83 FR 9765 - Self-Regulatory Organizations; New York Stock Exchange LLC; Order Granting Approval of Proposed Rule Change To Amend the NYSE Listed Company Manual To Modify Its Requirements With Respect to Physical Delivery of Proxy Materials to the Exchange
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 83, Issue 45 (March 7, 2018)
Federal Register Volume 83, Issue 45 (March 7, 2018)
| Page Range | 9765-9768 | |
| FR Document | 2018-04557 |
[Federal Register Volume 83, Number 45 (Wednesday, March 7, 2018)] [Notices] [Pages 9765-9768] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2018-04557] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-82796; File No. SR-NYSE-2017-42] Self-Regulatory Organizations; New York Stock Exchange LLC; Order Granting Approval of Proposed Rule Change To Amend the NYSE Listed Company Manual To Modify Its Requirements With Respect to Physical Delivery of Proxy Materials to the Exchange March 1, 2018. I. Introduction On November 22, 2017, New York Stock Exchange LLC (``NYSE'' or the ``Exchange'') filed with the Securities and Exchange Commission (``SEC'' or ``Commission''), pursuant to Section 19(b)(1) of the Securities Exchange Act [[Page 9766]] of 1934 (``Exchange Act'') \1\ and Rule 19b-4 thereunder,\2\ a proposed rule change to amend its rules that require listed companies to provide the Exchange with hard copies of proxy material sent to shareholders. The proposed rule change was published for comment in the Federal Register on December 12, 2017.\3\ On January 22, 2018, the Commission extended the time period within which to approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether to approve or disapprove the proposed rule change to March 12, 2018.\4\ The Commission received no comment letters on the proposed rule change. This order approves the proposed rule change. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78s(b)(1). \2\ 17 CFR 240.19b-4. \3\ See Securities Exchange Act Release No. 82225 (December 6, 2017), 82 FR 58473 (``Notice''). \4\ See Securities Exchange Act Release No. 82565, 83 FR 3812 (January 26, 2018). --------------------------------------------------------------------------- II. Description of the Proposed Rule Change Currently, Sections 204.00(B) and 402.01 of the NYSE Listed Company Manual (``Manual'') set forth requirements with respect to the physical delivery of hard copies of proxy materials to the Exchange. Among other things, Section 204.00(B) requires listed companies to file with the Exchange six hard copies of proxy materials not later than the date on which the material is physically or electronically delivered to shareholders, and one hard copy of any filing made on Form 6-K that is not required to be filed through the SEC's EDGAR system not later than the date on which the Form 6-K is filed with the Commission. Section 402.01 requires listed companies to provide the Exchange with three hard copies of definitive proxy material (together with proxy card) not later than the date on which such material is sent, or given, to any security holders, which satisfies the copies required to be provided to the Exchange under Rule 14a-6(b) of the Exchange Act.\5\ --------------------------------------------------------------------------- \5\ The copies required to be submitted to the Exchange pursuant to Rule 14a-6(b) under the Exchange Act only apply to domestic companies. See infra notes 9-11 and accompanying text. The Commission notes, however, that the Exchange's rules require listed companies, including foreign private issuers, to provide multiple hard copies of proxy materials under Sections 204.00 and 402.01 of the Manual. --------------------------------------------------------------------------- In addition to the Exchange's own requirements mandating that any listed company provide the Exchange with hard copies of proxy materials that are sent to shareholders, all U.S. domestic listed companies that are subject to the Commission's proxy rules are required to electronically file their proxy materials on the SEC's EDGAR system.\6\ The Exchange stated that its staff is notified when a listed company submits a filing to the Commission on EDGAR and generally reviews proxy materials on the EDGAR system shortly after they are filed.\7\ The Exchange also stated that its staff generally has completed its review of proxy materials prior to receiving the hard copies of the materials, and therefore the Exchange has no real need to receive hard copies.\8\ As to listed foreign private issuers, while their securities are exempt from the Commission's proxy rules,\9\ the Exchange rules require listed companies, including foreign private issuers, to hold annual shareholder meetings and solicit proxies for such meetings.\10\ A foreign private issuer, including those listed on the Exchange, will generally furnish proxy material on EDGAR using Form 6-K or may file its proxy material on Form 8-K if the foreign private issuer chooses to file periodic reports under the provisions for domestic companies. --------------------------------------------------------------------------- \6\ See Regulation S-T, 17 CFR 232.101. \7\ See Notice, supra note 3, at 58473. \8\ See id. \9\ 17 CFR 240.3a12-3(b). \10\ See Sections 302.00 (Annual Meetings) and 402.04 (Proxy Solicitation Required) of the Manual. --------------------------------------------------------------------------- Accordingly, the Exchange proposed to amend its paper filings requirements related to proxy materials in Sections 204.00(B) and 402.01 of the Manual to eliminate ``a significant amount of unnecessary use of paper and of resources devoted to processing unneeded materials received through the mail.'' \11\ --------------------------------------------------------------------------- \11\ See Notice, supra note 3, at 58474. --------------------------------------------------------------------------- Specifically, the Exchange has proposed to amend Section 402.01 of the Manual to provide that listed companies will not be required to provide proxy materials to the Exchange in physical form, provided such proxy materials are included in a Commission filing available on the SEC's EDGAR filing system.