81 FR 96102 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change in Connection With the Proposed Acquisition of National Stock Exchange, Inc. by the Exchange's Parent the NYSE Group, Inc. To Amend Certain Organizational Documents of NYSE Group, NYSE Holdings LLC, Intercontinental Exchange Holdings, Inc., and Intercontinental Exchange, Inc.
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 250 (December 29, 2016)
Federal Register Volume 81, Issue 250 (December 29, 2016)
| Page Range | 96102-96107 | |
| FR Document | 2016-31490 |
[Federal Register Volume 81, Number 250 (Thursday, December 29, 2016)] [Notices] [Pages 96102-96107] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-31490] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-79678; File No. SR-NYSEArca-2016-167] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change in Connection With the Proposed Acquisition of National Stock Exchange, Inc. by the Exchange's Parent the NYSE Group, Inc. To Amend Certain Organizational Documents of NYSE Group, NYSE Holdings LLC, Intercontinental Exchange Holdings, Inc., and Intercontinental Exchange, Inc. December 22, 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 December 16, 2016, NYSE Arca, Inc. (the ``Exchange'' or ``NYSE Arca'') filed with the Securities and Exchange Commission (the ``Commission'') the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 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 in connection with the proposed acquisition of National Stock Exchange, Inc. (``NSX'') by the Exchange's parent the NYSE Group, Inc. (``NYSE Group''), to amend certain organizational documents of NYSE Group, NYSE Holdings LLC (``NYSE Holdings''), Intercontinental Exchange Holdings, Inc. (``ICE Holdings''), and Intercontinental Exchange, Inc. (``ICE''). 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 Statutory Basis for, the Proposed Rule Change 1. Purpose Background On December 14, 2016, ICE entered into an agreement with the NSX pursuant to which its wholly-owned subsidiary NYSE Group would acquire all of the outstanding capital stock of the NSX (the ``Acquisition''). As a result of the Acquisition, the NSX would be renamed NYSE National, Inc. (``NYSE National'') and would be operated as a wholly-owned subsidiary of NYSE Group. NYSE Group is a wholly-owned subsidiary of NYSE Holdings, which is in turn 100% owned by ICE Holdings. ICE, a public company listed on the New York Stock Exchange LLC (the ``NYSE''), owns 100% of ICE Holdings. Following the Acquisition, NYSE National would continue to be registered as a national securities exchange and as a separate self- regulatory organization (``SRO''). As such, NYSE National would continue to have separate rules, membership rosters, and listings that would be distinct from the rules, membership rosters, and listings of the three other registered national securities exchanges and SROs owned by NYSE Group, namely, the NYSE, NYSE MKT and the Exchange (together, the ``NYSE Exchanges'').\4\ --------------------------------------------------------------------------- \4\ The NYSE Exchanges are referred to as the U.S. Regulated Subsidiaries in the corporate documents proposed to be amended in this rule filing. --------------------------------------------------------------------------- In connection with the Acquisition and as discussed more fully below, the following organizational documents of NYSE Group and its intermediary and ultimate parent entities would be amended:ICE bylaws and director independence policy, ICE Holdings bylaws and certificate of incorporation, NYSE Holdings operating agreement, and NYSE Group bylaws and certificate of incorporation. These proposed changes would consist of technical and conforming amendments to reflect the proposed new ownership of NYSE National by the NYSE Group, and, indirectly, ICE.\5\ --------------------------------------------------------------------------- \5\ The proposed revisions are also discussed in the NYSE and NYSE MKT companion rule filings related to the Acquisition. See SR- NYSE-2016-90 & SR-NYSEMKT-2016-122. --------------------------------------------------------------------------- [[Page 96103]] The proposed rule changes would be effected following approval of this rule filing no later than February 28, 2017, on a date determined by its Board. Proposed Rule Change The Exchange proposes that, in connection with the Acquisition, the Commission approve the organizational documents of ICE and its wholly- owned subsidiaries ICE Holdings and NYSE Group and the Independence Policy of the Board of Directors of Intercontinental Exchange, Inc. (``ICE Independence Policy''), all of which are to be amended concurrently with the Acquisition to reflect ownership of NYSE National. The current organizational documents of ICE and its wholly-owned subsidiaries provide certain protections to the NYSE Exchanges that are designed to protect and facilitate their self-regulatory functions, including certain restrictions on the ability to vote and own shares of ICE.\6\ In general, the organizational documents of ICE and its wholly- owned subsidiaries are being amended to provide similar protections to the NYSE National as are currently provided to the NYSE Exchanges under those documents. --------------------------------------------------------------------------- \6\ See Securities Exchange Release No. 70210 (August 15, 2013), 78 FR 51758 (August 21, 2013) (approving rule changes related to NYSE Euronext becoming a wholly owned subsidiary of ICE (then called IntercontinentalExchange Group, Inc.)). --------------------------------------------------------------------------- In addition, obsolete references to NYSE Market (DE), Inc. (formerly NYSE Market, Inc.) (``NYSE Market (DE)''), and NYSE Regulation, Inc. (``NYSE Regulation'') found in various documents are proposed to be deleted.\7\ --------------------------------------------------------------------------- \7\ NYSE Market (DE) and NYSE Regulation were previously parties to a Delegation Agreement whereby the NYSE delegated certain regulatory functions to NYSE Regulation and certain market functions to NYSE Market (DE). The Delegation Agreement was terminated when the NYSE re-integrated its regulatory and market functions. As a result, the two entities ceased being regulated subsidiaries. See Securities Exchange Act Release No. 75991 (September 28, 2015), 80 FR 59837 (October 2, 2015). NYSE Regulation has since been merged out of existence. --------------------------------------------------------------------------- Proposed Seventh Amended and Restated Bylaws of Intercontinental Exchange, Inc. (``ICE Bylaws'') The ICE Bylaws would be amended to reflect the Acquisition and incorporate NYSE National in the ICE Bylaws' existing voting and ownership restrictions, provisions relating to the qualifications of directors and officers and their submission to jurisdiction, compliance with the federal securities laws, access to books and records, and other matters related to its control of the U.S. Regulated Subsidiaries. Specifically, the ICE Bylaws would be amended as follows: The definition of ``U.S. Regulated Subsidiaries'' in Article III, Section 3.15, which currently includes the NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, LLC, the Exchange, NYSE Arca Equities, and NYSE MKT, would be amended to include NYSE National. The obsolete references to NYSE Market (DE) and NYSE Regulation would also be deleted. Article VIII (Confidential Information), Section 8.1, would be amended to extend to NYSE National the same protection regarding confidential information provided to the NYSE Exchanges and NYSE Arca Equities, and to remove the obsolete references to NYSE Market (DE) and NYSE Regulation. Article XI, Section 11.3, provides that, for so long as ICE controls any of the U.S. Regulated Subsidiaries, any amendment to or repeal of the ICE Bylaws must either be (i) filed with or filed with and approved by the Commission under Section 19 of the Exchange Act and the rules promulgated thereunder, or (ii) submitted to the boards of directors of the U.S. Regulated Subsidiaries or the boards of directors of their successors, in each case only to the extent that such entity continues to be controlled directly or indirectly by ICE. Section 11.3 would be amended to include the NYSE National, and to delete the obsolete references to NYSE Market (DE) and NYSE Regulation. The ICE Bylaws would be further amended to add a new Article XII (Voting and Ownership Limitations). New Section 12.1.a of Article XII would provide that, subject to its fiduciary obligations under applicable law, for so long as ICE directly or indirectly controls NYSE National (or its successor), the board of directors of ICE shall not adopt any resolution pursuant to clause (b) of Section A.2 of Article V of