Notice2021-11612
Self-Regulatory Organizations; Long-Term Stock Exchange; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to a Temporary Reduction in the Initial Listing Fee
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 3, 2021
Issuing agencies
Securities and Exchange Commission
Full Text
<html>
<head>
<title>Federal Register, Volume 86 Issue 105 (Thursday, June 3, 2021)</title>
</head>
<body><pre>
[Federal Register Volume 86, Number 105 (Thursday, June 3, 2021)]
[Notices]
[Pages 29818-29820]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-11612]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-92055; File No. SR-LTSE-2021-03]
Self-Regulatory Organizations; Long-Term Stock Exchange; Notice
of Filing and Immediate Effectiveness of Proposed Rule Change Relating
to a Temporary Reduction in the Initial Listing Fee
May 27, 2021.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on May 18, 2021, Long-Term Stock Exchange (``LTSE'' or the
``Exchange'') 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 Exchange. 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\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
LTSE proposes a rule change to temporarily reduce by half the
schedule of Initial Listing Fees for issuers' Primary Equity Securities
on LTSE in light of the competitive market for listings and the ongoing
disruptions caused by the global COVID-19 pandemic.\3\ The Initial
Listing fees would revert to their prior levels beginning on January 1,
2022.
---------------------------------------------------------------------------
\3\ The Exchange originally filed to establish a fee schedule of
listing fees for issuers of primary equity securities on January 22,
2020 (SR-LTSE-2020-02). On January 30, 2020, SR-LTSE-2020-02 was
withdrawn and replaced by SR-LTSE-2020-03. See Securities Exchange
Act Release No. 88133 (February 6, 2020), 85 FR 8048 (February 12,
2020).
---------------------------------------------------------------------------
The text of the proposed rule change is available at the Exchange's
website at <a href="https://longtermstockexchange.com/">https://longtermstockexchange.com/</a>, 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 these statements may be examined at
the places specified in Item IV below. The self-regulatory organization
has prepared summaries, set forth in Sections A, B, and C below, of the
most significant aspects of such statements.
A. Self-Regulatory Organization's Statement on the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange is filing this proposed rule change to amend Rule
14.601 to temporarily reduce by half the schedule of Initial Listing
Fees for issuers' Primary Equity Securities on LTSE in light of the
competitive market for listings and the ongoing disruptions caused by
the global COVID-19 pandemic.\4\ The Initial Listing fees would revert
to their prior levels beginning on January 1, 2022.
---------------------------------------------------------------------------
\4\ ``Primary Equity Security'' means a Company's first class of
Common Stock, Ordinary Shares, Shares or Certificates of Beneficial
Interest of Trust, Limited Partnership Interests or American
Depositary Receipts (``ADRs'') or Shares (``ADSs''). See Rule
14.002(a)(24).
---------------------------------------------------------------------------
1. Initial Listing Fee
The Initial Listing Fee in LTSE Rule 14.601(a)(1) is determined
based on the market capitalization of the Company when it lists on the
Exchange.\5\
---------------------------------------------------------------------------
\5\ See supra note 3.
---------------------------------------------------------------------------
The amount of such fee is set forth in the fee table LTSE Rule
14.601(a)(3). The Initial Listing Fee is prorated based on the number
of trading days in the year remaining at the time of a Company's
initial listing.\6\ The proposed rule change would reduce the Initial
Listing Fee in each listing tier for the remainder of 2021 by 50% while
also retaining the proration calculation as set forth in the Rule.\7\
Thus, for example, a Company with market capitalization up to $1
billion listing on LTSE on May 31, 2021, would have an Initial Listing
Fee of $44,642.50 ($75,000 x 150/252).\8\ Prior to the proposed rule
change, the Initial Listing Fee would have been $89,285.00 ($150,000 x
150/252).
---------------------------------------------------------------------------
\6\ See LTSE Rule 14.601(a)(1)(iv).
\7\ The Annual Listing Fee, which would be assessed for calendar
year 2022 for a Company listing on LTSE in 2021, is not affected by
the proposed rule change.
\8\ May 31, 2021 is the 150th trading day out of a total of 252
trading days in calendar year 2021.
---------------------------------------------------------------------------
Beginning January 1, 2022, the Initial Listing Fees and Annual
Listing Fees would revert to the levels as originally adopted in Rule
14.601.\9\
---------------------------------------------------------------------------
\9\ See supra note 3.
---------------------------------------------------------------------------
The Exchange believes that it is appropriate to temporarily reduce
the listing fees amount by half for the remainder of 2021. The market
for listings is highly competitive and the Exchange believes that a
temporary
[[Page 29819]]
reduction in fees is appropriate at this time as the Exchange is
attracting new listings. The Exchange does not believe that the
proposed temporary reduction in its Initial Listing Fees will have any
adverse impact on the amount of funds available for its regulatory
program.
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the requirements of Section 6(b) of the Act \10\ in general, and
furthers the objectives of Section 6(b)(4) of the Act \11\ in
particular, because it provides for the equitable allocation of
reasonable dues, fees, and other charges among its members, issuers,
and other persons using its facilities. The Exchange also believes that
the proposed rule change is consistent with the requirements of Section
6(b)(5) of the Act \12\ because it is designed 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 and is not designed to permit
unfair discrimination between customers, issuers, brokers and dealers.