\12\ If such proxy materials are available on EDGAR but not filed pursuant to Schedule 14A under the Exchange Act, the listed company would be required to provide to the Exchange information sufficient to identify such filing (by one of the means specified in Section 204.00(A)) \13\ not later than the date on which such material is sent, or given, to any security holders.\14\ Notwithstanding the foregoing, any listed company whose proxy materials are not included in their entirety (together with proxy card) in an SEC filing available on EDGAR will continue to be required to provide three definitive copies of any proxy material not available on EDGAR to the Exchange not later than the date on which such material is sent, or given, to any security holders. This is consistent with the number of copies required to be filed with the Exchange under Rule 14a-6(b) under the Exchange Act.\15\ --------------------------------------------------------------------------- \12\ See proposed Section 402.01. \13\ Section 204.00(A) of the Manual generally requires that prompt notice to the Exchange must be provided via a web portal or email address specified by the Exchange on its website. \14\ Domestic listed companies occasionally file their proxy materials on the SEC's EDGAR system using forms other than Schedule 14A, which may not be readily identified by Exchange staff. See Notice, supra note 3, at 58474. The Exchange stated that, as there is no easy way to identify which SEC report includes a company's proxy materials, the Exchange proposed to require listed companies not filing proxies using Schedule 14A under the Exchange Act to provide to the Exchange information needed to identify the submission containing proxy materials. Id. at 58474. \15\ See proposed Section 402.01. The Exchange also proposed to correct an erroneous reference to SEC Rule 14a-6(c) in Section 402.01 to refer instead to SEC Rule 14a-6(b). SEC Rule 14a-6(b) requires listed companies subject to the proxy rules to file three copies of such proxy material with the Exchange. --------------------------------------------------------------------------- The Exchange has also proposed conforming amendments to Section 204.00(B) of the Manual for consistency with the proposed amendments to Section 402.01. Specifically, the Exchange would amend Section 204.00(B) so as to require listed companies to file three hard copies of any proxy materials required to be submitted to the Exchange in physical form pursuant to Section 402.01 (as proposed to be amended) not later than the date on which the material is physically or electronically delivered to shareholders.\16\ In addition, the Exchange would amend Section 204.00(B) to require companies to file one hard copy of any filing that is not required to be filed through EDGAR, including pursuant to a hardship exemption granted by the Commission.\17\ --------------------------------------------------------------------------- \16\ See id. The Exchange also proposed to delete from this provision a cross-reference to Section 402.00 (Proxies) in the Manual. \17\ See proposed Section 204.00(B); see also 17 CFR 232.201 and .202. As noted above, the current language in Section 204.00(B) only requires the Exchange to provide one hard copy of any filing made on Form 6-K that is not required to be filed through EDGAR to be provided to the Exchange, and does not include the reference to a hardship exemption that the Exchange now proposes to add. In addition, the Exchange has proposed non-substantive changes to Section 204.00(B), including removing from Section 204.00(B)'s introductory paragraph a sentence stating that listed companies are required to file hard copies of certain SEC reports and other materials (such as proxies) with the Exchange. See proposed Section 204.00(B). The Exchange noted that this provision would be inconsistent with the Exchange's proposed revised approach to the review of SEC filings. See Notice, supra note 3, at 58473. --------------------------------------------------------------------------- [[Page 9767]] III. Discussion and Commission Findings After careful review, the Commission finds that the proposed rule change is consistent with the requirements of the Exchange Act and the rules and regulations thereunder applicable to a national securities exchange.\18\ In particular, the Commission finds that the proposed rule change is consistent with Section 6(b)(5) of the Exchange Act,\19\ which requires, among other things, that the rules of a national securities 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. --------------------------------------------------------------------------- \18\ In approving this proposal, the Commission has considered the proposed rule's impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). \19\ 15 U.S.C. 78f(b)(5). --------------------------------------------------------------------------- The Commission believes that the proposed amendments to the Manual are consistent with Section 6(b)(5) of the Exchange Act because, by allowing the Exchange to rely on electronic copies of proxy materials available on EDGAR, the proposed amendments are reasonably designed to allow Exchange staff to review all listed company proxy material in a timely manner and to ensure compliance with Exchange rules and the federal securities laws \20\ while eliminating the need for unnecessary paper copies when warranted.