the certificate of incorporation of ICE (which relates to ICE board of directors approval of ownership of ICE capital stock by a person together with its related persons in excess of 20%), unless the board of directors of ICE shall have determined that: In the case of a resolution to approve the exercise of voting rights in excess of 20% of the then outstanding votes entitled to be cast on such matter, neither such person nor any of its related persons is an ETP Holder of NYSE National; in the case of a resolution to approve the entering into of an agreement, plan or other arrangement under circumstances that would result in shares of stock of ICE that would be subject to such agreement, plan or other arrangement not being voted on any matter, or the withholding of any proxy relating thereto, where the effect of such agreement, plan or other arrangement would be to enable any person, but for Article V of the Certificate of Incorporation of ICE, either alone or together with its related persons, to vote, possess the right to vote or cause the voting of shares of stock of ICE that would exceed 20% of the then outstanding votes entitled to be cast on such matter neither such person nor any of its related persons is, with respect to NYSE National, an ETP Holder. New Section 12.1.b would provide that, subject to its fiduciary obligations under applicable law, for so long as ICE directly or indirectly controls NYSE National (or its successor), the Board of Directors of ICE shall not adopt any resolution pursuant to clause (b) of Section B(2) of Article V of ICE's Certificate of Incorporation, unless the Board of Directors shall have determined that neither such person nor any of its related persons is an ETP Holder. New Section 12.2 would provide that, for so long as ICE shall control, directly or indirectly, NYSE National (or its successor), the ICE board of directors shall not adopt any resolution to repeal or amend any provision of the certificate of incorporation of ICE unless such amendment or repeal shall either be (a) filed with or filed with and approved by the SEC under Section 19 of the Exchange Act and the rules promulgated thereunder or (b) submitted to the board of directors of NYSE National (or the board of directors of its successor), and if such board of directors determines that such amendment or repeal must be filed with or filed with and approved by the Commission under Section 19 of the Exchange Act and the rules promulgated thereunder before such amendment or repeal may be effectuated, then such amendment or repeal shall not be effectuated until filed with or filed with and approved by the Commission, as the case may be. Proposed Eighth Amended and Restated Certificate of Incorporation of Intercontinental Exchange Holdings, Inc. (``ICE Holdings Certificate of Incorporation'') The ICE Holdings Certificate of Incorporation is being amended as follows: On the first page, add ``Eighth'' and delete ``Seventh'' before ``Amended and Restated Certificate of Incorporation'' in the heading and update items (2)-(5) accordingly to reflect that this would be the eighth amendment and restatement [[Page 96104]] including replacing an incorrect reference to ``Sixth'' before ``Amended'' in item (3). The date would also be updated in the preamble on the first page. To distinguish between the ETP Holders of NYSE Arca Equities and those of NYSE National, subsection A.3.c.ii of Article V (Limitations on Voting and Ownership) would be amended to define an ETP Holder of NYSE Arca Equities as an ``NYSE Arca Equities ETP Holder.'' Obsolete references to NYSE Market (DE) and NYSE Regulation, would also be deleted.\8\ --------------------------------------------------------------------------- \8\ See note 7, supra. --------------------------------------------------------------------------- Subsection A.3.c of Article V would be amended to add a new subsection (v), similar to those in place for the other NYSE Exchanges, which would provide that, for so long as the ICE Holdings directly or indirectly controls NYSE National (or its successor), no person nor any of its related persons (as those terms are defined therein) is an ETP Holder (as proposed to be defined in the bylaws of NYSE National, discussed above) of NYSE National. Subsection A.3.d of Article V would be amended to add ``NYSE Arca'' before ``ETP Holder'' in one place to distinguish between the NYSE Arca Equities ETP Holders of and those of NYSE National. Subsection (A)(3)(d) would be further amended to add a new subsection (v) similar to those in place for the other NYSE Exchanges. The new subsection would incorporate NYSE National into the existing restriction, such that the ICE Holdings Board of Directors would be restricted from adopting a resolution to approve the exercise of voting rights that would exceed 20% of the then outstanding votes entitled to be cast on such matter, where neither such person nor any of its related persons is, with respect to NYSE National, an NYSE National ETP Holder. Subsection B.3 of Article V would be amended to add a new subsection (g) similar to those in place for the other NYSE Exchanges, incorporating NYSE National into the restriction on the ICE Holdings board of directors adopting any resolution pursuant to clause (b) of Section B.2 of Article V of the ICE Holdings Certificate of Incorporation (which relates to ICE board of directors approval of ownership of ICE capital stock by a person together with its related persons in excess of 20%) unless the NYSE Holdings board of directors determines that, for so long as ICE Holdings controls NYSE National, neither such person nor any of its related persons is an NYSE National ETP Holder. Proposed Fifth Amended and Restated Bylaws of Intercontinental Exchange Holdings, Inc. (``ICE Holdings Bylaws'') The ICE Holdings Bylaws are being amended as follows: The cover page and heading on the first page would be amended to add ``Fifth'' and delete ``Fourth'' before ``Amended and Restated Bylaws'' to reflect that this would be the fifth amendment and restatement. The effective date on the cover page would also be updated. Similar to the ICE Bylaws discussed above, the ICE Holdings Bylaws would be amended to include ``NYSE National, Inc.'' in: [cir] The definition of ``U.S. Regulated Subsidiaries'' in Article III, Section 3.15, which currently includes the NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, LLC, NYSE Arca, NYSE Arca Equities, and the Exchange, and to provide that the term ``U.S. Regulated Subsidiaries'' includes those entities listed or their successors, but only so long as they continue to be controlled, directly or indirectly, by ICE Holdings. Obsolete references to NYSE Market (DE) and NYSE Regulation in that section would also be deleted; \9\ --------------------------------------------------------------------------- \9\ See note 7, supra. --------------------------------------------------------------------------- [cir] Article VIII (Confidential Information), Section 8.1, which would be amended to extend the same protection to confidential information relating to the self-regulatory function of NYSE National or its successor; \10\ and --------------------------------------------------------------------------- \10\ Article VIII, Section 8.1 would also be amended to delete obsolete references to NYSE Market (DE) and NYSE Regulation. --------------------------------------------------------------------------- [cir] Article XI (Amendment to the Bylaws), Section 11.3, which provides that, for so long as ICE controls any of the U.S. Regulated Subsidiaries, any amendment to or repeal of the ICE Bylaws must either be (i) filed with or filed with and approved by the Commission under section 19 of the Exchange Act and the rules promulgated thereunder, or (ii) submitted to the boards of directors of the U.S. Regulated Subsidiaries or the boards of directors of their successors, in each case only to the extent that such entity continues to be controlled directly or indirectly by ICE Holdings. Obsolete references to NYSE Market (DE) and NYSE Regulation would also be deleted from Article VXI, Section 11.3.\11\ --------------------------------------------------------------------------- \11\ See note 7, supra. Conforming changes to delete and replace connectors would also be made throughout. --------------------------------------------------------------------------- Proposed Independence Policy of the Board of Directors of Intercontinental Exchange, Inc. (``ICE Director Independence Policy'') The ICE Director Independence Policy would be amended to add NYSE National to the section describing ``Independence Qualifications.'' In particular, NYSE National would be added to categories (1)(b) and (c) that refer to ``members,'' as defined in section 3(a)(3)(A)(i), 3(a)(3)(A)(ii), 3(a)(3)(A)(iii) and 3(a)(3)(A)(iv) of the Exchange Act.