81_FR_5825 81 FR 5803 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending the NYSE MKT Company Guide To Create a New Section 146 Under Which a Certain Category of Newly Listed Issuers Would Be Entitled To Receive Complimentary Products and Services From the Exchange

81 FR 5803 - Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of Proposed Rule Change Amending the NYSE MKT Company Guide To Create a New Section 146 Under Which a Certain Category of Newly Listed Issuers Would Be Entitled To Receive Complimentary Products and Services From the Exchange

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 22 (February 3, 2016)

Page Range5803-5806
FR Document2016-01932

Federal Register, Volume 81 Issue 22 (Wednesday, February 3, 2016) 
[Federal Register Volume 81, Number 22 (Wednesday, February 3, 2016)]
[Notices]
[Pages 5803-5806]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-01932]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-76996; File No. SR-NYSEMKT-2016-12]


Self-Regulatory Organizations; NYSE MKT LLC; Notice of Filing of 
Proposed Rule Change Amending the NYSE MKT Company Guide To Create a 
New Section 146 Under Which a Certain Category of Newly Listed Issuers 
Would Be Entitled To Receive Complimentary Products and Services From 
the Exchange

January 28, 2016.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby 
given that, on January 14, 2016, NYSE MKT LLC (the ``Exchange'' or 
``NYSE MKT'') filed with the Securities and Exchange Commission (the 
``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.
---------------------------------------------------------------------------

    \1\ 15 U.S.C.78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 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 amend the NYSE MKT Company Guide (the 
``Company Guide'') to create a new Section 146 under which a certain 
category of newly listed issuers would be entitled to receive 
complimentary products and services from the Exchange. The proposed 
rule change is available on the Exchange's Web site 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,

[[Page 5804]]

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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Company Guide to create a new 
Section 146 under which a certain category of newly listed issuers 
would be entitled to receive complimentary products and services from 
the Exchange. The Exchange proposes to offer such complimentary 
products and services for a period of 24 calendar months from the date 
of initial listing to (i) any U.S. company that lists common stock on 
the Exchange for the first time and any non-U.S. company that lists an 
equity security \4\ on the Exchange under Section 101 or 110 of the 
Company Guide for the first time, regardless of whether such U.S. or 
non-U.S. company conducts an offering, (ii) any U.S. or non-U.S. 
company that transfers its listing of common stock or equity 
securities, respectively, to the Exchange from another national 
securities exchange or (iii) any U.S. or non-U.S. company emerging from 
a bankruptcy, spinoff (where a company lists new shares in the absence 
of a public offering), and carve-out (where a company carves out a 
business line or division, which then conducts a separate initial 
public offering) (each, an ``Eligible New Listing'').
---------------------------------------------------------------------------

    \4\ For purposes of the proposed rule, ``equity securities'' 
means common stock or common share equivalents such as ordinary 
shares, New York shares, global shares, American Depository 
Receipts, or Global Depository Receipts.
---------------------------------------------------------------------------

    Historically, the Exchange has served as an alternative listing 
venue to the New York Stock Exchange (the ``NYSE'') for small 
capitalization companies unable to meet the NYSE's heightened initial 
listing standards. In this respect, the Exchange regularly competes 
with the Nasdaq Capital Market tier of the Nasdaq Stock Market and, in 
some cases, with the Nasdaq Global Market tier of the Nasdaq Stock 
Market. Like the Exchange, Nasdaq Capital Market and Nasdaq Global 
Market each have initial listing standards that can more readily 
accommodate small capitalization companies than the NYSE. The Exchange 
hopes in the future to compete for new listings to a greater degree 
with the Nasdaq Global Market. One way that the exchanges compete with 
each other is to offer companies services that aid their transition to 
being public or listed on a new exchange. For example, the Nasdaq 
Global Market currently offers newly listed companies the following 
services for a period of 24 calendar months following their listing: 
whistleblower hotline, investor relations Web site, press releases, 
interactive webcasting and market analytic tools.\5\ The total retail 
value of these services is approximately $70,000 per year.
---------------------------------------------------------------------------

    \5\ See Nasdaq Stock Market Rule IM-5900-7(b).
---------------------------------------------------------------------------

