81 FR 73187 - Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Article IV, Section 4.05 of the Tenth Amended and Restated Operating Agreement of the Exchange
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 205 (October 24, 2016)
Federal Register Volume 81, Issue 205 (October 24, 2016)
| Page Range | 73187-73189 | |
| FR Document | 2016-25577 |
[Federal Register Volume 81, Number 205 (Monday, October 24, 2016)] [Notices] [Pages 73187-73189] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-25577] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-79115; File No. SR-NYSE-2016-66] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending Article IV, Section 4.05 of the Tenth Amended and Restated Operating Agreement of the Exchange October 18, 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 October 6, 2016, New York Stock Exchange LLC (``NYSE'' or the ``Exchange'') 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 Article IV, Section 4.05 of the Tenth Amended and Restated Operating Agreement of the Exchange (``Operating Agreement'') regarding use of regulatory assets, fees, fines and penalties, and make additional, non-substantive edits. 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, 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 Article IV, Section 4.05 (Limitation on Distributions) of the Operating Agreement (``Section 4.05''), regarding use of regulatory assets, fees, fines and penalties (``Regulatory Funds''), and make additional, non-substantive edits. Proposed Amendment to Section 4.05 Section 4.05 provides that: [t]he Company shall not use any regulatory assets or any regulatory fees, fines or penalties collected by the Exchange's regulatory staff for commercial purposes or distribute such assets, fees, fines or penalties to the Member or any other entity.\4\ --------------------------------------------------------------------------- \4\ See Tenth Amended and Restated Operating Agreement of New York Stock Exchange LLC, Art. IV, Sec. 4.05; see also Securities Exchange Act Release No. 78805 (September 9, 2016), 81 FR 63536 (September 15, 2016) (SR-NYSE-2016-51). --------------------------------------------------------------------------- Although it prohibits the use of Regulatory Funds for ``commercial purposes,'' that term is not defined in Section 4.05 or elsewhere in the Operating Agreement. Accordingly, to add greater clarity to the limits on the use of Regulatory Funds, the Exchange proposes to replace the prohibition against using Regulatory Funds for ``commercial purposes'' with a statement that Regulatory Funds ``will be applied to fund the legal, regulatory and surveillance operations'' of the Exchange. The prohibition on using Regulatory Funds for distributions to the Member or any other entity would remain. In addition, ``Exchange'' is not a defined term in the Operating Agreement, which defines the Exchange as the ``Company.'' Accordingly, the Exchange proposes to replace ``Exchange's regulatory staff'' with ``Company's regulatory staff.'' The amended Section 4.05 would read as follows: Any regulatory assets or any regulatory fees, fines or penalties collected by the Company's regulatory staff will be applied to fund the legal, regulatory and surveillance operations of the Company, and the Company shall not distribute such assets, fees, fines or penalties to the Member or any other entity. The Exchange believes that the increased clarity in the scope of the limits on use of Regulatory Funds will enhance the protections provided by Section 4.05 against the possibility that Regulatory Funds may be assessed to respond to the Exchange's budgetary needs rather than to serve a disciplinary purpose.\5\ --------------------------------------------------------------------------- \5\ See Securities Exchange Act Release No. 77899 (May 24, 2016), 81 FR 34393 (May 31, 2016) (SR-NYSE-2016-37). --------------------------------------------------------------------------- The proposed amendments would have the benefit of bringing Section 4.05 into greater conformity with the bylaws of the Exchange's affiliate NYSE Arca, Inc., which provide that regulatory fees and penalties ``will be applied to fund the legal, regulatory and surveillance operations of the Exchange.'' \6\ --------------------------------------------------------------------------- \6\ See Bylaws of NYSE Arca, Inc., Art. II, Sec. 2.06 (``Any revenues received by the Exchange from regulatory fees or regulatory penalties will be applied to fund the legal, regulatory and surveillance operations of the Exchange and will not be used to pay dividends. For purposes of this Section, regulatory penalties shall include restitution and disgorgement of funds intended for customers.''). The Exchange's affiliate NYSE MKT LLC has submitted substantially the same proposed amendment to its operating agreement. See SR-NYSEMKT-2016-93. --------------------------------------------------------------------------- The proposed amendments would make Section 4.05 more consistent with the limitations on the use of regulatory income of other self- regulatory organizations (``SROs''). Most such limitations are substantially similar to the proposed revised Section 4.05. For example, similar to the proposed Section 4.05, the limited liability company agreements of the BOX Options Exchange (``BOX''), International Securities Exchange, LLC (``ISE''), and its affiliates ISE Gemini, LLC and ISE Mercury, LLC, provide that regulatory funds shall be used to fund the relevant SRO's legal, regulatory and surveillance operations.