\12\ The clause ``and `Person Associated with an ETP Holder' (as defined in Rule 1.5 of NYSE National, Inc.)'' would also be added to category (1)(b) in reference to ``allied persons.'' NYSE National would also be added to subsections (4) and (5) of the ``Independence Qualifications'' section.\13\ Obsolete references to NYSE Market (DE) and NYSE Regulation would also be deleted.\14\ --------------------------------------------------------------------------- \12\ See 15 U.S.C. 78c(a)(3)(a). \13\ Conforming changes would also be made to delete and replace connectors. The link in footnote 2 to the NYSE Listed Company Manual and commentary would also be updated. \14\ See note 7, supra. --------------------------------------------------------------------------- Proposed Eighth Amended and Restated Limited Liability Company Agreement of NYSE Holdings LLC (``NYSE Holdings LLC Operating Agreement'') The NYSE Holdings LLC Operating Agreement would be amended as follows: The heading and preamble would be amended to add ``Eighth'' and delete ``Seventh'' before ``Amended and Restated Limited Liability Agreement'' to reflect that this would be the eighth amendment and restatement. The effective date would also be updated. After ``This Agreement amends and restates in its entirety that'' in the second full sentence would be added the clause ``certain Seventh Amended and Restated Limited Liability Company Agreement, dated as of May 22, 2015, which amended and restated in its entirety that.'' The current penultimate whereas clause would be amended by adding ``in May 2015'' before ``the Company'' and ``now desires to amend and restate'' immediately following would be replaced with ``amended and restated.'' ``Had'' and ``are'' would be changed to the past tense ``had'' [sic] and ``were'' in the final sentence. The following new whereas clause would be added immediately above the current last whereas clause: ``WHEREAS, the Company now desires to amend and restate the Seventh Amended and Restated Agreement to [[Page 96105]] reflect the acquisition of NYSE National, Inc. by the Company's wholly- owned subsidiary NYSE Group, Inc.;''. The definition of ETP Holder in Article I (Interpretation), Section 1.1 would be deleted and new definitions of an NYSE Arca ETP Holder and NYSE National ETP Holder would be added. The obsolete definition of NYSE Market (DE) would be deleted.\15\ --------------------------------------------------------------------------- \15\ See note 7, supra. --------------------------------------------------------------------------- Article IX (Voting and Ownership Limitations), Section 9.1(a)(3)(C) would be amended to add ``NYSE Arca'' before ``ETP Holder'' and the defined term ``NYSE Arca ETP Holder'' to distinguish between the ETP Holders of NYSE Arca Equities and those of NYSE National. An obsolete reference to NYSE Market (DE) would also be deleted from Section 9.1(a)(3)(C).\16\ --------------------------------------------------------------------------- \16\ See note 7, supra. Conforming changes to delete and replace connectors would also be made throughout. --------------------------------------------------------------------------- Section 9.1(a)(3)(C) would be amended to add a new subsection (v) similar to those in place for the other NYSE Exchanges. The new subsection (v) would incorporate NYSE National into the existing restriction, such that the ICE Holdings board of directors would be restricted from adopting a resolution pursuant to clause (b) of Section 9.1(a)(2) unless the NYSE Holdings board of directors determines that, for so long as NYSE Holdings directly or indirectly controls NYSE National, Inc. (or its successor), neither such person nor any of its related persons is an ETP Holder (as defined in the bylaws of NYSE National, as such bylaws may be in effect from time to time) of NYSE National (``NYSE National ETP Holder''). The clause would also provide that any such person that is a related person of an ETP Holder shall hereinafter also be deemed to be an ``NYSE National ETP Holder'' for purposes of the agreement, as the context may require. Article IX, Section 9.1(a)(3)(D) would be amended to add ``NYSE Arca'' before ``ETP Holder.'' An outdated reference to NYSE Market (DE) would also be deleted. Further, a new clause (v) would be added to Section 9.1(a)(3)(D) to incorporate NYSE National into the existing restriction on the NYSE Holdings Board of Directors, such that it would be restricted from adopting a resolution to approve the exercise of voting rights that would exceed 20% of the then outstanding votes entitled to be cast on such matter for so long as NYSE Holdings controls NYSE National. The clause would provide that ``for so long as the Corporation directly or indirectly controls NYSE National, neither such person nor any of its Related Persons is an NYSE National ETP Holder.'' Article IX, Section 9.1(b)(3) of Article IX [sic] would be amended to add a new subpart (G) to incorporate NYSE National into the existing restriction on the NYSE Holdings Board of Directors, so that it would provide that, subject to its fiduciary obligations under applicable law, for so long as NYSE Holdings directly or indirectly controls NYSE National (or its successor), the board of directors of NYSE Holdings shall not adopt any resolution pursuant to (b) of Section 9.1(b)(2) of the NYSE Holdings LLC Operating Agreement, unless the board of directors of NYSE Holdings shall have determined that neither such person nor any of its related persons is an NYSE National ETP Holder. Proposed Fifth Amended and Restated Certificate of Incorporation of NYSE Group, Inc. (``NYSE Group Certificate of Incorporation'') The NYSE Group Certificate of Incorporation is being amended as follows: On the first page, add ``Fifth'' and delete ``Fourth'' before ``Amended and Restated Certificate of Incorporation'' in the heading. The Recitations would be amended to reflect that this would be the fifth amendment and restatement. First, the Fifth Recitation would be updated to reflect that a Fourth Amended and Restated Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on December 29, 2014. A new Sixth Recitation would be updated to reflect that the Fifth Amended and Restated Certificate of Incorporation has been duly adopted. The current Sixth Recitation would become the Seventh and would reflect that the Fourth Amended and Restated Certificate of Incorporation is amended and restated in its entirety. NYSE National would be added to the list of ``Regulated Subsidiaries'' in Article 4 (Stock), Section 4(b)(1), which currently includes the NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, LLC, NYSE Arca Equities, and NYSE MKT, and the obsolete references to NYSE Market (DE) and NYSE Regulation would be deleted. To distinguish between the ETP Holders of NYSE Arca Equities and those of NYSE National, Section 4(b)(1)(y) of Article IV would be amended to define an ETP Holder of NYSE Arca Equities as an ``NYSE Arca Equities ETP Holder.'' An outdated reference to NYSE Market (DE) would also be deleted. Section 4(b)(1)(y) would also be amended to add a provision to [sic] similar to those in place for the other NYSE Exchanges providing that, for so long as NYSE Group directly or indirectly controls NYSE National (or its successor), neither such person nor any of its related persons is an ETP Holder (as defined in the rules of NYSE National, as such rules may be in effect from time to time) of NYSE National (defined as an ``NYSE National ETP Holder'') and that any such person that is a related person of an NYSE National ETP Holder shall hereinafter also be deemed to be an ``NYSE National ETP Holder'' for purposes of the certificate of incorporation, as the context may require. Further, subsection 4(b)(1)(z) of Article IV would be amended to define an ETP Holder of NYSE Arca Equities as an ``NYSE Arca Equities ETP Holder'' and delete an outdated reference to NYSE Market (DE). Subsection 4(b)(1)(z) would also be amended to incorporate NYSE National into the existing restriction on the ICE Holdings Board of Directors, such that it would be restricted from adopting a resolution to approve the exercise of voting rights that would exceed 20% of the then outstanding votes entitled to be cast on such matter, where neither such person nor any of its related persons is, with respect to NYSE National, an NYSE National ETP Holder. A new subpart (vii) would be added to subsection 4(b)(2)(C) of Article IV to incorporate NYSE National into the existing restriction on the NYSE Group Board of Directors, such that it would be restricted from adopting a resolution to approve the exercise of voting rights that would exceed 20% of the then outstanding votes entitled to be cast on such matter, where neither such person nor any of its related persons is, with respect to NYSE National, an NYSE National ETP Holder.