    To enable it to compete for listings with the Nasdaq Global Market, 
the Exchange proposes to offer Eligible New Listings Web-hosting 
products and services (with a commercial value of approximately $16,000 
annually), web-casting services (with a commercial value of 
approximately $6,500 annually), whistleblower hotline services (with a 
commercial value of approximately $4,000 annually), news distribution 
products and services (with a commercial value of approximately $20,000 
annually) and corporate governance tools (with a commercial value of 
approximately $15,000 annually) for a period of 24 calendar months from 
the date of initial listing on the Exchange.
    The Exchange believes that each of the services it proposes to 
offer to Eligible New Listings on the Exchange may be valuable to 
companies that are listing publicly for the first time or transferring 
their listing to the Exchange. Web-hosting products and services assist 
Eligible New Listings in engaging with their shareholders by providing 
them with a Web site that contains business content that can be viewed 
by investors. Similarly, web-casting services are an important tool 
utilized by listed companies to communicate with shareholders in 
connection with their quarterly earnings release process. A 
whistleblower hotline assists Eligible New Listings in complying with, 
among other things, the requirements of the Sarbanes-Oxley Act, Foreign 
Corrupt Practices Act and UK Bribery Act. News distribution products 
and services assist Eligible New Listings in complying with Exchange 
disclosure requirements. Lastly, corporate governance tools will help 
educate the board of directors of each Eligible New Listing about 
corporate governance best practices.
    The Exchange proposes to codify in the new Section 146 of the 
Company Guide that all companies listed on the Exchange are entitled to 
certain complimentary products and services via the Exchange's Market 
Access Center. The Market Access Center is a market information 
analytics platform that is a combination of technology-enabled market 
intelligence insight and a team of highly skilled market professionals. 
The platform was created to provide issuers with better market insight 
and information across all exchanges and trading venues. The Market 
Access Center includes products and services that were (i) developed by 
the Exchange using proprietary data and/or intellectual property or 
(ii) built by a third-party expressly for the Exchange's listed 
companies. Within this platform all issuers have access to tools and 
information related to market intelligence, education, investor 
outreach, media visibility, corporate governance, and advocacy 
initiatives. For example, the Market Access Center offers daily trading 
summaries; a trading alert system highlighting user-defined trading or 
market events; a Web site featuring timely content for Exchange-listed 
senior executives featuring trading information, market data, and 
institutional ownership. All issuers listed on the Exchange have access 
to the Exchange's Market Access Center on the same basis. The products 
and services currently available through the Exchange's Market Access 
Center have a commercial value of approximately $50,000.
    The specific tools and services offered by the products discussed 
herein will be developed by the Exchange or by third-party vendors. 
NYSE Governance Services \6\ will offer and develop the corporate 
governance tools discussed herein, but will not provide any other 
service discussed herein. NYSE Governance Services is an entity that is 
owned by the Exchange's parent

[[Page 5805]]

company and is a leading provider of corporate governance, risk and 
compliance services to a diverse set of customers, including, among 
others, companies listed on the Exchange. Companies that are offered 
these products are under no obligation to accept them and a company's 
listing on the Exchange is not conditioned upon acceptance of any 
product or service. The Exchange notes that, from time to time, 
companies elect to purchase products and services from other vendors at 
their own expense rather than accepting comparable products and 
services offered by the Exchange.
---------------------------------------------------------------------------

    \6\ The Exchange believes that NYSE Governance Services is not a 
``facility'' of the Exchange. 15 U.S.C. 78c(a)(2). The Act defines 
``facility'' to include an exchange's ``premises, tangible or 
intangible property whether on the premises or not, any right to the 
use of such premises or property or any service thereof for the 
purpose of effecting or reporting a transaction on an exchange 
(including, among other things, any system or communication to or 
from the exchange, by ticker or otherwise, maintained by or with the 
consent of the exchange), and any right of the exchange to the use 
of any property or service.'' NYSE Governance Services is a distinct 
entity that is separate from the Exchange and engages in a discrete 
line of business that is not ``for the purpose of effecting or 
reporting a transaction'' on an exchange. While this proposal is 
being filed with the Commission under Section 19(b)(2) of the Act 
because it relates to services offered in connection with a listing 
on the Exchange, the Exchange does not believe it is required to 
file NYSE Governance Services' price schedule or changes that do not 
relate to services offered in connection with a listing on the 
Exchange.
---------------------------------------------------------------------------