\7\ Consistent [[Page 73188]] with the proposed revised Section 4.05, their definition of ``regulatory funds'' includes fees, fines or penalties derived from its regulatory operations.\8\ --------------------------------------------------------------------------- \7\ Such provisions also limit the relevant SRO from making any distribution to its member using regulatory funds. See Box Options Exchange Limited Liability Company Agreement, Art. 1, Sec. 1.1 and Art. 8, Sec. 8.1; Third Amended and Restated Limited Liability Company Agreement of International Securities Exchange, LLC, Art. III, Sec. 3.3(ii); Second Amended and Restated Limited Liability Company Agreement of ISE Gemini, LLC, Art. III, Sec. 3.3(ii); and Limited Liability Company Agreement of ISE Mercury, LLC, Art. III, Sec. 3.3(ii). \8\ The BOX definition of regulatory funds also states that such funds ``shall not include revenues derived from listing fees, market data revenues, transaction revenues or any other aspect of the commercial operations of the Exchange or a facility of the Exchange, even if a portion of such revenues are used to pay costs associated with the regulatory operations of the Exchange.'' Box Options Exchange Limited Liability Company Agreement, Art. 1, Sec. 1.1. The agreements of ISE and its affiliates have substantially similar language. See Third Amended and Restated Limited Liability Company Agreement of International Securities Exchange, LLC, Art. III, Sec. 3.3(ii); Second Amended and Restated Limited Liability Company Agreement of ISE Gemini, LLC, Art. III, Sec. 3.3(ii); and Limited Liability Company Agreement of ISE Mercury, LLC, Art. III, Sec. 3.3(ii). --------------------------------------------------------------------------- Some SROs have provisions that are less restrictive than the proposed Section 4.05. More specifically, the governing documents of affiliates Bats BZX Exchange, Inc., Bats BYX Exchange, Inc., Bats EDGX Exchange, Inc., and Bats EDGA Exchange, Inc. permit such SROs to use regulatory funds to fund legal and regulatory operations, including surveillance and enforcement activities, but also provide that revenues received from fees derived from the regulatory function or regulatory penalties may be used to pay restitution and disgorgement of funds intended for customers.\9\ The limited liability company agreement of Miami International Securities Exchange, LLC, and bylaws of National Stock Exchange, Inc., have similar provisions.\10\ By contrast, the operating agreement of the NASDAQ Stock Market LLC (``Nasdaq'') simply limits Nasdaq from making a distribution to its member using regulatory funds, and does not impose other restrictions.\11\ --------------------------------------------------------------------------- \9\ The described revenues may not be used for non-regulatory purposes or distributed to the stockholder. See Fourth Amended and Restated Bylaws of Bats BZX Exchange, Inc., Art. X, Sec. 4; Fourth Amended and Restated Bylaws of Bats BYX Exchange, Inc., Art. X, Sec. 4; Fifth Amended and Restated Bylaws of Bats EDGX Exchange, Inc., Art. X, Sec. 4; and Fifth Amended and Restated Bylaws of Bats EDGA Exchange, Inc., Art. X, Sec. 4. \10\ See Second Amended and Restated Limited Liability Company Agreement of Miami International Securities Exchange, LLC, Art. IX, Sec. 9.4 (``Any Regulatory Funds will not be used for non-regulatory purposes or distributed to the LLC Member, but rather, shall be applied to fund the legal and regulatory operations of the Company (including surveillance and enforcement activities), or, as the case may be, shall be used to pay restitution and disgorgement of funds intended for customers.''); Third Amended and Restated By-laws of National Stock Exchange, Inc., Art. X, Sec. 10.4 (``Any revenues received by the Exchange from fees derived from its regulatory function or regulatory penalties will not be used to pay dividends and shall be applied to fund the legal and regulatory operations of the Exchange (including surveillance and enforcement activities), or, as the case may be, shall be used to pay restitution and disgorgement of funds intended for customers.''); see also Amended and Restated By-Laws of Miami International Securities