\17\ --------------------------------------------------------------------------- \17\ An obsolete reference to NYSE Market (DE) would also be deleted from Article IV, 4(b)(2)(C)(v). --------------------------------------------------------------------------- Article X (Confidential Information) would be amended to extend the same protection to confidential information relating to the self-regulatory function of NYSE National or its successor and delete obsolete references to NYSE Market (DE) and NYSE Regulation. Article XII (Amendments to Certificate of Incorporation) provides that, for so long as NYSE Group controls the Regulated Subsidiaries, before any amendment or repeal of any provision of the Certificate of Incorporation shall be effective, such amendment or repeal shall either (a) be filed with or filed with and approved by the SEC under [[Page 96106]] Section 19 of the Exchange Act and the rules promulgated thereunder or (b) be submitted to the boards of directors of NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, NYSE Arca Equities, and NYSE MKT or the boards of directors of their successors. Article XII would be amended to add NYSE National to subsection (b) and delete references to NYSE Market (DE) and NYSE Regulation. Proposed Third Amended and Restated Bylaws of NYSE Group, Inc. (``NYSE Group Bylaws'') The NYSE Group Bylaws are being amended as follows: Add ``Third'' and delete ``Second'' before ``Amended and Restated Bylaws'' in the heading to reflect that this would be the third amendment and restatement. Article VII (Miscellaneous), Section 7.9(A)(b) currently provides that, for so long as NYSE Group controls any of the NYSE Exchanges, any amendment to or repeal of the ICE Bylaws must either be (i) filed with or filed with and approved by the Commission under section 19 of the Exchange Act and the rules promulgated thereunder, or (ii) submitted to the boards of directors of the NYSE, NYSE Market (DE), NYSE Regulation, NYSE Arca, NYSE Arca Equities, and NYSE Alternext US LLC or the boards of directors of their successors, in each case only to the extent that such entity continues to be controlled directly or indirectly by ICE. Section 7.9(A)(b) would be amended to delete obsolete references to NYSE Market (DE) and NYSE Regulation, replace the outdated reference to ``NYSE Alternext US LLC'' with ``NYSE MKT LLC,'' and add NYSE National. 2. Statutory Basis The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Exchange Act \18\ in general, and with Section 6(b)(1) \19\ 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. The Exchange believes that the proposed changes to the corporate documents of the NYSE Group and its intermediary and ultimate parent entities, including the ICE bylaws and director independence policy, ICE Holdings bylaws and certificate of incorporation, NYSE Holdings operating agreement, and the NYSE Group bylaws and certificate of incorporation, to reflect the Acquisition, including updating corporate names, would contribute to the orderly operation of the Exchange by adding clarity and transparency to the Exchange's rules and would enable the Exchange to continue to be so organized as to have the capacity to carry out the purposes of the Exchange Act and comply and enforce compliance with the provisions of the Exchange Act by its members and persons associated with its members. The Exchange therefore believes that approval of the amendment to the Bylaws is consistent with Section 6(b)(1). --------------------------------------------------------------------------- \18\ 15 U.S.C. 78f(b). \19\ 15 U.S.C. 78f(b)(1). --------------------------------------------------------------------------- For similar reasons, the Exchange also believes that this filing furthers the objectives of Section 6(b)(5) of the Exchange Act \20\ because the proposed rule change would be consistent with and facilitate would create [sic] a governance and regulatory structure that is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with persons engaged in 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. As discussed above, the proposed updates to the corporate documents and replacement of outdated or obsolete references removes impediments to and perfects the mechanism of a free and open market by removing confusion that may result from having these references in the governing documents following the Acquisition. The Exchange further believes that the proposal removes impediments to and perfects the mechanism of a free and open market by ensuring that persons subject to the Exchange's jurisdiction, regulators, and the investing public can more easily navigate and understand the governing documents. The Exchange further believes that eliminating an obsolete reference would not be inconsistent with the public interest and the protection of investors because investors will not be harmed and in fact would benefit from increased transparency, thereby reducing potential confusion. Removing such obsolete references will also further the goal of transparency and add clarity to the Exchange's rules. --------------------------------------------------------------------------- \20\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- 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 updating the Exchange's rules to reflect the Acquisition and to remove obsolete references. 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 within such longer period 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 such 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-NYSEArca-2016-167 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-NYSEArca-2016-167. This file number should be included on the [[Page 96107]] 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-NYSEArca-2016-167 and should be submitted on or before January 19, 2017. --------------------------------------------------------------------------- \21\ 17 CFR 200.30-3(a)(12). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\21\ Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2016-31490 Filed 12-28-16; 8:45 am] BILLING CODE 8011-01-P
![96102 Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
Electronic Comments SECURITIES AND EXCHANGE the places specified in Item IV below.
COMMISSION The Exchange has prepared summaries,
• Use the Commission’s Internet set forth in sections A, B, and C below,
comment form (http://www.sec.gov/ [Release No. 34–79678; File No. SR–
NYSEArca–2016–167]
of the most significant parts of such
rules/sro.shtml); or statements.
• Send an email to rule-comments@ Self-Regulatory Organizations; NYSE A. Self-Regulatory Organization’s
sec.gov. Please include File Number SR– Arca, Inc.; Notice of Filing of Proposed Statement of the Purpose of, and
BX–2016–068 on the subject line. Rule Change in Connection With the Statutory Basis for, the Proposed Rule
Proposed Acquisition of National Change
Paper Comments Stock Exchange, Inc. by the
Exchange’s Parent the NYSE Group, 1. Purpose
• Send paper comments in triplicate
to Brent J. Fields, Secretary, Securities Inc. To Amend Certain Organizational Background
and Exchange Commission, 100 F Street Documents of NYSE Group, NYSE
On December 14, 2016, ICE entered
NE., Washington, DC 20549–1090. Holdings LLC, Intercontinental
into an agreement with the NSX
Exchange Holdings, Inc., and
All submissions should refer to File pursuant to which its wholly-owned
Intercontinental Exchange, Inc.
Number SR–BX–2016–068. This file subsidiary NYSE Group would acquire
December 22, 2016. all of the outstanding capital stock of
number should be included on the
Pursuant to Section 19(b)(1) 1 of the the NSX (the ‘‘Acquisition’’). As a result
subject line if email is used. To help the
Securities Exchange Act of 1934 (the of the Acquisition, the NSX would be
Commission process and review your renamed NYSE National, Inc. (‘‘NYSE
‘‘Act’’) 2 and Rule 19b–4 thereunder,3
comments more efficiently, please use National’’) and would be operated as a
notice is hereby given that, on December
only one method. The Commission will 16, 2016, NYSE Arca, Inc. (the wholly-owned subsidiary of NYSE
post all comments on the Commission’s ‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with Group. NYSE Group is a wholly-owned
Internet Web site (http://www.sec.gov/ the Securities and Exchange subsidiary of NYSE Holdings, which is
rules/sro.shtml). Copies of the Commission (the ‘‘Commission’’) the in turn 100% owned by ICE Holdings.
submission, all subsequent proposed rule change as described in ICE, a public company listed on the
amendments, all written statements Items I and II below, which Items have New York Stock Exchange LLC (the
with respect to the proposed rule been prepared by the self-regulatory ‘‘NYSE’’), owns 100% of ICE Holdings.