    The Exchange believes that companies listing on the Exchange for 
the first time often require a period of time after listing to complete 
the contracting and training process with vendors providing the 
complimentary products and services. Therefore, many companies are not 
able to begin using the suite of products offered to them immediately 
on the date of listing. To address this issue, the Exchange proposes to 
specify in Section 146 that if an Eligible New Listing begins using a 
particular service within 30 days after the date of listing, the 
complimentary period begins on such date of first use. In all other 
instances, the complimentary period will begin on the listing date.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\7\ in general, and furthers the 
objectives of Sections 6(b)(4) \8\ of the Act, in particular, in that 
it is designed to provide for the equitable allocation of reasonable 
dues, fees, and other charges among its members and issuers and other 
persons using its facilities. The Exchange also believes that the 
proposed rule change is consistent with Section 6(b)(5) \9\ of the Act 
in that it is not designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \7\ 15 U.S.C. 78f(b).
    \8\ 15 U.S.C. 78f(b)(4).
    \9\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that it is reasonable to offer complimentary 
products and services to attract new listings and respond to 
competitive pressures. The Exchange faces competition in the market for 
listing services and it competes, in part, by improving the quality of 
the services that it offers to listed companies. By offering products 
and services on a complimentary basis and ensuring that it is offering 
the services most valued by its listed issuers, the Exchange will 
improve the quality of the services that listed companies receive.
    The Exchange believes it is appropriate to offer a package of 
complimentary products and services to Eligible New Listings because 
such services will ease the transition of companies that are becoming 
public for the first time or transferring their listing to a new 
exchange. Further, Nasdaq offers a comparable suite of complimentary 
products and services to new listings and transfers and the proposed 
rule change will enable the Exchange to more effectively compete for 
listings.
    Allowing companies up to 30 days after their listing to start using 
the complimentary products and services is a reflection of the 
Exchange's experience that it can take companies a period of time to 
review and complete necessary contracts and training for services 
following their listing. Allowing this modest 30 day period, if the 
company needs it, helps ensure that the company will have the benefit 
of the full period permitted under the rule to actually use the 
services, thus giving companies the full intended benefit.

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. The proposed rule change 
enables the Exchange to compete for listings by offering Eligible New 
Listings a package of complimentary products and services that assist 
their transition to being publicly listed for the first time or 
transferring their listing to the Exchange. All similarly situated 
companies are eligible for the same package of services. Further, the 
Exchange notes that the Nasdaq Global Market already offers a similar 
suite of complimentary products and services to companies initially 
listing or transferring their listing from the New York Stock Exchange 
to its market. Therefore, the proposed creation of Section 146 of the 
Company Guide will increase competition by enabling the Exchange to 
more effectively compete for listings.

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

    Within 45 days of the date of publication of this notice in the 
Federal Register or up to 90 days (i) as the Commission may designate 
if it finds such longer period to be appropriate and publishes its 
reasons for so finding or (ii) as to which the self-regulatory 
organization consents, the Commission will:
    (A) By order approve or disapprove the proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

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-NYSEMKT-2016-12 on the subject line.

Paper Comments

     Send paper comments in triplicate to Brent J. Fields, 
Secretary, Securities and Exchange Commission, 100 F Street NE., 
Washington, DC 20549-1090.

All submissions should refer to File Number SR-NYSEMKT-2016-12. 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 Web site (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 Web site 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

[[Page 5806]]

inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; the Commission does 
not edit personal identifying information from submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-NYSEMKT-2016-12 and should 
be submitted on or before February 24, 2016.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\10\
Robert W. Errett,
Deputy Secretary.
---------------------------------------------------------------------------