Exchange, LLC, Art. IX, Sec. 9.4. \11\ See Second Amended Limited Liability Company Agreement of The NASDAQ Stock Market LLC, Sec. 15. See also by-laws of NASDAQ BX, Inc., Art. IX, Sec. 9.8, and Second Amended Limited Liability Company Agreement of NASDAQ PHLX LLC, Sec. 14. When the NASDAQ OMX Group, Inc. acquired the Boston Stock Exchange (``BSE''), the BSE by-laws were amended to include a similar provision that dividends could not be paid to the stockholders using regulatory funds. See Securities Exchange Act Release No. 58324 (August 7, 2008), 73 FR 46936 (August 12, 2008) (SR-BSE- 2008-02; SR-BSE-2008-23; SR-BSE- 2008-25; SR-BSECC-2008-01), at 46942. --------------------------------------------------------------------------- Additional Proposed Amendments The Exchange proposes to make a non-substantive amendment to the second sentence of Article II, Section 2.03(h)(iii) (Board). Currently, the sentence provides that the Committee for Review (``CFR'') will be responsible for, among other things, ``reviewing determinations to limit or prohibit the continued listing of an issuer's securities on the Exchange.'' The Exchange proposes to replace ``Exchange'' with ``exchange operated by the Company.'' The Exchange proposes to make the change because, as noted above, ``Exchange'' is not a defined term in the Operating Agreement. Finally, the Exchange proposes to make technical and conforming changes to the recitals and signature page of the Operating Agreement. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Exchange Act \12\ in general, and Section 6(b)(1) \13\ in particular, in that it enables the Exchange to be so organized as to have the capacity to be able to carry out the purposes of the Exchange Act and to comply, and to enforce compliance by its exchange members and persons associated with its exchange members, with the provisions of the Exchange Act, the rules and regulations thereunder, and the rules of the Exchange. --------------------------------------------------------------------------- \12\ 15 U.S.C. 78f(b). \13\ 15 U.S.C. 78f(b)(1). --------------------------------------------------------------------------- The Exchange believes that replacing the current prohibition against using Regulatory Funds for undefined ``commercial purposes'' with a requirement that Regulatory Funds ``be applied to fund the legal, regulatory and surveillance operations'' of the Exchange would enable the Exchange to be so organized as to have the capacity to be able to carry out the purposes of the Exchange Act and to comply with the provisions of the Exchange Act, the rules and regulations thereunder, and the rules of the Exchange, because it would add greater clarity to the limits on the use of Regulatory Funds, enhancing the protections provided by Section 4.05 against the possibility that Regulatory Funds may be assessed to respond to the Exchange's budgetary needs rather than to serve a disciplinary purpose.\14\ The proposed changes to Section 4.05 would make it more transparent to market participants. --------------------------------------------------------------------------- \14\ See Securities Exchange Act Release No. 77899 (May 24, 2016), 81 FR 34393 (May 31, 2016) (SR-NYSE-2016-37). --------------------------------------------------------------------------- Similarly, the Exchange believes that replacing ``Exchange's regulatory staff'' with ``Company's regulatory staff'' in Section 4.05 and replacing ``Exchange'' with ``exchange operated by the Company'' in Article II, Section 2.03(h)(iii) would enable the Exchange to be so organized as to have the capacity to be able to carry out the purposes of the Exchange Act and to comply with the provisions of the Exchange Act, the rules and regulations thereunder, and the rules of the Exchange, because it would add greater clarity to the Operating Agreement by using the defined term ``Company'' instead of ``Exchange,'' which is not defined in the Operating Agreement. For the same reasons, the Exchange believes that the proposed rule changes are consistent with Section 6(b)(4),\15\ which requires that the rules of the exchange provide for the equitable allocation of reasonable dues, fees, and other charges among the exchange's members and issuers and other persons using its facilities, and Section 6(b)(5),\16\ which requires that the rules of the exchange be 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 regulating, clearing, settling, processing information with respect to, and 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. The proposed changes would add greater clarity to the limits on the use of Regulatory Funds, enhancing the protections provided by Section 4.05, and ensure the use of defined terms, thereby making Section 4.05 and Article [[Page 73189]] II, Section 2.03(h)(iii) more transparent to market participants. --------------------------------------------------------------------------- \15\ 