change that are filed with the organization. The Commission is Following the Acquisition, NYSE
Commission, and all written publishing this notice to solicit National would continue to be
communications relating to the comments on the proposed rule change registered as a national securities
proposed rule change between the from interested persons. exchange and as a separate self-
Commission and any person, other than regulatory organization (‘‘SRO’’). As
I. Self-Regulatory Organization’s such, NYSE National would continue to
those that may be withheld from the
Statement of the Terms of Substance of have separate rules, membership rosters,
public in accordance with the the Proposed Rule Change
provisions of 5 U.S.C. 552, will be and listings that would be distinct from
available for Web site viewing and The Exchange proposes in connection the rules, membership rosters, and
printing in the Commission’s Public with the proposed acquisition of listings of the three other registered
Reference Room, 100 F Street NE., National Stock Exchange, Inc. (‘‘NSX’’) national securities exchanges and SROs
by the Exchange’s parent the NYSE owned by NYSE Group, namely, the
Washington, DC 20549 on official
Group, Inc. (‘‘NYSE Group’’), to amend NYSE, NYSE MKT and the Exchange
business days between the hours of
certain organizational documents of (together, the ‘‘NYSE Exchanges’’).4
10:00 a.m. and 3:00 p.m. Copies of such NYSE Group, NYSE Holdings LLC In connection with the Acquisition
filing also will be available for (‘‘NYSE Holdings’’), Intercontinental and as discussed more fully below, the
inspection and copying at the principal Exchange Holdings, Inc. (‘‘ICE following organizational documents of
office of the Exchange. All comments Holdings’’), and Intercontinental NYSE Group and its intermediary and
received will be posted without change; Exchange, Inc. (‘‘ICE’’). The proposed ultimate parent entities would be
the Commission does not edit personal rule change is available on the amended:
identifying information from Exchange’s Web site at www.nyse.com, • ICE bylaws and director
submissions. You should submit only at the principal office of the Exchange, independence policy,
information that you wish to make and at the Commission’s Public • ICE Holdings bylaws and certificate
available publicly. All submissions Reference Room. of incorporation,
should refer to File Number SR–BX– • NYSE Holdings operating
II. Self-Regulatory Organization’s agreement, and
2016–068, and should be submitted on
Statement of the Purpose of, and • NYSE Group bylaws and certificate
or before January 19, 2017.
Statutory Basis for, the Proposed Rule of incorporation.
For the Commission, by the Division of Change These proposed changes would
Trading and Markets, pursuant to delegated consist of technical and conforming
In its filing with the Commission, the
authority.16 amendments to reflect the proposed
self-regulatory organization included
Eduardo A. Aleman,
asabaliauskas on DSK3SPTVN1PROD with NOTICES
statements concerning the purpose of, new ownership of NYSE National by the
Assistant Secretary. and basis for, the proposed rule change NYSE Group, and, indirectly, ICE.5
[FR Doc. 2016–31476 Filed 12–28–16; 8:45 am] and discussed any comments it received
4 The NYSE Exchanges are referred to as the U.S.
BILLING CODE 8011–01–P on the proposed rule change. The text
Regulated Subsidiaries in the corporate documents
of those statements may be examined at proposed to be amended in this rule filing.
5 The proposed revisions are also discussed in the
1 15 U.S.C. 78s(b)(1). NYSE and NYSE MKT companion rule filings
2 15 U.S.C. 78a. related to the Acquisition. See SR–NYSE–2016–90
16 17 CFR 200.30–3(a)(12). 3 17 CFR 240.19b–4. & SR–NYSEMKT–2016–122.
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![96104 Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
including replacing an incorrect related persons is an NYSE National Proposed Independence Policy of the
reference to ‘‘Sixth’’ before ‘‘Amended’’ ETP Holder. Board of Directors of Intercontinental
in item (3). The date would also be Exchange, Inc. (‘‘ICE Director
updated in the preamble on the first Proposed Fifth Amended and Restated Independence Policy’’)
page. Bylaws of Intercontinental Exchange
Holdings, Inc. (‘‘ICE Holdings Bylaws’’) The ICE Director Independence Policy
• To distinguish between the ETP would be amended to add NYSE
Holders of NYSE Arca Equities and The ICE Holdings Bylaws are being National to the section describing
those of NYSE National, subsection amended as follows: ‘‘Independence Qualifications.’’ In
A.3.c.ii of Article V (Limitations on particular, NYSE National would be
Voting and Ownership) would be • The cover page and heading on the
first page would be amended to add added to categories (1)(b) and (c) that
amended to define an ETP Holder of refer to ‘‘members,’’ as defined in
NYSE Arca Equities as an ‘‘NYSE Arca ‘‘Fifth’’ and delete ‘‘Fourth’’ before
‘‘Amended and Restated Bylaws’’ to section 3(a)(3)(A)(i), 3(a)(3)(A)(ii),
Equities ETP Holder.’’ Obsolete 3(a)(3)(A)(iii) and 3(a)(3)(A)(iv) of the
references to NYSE Market (DE) and reflect that this would be the fifth
amendment and restatement. The Exchange Act.12 The clause ‘‘and
NYSE Regulation, would also be ‘Person Associated with an ETP Holder’
deleted.8 effective date on the cover page would
also be updated. (as defined in Rule 1.5 of NYSE
Subsection A.3.c of Article V would National, Inc.)’’ would also be added to
be amended to add a new subsection (v), • Similar to the ICE Bylaws discussed category (1)(b) in reference to ‘‘allied
similar to those in place for the other above, the ICE Holdings Bylaws would persons.’’ NYSE National would also be
NYSE Exchanges, which would provide be amended to include ‘‘NYSE National, added to subsections (4) and (5) of the
that, for so long as the ICE Holdings Inc.’’ in: ‘‘Independence Qualifications’’
directly or indirectly controls NYSE Æ The definition of ‘‘U.S. Regulated section.13 Obsolete references to NYSE
National (or its successor), no person Subsidiaries’’ in Article III, Section 3.15, Market (DE) and NYSE Regulation
nor any of its related persons (as those which currently includes the NYSE, would also be deleted.14
terms are defined therein) is an ETP NYSE Market (DE), NYSE Regulation,
Holder (as proposed to be defined in the Proposed Eighth Amended and Restated
NYSE Arca, LLC, NYSE Arca, NYSE Limited Liability Company Agreement
bylaws of NYSE National, discussed Arca Equities, and the Exchange, and to
above) of NYSE National. of NYSE Holdings LLC (‘‘NYSE
provide that the term ‘‘U.S. Regulated
• Subsection A.3.d of Article V would Subsidiaries’’ includes those entities
Holdings LLC Operating Agreement’’)
be amended to add ‘‘NYSE Arca’’ before listed or their successors, but only so The NYSE Holdings LLC Operating
‘‘ETP Holder’’ in one place to long as they continue to be controlled, Agreement would be amended as
distinguish between the NYSE Arca directly or indirectly, by ICE Holdings. follows:
Equities ETP Holders of and those of Obsolete references to NYSE Market • The heading and preamble would
NYSE National. (DE) and NYSE Regulation in that be amended to add ‘‘Eighth’’ and delete
Subsection (A)(3)(d) would be further section would also be deleted; 9 ‘‘Seventh’’ before ‘‘Amended and
amended to add a new subsection (v) Restated Limited Liability Agreement’’
similar to those in place for the other Æ Article VIII (Confidential to reflect that this would be the eighth
NYSE Exchanges. The new subsection Information), Section 8.1, which would amendment and restatement. The
would incorporate NYSE National into be amended to extend the same effective date would also be updated.
the existing restriction, such that the protection to confidential information After ‘‘This Agreement amends and
ICE Holdings Board of Directors would relating to the self-regulatory function of restates in its entirety that’’ in the
be restricted from adopting a resolution NYSE National or its successor; 10 and second full sentence would be added
to approve the exercise of voting rights Æ Article XI (Amendment to the the clause ‘‘certain Seventh Amended
that would exceed 20% of the then Bylaws), Section 11.3, which provides and Restated Limited Liability Company
outstanding votes entitled to be cast on that, for so long as ICE controls any of Agreement, dated as of May 22, 2015,
such matter, where neither such person the U.S. Regulated Subsidiaries, any which amended and restated in its
nor any of its related persons is, with amendment to or repeal of the ICE entirety that.’’
respect to NYSE National, an NYSE Bylaws must either be (i) filed with or • The current penultimate whereas
National ETP Holder. filed with and approved by the clause would be amended by adding ‘‘in
• Subsection B.3 of Article V would Commission under section 19 of the May 2015’’ before ‘‘the Company’’ and
be amended to add a new subsection (g) Exchange Act and the rules promulgated ‘‘now desires to amend and restate’’
similar to those in place for the other thereunder, or (ii) submitted to the immediately following would be
NYSE Exchanges, incorporating NYSE boards of directors of the U.S. Regulated replaced with ‘‘amended and restated.’’
