions and is prorated to the number of trading days in a 
month that an eligible security is assigned to a DMM.
    The Exchange proposes to eliminate this rebate in its entirety and 
to remove it from the Price List because the rebate has been 
underutilized by member organizations insofar as no DMMs with 30 or 
fewer assigned securities has qualified for the rebate in the past six 
months. As such, Exchange does not anticipate any member organization 
in the near future would qualify for the rebate that is the subject of 
this proposed rule change.
Expired Waivers
    In response to the unprecedented events surrounding the spread of 
COVID-19 in 2020, the Exchange waived certain equipment and related 
service charges and trading license fees for NYSE Trading Floor-based 
member organizations beginning in June 2020 through the earlier of the 
first full month of a full reopening of the Trading Floor facilities to 
Floor personnel or June 2021.\4\
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    \4\ See Securities Exchange Act Release No. 89050 (March 25, 
2021), 86 FR 16798 (March 31, 2021) (SR-NYSE-2021-19). See also 
Securities Exchange Act Release No. 89050 (June 11, 2020), 85 FR 
36637 (June 17, 2020) (SR-NYSE-2020-49); Securities Exchange Act 
Release No. 89324 (July 15, 2020), 85 FR 44129 (July 21, 2020) (SR-
NYSE-2020-59); Securities Exchange Act Release No. 89754 (September 
2, 2020), 85 FR 55550 (September 8, 2020) (SR-NYSE-2020-71); 
Securities Exchange Act Release No. 89798 (September 9, 2020), 85 FR 
57263 (September 15, 2020) (SR-NYSE2020-72); Securities Exchange Act 
Release No. 90161 (October 13, 2020), 85 FR 66370 (October 19, 2020) 
(SR-NYSE-2020-81); Securities Exchange Act Release No. 90391 
(November 10, 2020), 85 FR 73326 (November 17, 2020) (SR-NYSE2020-
92); Securities Exchange Act Release No. 90744 (December 21, 2020), 
85 FR 85712 (December 29, 2020) (SR-NYSE-2020-102); Securities 
Exchange Act Release No. 91082 (February 9, 2021), 86 FR 9546 
(February 16, 2021) (SR-NYSE-2021-10).
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    Specifically, the Exchange waived 50% of the Annual Telephone Line 
Charge of 400 per phone number; the $129 fee for a single line phone, 
jack, and data jack; the related service charges ($161.25 to install 
single jack (voice or data); $107.50 to relocate a jack; $53.75 to 
remove a jack; $107.50 to install voice or data line; $53.75 to 
disconnect data line; $53.75 to change a phone line subscriber; and 
miscellaneous telephone charges billed at $106 per hour in 15 minute 
increments); and the monthly portion of all applicable annual fees for 
member organizations that (1) had at least one trading license, a 
physical trading Floor presence and Floor broker executions accounting 
for 40% or more of the member organization's combined adding, taking 
and auction volumes during March 1 to March 20, 2020 or, if not a 
member organization during March 1 to March 20, 2020, based on the 
member organization's combined adding, taking, and auction volumes 
during its first month as a member organization on or after May 26, 
2020, and (2) were unable to operate at more than 50% of their March 
2020 on-Floor staffing levels or, for member organizations that began 
Floor operations after March 2020, are unable to operate at more than 
50% of their Exchange-approved on-Floor staffing levels, both excluding 
part-time Floor brokers known as ``flex brokers''.
    As set forth in footnotes 11 and 15 of the Price List, the waivers 
expired in June 2021 and have not been renewed. The Exchange 
accordingly proposes to delete footnote 11, which sets forth the 
equipment waivers described above, in its entirety, and to delete that 
portion of footnote 15 which addresses the waiver of the monthly 
portion of all applicable annual fees for member organizations, as 
obsolete.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\5\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\6\ in 
particular, because it provides for the equitable allocation of 
reasonable dues, fees, and other charges among its members, issuers and 
other persons using its facilities and does not unfairly discriminate 
between customers, issuers, brokers or dealers.
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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4) & (5).
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The Proposed Change Is Reasonable
    The Exchange believes that the proposed elimination of the monthly 
rebate of $1,500 per security, up to a maximum of $10,000, for DMMs 
with 30 or fewer assigned securities is reasonable because DMMs have 
underutilized the incentive. No DMM has qualified for the rebate in the 
past six months. The Exchange does not anticipate any member 
organization in the near future qualifying for the rebate that is the 
subject of this proposed rule change. The Exchange believes it is 
reasonable to eliminate requirements and credits when such incentives 
become underutilized. The Exchange also believes eliminating 
underutilized incentive programs would also simplify the Price List. 
The Exchange further believes that removing the optional DMM rebate and 
credit from the Price List would also add clarity and transparency to 
the Price List.
    Further, the Exchange believes that it is reasonable to delete the 
expired waivers for NYSE Trading Floor-based member organizations from 
the Price List because the waivers are no longer offered and the fees 
are currently being charged. Deleting obsolete waivers would add 
greater clarity of the Exchange's rules and enable market participants 
to navigate the Exchange's Price List more easily.
The Proposal Is an Equitable Allocation of Fees
    The Exchange believes the proposal equitably allocates fees among 
its market participants because elimination of underutilized and 
ineffective DMM rebate and credits the Exchange proposes to eliminate 
would be eliminated in their entirety, and would no longer be available 
to any member organization in any form. Similarly, the Exchange 
believes the proposal equitably allocates fees among its market 
participants because elimination of obsolete waivers would apply to all 
similarly-situated member organizations on an equal basis. All such 
member organizations would continue to be subject to the same fee 
structure, and access to the Exchange's market would continue to be 
offered on fair and nondiscriminatory terms.
The Proposal Is Not Unfairly Discriminatory
    The Exchange believes that the proposal is not unfairly 
discriminatory. The proposal is not unfairly discriminatory because it 
neither targets nor will it have a disparate impact on any particular 
category of market participant. The Exchange believes that the proposal 
is not unfairly discriminatory because the proposed elimination of the 
optional DMM rebate and credits would affect all similarly-