\21\ At the same time, the proposed rule changes furthers the purposes of Section 6(b)(5), and in particular the protection of investors and the public interest, because Sections 204.00(B) and 402.01 of the Manual will still require listed companies that do not file proxy materials electronically on EDGAR, or that do not include their entire proxy materials (including the proxy card) on EDGAR, to submit three hard copies of such materials to the Exchange. --------------------------------------------------------------------------- \20\ Generally, the Exchange reviews proxies for purposes of Exchange rules concerning broker voting and for other matters that may arise concerning compliance with Exchange rules and the federal securities laws. In addition, the Commission notes that NYSE Listing Agreement requires listed companies to comply with the requirements of the federal securities laws, as well as NYSE rules. See https://www.nyse.com/publicdocs/nyse/listing/Domestic_Co_Listing_Agreement.pdf. \21\ The Commission notes that other national securities exchanges, such as The Nasdaq Stock Market LLC (``Nasdaq''), also have rules that allow listed companies to satisfy the exchange's filing requirements, including for proxies, by virtue of filing on EDGAR. See, e.g., Nasdaq Rules 5005(a)(16), 5620(b), and 5250(c)(1). --------------------------------------------------------------------------- The Commission notes that it has previously granted the Exchange no-action relief, on behalf of listed companies and third party filers, from the obligation to provide paper copies to the Exchange with respect to materials filed with the Commission through the EDGAR system, including proxy materials (``1998 No-Action Letter'').\22\ The Exchange, however, had previously decided not to rely on the 1998 No- Action Letter with respect to proxy material but now has, for the reasons described in its proposal, decided to do so. Given that the Exchange currently uses EDGAR to review proxies, the Commission would expect there should be little impact on the Exchange's proxy review process if it no longer also receives paper submissions of proxies filed on EDGAR. As the Exchange noted in its filing, it generally completes its review ``. . . long before [it] receives hard copies of proxy materials,'' \23\ so there appears to be little risk in eliminating the paper copy requirement for proxy material where the complete filing is available on EDGAR. Further, to the extent the Exchange cannot rely on the 1998 No-Action Letter because proxy material is not submitted on EDGAR (such as when a hardship exemption is granted) or is not available in its entirety on EDGAR, the Exchange rules will continue to require listed companies to provide three hard copies of such proxy material to the Exchange, which would meet the requirements of Rule 14a-6 under the Exchange Act for companies subject to the U.S. proxy rules. --------------------------------------------------------------------------- \22\ See letter to Michael J. Simon, Milbank, Tweed, Hadley & McCloy from Ann M. Krauskopf, Special Counsel, Division of Corporation Finance, Commission, and Howard L. Kramer, Senior Associate Director, Office of Market Supervision, Division of Market Regulation, Commission, dated July 22, 1998. The 1998 No-Action Letter also granted the Exchange relief in relation to documents available for review on EDGAR from the recordkeeping requirements of Rule 17a-1 under the Exchange Act. The Exchange stated that at the time such no-action relief was granted, the Exchange decided not to rely on it in relation to proxy materials. See Notice, supra note 3, at 58474. \23\ See Notice, supra note 3, at 58473. --------------------------------------------------------------------------- The Commission notes that the proposed changes to the Exchange rules are drafted to enable the Exchange to eliminate outdated paper copy requirements in the Manual only in those cases where the Exchange is able to review proxy material in a timely manner on EDGAR, for purposes of compliance with Exchange rules and the federal securities laws, and as long as consistent with the conditions of the 1998 No- Action Letter. The Exchange's proposal also requires listed companies to provide to the Exchange information sufficient to identify proxy materials that have been submitted through EDGAR, but not filed pursuant to Schedule 14A under the Exchange Act. This provision should enable the Exchange to identify the documents it needs to review proxy materials on EDGAR quickly to review for compliance with both Exchange rules and the federal securities laws consistent with investor protection and the public interest. In particular, this should help the Exchange more readily identify proxy materials filed on EDGAR by foreign private issuers, which, as the Exchange notes, often furnish and submit their proxy materials to the Commission as part of a Form 6-K or Form 8- K,\24\ as well as proxy materials occasionally filed by domestic listed companies on forms other than Schedule 14A under the Exchange Act. --------------------------------------------------------------------------- \24\ See Notice, supra note 3, at 58473. As the Exchange also noted, while foreign private issuers are not required to comply with the Commission's proxy rules, the Exchange requires them to solicit proxies. See id. --------------------------------------------------------------------------- Finally, the proposal to require companies to file with the Exchange one hard copy of any filing that is not required to be filed through EDGAR should help enable the Exchange to continue to receive all filings made by its listed companies, which in turn should aid the Exchange in fulfilling its regulatory responsibilities to oversee companies for compliance with listing, and other Exchange, rules and the federal securities laws.