National into the restriction on the ICE Subsidiaries or the boards of directors of ‘‘Had’’ and ‘‘are’’ would be changed to
Holdings board of directors adopting their successors, in each case only to the the past tense ‘‘had’’ [sic] and ‘‘were’’ in
any resolution pursuant to clause (b) of extent that such entity continues to be the final sentence.
Section B.2 of Article V of the ICE controlled directly or indirectly by ICE • The following new whereas clause
Holdings Certificate of Incorporation Holdings. Obsolete references to NYSE would be added immediately above the
(which relates to ICE board of directors Market (DE) and NYSE Regulation current last whereas clause:
approval of ownership of ICE capital would also be deleted from Article VXI, ‘‘WHEREAS, the Company now desires
asabaliauskas on DSK3SPTVN1PROD with NOTICES
stock by a person together with its Section 11.3.11 to amend and restate the Seventh
related persons in excess of 20%) unless Amended and Restated Agreement to
the NYSE Holdings board of directors 9 See note 7, supra.
determines that, for so long as ICE 10 ArticleVIII, Section 8.1 would also be amended 12 See 15 U.S.C. 78c(a)(3)(a).
Holdings controls NYSE National, to delete obsolete references to NYSE Market (DE) 13 Conforming changes would also be made to
and NYSE Regulation. delete and replace connectors. The link in footnote
neither such person nor any of its 11 See note 7, supra. Conforming changes to 2 to the NYSE Listed Company Manual and
delete and replace connectors would also be made commentary would also be updated.
8 See note 7, supra. throughout. 14 See note 7, supra.
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![Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices 96105
reflect the acquisition of NYSE National, controls NYSE National, neither such Section 4(b)(1)(y) would also be
Inc. by the Company’s wholly-owned person nor any of its Related Persons is amended to add a provision to [sic]
subsidiary NYSE Group, Inc.;’’. an NYSE National ETP Holder.’’ similar to those in place for the other
• The definition of ETP Holder in • Article IX, Section 9.1(b)(3) of NYSE Exchanges providing that, for so
Article I (Interpretation), Section 1.1 Article IX [sic] would be amended to long as NYSE Group directly or
would be deleted and new definitions of add a new subpart (G) to incorporate indirectly controls NYSE National (or its
an NYSE Arca ETP Holder and NYSE NYSE National into the existing successor), neither such person nor any
National ETP Holder would be added. restriction on the NYSE Holdings Board of its related persons is an ETP Holder
The obsolete definition of NYSE Market of Directors, so that it would provide (as defined in the rules of NYSE
(DE) would be deleted.15 that, subject to its fiduciary obligations National, as such rules may be in effect
• Article IX (Voting and Ownership under applicable law, for so long as from time to time) of NYSE National
Limitations), Section 9.1(a)(3)(C) would NYSE Holdings directly or indirectly (defined as an ‘‘NYSE National ETP
be amended to add ‘‘NYSE Arca’’ before controls NYSE National (or its Holder’’) and that any such person that
‘‘ETP Holder’’ and the defined term successor), the board of directors of is a related person of an NYSE National
‘‘NYSE Arca ETP Holder’’ to distinguish NYSE Holdings shall not adopt any ETP Holder shall hereinafter also be
between the ETP Holders of NYSE Arca resolution pursuant to (b) of Section deemed to be an ‘‘NYSE National ETP
Equities and those of NYSE National. 9.1(b)(2) of the NYSE Holdings LLC Holder’’ for purposes of the certificate of
An obsolete reference to NYSE Market Operating Agreement, unless the board incorporation, as the context may
(DE) would also be deleted from Section of directors of NYSE Holdings shall require.
9.1(a)(3)(C).16 have determined that neither such • Further, subsection 4(b)(1)(z) of
Section 9.1(a)(3)(C) would be person nor any of its related persons is Article IV would be amended to define
amended to add a new subsection (v) an NYSE National ETP Holder. an ETP Holder of NYSE Arca Equities as
similar to those in place for the other an ‘‘NYSE Arca Equities ETP Holder’’
Proposed Fifth Amended and Restated
NYSE Exchanges. The new subsection and delete an outdated reference to
Certificate of Incorporation of NYSE
(v) would incorporate NYSE National NYSE Market (DE). Subsection 4(b)(1)(z)
Group, Inc. (‘‘NYSE Group Certificate of
into the existing restriction, such that would also be amended to incorporate
Incorporation’’)
the ICE Holdings board of directors NYSE National into the existing
would be restricted from adopting a The NYSE Group Certificate of restriction on the ICE Holdings Board of
resolution pursuant to clause (b) of Incorporation is being amended as Directors, such that it would be
Section 9.1(a)(2) unless the NYSE follows: restricted from adopting a resolution to
• On the first page, add ‘‘Fifth’’ and approve the exercise of voting rights
Holdings board of directors determines
delete ‘‘Fourth’’ before ‘‘Amended and that would exceed 20% of the then
that, for so long as NYSE Holdings
Restated Certificate of Incorporation’’ in outstanding votes entitled to be cast on
directly or indirectly controls NYSE
the heading. The Recitations would be such matter, where neither such person
National, Inc. (or its successor), neither
amended to reflect that this would be nor any of its related persons is, with
such person nor any of its related
the fifth amendment and restatement. respect to NYSE National, an NYSE
persons is an ETP Holder (as defined in
First, the Fifth Recitation would be National ETP Holder.
the bylaws of NYSE National, as such
updated to reflect that a Fourth • A new subpart (vii) would be added
bylaws may be in effect from time to
Amended and Restated Certificate of to subsection 4(b)(2)(C) of Article IV to
time) of NYSE National (‘‘NYSE
Incorporation was filed with the incorporate NYSE National into the
National ETP Holder’’). The clause
Secretary of State of the State of existing restriction on the NYSE Group
would also provide that any such
Delaware on December 29, 2014. A new Board of Directors, such that it would be
person that is a related person of an ETP
Sixth Recitation would be updated to restricted from adopting a resolution to
Holder shall hereinafter also be deemed
reflect that the Fifth Amended and approve the exercise of voting rights
to be an ‘‘NYSE National ETP Holder’’
Restated Certificate of Incorporation has that would exceed 20% of the then
for purposes of the agreement, as the
been duly adopted. The current Sixth outstanding votes entitled to be cast on
context may require.