[[Page 44761]]

situated market participants on an equal and non-discriminatory basis. 
The Exchange believes that eliminating optional DMM rebate and credits 
that are underutilized and ineffective would no longer be available to 
any DMM on an equal basis. Further, the proposal does not permit unfair 
discrimination because elimination of obsolete waivers would apply to 
all similarly situated member organizations on an equal basis. In 
addition, the Exchange believes that the proposed elimination of 
obsolete waivers would remove impediments to and perfect the mechanism 
of a free and open market by eliminating references to waivers that are 
no longer offered, thereby improving the clarity of the Exchange's 
rules and enabling market participants to more easily navigate the 
Exchange's Price List. The Exchange also believes that the proposed 
change would protect investors and the public interest because the 
deletion of underutilized and obsolete fees would make the Price List 
more accessible and transparent and facilitate market participants' 
understanding of the fees charged for services currently offered by the 
Exchange.
    Finally, the Exchange believes that it is subject to significant 
competitive forces, as described below in the Exchange's statement 
regarding the burden on competition.
    For the foregoing reasons, the Exchange believes that the proposal 
is consistent with the Act.

B. Self-Regulatory Organization's Statement on Burden on Competition

    In accordance with Section 6(b)(8) of the Act,\7\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. Instead, as discussed above, the proposal relates 
solely to elimination of an underutilized rebate and obsolete waivers 
and, as such, would not have any impact on intra- or inter-market 
competition because the proposed change is solely designed to 
accurately reflect the services that the Exchange currently offers, 
thereby adding clarity to the Price List.
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    \7\ 15 U.S.C. 78f(b)(8).
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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 foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \8\ of the Act and subparagraph (f)(2) of Rule 19b-
4 \9\ thereunder, because it establishes a due, fee, or other charge 
imposed by the Exchange.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 17 CFR 240.19b-4(f)(2).
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    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) \10\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \10\ 15 U.S.C. 78s(b)(2)(B).
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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 rule-comments@sec.gov. Please include 
File Number SR-NYSE-2021-41 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-NYSE-2021-41. 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 to make available publicly. All submissions 
should refer to File Number SR-NYSE-2021-41 and should be submitted on 
or before September 3, 2021.
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    \11\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-17306 Filed 8-12-21; 8:45 am]
BILLING CODE 8011-01-P