    \10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

[FR Doc. 2016-01932 Filed 2-2-16; 8:45 am]
 BILLING CODE 8011-01-P

Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 5803 introducing new products to the change should be approved or For the Commission, by the Division of marketplace and encouraging disapproved. Trading and Markets, pursuant to delegated Specialists to make a market in these authority.17 products, which would in turn, benefit IV. Solicitation of Comments Robert W. Errett, market participants. Deputy Secretary. Interested persons are invited to To the extent that there is an submit written data, views, and [FR Doc. 2016–01928 Filed 2–2–16; 8:45 am] additional competitive burden on BILLING CODE 8011–01–P arguments concerning the foregoing, market participants that are not eligible including whether the proposed rule for the credit (i.e., non-Specialists), the change is consistent with the Act. Exchange believes that this is SECURITIES AND EXCHANGE Comments may be submitted by any of appropriate because the proposal would COMMISSION incent Specialists to quote and trade in the following methods: [Release No. 34–76996; File No. SR– options on ByRDs which would Electronic Comments NYSEMKT–2016–12] enhance the quality of the Exchange’s markets and increases the volume of • Use the Commission’s Internet Self-Regulatory Organizations; NYSE contracts traded here. To the extent that comment form (http://www.sec.gov/ MKT LLC; Notice of Filing of Proposed this purpose is achieved, all of the rules/sro.shtml); or Rule Change Amending the NYSE MKT Exchange’s market participants should • Send an email to rule-comments@ Company Guide To Create a New benefit from the improved market sec.gov. Please include File Number SR– Section 146 Under Which a Certain liquidity. Enhanced market quality and NYSEMKT–2016–10 on the subject line. Category of Newly Listed Issuers increased transaction volume that Would Be Entitled To Receive results from the anticipated increase in Paper Comments Complimentary Products and Services order flow directed to the Exchange will From the Exchange benefit all market participants and • Send paper comments in triplicate improve competition on the Exchange. to Secretary, Securities and Exchange January 28, 2016. Moreover, the Exchange believes it is Commission, 100 F Street NE., Pursuant to Section 19(b)(1) 1 of the appropriate to offer the credit to Washington, DC 20549–1090. Securities Exchange Act of 1934 (the Specialists (and not to other types of All submissions should refer to File ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 Market Makers) as Specialists are Number SR–NYSEMKT–2016–10. This notice is hereby given that, on January subject to heightened continuous 14, 2016, NYSE MKT LLC (the file number should be included on the quoting obligations that exceed those ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with subject line if email is used. To help the required of other Market Makers.13 the Securities and Exchange Commission process and review your Commission (the ‘‘Commission’’) the C. Self-Regulatory Organization’s comments more efficiently, please use proposed rule change as described in Statement on Comments on the only one method. The Commission will Items I, II, and III below, which Items Proposed Rule Change Received From post all comments on the Commission’s have been prepared by the self- Members, Participants, or Others Internet Web site (http://www.sec.gov/ regulatory organization. The No written comments were solicited rules/sro.shtml). Copies of the Commission is publishing this notice to or received with respect to the proposed submission, all subsequent solicit comments on the proposed rule rule change. amendments, all written statements change from interested persons. with respect to the proposed rule III. Date of Effectiveness of the change that are filed with the I. Self-Regulatory Organization’s Proposed Rule Change and Timing for Commission, and all written Statement of the Terms of Substance of Commission Action communications relating to the the Proposed Rule Change The foregoing rule change is effective proposed rule change between the The Exchange proposes to amend the upon filing pursuant to Section Commission and any person, other than NYSE MKT Company Guide (the 19(b)(3)(A) 14 of the Act and those that may be withheld from the ‘‘Company Guide’’) to create a new subparagraph (f)(2) of Rule 19b–4 15 public in accordance with the Section 146 under which a certain thereunder, because it establishes a due, provisions of 5 U.S.C. 552, will be category of newly listed issuers would fee, or other charge imposed by the available for Web site viewing and be entitled to receive complimentary Exchange. printing in the Commission’s Public products and services from the At any time within 60 days of the Reference Room, 100 F Street NE., Exchange. The proposed rule change is filing of such proposed rule change, the Washington, DC 20549 on official available on the Exchange’s Web site at Commission summarily may business days between the hours of www.nyse.com, at the principal office of temporarily suspend such rule change if 10:00 a.m. and 3:00 p.m. Copies of such the Exchange, and at the Commission’s it appears to the Commission that such filing also will be available for Public Reference Room. action is necessary or appropriate in the inspection and copying at the principal public interest, for the protection of II. Self-Regulatory Organization’s office of the Exchange. All comments Statement of the Purpose of, and investors, or otherwise in furtherance of received will be posted without change; the purposes of the Act. If the Statutory Basis for, the Proposed Rule the Commission does not edit personal Change Commission takes such action, the identifying information from mstockstill on DSK4VPTVN1PROD with NOTICES Commission shall institute proceedings submissions. You should submit only In its filing with the Commission, the under Section 19(b)(2)(B) 16 of the Act to information that you wish to make self-regulatory organization included determine whether the proposed rule available publicly. All submissions statements concerning the purpose of, 13 See should refer to File Number SR– supra n. 5. 17 17 CFR 200.30–3(a)(12). 14 15 U.S.C. 78s(b)(3)(A). NYSEMKT–2016–10, and should be 1 15 U.S.C.78s(b)(1). 15 17 CFR 240.19b–4(f)(2). submitted on or before February 24, 2 15 U.S.C. 78a. 16 15 U.S.C. 78s(b)(2)(B). 2016. 3 17 CFR 240.19b–4. VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1