• Article IX, Section 9.1(a)(3)(D) Recitation would become the Seventh such matter, where neither such person
would be amended to add ‘‘NYSE Arca’’ and would reflect that the Fourth nor any of its related persons is, with
before ‘‘ETP Holder.’’ An outdated Amended and Restated Certificate of respect to NYSE National, an NYSE
reference to NYSE Market (DE) would Incorporation is amended and restated National ETP Holder.17
also be deleted. in its entirety. • Article X (Confidential Information)
• NYSE National would be added to would be amended to extend the same
Further, a new clause (v) would be
the list of ‘‘Regulated Subsidiaries’’ in protection to confidential information
added to Section 9.1(a)(3)(D) to
Article 4 (Stock), Section 4(b)(1), which relating to the self-regulatory function of
incorporate NYSE National into the
currently includes the NYSE, NYSE NYSE National or its successor and
existing restriction on the NYSE
Market (DE), NYSE Regulation, NYSE delete obsolete references to NYSE
Holdings Board of Directors, such that it
Arca, LLC, NYSE Arca Equities, and Market (DE) and NYSE Regulation.
would be restricted from adopting a
resolution to approve the exercise of
NYSE MKT, and the obsolete references • Article XII (Amendments to
to NYSE Market (DE) and NYSE Certificate of Incorporation) provides
voting rights that would exceed 20% of
Regulation would be deleted. that, for so long as NYSE Group controls
the then outstanding votes entitled to be • To distinguish between the ETP
asabaliauskas on DSK3SPTVN1PROD with NOTICES
cast on such matter for so long as NYSE the Regulated Subsidiaries, before any
Holders of NYSE Arca Equities and amendment or repeal of any provision
Holdings controls NYSE National. The those of NYSE National, Section
clause would provide that ‘‘for so long of the Certificate of Incorporation shall
4(b)(1)(y) of Article IV would be be effective, such amendment or repeal
as the Corporation directly or indirectly amended to define an ETP Holder of shall either (a) be filed with or filed
15 See
NYSE Arca Equities as an ‘‘NYSE Arca with and approved by the SEC under
note 7, supra.
16 See note 7, supra. Conforming changes to
Equities ETP Holder.’’ An outdated
delete and replace connectors would also be made reference to NYSE Market (DE) would 17 An obsolete reference to NYSE Market (DE)
throughout. also be deleted. would also be deleted from Article IV, 4(b)(2)(C)(v).
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![96106 Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices
Section 19 of the Exchange Act and the independence policy, ICE Holdings also further the goal of transparency and
rules promulgated thereunder or (b) be bylaws and certificate of incorporation, add clarity to the Exchange’s rules.
submitted to the boards of directors of NYSE Holdings operating agreement,
B. Self-Regulatory Organization’s
NYSE, NYSE Market (DE), NYSE and the NYSE Group bylaws and Statement on Burden on Competition
Regulation, NYSE Arca, NYSE Arca certificate of incorporation, to reflect the
Equities, and NYSE MKT or the boards Acquisition, including updating The Exchange does not believe that
of directors of their successors. Article corporate names, would contribute to the proposed rule change will impose
XII would be amended to add NYSE the orderly operation of the Exchange by any burden on competition that is not
National to subsection (b) and delete adding clarity and transparency to the necessary or appropriate in furtherance
references to NYSE Market (DE) and Exchange’s rules and would enable the of the purposes of the Exchange Act.
NYSE Regulation. Exchange to continue to be so organized The proposed rule change is not
as to have the capacity to carry out the intended to address competitive issues
Proposed Third Amended and Restated
purposes of the Exchange Act and but rather is concerned solely with
Bylaws of NYSE Group, Inc. (‘‘NYSE
comply and enforce compliance with updating the Exchange’s rules to reflect
Group Bylaws’’)
the provisions of the Exchange Act by the Acquisition and to remove obsolete
The NYSE Group Bylaws are being references.
amended as follows: its members and persons associated
• Add ‘‘Third’’ and delete ‘‘Second’’ with its members. The Exchange C. Self-Regulatory Organization’s
before ‘‘Amended and Restated Bylaws’’ therefore believes that approval of the Statement on Comments on the
in the heading to reflect that this would amendment to the Bylaws is consistent Proposed Rule Change Received From
be the third amendment and with Section 6(b)(1). Members, Participants, or Others
restatement. For similar reasons, the Exchange also No written comments were solicited
• Article VII (Miscellaneous), Section believes that this filing furthers the or received with respect to the proposed
7.9(A)(b) currently provides that, for so objectives of Section 6(b)(5) of the rule change.
long as NYSE Group controls any of the Exchange Act 20 because the proposed
NYSE Exchanges, any amendment to or III. Date of Effectiveness of the
rule change would be consistent with
repeal of the ICE Bylaws must either be Proposed Rule Change and Timing for
and facilitate would create [sic] a
(i) filed with or filed with and approved Commission Action
governance and regulatory structure that
by the Commission under section 19 of is designed to prevent fraudulent and Within 45 days of the date of
the Exchange Act and the rules manipulative acts and practices, to publication of this notice in the Federal
promulgated thereunder, or (ii) promote just and equitable principles of Register or within such longer period
submitted to the boards of directors of trade, to foster cooperation and up to 90 days (i) as the Commission may
the NYSE, NYSE Market (DE), NYSE coordination with persons engaged in designate if it finds such longer period
Regulation, NYSE Arca, NYSE Arca regulating, clearing, settling, processing to be appropriate and publishes its
Equities, and NYSE Alternext US LLC or information with respect to, and reasons for so finding or (ii) as to which
the boards of directors of their facilitating transactions in securities, to the self-regulatory organization
successors, in each case only to the remove impediments to, and perfect the consents, the Commission will:
extent that such entity continues to be mechanism of a free and open market (A) By order approve or disapprove
controlled directly or indirectly by ICE. and a national market system and, in such proposed rule change, or
Section 7.9(A)(b) would be amended to general, to protect investors and the (B) institute proceedings to determine
delete obsolete references to NYSE public interest. As discussed above, the whether the proposed rule change
Market (DE) and NYSE Regulation, proposed updates to the corporate should be disapproved.
replace the outdated reference to ‘‘NYSE documents and replacement of outdated IV. Solicitation of Comments
Alternext US LLC’’ with ‘‘NYSE MKT or obsolete references removes
LLC,’’ and add NYSE National. Interested persons are invited to
impediments to and perfects the
submit written data, views and
2. Statutory Basis mechanism of a free and open market by
arguments concerning the foregoing,
The Exchange believes that the removing confusion that may result including whether the proposed rule
proposed rule change is consistent with from having these references in the change is consistent with the Act.
Section 6(b) of the Exchange Act 18 in governing documents following the Comments may be submitted by any of
general, and with Section 6(b)(1) 19 in Acquisition. The Exchange further the following methods:
particular, in that it enables the believes that the proposal removes
impediments to and perfects the Electronic Comments
Exchange to be so organized as to have
the capacity to be able to carry out the mechanism of a free and open market by • Use the Commission’s Internet
purposes of the Exchange Act and to ensuring that persons subject to the comment form (http://www.sec.gov/
comply, and to enforce compliance by Exchange’s jurisdiction, regulators, and rules/sro.shtml); or
its exchange members and persons the investing public can more easily • Send an email to rule-comments@
associated with its exchange members, navigate and understand the governing sec.gov. Please include File Number SR–
with the provisions of the Exchange Act, documents. The Exchange further NYSEArca–2016–167 on the subject
the rules and regulations thereunder, believes that eliminating an obsolete line.
reference would not be inconsistent
asabaliauskas on DSK3SPTVN1PROD with NOTICES
and the rules of the Exchange. The Paper Comments
Exchange believes that the proposed with the public interest and the
changes to the corporate documents of protection of investors because investors • Send paper comments in triplicate
the NYSE Group and its intermediary will not be harmed and in fact would to Secretary, Securities and Exchange
and ultimate parent entities, including benefit from increased transparency, Commission, 100 F Street NE.,
the ICE bylaws and director thereby reducing potential confusion. Washington, DC 20549–1090.
Removing such obsolete references will All submissions should refer to File
18 15 U.S.C. 78f(b). Number SR–NYSEArca–2016–167. This
19 15 U.S.C. 78f(b)(1). 20 15 U.S.C. 78f(b)(5). file number should be included on the
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![Federal Register / Vol. 81, No. 250 / Thursday, December 29, 2016 / Notices 96107
subject line if email is used. To help the 19b–4 thereunder,2 a proposed rule On December 9, 2016, the Exchange
Commission process and review your change to amend the co-location filed Amendment No. 2 to the proposed
comments more efficiently, please use services offered by the Exchange to: (1) rule change as described in Items I and
only one method. The Commission will Provide additional information II below, which Items have been
post all comments on the Commission’s regarding the access to various trading prepared by Exchange. On December 13,
Internet Web site (http://www.sec.gov/ and execution services; connectivity to 2016 the Exchange filed Amendment
rules/sro.shtml). Copies of the market data feeds and testing and No. 3 to the proposed rule change.9 The
submission, all subsequent certification feeds; connectivity to Third Commission is publishing this notice to
amendments, all written statements Party Systems; and connectivity to solicit comments on Amendment Nos. 2
with respect to the proposed rule DTCC provided to Users using data and 3 to the proposed rule change from
change that are filed with the center local area networks; and (2) interested persons.
Commission, and all written establish fees relating to a User’s access I. Self-Regulatory Organization’s
communications relating to the to various trading and execution Statement of the Terms of Substance of
proposed rule change between the services; connectivity to market data the Proposed Amendments
Commission and any person, other than feeds and testing and certification feeds;
those that may be withheld from the connectivity to DTCC; and other The Exchange proposes to amend the
public in accordance with the services. The proposed rule change was co-location services offered by the
provisions of 5 U.S.C. 552, will be published for comment in the Federal Exchange to establish fees relating to
available for Web site viewing and Register on August 26, 2016.3 The Users’ access to third party trading and
printing in the Commission’s Public Commission received no comments in execution services; connectivity to third
Reference Room, 100 F Street NE., response to the proposed rule change.4 party data feeds and testing and
Washington, DC 20549, on official On October 4, 2016, the Commission certification feeds; access to clearing;
business days between the hours of extended the time period within which and other services. In addition, this
10:00 a.m. and 3:00 p.m. Copies of the to approve the proposed rule change, proposed rule change reflects changes to
filing also will be available for disapprove the proposed rule change, or the NYSE Arca Options Fee Schedule
inspection and copying at the principal institute proceedings to determine (the ‘‘Options Fee Schedule’’) and,
office of the Exchange. All comments whether to approve or disapprove the through its wholly owned subsidiary
received will be posted without change; proposed rule change to November 24, NYSE Arca Equities, Inc. (‘‘NYSE Arca
the Commission does not edit personal 2016.5 Equities’’), the NYSE Arca Equities
Schedule of Fees and Charges for
identifying information from On November 2, 2016, the Exchange
Exchange Services (the ‘‘Equities Fee
submissions. You should submit only filed Amendment No. 1 to the proposed
Schedule’’ and, together with the
information that you wish to make rule change.6 On November 29, 2016,
Options Fee Schedule, the ‘‘Fee
available publicly. All submissions the Commission instituted proceedings
Schedules’’) related to these co-location
should refer to File Number SR– to determine whether to approve or
services. This Amendment No. 2 10
NYSEArca–2016–167 and should be disapprove the proposed rule change, as
supersedes the original filing and
submitted on or before January 19, 2017. modified by Amendment No. 1.7 In
Amendment 1 in their entirety.11 The
For the Commission, by the Division of response to the Order Instituting
Trading and Markets, pursuant to delegated Proceedings, the Commission received The Commission notes that it received an
authority.21 additional comment letters regarding additional letter on the NYSE Companion Filing.
Eduardo A. Aleman, the proposed rule change.8 See letter to Brent J. Fields, Commission, from
Adam C. Cooper, Senior Managing Director and
Assistant Secretary. Chief Legal Officer, Citadel Securities, dated
2 17 CFR 240.19b–4.
[FR Doc. 2016–31490 Filed 12–28–16; 8:45 am] 3 See
December 12, 2016. All comments received by the
Securities Exchange Act Release No. 34–
BILLING CODE 8011–01–P
Commission on the NYSE Companion Filing are
78628 (August 22, 2016), 81 FR 59004 (‘‘Notice’’).
available on the Commission’s Web site at: https://
4 The Commission notes that it did receive one
www.sec.gov/comments/sr-nyse-2016-45/
comment letter on a related filing, NYSE–2016–45 nyse201645.shtml.
SECURITIES AND EXCHANGE (the ‘‘NYSE Companion Filing’’), which is equally 9 The Commission notes that the Exhibit 5 filed
relevant to this filing. See letter to Brent J. Fields, with Amendment No. 2 contained erroneous rule
COMMISSION Secretary, Commission, from John Ramsay, Chief text and therefore was corrected in Amendment No.
Market Policy Officer, Investors Exchange LLC 3. Amendment Nos. 2 and 3 are available at https://
[Release No. 34–79673; File No. SR– (IEX), dated September 9, 2016.
NYSEArca–2016–89] www.sec.gov/comments/sr-nysearca-2016-89/
On September 23, 2016, the NYSE submitted a nysearca201689-3.pdf.
response to the IEX letter. 10 See supra note 9, noting that Amendment No.
Self-Regulatory Organizations; NYSE 5 See Securities Exchange Act Release No. 34–
2 was modified in part by Amendment No. 3.
Arca, Inc.; Notice of Filing of 78967 (September 28, 2016), 81 FR 68480. Accordingly, the Commission notes that
Amendment Nos. 2 and 3 to Proposed 6 Amendment No. 1 is available on the
Amendment Nos. 2 and 3 together supersede the
Rule Change Amending the Co- Commission’s Web site at https://www.sec.gov/ original filing, as modified by Amendment No. 1,
comments/sr-nysearca-2016-89/nysearca201689- in its entirety.
Location Services Offered by the 1.pdf. 11 The Securities and Exchange Commission
Exchange To Add Certain Access and 7 See Securities Exchange Act Release 34–79379
(‘‘Commission’’) has issued an order instituting
Connectivity Fees (November 22, 2016), 81 FR 86036. proceedings to determine whether to approve or
8 See letter to Brent J. Fields, Commission, from disapprove the proposed rule change, as modified
December 22, 2016. Melissa MacGregor, Managing Director and by amendments 1 and 2. See Securities Exchange
asabaliauskas on DSK3SPTVN1PROD with NOTICES
On August 16, 2016, NYSE Arca, Inc. Associate General Counsel, SIFMA, dated December Act Release No. 79379 (November 22, 2016), 81 FR
(‘‘NYSE Arca’’ or the ‘‘Exchange’’) filed 12, 2016; letter to Brent J. Fields, Commission, from 86036 (November 29, 2016) (SR–NYSEArca–2016–
Joe Wald, Chief Executive Officer, Clearpool Group, 89) (the ‘‘November 22 Order’’). In its filing, as
with the Securities and Exchange dated December 16, 2016; letter to Brent J. Fields, amended by amendment 1, the Exchange proposed
Commission (‘‘Commission’’), pursuant Secretary, Commission, from John Ramsay, Chief adding to the Fee Schedules (a) a more detailed
to Section 19(b)(1) of the Securities Market Policy Officer, Investors Exchange LLC description of the connectivity to certain market
Exchange Act of 1934 (‘‘Act’’) 1 and Rule (IEX), dated December 21, 2016. All comments data products (the ‘‘Included Data Products’’) that
received by the Commission on the proposed rule Users receive with connections to the local area
change are available on the Commission’s Web site networks available in the data center; and (b)
21 17 CFR 200.30–3(a)(12). at: https://www.sec.gov/comments/sr-nysearca- connectivity fees for connecting to other market
1 15 U.S.C. 78s(b)(1). 2016-89/nysearca201689.shtml. Continued
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Document Created: 2016-12-29 01:58:25
Document Modified: 2016-12-29 01:58:25
| 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 96102 |
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