15 U.S.C. 78f(b)(4). \16\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Exchange notes that the proposed change to Section 4.05 would have the additional benefit of bringing the Exchange's restrictions on the use of regulatory assets and income into greater conformity with those of its affiliate NYSE Arca, Inc. In addition, the proposed amendments would make Section 4.05 more consistent with the limitations on the use of regulatory income of other SROs. Most such limitations are substantially similar to the proposed revised Section 4.05. In fact, the proposed Section 4.05 is more restrictive than the provisions of some other SROs, whose rules allow the use of regulatory funds for restitution and disgorgement of funds intended for customers, or simply limit the SRO from making a distribution to its member using regulatory funds. 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 Exchange Act. The proposed rule change is not intended to address competitive issues but rather is concerned solely with the administration and functioning of the Exchange. 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 \17\ and Rule 19b-4(f)(6) thereunder.\18\ 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 and Rule 19b- 4(f)(6)(iii) thereunder. --------------------------------------------------------------------------- \17\ 15 U.S.C. 78s(b)(3)(A)(iii). \18\ 17 CFR 240.19b-4(f)(6). --------------------------------------------------------------------------- A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally does not become operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b4(f)(6)(iii),\20\ the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. --------------------------------------------------------------------------- \19\ 17 CFR 240.19b-4(f)(6). \20\ 17 CFR 240.19b-4(f)(6)(iii). --------------------------------------------------------------------------- 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) \21\ of the Act to determine whether the proposed rule change should be approved or disapproved. --------------------------------------------------------------------------- \21\ 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 CommentsUse 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-NYSE-2016-66 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-NYSE-2016-66. 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 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-NYSE-2016-66 and should be submitted on or before November 14, 2016. --------------------------------------------------------------------------- \22\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\22\ Robert W. Errett, Deputy Secretary. [FR Doc. 2016-25577 Filed 10-21-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 205 / Monday, October 24, 2016 / Notices 73187
2016. The Commission is extending this assets, fees, fines and penalties, and In addition, ‘‘Exchange’’ is not a
45-day time period. make additional, non-substantive edits. defined term in the Operating
The Commission finds that it is The proposed rule change is available Agreement, which defines the Exchange
appropriate to designate a longer period on the Exchange’s Web site at as the ‘‘Company.’’ Accordingly, the
within which to take action on the www.nyse.com, at the principal office of Exchange proposes to replace
proposed rule change so that it has the Exchange, and at the Commission’s ‘‘Exchange’s regulatory staff’’ with
sufficient time to consider the proposed Public Reference Room. ‘‘Company’s regulatory staff.’’
rule change. Accordingly, pursuant to The amended Section 4.05 would
II. Self-Regulatory Organization’s
Section 19(b)(2) of the Act,5 the read as follows:
Statement of the Purpose of, and
Commission designates December 7, Any regulatory assets or any regulatory
Statutory Basis for, the Proposed Rule
2016, as the date by which the fees, fines or penalties collected by the
Change
Commission shall either approve or Company’s regulatory staff will be applied to
disapprove or institute proceedings to In its filing with the Commission, the fund the legal, regulatory and surveillance
determine whether to disapprove the self-regulatory organization included operations of the Company, and the
proposed rule change (File No. SR– statements concerning the purpose of, Company shall not distribute such assets,
NASDAQ–2016–121). and basis for, the proposed rule change fees, fines or penalties to the Member or any
and discussed any comments it received other entity.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
on the proposed rule change. The text The Exchange believes that the
authority.6 of those statements may be examined at increased clarity in the scope of the
Brent J. Fields,
the places specified in Item IV below. limits on use of Regulatory Funds will
The Exchange has prepared summaries, enhance the protections provided by
Secretary.
set forth in sections A, B, and C below, Section 4.05 against the possibility that
[FR Doc. 2016–25615 Filed 10–21–16; 8:45 am]
of the most significant parts of such Regulatory Funds may be assessed to
BILLING CODE 8011–01–P statements. respond to the Exchange’s budgetary
A. Self-Regulatory Organization’s needs rather than to serve a disciplinary
SECURITIES AND EXCHANGE Statement of the Purpose of, and the purpose.5
COMMISSION Statutory Basis for, the Proposed Rule The proposed amendments would
Change have the benefit of bringing Section 4.05
[Release No. 34–79115; File No. SR–NYSE– into greater conformity with the bylaws
2016–66] 1. Purpose of the Exchange’s affiliate NYSE Arca,
Self-Regulatory Organizations; New The Exchange proposes to amend Inc., which provide that regulatory fees
York Stock Exchange LLC; Notice of Article IV, Section 4.05 (Limitation on and penalties ‘‘will be applied to fund
Filing and Immediate Effectiveness of Distributions) of the Operating the legal, regulatory and surveillance
Proposed Rule Change Amending Agreement (‘‘Section 4.05’’), regarding operations of the Exchange.’’ 6
Article IV, Section 4.05 of the Tenth use of regulatory assets, fees, fines and The proposed amendments would
Amended and Restated Operating penalties (‘‘Regulatory Funds’’), and make Section 4.05 more consistent with
Agreement of the Exchange make additional, non-substantive edits. the limitations on the use of regulatory
Proposed Amendment to Section 4.05 income of other self-regulatory
October 18, 2016. organizations (‘‘SROs’’). Most such
Pursuant to Section 19(b)(1) 1 of the Section 4.05 provides that: limitations are substantially similar to
Securities Exchange Act of 1934 (the [t]he Company shall not use any the proposed revised Section 4.05. For
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 regulatory assets or any regulatory fees, example, similar to the proposed
notice is hereby given that on October fines or penalties collected by the Section 4.05, the limited liability
6, 2016, New York Stock Exchange LLC Exchange’s regulatory staff for company agreements of the BOX
(‘‘NYSE’’ or the ‘‘Exchange’’) filed with commercial purposes or distribute such Options Exchange (‘‘BOX’’),
the Securities and Exchange assets, fees, fines or penalties to the International Securities Exchange, LLC
Commission (the ‘‘Commission’’) the Member or any other entity.4
(‘‘ISE’’), and its affiliates ISE Gemini,
Although it prohibits the use of
proposed rule change as described in LLC and ISE Mercury, LLC, provide that
Regulatory Funds for ‘‘commercial
Items I, II, and III below, which Items regulatory funds shall be used to fund
purposes,’’ that term is not defined in
have been prepared by the self- the relevant SRO’s legal, regulatory and
Section 4.05 or elsewhere in the
regulatory organization. The surveillance operations.7 Consistent
Operating Agreement. Accordingly, to
Commission is publishing this notice to
add greater clarity to the limits on the
solicit comments on the proposed rule 5 See Securities Exchange Act Release No. 77899
use of Regulatory Funds, the Exchange (May 24, 2016), 81 FR 34393 (May 31, 2016) (SR–
change from interested persons.
proposes to replace the prohibition NYSE–2016–37).
I. Self-Regulatory Organization’s against using Regulatory Funds for 6 See Bylaws of NYSE Arca, Inc., Art. II, Sec. 2.06
Statement of the Terms of Substance of ‘‘commercial purposes’’ with a (‘‘Any revenues received by the Exchange from
regulatory fees or regulatory penalties will be
the Proposed Rule Change statement that Regulatory Funds ‘‘will applied to fund the legal, regulatory and
The Exchange proposes to amend be applied to fund the legal, regulatory surveillance operations of the Exchange and will
Article IV, Section 4.05 of the Tenth and surveillance operations’’ of the not be used to pay dividends. For purposes of this
Amended and Restated Operating Exchange. The prohibition on using Section, regulatory penalties shall include
restitution and disgorgement of funds intended for
sradovich on DSK3GMQ082PROD with NOTICES
Agreement of the Exchange (‘‘Operating Regulatory Funds for distributions to
customers.’’). The Exchange’s affiliate NYSE MKT
Agreement’’) regarding use of regulatory the Member or any other entity would LLC has submitted substantially the same proposed
remain. amendment to its operating agreement. See SR–
5 Id.
NYSEMKT–2016–93.
4 See Tenth Amended and Restated Operating 7 Such provisions also limit the relevant SRO
6 17 CFR 200.30–3(a)(31).
Agreement of New York Stock Exchange LLC, Art. from making any distribution to its member using
1 15 U.S.C.78s(b)(1). IV, Sec. 4.05; see also Securities Exchange Act regulatory funds. See Box Options Exchange
2 15 U.S.C. 78a.
Release No. 78805 (September 9, 2016), 81 FR Limited Liability Company Agreement, Art. 1, Sec.
3 17 CFR 240.19b–4. 63536 (September 15, 2016) (SR–NYSE–2016–51). Continued
VerDate Sep<11>2014 17:42 Oct 21, 2016 Jkt 241001 PO 00000 Frm 00132 Fmt 4703 Sfmt 4703 E:\FR\FM\24OCN1.SGM 24OCN1](https://thefederalregister.org/doc/81_FR_73392/page/1.svg)
![Federal Register / Vol. 81, No. 205 / Monday, October 24, 2016 / Notices 73189
II, Section 2.03(h)(iii) more transparent of the Act and Rule 19b–4(f)(6)(iii) Commission and any person, other than
to market participants. thereunder. those that may be withheld from the
The Exchange notes that the proposed A proposed rule change filed under public in accordance with the
change to Section 4.05 would have the Rule 19b–4(f)(6) 19 normally does not provisions of 5 U.S.C. 552, will be
additional benefit of bringing the become operative prior to 30 days after available for Web site viewing and
Exchange’s restrictions on the use of the date of the filing. However, pursuant printing in the Commission’s Public
regulatory assets and income into to Rule 19b4(f)(6)(iii),20 the Commission Reference Room, 100 F Street NE.,
greater conformity with those of its may designate a shorter time if such Washington, DC 20549 on official
affiliate NYSE Arca, Inc. In addition, the action is consistent with the protection business days between the hours of
proposed amendments would make of investors and the public interest. 10:00 a.m. and 3:00 p.m. Copies of the
At any time within 60 days of the filing also will be available for
Section 4.05 more consistent with the
filing of such proposed rule change, the inspection and copying at the principal
limitations on the use of regulatory
Commission summarily may office of the Exchange. All comments
income of other SROs. Most such
temporarily suspend such rule change if received will be posted without change;
limitations are substantially similar to
it appears to the Commission that such the Commission does not edit personal
the proposed revised Section 4.05. In
action is necessary or appropriate in the identifying information from
fact, the proposed Section 4.05 is more
public interest, for the protection of submissions. You should submit only
restrictive than the provisions of some
investors, or otherwise in furtherance of information that you wish to make
other SROs, whose rules allow the use
the purposes of the Act. If the available publicly. All submissions
of regulatory funds for restitution and
Commission takes such action, the should refer to File Number SR–NYSE–
disgorgement of funds intended for
Commission shall institute proceedings 2016–66 and should be submitted on or
customers, or simply limit the SRO from
under Section 19(b)(2)(B) 21 of the Act to before November 14, 2016.
making a distribution to its member
determine whether the proposed rule
using regulatory funds. For the Commission, by the Division of
change should be approved or Trading and Markets, pursuant to delegated
B. Self-Regulatory Organization’s disapproved. authority.22
Statement on Burden on Competition Robert W. Errett,
IV. Solicitation of Comments
Deputy Secretary.
The Exchange does not believe that Interested persons are invited to
the proposed rule change will impose [FR Doc. 2016–25577 Filed 10–21–16; 8:45 am]
submit written data, views, and
any burden on competition that is not arguments concerning the foregoing, BILLING CODE 8011–01–P
necessary or appropriate in furtherance including whether the proposed rule
of the purposes of the Exchange Act. change is consistent with the Act.
The proposed rule change is not Comments may be submitted by any of SOCIAL SECURITY ADMINISTRATION
intended to address competitive issues the following methods: [Docket No: SSA–2016–0051]
but rather is concerned solely with the
administration and functioning of the Electronic Comments
Agency Information Collection
Exchange. • Use the Commission’s Internet Activities: Proposed Request and
comment form (http://www.sec.gov/ Comment Request
C. Self-Regulatory Organization’s rules/sro.shtml); or
Statement on Comments on the • Send an email to rule-comments@ The Social Security Administration
Proposed Rule Change Received From sec.gov. Please include File Number SR– (SSA) publishes a list of information
Members, Participants, or Others NYSE–2016–66 on the subject line. collection packages requiring clearance
by the Office of Management and
No written comments were solicited Paper Comments Budget (OMB) in compliance with
or received with respect to the proposed • Send paper comments in triplicate Public Law 104–13, the Paperwork
rule change. to Brent J. Fields, Secretary, Securities Reduction Act of 1995, effective October
III. Date of Effectiveness of the and Exchange Commission, 100 F Street 1, 1995. This notice includes revisions
Proposed Rule Change and Timing for NE., Washington, DC 20549–1090. of OMB-approved information
Commission Action All submissions should refer to File collections.
Number SR–NYSE–2016–66. This file SSA is soliciting comments on the
The Exchange has filed the proposed number should be included on the accuracy of the agency’s burden
rule change pursuant to Section subject line if email is used. To help the estimate; the need for the information;
19(b)(3)(A)(iii) of the Act 17 and Rule Commission process and review your its practical utility; ways to enhance its
19b–4(f)(6) thereunder.18 Because the comments more efficiently, please use quality, utility, and clarity; and ways to
proposed rule change does not: (i) only one method. The Commission will minimize burden on respondents,
Significantly affect the protection of post all comments on the Commission’s including the use of automated
investors or the public interest; (ii) Internet Web site (http://www.sec.gov/ collection techniques or other forms of
impose any significant burden on rules/sro.shtml). Copies of the information technology. Mail, email, or
competition; and (iii) become operative submission, all subsequent fax your comments and
prior to 30 days from the date on which amendments, all written statements recommendations on the information
it was filed, or such shorter time as the with respect to the proposed rule collection(s) to the OMB Desk Officer
Commission may designate, if and SSA Reports Clearance Officer at
sradovich on DSK3GMQ082PROD with NOTICES
change that are filed with the
consistent with the protection of Commission, and all written the following addresses or fax numbers.
investors and the public interest, the communications relating to the (OMB), Office of Management and
proposed rule change has become proposed rule change between the Budget, Attn: Desk Officer for SSA,
effective pursuant to Section 19(b)(3)(A) Fax: 202–395–6974, Email address:
19 17 CFR 240.19b–4(f)(6). OIRA_Submission@omb.eop.gov
17 15 U.S.C. 78s(b)(3)(A)(iii). 20 17 CFR 240.19b–4(f)(6)(iii).
18 17 CFR 240.19b–4(f)(6). 21 15 U.S.C. 78s(b)(2)(B). 22 17 CFR 200.30–3(a)(12).
VerDate Sep<11>2014 17:42 Oct 21, 2016 Jkt 241001 PO 00000 Frm 00134 Fmt 4703 Sfmt 4703 E:\FR\FM\24OCN1.SGM 24OCN1](https://thefederalregister.org/doc/81_FR_73392/page/3.svg)
Document Created: 2016-10-21 23:46:28
Document Modified: 2016-10-21 23:46:28
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 81 FR 73187 |
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