\25\ This situation may arise, for example, when a listed company has been granted a hardship exemption under Regulation S-T to file in paper rather than electronically on EDGAR.\26\ --------------------------------------------------------------------------- \25\ The Commission notes that this change broadens the Exchange's current rule which had been limited to filings on Form 6- K not submitted on EDGAR. See supra note 17. The requirement to submit to the Exchange one copy of any filing not filed in EDGAR covers all listed company filings with the Commission, including Form 6-Ks, with the exception of proxy material, for which three copies of all the proxy material not filed in EDGAR must be filed with the Exchange. See also General Instructions to Form 6-K. \26\ The Commission notes that the 1998 No-Action Letter stated that the no-action relief may not be relied upon and a paper filing with the Exchange would be required if a listed company or third party filer files a document with the Commission in paper pursuant to a hardship exemption. --------------------------------------------------------------------------- Accordingly, for the reasons discussed above, the Commission finds that the proposed rule change is consistent with the Exchange Act. [[Page 9768]] IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Exchange Act,\27\ that the proposed rule change (SR-NYSE-2017-42), be, and hereby is, approved. --------------------------------------------------------------------------- \27\ 15 U.S.C. 78f(b)(2). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\28\ --------------------------------------------------------------------------- \28\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018-04557 Filed 3-6-18; 8:45 am] BILLING CODE 8011-01-P
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analysis as to whether to approve or IV. Request for Written Comments internet website (http://www.sec.gov/
disapprove the proposal. The Commission requests that rules/sro.shtml). Copies of the
Pursuant to Section 19(b)(2)(B) of the interested persons provide written submission, all subsequent
Act,88 the Commission is providing submissions of their views, data, and amendments, all written statements
notice of the grounds for disapproval arguments with respect to the issues with respect to the Proposed Rule
under consideration. The Commission is raised by the Proposed Rule Change. In Change that are filed with the
instituting proceedings to allow for particular, the Commission invites the Commission, and all written
additional analysis of, and input from, written views of interested persons communications relating to the
commenters with respect to the concerning whether the Proposed Rule Proposed Rule Change between the
Proposed Rule Change’s consistency Change is inconsistent with Section Commission and any person, other than
with the Act and the rules thereunder. 17A(b)(3)(F) of the Act 92 and Rules those that may be withheld from the
Specifically, the Commission believes 17Ad–22(b)(1)–(2) 93 and 17Ad– public in accordance with the
that the Proposed Rule Change raises 22(e)(6) 94 under the Act, or any other provisions of 5 U.S.C. 552, will be
questions as to whether the proposal is provision of the Act or rules and available for website viewing and
consistent with (i) Section 17A(b)(3)(F) regulations thereunder. printing in the Commission’s Public
of Act, which requires that the rules of Although there do not appear to be Reference Room, 100 F Street NE,
a clearing agency be designed to, among any issues relevant to approval or Washington, DC 20549, on official
other things, assure the safeguarding of disapproval that would be facilitated by business days between the hours of
securities and funds which are in the an oral presentation of views, data, and 10:00 a.m. and 3:00 p.m. Copies of such
custody or control of the clearing agency arguments, the Commission will filing also will be available for
or for which it is responsible; 89 (ii) consider, pursuant to Rule 19b–4, any inspection and copying at the principle
Rules 17Ad–22(b)(1) and (b)(2) under request for an opportunity to make an office of OCC. All comments received
the Act, which require a registered oral presentation.95 will be posted without change. Persons
clearing agency that performs central Interested persons are invited to submitting comments are cautioned that
counterparty services establish, submit written data, views, and we do not redact or edit personal
implement, maintain and enforce arguments regarding whether the identifying information from comment
written policies and procedures Proposed Rule Change should be submissions. You should submit only
reasonably designed to, in part: (1) approved or disapproved on or before information that you wish to make
Measure its credit exposures to its March 28, 2018. Any person who available publicly.