---------------------------------------------------------------------------
\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(4).
\12\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------
The Exchange believes that the temporary reduction for the
remainder of 2021 of the Initial Listing Fee is reasonable in view of
the highly competitive market for listings and the disruptions faced by
Companies as a result of the global COVID-19 pandemic. The benefits to
a Company, its shareholders and stakeholders from pursuing long-term
value creation were discussed extensively in the background and
rationale for LTSE's Long-Term Policies.\13\ While LTSE believes that
the current environment reinforces the importance for a Company to
demonstrate its commitment to long-termism and the Long-Term Policies
set forth in Rule 14.425, the Exchange also believes that a temporary
reduction in fees is appropriate in the current economic environment.
The proposed rule change applies the reduction in fees equitably in
that all price tiers are reduced by 50% and the reduced Initial Listing
Fee is available to all Companies that elect to list on LTSE in
calendar year 2021.
---------------------------------------------------------------------------
\13\ See Securities Exchange Act Release No. 86327 (July 8,
2019), 84 FR 33293 (July 12, 2019).
---------------------------------------------------------------------------
Additionally, the Exchange operates in a highly competitive market
for the listing of Primary Equity Securities. The Commission has
repeatedly expressed its preference for competition over regulatory
intervention in determining prices, products, and services in the
securities markets. A temporary reduction in price contributes to the
competitive marketplace. The Exchange believes therefore that the
proposed rule change supports an open market and the national market
system, and is consistent with the public interest.
B. Self-Regulatory Organization's Statement on Burden on Competition
LTSE does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. The proposed rule change would
establish a temporary reduction in the schedule of Initial Listing
Fees.
The market for listing services is highly competitive. Each listing
exchange has a different fee schedule that applies to issuers seeking
to list securities on its exchange. Issuers have the option to list
their securities on these alternative venues based on the fees charged
and the value provided by each listing. Because issuers have a choice
to list their securities on a different national securities exchange,
the Exchange does not believe that the proposed rule change imposes a
burden on competition.
Intramarket Competition. The proposed rule change would establish a
temporarily-reduced Initial Listing Fee that will be charged to all
Companies listing on LTSE on the same basis. The Exchange does not
believe that the proposed, temporary fees will have any meaningful
effect on the competition among issuers listed on the Exchange.
Intermarket Competition. The Exchange operates in a highly
competitive market in which issuers can readily choose to list
securities on other exchanges and transfer listings to other exchanges
if they deem fee levels at those other venues to be more favorable.
Consequently, the Exchange does not believe the proposed rule change
will impose any burden on intermarket competition in a manner that is
not necessary or appropriate in furtherance of the purposes of the Act.
The Exchange also notes that other listing venues adjust their fees
from time to time.\14\
---------------------------------------------------------------------------
\14\ See, e.g., Securities Exchange Act Release No. 90519
(November 25, 2020), 85 FR 77324 (December 1, 2020) (Nasdaq's Notice
of Filing and Immediate Effectiveness of Proposed Rule Change To
Modify Certain Annual Listing Fees).
---------------------------------------------------------------------------
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) \15\ of the Act and paragraph (f) of Rule 19b-4 \16\
thereunder. At any time within 60 days of the filing of such proposed
rule change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule change should be approved or
disapproved.
---------------------------------------------------------------------------
\15\ 15 U.S.C. 78s(b)(3)(A).
\16\ 17 CFR 240.19b-4(f)(2).
---------------------------------------------------------------------------
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
<bullet> Use the Commission's internet comment form (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#bbc9ced7de96d8d4d6d6ded5cfc8fbc8ded895dcd4cd"><span class="__cf_email__" data-cfemail="443631282169272b2929212a3037043721276a232b32">[email protected]</span></a>. Please include
File No. SR-LTSE-2021-03 on the subject line.
Paper Comments
<bullet> 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 No. SR-LTSE-2021-03. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (<a href="http://www.sec.gov/rules/sro.shtml">http://www.sec.gov/rules/sro.shtml</a>).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule
[[Page 29820]]
change that are filed with the Commission, and all written
communications relating to the proposed rule change between the
Commission and any person, other than those that may be withheld from
the public in accordance with the provisions of 5 U.S.C. 552, will be
available for website viewing and printing in the Commission's Public
Reference Room, 100 F Street NE, Washington, DC 20549, on official
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of
the filing also will be available for inspection and copying at the
principal office of the Exchange. All comments received will be posted
without change. Persons submitting comments are cautioned that we do
not redact or edit personal identifying information from comment
submissions. You should submit only information that you wish to make
available publicly. All submissions should refer to File No. SR-LTSE-
2021-03, and should be submitted on or before June 24, 2021.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
---------------------------------------------------------------------------
\17\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-11612 Filed 6-2-21; 8:45 am]
BILLING CODE 8011-01-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on June 3, 2021.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.