5804 Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices and basis for, the proposed rule change future to compete for new listings to a Exchange are entitled to certain and discussed any comments it received greater degree with the Nasdaq Global complimentary products and services on the proposed rule change. The text Market. One way that the exchanges via the Exchange’s Market Access of those statements may be examined at compete with each other is to offer Center. The Market Access Center is a the places specified in Item IV below. companies services that aid their market information analytics platform The Exchange has prepared summaries, transition to being public or listed on a that is a combination of technology- set forth in sections A, B, and C below, new exchange. For example, the Nasdaq enabled market intelligence insight and of the most significant parts of such Global Market currently offers newly a team of highly skilled market statements. listed companies the following services professionals. The platform was created for a period of 24 calendar months to provide issuers with better market A. Self-Regulatory Organization’s following their listing: whistleblower insight and information across all Statement of the Purpose of, and hotline, investor relations Web site, exchanges and trading venues. The Statutory Basis for, the Proposed Rule press releases, interactive webcasting Market Access Center includes products Change and market analytic tools.5 The total and services that were (i) developed by 1. Purpose retail value of these services is the Exchange using proprietary data The Exchange proposes to amend the approximately $70,000 per year. and/or intellectual property or (ii) built Company Guide to create a new Section To enable it to compete for listings by a third-party expressly for the 146 under which a certain category of with the Nasdaq Global Market, the Exchange’s listed companies. Within newly listed issuers would be entitled to Exchange proposes to offer Eligible New this platform all issuers have access to receive complimentary products and Listings Web-hosting products and tools and information related to market services from the Exchange. The services (with a commercial value of intelligence, education, investor Exchange proposes to offer such approximately $16,000 annually), web- outreach, media visibility, corporate complimentary products and services casting services (with a commercial governance, and advocacy initiatives. for a period of 24 calendar months from value of approximately $6,500 For example, the Market Access Center the date of initial listing to (i) any U.S. annually), whistleblower hotline offers daily trading summaries; a trading company that lists common stock on the services (with a commercial value of alert system highlighting user-defined approximately $4,000 annually), news trading or market events; a Web site Exchange for the first time and any non- distribution products and services (with featuring timely content for Exchange- U.S. company that lists an equity a commercial value of approximately listed senior executives featuring security 4 on the Exchange under $20,000 annually) and corporate trading information, market data, and Section 101 or 110 of the Company governance tools (with a commercial institutional ownership. All issuers Guide for the first time, regardless of value of approximately $15,000 listed on the Exchange have access to whether such U.S. or non-U.S. company annually) for a period of 24 calendar the Exchange’s Market Access Center on conducts an offering, (ii) any U.S. or months from the date of initial listing on the same basis. The products and non-U.S. company that transfers its the Exchange. services currently available through the listing of common stock or equity The Exchange believes that each of Exchange’s Market Access Center have a securities, respectively, to the Exchange the services it proposes to offer to commercial value of approximately from another national securities Eligible New Listings on the Exchange $50,000. exchange or (iii) any U.S. or non-U.S. may be valuable to companies that are The specific tools and services offered company emerging from a bankruptcy, listing publicly for the first time or by the products discussed herein will be spinoff (where a company lists new transferring their listing to the developed by the Exchange or by third- shares in the absence of a public Exchange. Web-hosting products and party vendors. NYSE Governance offering), and carve-out (where a services assist Eligible New Listings in Services 6 will offer and develop the company carves out a business line or engaging with their shareholders by corporate governance tools discussed division, which then conducts a providing them with a Web site that herein, but will not provide any other separate initial public offering) (each, an contains business content that can be service discussed herein. NYSE ‘‘Eligible New Listing’’). viewed by investors. Similarly, web- Governance Services is an entity that is Historically, the Exchange has served casting services are an important tool owned by the Exchange’s parent as an alternative listing venue to the utilized by listed companies to New York Stock Exchange (the ‘‘NYSE’’) communicate with shareholders in 6 The Exchange believes that NYSE Governance for small capitalization companies connection with their quarterly earnings Services is not a ‘‘facility’’ of the Exchange. 15 unable to meet the NYSE’s heightened release process. A whistleblower hotline U.S.C. 78c(a)(2). The Act defines ‘‘facility’’ to initial listing standards. In this respect, include an exchange’s ‘‘premises, tangible or assists Eligible New Listings in intangible property whether on the premises or not, the Exchange regularly competes with complying with, among other things, the any right to the use of such premises or property the Nasdaq Capital Market tier of the requirements of the Sarbanes-Oxley Act, or any service thereof for the purpose of effecting Nasdaq Stock Market and, in some or reporting a transaction on an exchange Foreign Corrupt Practices Act and UK (including, among other things, any system or cases, with the Nasdaq Global Market Bribery Act. News distribution products communication to or from the exchange, by ticker tier of the Nasdaq Stock Market. Like and services assist Eligible New Listings or otherwise, maintained by or with the consent of the Exchange, Nasdaq Capital Market in complying with Exchange disclosure the exchange), and any right of the exchange to the and Nasdaq Global Market each have use of any property or service.’’ NYSE Governance requirements. Lastly, corporate Services is a distinct entity that is separate from the initial listing standards that can more governance tools will help educate the Exchange and engages in a discrete line of business readily accommodate small mstockstill on DSK4VPTVN1PROD with NOTICES board of directors of each Eligible New that is not ‘‘for the purpose of effecting or reporting capitalization companies than the a transaction’’ on an exchange. While this proposal Listing about corporate governance best is being filed with the Commission under Section NYSE. The Exchange hopes in the practices. 19(b)(2) of the Act because it relates to services The Exchange proposes to codify in offered in connection with a listing on the 4 For purposes of the proposed rule, ‘‘equity Exchange, the Exchange does not believe it is the new Section 146 of the Company securities’’ means common stock or common share required to file NYSE Governance Services’ price equivalents such as ordinary shares, New York Guide that all companies listed on the schedule or changes that do not relate to services shares, global shares, American Depository offered in connection with a listing on the Receipts, or Global Depository Receipts. 5 See Nasdaq Stock Market Rule IM–5900–7(b). Exchange. VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1

Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices 5805 company and is a leading provider of improve the quality of the services that III. Date of Effectiveness of the corporate governance, risk and listed companies receive. Proposed Rule Change and Timing for compliance services to a diverse set of The Exchange believes it is Commission Action customers, including, among others, appropriate to offer a package of Within 45 days of the date of companies listed on the Exchange. complimentary products and services to publication of this notice in the Federal Companies that are offered these Eligible New Listings because such Register or up to 90 days (i) as the products are under no obligation to services will ease the transition of Commission may designate if it finds accept them and a company’s listing on companies that are becoming public for such longer period to be appropriate the Exchange is not conditioned upon the first time or transferring their listing and publishes its reasons for so finding acceptance of any product or service. to a new exchange. Further, Nasdaq or (ii) as to which the self-regulatory The Exchange notes that, from time to offers a comparable suite of organization consents, the Commission time, companies elect to purchase complimentary products and services to will: products and services from other new listings and transfers and the (A) By order approve or disapprove vendors at their own expense rather proposed rule change will enable the the proposed rule change, or than accepting comparable products and Exchange to more effectively compete (B) institute proceedings to determine services offered by the Exchange. for listings. whether the proposed rule change The Exchange believes that companies listing on the Exchange for Allowing companies up to 30 days should be disapproved. the first time often require a period of after their listing to start using the IV. Solicitation of Comments time after listing to complete the complimentary products and services is a reflection of the Exchange’s Interested persons are invited to contracting and training process with experience that it can take companies a submit written data, views, and vendors providing the complimentary period of time to review and complete arguments concerning the foregoing, products and services. Therefore, many necessary contracts and training for including whether the proposed rule companies are not able to begin using services following their listing. change is consistent with the Act. the suite of products offered to them Allowing this modest 30 day period, if Comments may be submitted by any of immediately on the date of listing. To the company needs it, helps ensure that the following methods: address this issue, the Exchange proposes to specify in Section 146 that the company will have the benefit of the Electronic Comments if an Eligible New Listing begins using full period permitted under the rule to • Use the Commission’s Internet a particular service within 30 days after actually use the services, thus giving comment form (http://www.sec.gov/ the date of listing, the complimentary companies the full intended benefit. rules/sro.shtml); or period begins on such date of first use. • Send an email to rule-comments@ B. Self-Regulatory Organization’s In all other instances, the sec.gov. Please include File Number SR– Statement on Burden on Competition complimentary period will begin on the NYSEMKT–2016–12 on the subject line. listing date. The Exchange does not believe that the proposed rule change will impose Paper Comments 2. Statutory Basis any burden on competition that is not • Send paper comments in triplicate The Exchange believes that the necessary or appropriate in furtherance to Brent J. Fields, Secretary, Securities proposed rule change is consistent with of the purposes of the Act. The and Exchange Commission, 100 F Street Section 6(b) of the Act,7 in general, and proposed rule change enables the NE., Washington, DC 20549–1090. furthers the objectives of Sections Exchange to compete for listings by 6(b)(4) 8 of the Act, in particular, in that All submissions should refer to File offering Eligible New Listings a package Number SR–NYSEMKT–2016–12. This it is designed to provide for the of complimentary products and services equitable allocation of reasonable dues, file number should be included on the that assist their transition to being subject line if email is used. To help the fees, and other charges among its publicly listed for the first time or members and issuers and other persons Commission process and review your transferring their listing to the comments more efficiently, please use using its facilities. The Exchange also Exchange. All similarly situated believes that the proposed rule change only one method. The Commission will companies are eligible for the same post all comments on the Commission’s is consistent with Section 6(b)(5) 9 of the package of services. Further, the Act in that it is not designed to permit Internet Web site (http://www.sec.gov/ Exchange notes that the Nasdaq Global rules/sro.shtml). Copies of the unfair discrimination between Market already offers a similar suite of customers, issuers, brokers, or dealers. submission, all subsequent complimentary products and services to amendments, all written statements The Exchange believes that it is companies initially listing or with respect to the proposed rule reasonable to offer complimentary transferring their listing from the New change that are filed with the products and services to attract new York Stock Exchange to its market. Commission, and all written listings and respond to competitive Therefore, the proposed creation of communications relating to the pressures. The Exchange faces Section 146 of the Company Guide will proposed rule change between the competition in the market for listing increase competition by enabling the Commission and any person, other than services and it competes, in part, by Exchange to more effectively compete those that may be withheld from the improving the quality of the services for listings. public in accordance with the that it offers to listed companies. By mstockstill on DSK4VPTVN1PROD with NOTICES offering products and services on a C. Self-Regulatory Organization’s provisions of 5 U.S.C. 552, will be complimentary basis and ensuring that Statement on Comments on the available for Web site viewing and it is offering the services most valued by Proposed Rule Change Received From printing in the Commission’s Public its listed issuers, the Exchange will Members, Participants, or Others Reference Room, 100 F Street NE., Washington, DC 20549, on official 7 15 U.S.C. 78f(b). No written comments were solicited business days between the hours of 8 15 U.S.C. 78f(b)(4). or received with respect to the proposed 10:00 a.m. and 3:00 p.m. Copies of the 9 15 U.S.C. 78f(b)(5). rule change. filing also will be available for VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1