participants at least once a day and limit wishes to file a rebuttal to any other All submissions should refer to File
its exposures to potential losses from person’s submission must file that Number SR–OCC–2017–022 and should
defaults by its participants under rebuttal on or before April 11, 2018. be submitted on or before March 28,
normal market conditions so that the Comments may be submitted by any of 2018. If comments are received, any
operations of the clearing agency would the following methods: rebuttal comments should be submitted
not be disrupted and non-defaulting on or before April 11, 2018.
participants would not be exposed to Electronic Comments
For the Commission, by the Division of
losses that they cannot anticipate or • Use the Commission’s internet Trading and Markets, pursuant to delegated
control; and (2) use margin comment form (http://www.sec.gov/ authority.96
requirements to limit its credit rules/sro.shtml); or Robert W. Errett,
exposures to participants under normal • Send an email to rule-comments@ Deputy Secretary.
market conditions and use risk-based sec.gov. Please include File Number SR– [FR Doc. 2018–04624 Filed 3–6–18; 8:45 am]
models and parameters to set margin OCC–2017–022 on the subject line. BILLING CODE 8011–01–P
requirements; 90 and (iii) Rule 17Ad–
22(e)(6) under the Act, which requires Paper Comments
OCC to establish, implement, maintain • Send paper comments in triplicate SECURITIES AND EXCHANGE
and enforce written policies and to Secretary, Securities and Exchange COMMISSION
procedures reasonably designed to cover Commission, 100 F Street NE,
its credit exposures to its participants by Washington, DC 20549. [Release No. 34–82796; File No. SR–NYSE–
2017–42]
establishing a risk-based margin system All submissions should refer to File
that, among other things: (i) Considers, Number SR–OCC–2017–022. This file Self-Regulatory Organizations; New
and produces margin levels number should be included on the York Stock Exchange LLC; Order
commensurate with, the risks and subject line if email is used. To help the Granting Approval of Proposed Rule
particular attributes of each relevant Commission process and review your Change To Amend the NYSE Listed
product, portfolio, and market; (ii) comments more efficiently, please use Company Manual To Modify Its
calculates margin sufficient to cover its only one method. The Commission will Requirements With Respect to
potential future exposure to participants post all comments on the Commission’s Physical Delivery of Proxy Materials to
in the interval between the last margin the Exchange
collection and the close out of positions 92 15 U.S.C. 78q–1(b)(3)(F).
following a participant default; and (iii) 93 17 CFR 240.17Ad–22(b)(1)–(2). March 1, 2018.
94 17 CFR 240.17Ad–22(e)(6).
uses reliable sources of timely price data I. Introduction
95 Section 19(b)(2) of the Act, as amended by the
and uses procedures and sound Securities Acts Amendments of 1975, Public Law
valuation models for addressing On November 22, 2017, New York
daltland on DSKBBV9HB2PROD with NOTICES
94–29, 89 Stat. 97 (1975), grants the Commission
circumstances in which pricing data are flexibility to determine what type of proceeding— Stock Exchange LLC (‘‘NYSE’’ or the
not readily available or reliable.91 either oral or notice and opportunity for written ‘‘Exchange’’) filed with the Securities
comments—is appropriate for consideration of a and Exchange Commission (‘‘SEC’’ or
88 15
particular proposal by a self-regulatory ‘‘Commission’’), pursuant to Section
U.S.C. 78s(b)(2)(B). organization. See Securities Acts Amendments of
89 15 U.S.C. 78q–1(b)(3)(F). 1975, Report of the Senate Committee on Banking, 19(b)(1) of the Securities Exchange Act
90 17 CFR 240.17Ad–22(b)(1) and (2).
Housing and Urban Affairs to Accompany S. 249,
91 17 CFR 240.17Ad–22(e)(6). S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975). 96 17 CFR 200.30–3(a)(12).
