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Notice2022-00266

Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Its Price List With Respect to a Regulatory Fee Related to the Central Registration Depository

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Published
January 11, 2022

Issuing agencies

Securities and Exchange Commission

Full Text

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<title>Federal Register, Volume 87 Issue 7 (Tuesday, January 11, 2022)</title>
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[Federal Register Volume 87, Number 7 (Tuesday, January 11, 2022)]
[Notices]
[Pages 1463-1464]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-00266]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-93904; File No. SR-NYSE-2021-77]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Its Price List With Respect to a Regulatory Fee Related to the 
Central Registration Depository

January 5, 2022.
    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 22, 2021, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Price List (the ``Price List'') 
with respect to a regulatory fee related to the Central Registration 
Depository (``CRD system''), which is collected by the Financial 
Industry Regulatory Authority, Inc. (``FINRA''). The Exchange proposes 
to implement the fee change on January 2, 2022. The proposed rule 
change is available on the Exchange's website at <a href="http://www.nyse.com">www.nyse.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 those statements may be examined at 
the places specified in Item IV below. The Exchange has prepared 
summaries, set forth in sections A, B, and C below, of the most 
significant parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend the Price List with respect to a 
regulatory fee collected by FINRA for use of the CRD system.\4\ The 
Exchange proposes to implement the fee change on January 2, 2022.
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    \4\ The CRD system is the central licensing and registration 
system for the U.S. securities industry. The CRD system enables 
individuals and firms seeking registration with multiple states and 
self-regulatory organizations to do so by submitting a single form, 
fingerprint card, and a combined payment of fees to FINRA. Through 
the CRD system, FINRA maintains the qualification, employment, and 
disciplinary histories of registered associated persons of broker-
dealers.
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    FINRA collects and retains certain regulatory fees via the CRD 
system for the registration of associated persons of member 
organizations of the Exchange that are not FINRA members (``Non-FINRA 
Member Organizations'').\5\ The CRD system fees are user-based, and 
there is no distinction in the cost incurred by FINRA if the user is a 
FINRA member or a Non-FINRA Member Organization.
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    \5\ The Exchange originally adopted fees for use of the CRD 
system in 2001 and amended those fees in 2013. See Securities 
Exchange Act Release Nos. 45112 (November 28, 2001), 66 FR 63086 
(December 4, 2001) (SR-NYSE-2001-47); 68587 (January 4, 2013), 78 FR 
2467 (January 11, 2013) (SR-NYSE-2012-77). While the Exchange lists 
these fees in its Price List, it does not collect or retain these 
fees.
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    FINRA recently amended one of the fees assessed for use of the CRD 
system.\6\ Accordingly, the Exchange proposes to amend the Price List 
to mirror the fee assessed by FINRA, which will be implemented 
concurrently with the amended FINRA fee on January 2, 2022.\7\ 
Specifically, the

[[Page 1464]]

Exchange proposes to amend the Price List to modify the fee charged to 
Non-FINRA Member Organizations for each initial Form U4 filed for the 
registration of a representative or principal from $100 to $125.\8\
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    \6\ See Securities Exchange Act Release No. 90176 (October 14, 
2020), 85 FR 66592 (October 20, 2020) (SR-FINRA-2020-032).
    \7\ The Exchange notes that it has only adopted the CRD system 
fees charged by FINRA to Non-FINRA Member Organizations when such 
fees are applicable. In this regard, certain FINRA CRD system fees 
and requirements are specific to FINRA members, but do not apply to 
NYSE-only member organizations. Non-FINRA Member Organizations have 
been charged CRD system fees since 2001. See note 5, supra. Member 
organizations that are also FINRA members are charged CRD system 
fees according to Section 4 of Schedule A to the FINRA By-Laws.
    \8\ See Section 4(b)(1) of Schedule A to the FINRA By-Laws 
effective on January 2, 2022. This fee is assessed when a Non-FINRA 
Member Organization submits an initial Uniform Application for 
Securities Industry Regulation or Transfer (known as a ``Form U4'') 
filed by a member in the CRD system to register an individual.
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    The Exchange notes that the proposed change is not otherwise 
intended to address any other issues surrounding regulatory fees, and 
the Exchange is not aware of any problems that member organizations 
would have in complying with the proposed change.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\9\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5),\10\ 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 and does not unfairly discriminate between customers, 
issuers, brokers, or dealers.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(4) & (5).
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    The Exchange believes that the proposed fee change is reasonable 
because the fee will be identical to that adopted by FINRA as of 
January 2, 2022 for use of the CRD system to submit a Form U4. The 
costs of operating and improving the CRD system are similarly borne by 
FINRA when a Non-FINRA Member Organization uses the CRD system; 
accordingly, the fees collected for such use should, as proposed by the 
Exchange, mirror the fees assessed to FINRA members. In addition, as 
FINRA noted in amending its fees, it believes that its proposed pricing 
structure is reasonable and correlates fees with the components that 
drive its regulatory costs to the extent feasible.
    The Exchange also believes that the proposed fee change provides 
for the equitable allocation of reasonable fees and other charges, and 
does not unfairly discriminate between customers, issuers, brokers, and 
dealers. The fee applies equally to all individuals and firms required 
to report information to the CRD system, and the proposed change will 
result in the same regulatory fee being charged to all member 
organizations required to report information to the CRD system and for 
services performed by FINRA regardless of whether such member 
organizations are FINRA members. Accordingly, the Exchange believes 
that the fee collected for such use should increase in lockstep with 
the fee adopted by FINRA as of January 2, 2022, as is proposed by the 
Exchange.

B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will 
impose any burden on competition that is not necessary or appropriate 
in furtherance of the purposes of the Act. Specifically, the Exchange 
believes that the proposed change will reflect the fee that will be 
assessed by FINRA for Form U4 filings as of January 2, 2022 and will 
thus result in the same regulatory fees being charged to all member 
organizations required to report information to the CRD system and for 
services performed by FINRA, regardless of whether or not such member 
organizations are FINRA members.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    No written comments were solicited or received with respect to the 
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    The foregoing rule change is effective upon filing pursuant to 
Section 19(b)(3)(A) \11\ of the Act and subparagraph (f)(2) of Rule 
19b-4 \12\ thereunder, because it establishes a due, fee, or other 
charge imposed by the Exchange.
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    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(2).
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    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act. If the Commission 
takes such action, the Commission shall institute proceedings under 
Section 19(b)(2)(B) \13\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \13\ 15 U.S.C. 78s(b)(2)(B).
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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="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
    <bullet> Send an email to <a href="/cdn-cgi/l/email-protection#3e4c4b525b135d5153535b504a4d7e4d5b5d10595148"><span class="__cf_email__" data-cfemail="ee9c9b828bc38d8183838b809a9dae9d8b8dc0898198">[email&#160;protected]</span></a>. Please include 
File Number SR-NYSE-2021-77 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 Number SR-NYSE-2021-77. 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="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). 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 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 Number SR-NYSE-2021-77 and should be 
submitted on or before February 1, 2022.
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    \14\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-00266 Filed 1-10-22; 8:45 am]
BILLING CODE 8011-01-P


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