5806 Federal Register / Vol. 81, No. 22 / Wednesday, February 3, 2016 / Notices inspection and copying at the principal II. Self-Regulatory Organization’s 2. Statutory Basis office of the Exchange. All comments Statement of the Purpose of, and The Exchange believes that the received will be posted without change; Statutory Basis for, the Proposed Rule proposed rule change is consistent with the Commission does not edit personal Change the requirements of the Act and the identifying information from In its filing with the Commission, the rules and regulations thereunder that submissions. You should submit only self-regulatory organization included are applicable to a national securities information that you wish to make statements concerning the purpose of, exchange, and, in particular, with the available publicly. All submissions and basis for, the proposed rule change requirements of Section 6(b) of the Act.7 should refer to File Number SR– and discussed any comments it received In particular, the proposal is consistent NYSEMKT–2016–12 and should be on the proposed rule change. The text with Section 6(b)(5) of the Act,8 because submitted on or before February 24, of these statements may be examined at it is designed to promote just and 2016. the places specified in Item IV below. equitable principles of trade, to remove The self-regulatory organization has impediments to and perfect the For the Commission, by the Division of prepared summaries, set forth in mechanisms of a free and open market Trading and Markets, pursuant to delegated sections A, B and C below, of the most and a national market system and, in authority.10 significant aspects of such statements. general, to protect investors and the Robert W. Errett, public interest. The proposed rule Deputy Secretary. A. Self-Regulatory Organization’s change makes a non-substantive change [FR Doc. 2016–01932 Filed 2–2–16; 8:45 am] Statement of the Purpose of, and the to the name of the PFOF program BILLING CODE 8011–01–P Statutory Basis for, the Proposed Rule operated by the Exchange. The Change Exchange believes that this change will 1. Purpose be beneficial for members and investors SECURITIES AND EXCHANGE who already use this term with respect COMMISSION The Exchange administers a payment to trading on other options markets that for order flow (‘‘PFOF’’) program that have already adopted this terminology. helps Market Makers 3 establish PFOF The Exchange further notes that the [Release No. 34–76990; File No. SR–ISE– arrangements with Electronic Access 2016–04] marketing fee program will continue to Members (‘‘EAMs’’) in exchange for operate exactly as it does today. those EAMs routing some or all of their Self-Regulatory Organizations; B. Self-Regulatory Organization’s order flow to the Market Maker. This International Securities Exchange, PFOF program is funded through a fee Statement on Burden on Competition LLC; Notice of Filing and Immediate of $0.70 per contract,4 which is paid by In accordance with Section 6(b)(8) of Effectiveness of Proposed Rule ISE Market Makers for each regular the Act,9 the Exchange does not believe Change To Amend the Schedule of Priority Customer 5 contract executed in that the proposed rule change will Fees Non-Select Symbols.6 The Exchange impose any burden on intermarket or January 28, 2016. now proposes to rename the PFOF fee intramarket competition that is not to ‘‘marketing fee’’ to keep the name of necessary or appropriate in furtherance Pursuant to Section 19(b)(1) of the this program consistent with usage on of the purposes of the Act. The Securities Exchange Act of 1934 (the other options markets that have adopted