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III. Discussion and Commission materials electronically on EDGAR, or federal securities laws, and as long as
Findings that do not include their entire proxy consistent with the conditions of the
After careful review, the Commission materials (including the proxy card) on 1998 No-Action Letter.
finds that the proposed rule change is EDGAR, to submit three hard copies of The Exchange’s proposal also requires
consistent with the requirements of the such materials to the Exchange. listed companies to provide to the
Exchange Act and the rules and The Commission notes that it has Exchange information sufficient to
regulations thereunder applicable to a previously granted the Exchange no- identify proxy materials that have been
national securities exchange.18 In action relief, on behalf of listed submitted through EDGAR, but not filed
particular, the Commission finds that companies and third party filers, from pursuant to Schedule 14A under the
the proposed rule change is consistent the obligation to provide paper copies to Exchange Act. This provision should
with Section 6(b)(5) of the Exchange the Exchange with respect to materials enable the Exchange to identify the
Act,19 which requires, among other filed with the Commission through the documents it needs to review proxy
things, that the rules of a national EDGAR system, including proxy materials on EDGAR quickly to review
securities exchange be designed to materials (‘‘1998 No-Action Letter’’).22 for compliance with both Exchange
prevent fraudulent and manipulative The Exchange, however, had previously rules and the federal securities laws
acts and practices, to promote just and decided not to rely on the 1998 No-
consistent with investor protection and
equitable principles of trade, to foster Action Letter with respect to proxy
the public interest. In particular, this
cooperation and coordination with material but now has, for the reasons
should help the Exchange more readily
persons engaged in regulating, clearing, described in its proposal, decided to do
identify proxy materials filed on EDGAR
settling, processing information with so. Given that the Exchange currently
by foreign private issuers, which, as the
respect to, and facilitating transactions uses EDGAR to review proxies, the
Exchange notes, often furnish and
in securities, to remove impediments to Commission would expect there should
submit their proxy materials to the
and perfect the mechanism of a free and be little impact on the Exchange’s proxy
Commission as part of a Form 6–K or
open market and a national market review process if it no longer also
Form 8–K,24 as well as proxy materials
system, and, in general, to protect receives paper submissions of proxies
occasionally filed by domestic listed
investors and the public interest. filed on EDGAR. As the Exchange noted
companies on forms other than
The Commission believes that the in its filing, it generally completes its
Schedule 14A under the Exchange Act.
proposed amendments to the Manual review ‘‘. . . long before [it] receives
are consistent with Section 6(b)(5) of the hard copies of proxy materials,’’ 23 so Finally, the proposal to require
Exchange Act because, by allowing the there appears to be little risk in companies to file with the Exchange one
Exchange to rely on electronic copies of eliminating the paper copy requirement hard copy of any filing that is not
proxy materials available on EDGAR, for proxy material where the complete required to be filed through EDGAR
the proposed amendments are filing is available on EDGAR. Further, to should help enable the Exchange to
reasonably designed to allow Exchange the extent the Exchange cannot rely on continue to receive all filings made by
staff to review all listed company proxy the 1998 No-Action Letter because its listed companies, which in turn
material in a timely manner and to proxy material is not submitted on should aid the Exchange in fulfilling its
ensure compliance with Exchange rules EDGAR (such as when a hardship regulatory responsibilities to oversee
and the federal securities laws 20 while exemption is granted) or is not available companies for compliance with listing,
eliminating the need for unnecessary in its entirety on EDGAR, the Exchange and other Exchange, rules and the
paper copies when warranted.21 At the rules will continue to require listed federal securities laws.25 This situation
same time, the proposed rule changes companies to provide three hard copies may arise, for example, when a listed
furthers the purposes of Section 6(b)(5), of such proxy material to the Exchange, company has been granted a hardship
and in particular the protection of which would meet the requirements of exemption under Regulation S–T to file
investors and the public interest, Rule 14a–6 under the Exchange Act for in paper rather than electronically on
because Sections 204.00(B) and 402.01 companies subject to the U.S. proxy EDGAR.26
of the Manual will still require listed rules. Accordingly, for the reasons
companies that do not file proxy The Commission notes that the discussed above, the Commission finds
proposed changes to the Exchange rules that the proposed rule change is
approach to the review of SEC filings. See Notice, are drafted to enable the Exchange to
supra note 3, at 58473.
consistent with the Exchange Act.
18 In approving this proposal, the Commission has
eliminate outdated paper copy
considered the proposed rule’s impact on requirements in the Manual only in 24 See Notice, supra note 3, at 58473. As the
efficiency, competition, and capital formation. See those cases where the Exchange is able Exchange also noted, while foreign private issuers
15 U.S.C. 78c(f). to review proxy material in a timely are not required to comply with the Commission’s
19 15 U.S.C. 78f(b)(5). proxy rules, the Exchange requires them to solicit
20 Generally, the Exchange reviews proxies for
manner on EDGAR, for purposes of proxies. See id.
purposes of Exchange rules concerning broker
compliance with Exchange rules and the 25 The Commission notes that this change
voting and for other matters that may arise broadens the Exchange’s current rule which had
22 See letter to Michael J. Simon, Milbank, Tweed, been limited to filings on Form 6–K not submitted
concerning compliance with Exchange rules and
the federal securities laws. In addition, the Hadley & McCloy from Ann M. Krauskopf, Special on EDGAR. See supra note 17. The requirement to
Commission notes that NYSE Listing Agreement Counsel, Division of Corporation Finance, submit to the Exchange one copy of any filing not
requires listed companies to comply with the Commission, and Howard L. Kramer, Senior filed in EDGAR covers all listed company filings
requirements of the federal securities laws, as well Associate Director, Office of Market Supervision, with the Commission, including Form 6–Ks, with
as NYSE rules. See https://www.nyse.com/ Division of Market Regulation, Commission, dated the exception of proxy material, for which three
daltland on DSKBBV9HB2PROD with NOTICES
publicdocs/nyse/listing/Domestic_Co_Listing_ July 22, 1998. The 1998 No-Action Letter also copies of all the proxy material not filed in EDGAR
Agreement.pdf. granted the Exchange relief in relation to must be filed with the Exchange. See also General
21 The Commission notes that other national documents available for review on EDGAR from the Instructions to Form 6–K.
securities exchanges, such as The Nasdaq Stock recordkeeping requirements of Rule 17a–1 under 26 The Commission notes that the 1998 No-Action
Market LLC (‘‘Nasdaq’’), also have rules that allow the Exchange Act. The Exchange stated that at the Letter stated that the no-action relief may not be
listed companies to satisfy the exchange’s filing time such no-action relief was granted, the relied upon and a paper filing with the Exchange
requirements, including for proxies, by virtue of Exchange decided not to rely on it in relation to would be required if a listed company or third party
filing on EDGAR. See, e.g., Nasdaq Rules proxy materials. See Notice, supra note 3, at 58474. filer files a document with the Commission in paper
5005(a)(16), 5620(b), and 5250(c)(1). 23 See Notice, supra note 3, at 58473. pursuant to a hardship exemption.
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IV. Conclusion the class of security, the public trading Commission, including whether the
It is therefore ordered, pursuant to volume and price history in the security information shall have practical utility;
Section 19(b)(2) of the Exchange Act,27 for specified time periods on the subject (b) the accuracy of the Commission’s
that the proposed rule change (SR– exchange and a statement indicating estimates of the burden of the proposed
NYSE–2017–42), be, and hereby is, that the applicant has provided a copy collection of information; (c) ways to
approved. of such application to the exchange enhance the quality, utility, and clarity
from which the suspension or of the information on respondents; and
For the Commission, by the Division of termination of unlisted trading (d) ways to minimize the burden of the
Trading and Markets, pursuant to delegated
privileges are sought, and to any other collection of information on
authority.28
exchange on which the security is listed respondents, including through the use
Eduardo A. Aleman,
or admitted to unlisted trading of automated collection techniques or
Assistant Secretary. privileges. other forms of information technology.
[FR Doc. 2018–04557 Filed 3–6–18; 8:45 am] The information required to be Consideration will be given to
BILLING CODE 8011–01–P included in applications submitted comments and suggestions submitted in
pursuant to Rule 12f–3, is intended to writing within 60 days of this
provide the Commission with sufficient publication.
SECURITIES AND EXCHANGE information to make the necessary An agency may not conduct or
COMMISSION findings under the Act to terminate or sponsor, and a person is not required to
suspend by order the unlisted trading respond to, a collection of information
Proposed Collection; Comment privileges granted a security on a
Request under the PRA unless it displays a
national securities exchange. Without currently valid OMB control number.
Upon Written Request, Copies Available the Rule, the Commission would be Please direct your written comments
from: U.S. Securities and Exchange unable to fulfill these statutory to: Pamela Dyson, Director/Chief
Commission, Office of FOIA Services, responsibilities. Information Officer, Securities and
100 F Street NE, Washington, DC The burden of complying with Rule Exchange Commission, c/o Remi Pavlik-
20549–2736. 12f–3 arises when a potential Simon, 100 F Street NE, Washington,
respondent, having a demonstrable bona DC 20549 or send an email to: PRA_
Extension: Rule 12f–3, SEC File No. 270–141, fide interest in the question of
OMB Control No. 3235–0249. Mailbox@sec.gov.
termination or suspension of the
Notice is hereby given that pursuant unlisted trading privileges of a security, Dated: March 1, 2018.
to the Paperwork Reduction Act of 1995 determines to seek such termination or Eduardo A. Aleman,
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the suspension. The staff estimates that Assistant Secretary.
Securities and Exchange Commission each such application to terminate or [FR Doc. 2018–04573 Filed 3–6–18; 8:45 am]
(‘‘Commission’’) is soliciting comments suspend unlisted trading privileges BILLING CODE 8011–01–P
on the existing collection of information requires approximately one hour to
provided for in Rule 12f–3 (17 CFR complete. Thus each potential
240.12f–3), under the Securities respondent would incur on average one SECURITIES AND EXCHANGE
Exchange Act of 1934 (‘‘Act’’) (15 U.S.C. burden hour in complying with the COMMISSION
78a et seq.). The Commission plans to Rule.
[Release No. 34–82795; File No. SR–
submit this existing collection of The Commission staff estimates that
NYSEArca–2018–02]
information to the Office of there could be as many as 18 responses
Management and Budget (‘‘OMB’’) for annually for an aggregate burden for all Self-Regulatory Organizations; NYSE
extension and approval. respondents of 18 hours. Each Arca, Inc.; Notice of Designation of a
Rule 12f–3 (‘‘Rule’’), which was respondent’s related internal cost of Longer Period for Commission Action
originally adopted in 1955 pursuant to compliance for Rule 12f–3 would be on a Proposed Rule Change Relating
Sections 12(f) and 23(a) of the Act, and $221.00, or, the cost of one hour of to Listing and Trading of the Direxion
as further modified in 1995, sets forth professional work of a paralegal needed Daily Bitcoin Bear 1X Shares, Direxion
the requirements to submit an to complete the application. The total Daily Bitcoin 1.25X Bull Shares,
application to the Commission for annual cost of compliance for all Direxion Daily Bitcoin 1.5X Bull
termination or suspension of unlisted potential respondents, therefore, is Shares, Direxion Daily Bitcoin 2X Bull
trading privileges in a security, as $3,978.00 (18 responses × $221.00/ Shares and Direxion Daily Bitcoin 2X
contemplated under Section 12(f)(4) of response). Bear Shares Under NYSE Arca Rule
the Act. In addition to requiring that one Compliance with the application 8.200–E
copy of the application be filed with the requirements of Rule 12f–3 is
Commission, the Rule requires that the mandatory, though the filing of such March 1, 2018.
application contain specified applications is undertaken voluntarily. On January 4, 2018, NYSE Arca, Inc.
information. Under the Rule, an Rule 12f–3 does not have a record (‘‘NYSE Arca’’) filed with the Securities
application to suspend or terminate retention requirement per se. However, and Exchange Commission
unlisted trading privileges must responses made pursuant to Rule 12f–3 (‘‘Commission’’), pursuant to Section
provide, among other things, the name are subject to the recordkeeping 19(b)(1) of the Securities Exchange Act
of the applicant; a brief statement of the requirements of Rules 17a–3 and 17a–4 of 1934 (‘‘Act’’) 1 and Rule 19b–4
applicant’s interest in the question of of the Act. Information received in thereunder,2 a proposed rule change to
daltland on DSKBBV9HB2PROD with NOTICES
termination or suspension of such response to Rule 12f–3 shall not be kept list and trade the shares of the Direxion
unlisted trading privileges; the title of confidential; the information collected Daily Bitcoin Bear 1X Shares, Direxion
the security; the name of the issuer; is public information. Daily Bitcoin 1.25X Bull Shares,
certain information regarding the size of Written comments are invited on: (a) Direxion Daily Bitcoin 1.5X Bull Shares,
Whether the proposed collection of
27 15 U.S.C. 78f(b)(2). information is necessary for the proper 1 15 U.S.C. 78s(b)(1).
28 17 CFR 200.30–3(a)(12). performance of the functions of the 2 17 CFR 240.19b–4.
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Document Created: 2018-03-07 01:27:13
Document Modified: 2018-03-07 01:27:13
| 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 | 83 FR 9765 |
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