proposed rule change is a non- ‘‘Act’’),1 and Rule 19b–4 thereunder,2 this terminology. The Exchange is not substantive name change and is notice is hereby given that on January proposing any substantive changes to therefore not designed to have any 19, 2016 the International Securities this program. competitive impact. Exchange, LLC (the ‘‘Exchange’’ or the ‘‘ISE’’) filed with the Securities and 3 The term ‘‘Market Makers’’ refers to C. Self-Regulatory Organization’s Exchange Commission the proposed ‘‘Competitive Market Makers’’ and ‘‘Primary Market Statement on Comments on the rule change, as described in Items I and Makers’’ collectively. See Rule 100(a)(25). Proposed Rule Change Received From II below, which items have been 4 The fee is waived in FX Options, Flash Orders, Members, Participants, or Others and for Complex Orders in all symbols. The PFOF prepared by the self-regulatory fee is rebated proportionately to the members that The Exchange has not solicited, and organization. The Commission is paid the fee such that on a monthly basis the PFOF does not intend to solicit, comments on publishing this notice to solicit fund balance administered by a Primary Market this proposed rule change. The Maker for a Group of options established under comments on the proposed rule change Rule 802(b) does not exceed $100,000 and the PFOF Exchange has not received any from interested persons. fund balance administered by a preferenced unsolicited written comments from Competitive Market Maker for such a Group does members or other interested parties. I. Self-Regulatory Organization’s not exceed $100,000. A preferenced Competitive Statement of the Terms of Substance of Market Maker that elects not to administer a fund III. Date of Effectiveness of the the Proposed Rule Change will not be charged the PFOF fee. Proposed Rule Change and Timing for The Exchange assesses an administrative fee of Commission Action 0.45% on the total amount of the funds collected The ISE proposes to amend the each month. Because the proposed rule change Schedule of Fees to rename its Payment 5 A ‘‘Priority Customer’’ is a person or entity that does not (i) significantly affect the for Order Flow program. The text of the is not a broker/dealer in securities, and does not protection of investors or the public proposed rule change is available on the place more than 390 orders in listed options per day interest; (ii) impose any significant on average during a calendar month for its own mstockstill on DSK4VPTVN1PROD with NOTICES Exchange’s Web site (http:// burden on competition; and (iii) become beneficial account(s), as defined in Rule www.ise.com), at the principal office of 100(a)(37A). operative for 30 days from the date on the Exchange, and at the Commission’s 6 ‘‘Non-Select Symbols’’ are options overlying all which it was filed, or such shorter time Public Reference Room. symbols excluding Select Symbols. The Schedule of as the Commission may designate, it has Fees currently states that PFOF is applicable to ‘‘Non-Penny Pilot Symbols,’’ which is an outdated 10 17 CFR 200.30–3(a)(12). 7 15 U.S.C. 78f(b). term. The Exchange therefore proposes to update 1 15 U.S.C. 78s(b)(1). 8 15 U.S.C. 78f(b)(5). the Schedule of Fees to refer instead to ‘‘Non-Select 2 17 CFR 240.19b–4. Symbols.’’ 9 15 U.S.C. 78f(b)(8). VerDate Sep<11>2014 19:14 Feb 02, 2016 Jkt 238001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 E:\FR\FM\03FEN1.SGM 03FEN1


Document Created: 2016-02-03 00:40:29
Document Modified: 2016-02-03 00:40:29
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
FR Citation81 FR 5803 
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR