Notice2022-07343
Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Extend the Temporary Period for Specified Commentaries to Rules 7.35A and 7.35C and Temporary Rule Relief in Rule 36.30
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
April 7, 2022
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 87 Issue 67 (Thursday, April 7, 2022)</title>
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[Federal Register Volume 87, Number 67 (Thursday, April 7, 2022)]
[Notices]
[Pages 20479-20481]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-07343]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-94585; File No. SR-NYSE-2022-18]
Self-Regulatory Organizations; New York Stock Exchange LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Extend the Temporary Period for Specified Commentaries to Rules 7.35A
and 7.35C and Temporary Rule Relief in Rule 36.30
April 1, 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 March 29, 2022, 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
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.
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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 extend the temporary period for specified
Commentaries to Rules 7.35A and 7.35C and temporary rule relief in Rule
36.30, to end on the earlier of a full reopening of the Trading Floor
facilities to DMMs or after the Exchange closes on July 31, 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 extend the temporary period for specified
Commentaries to Rules 7.35A and 7.35C and temporary rule relief to Rule
36.30 to end on the earlier of a full reopening of the Trading Floor
facilities to DMMs or after the Exchange closes on July 31, 2022. The
current temporary period that these Rules are in effect ends on the
earlier of a full reopening of the Trading Floor facilities to DMMs or
after the Exchange closes on March 31, 2022.
Background
To slow the spread of COVID-19 through social-distancing measures,
on March 18, 2020, the CEO of the Exchange made a determination under
Rule 7.1(c)(3) that, beginning March 23, 2020, the Trading Floor
facilities located at 11 Wall Street in New York City would close and
the Exchange would move, on a temporary basis, to fully electronic
trading.\4\ On May 14, 2020, the CEO of the Exchange made a
determination under Rule 7.1(c)(3) to reopen the Trading Floor on a
limited basis on May 26, 2020 to a subset of Floor brokers, subject to
safety measures designed to prevent the spread of COVID-19.\5\ On June
15, 2020, the CEO of the Exchange made a determination under Rule
7.1(c)(3) to begin the second phase of the Trading Floor reopening by
allowing DMMs to return on June 17, 2020, subject to safety measures
designed to prevent the spread of COVID-19.\6\ Consistent with these
safety measures, both DMMs and Floor broker firms continue to operate
with reduced staff on the Trading Floor.
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\4\ Pursuant to Rule 7.1(e), the CEO notified the Board of
Directors of the Exchange of this determination. The Exchange's
current rules establish how the Exchange will function fully-
electronically. The CEO also closed the NYSE American Options
Trading Floor, which is located at the same 11 Wall Street
facilities, and the NYSE Arca Options Trading Floor, which is
located in San Francisco, CA. See Press Release, dated March 18,
2020, available here: <a href="https://ir.theice.com/press/press-releases/all-categories/2020/03-18-2020-204202110">https://ir.theice.com/press/press-releases/all-categories/2020/03-18-2020-204202110</a>.
\5\ See Securities Exchange Act Release No. 88933 (May 22,
2020), 85 FR 32059 (May 28, 2020) (SR-NYSE-2020-47) (Notice of
filing and immediate effectiveness of proposed rule change).
\6\ See Securities Exchange Act Release No. 89086 (June 17,
2020) (SR-NYSE-2020-52) (Notice of filing and immediate
effectiveness of proposed rule change).
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Proposed Rule Change
Beginning in March 2020, the Exchange modified its rules to add
Commentaries to Rules 7.35, 7.35A,
[[Page 20480]]
7.35B, and 7.35C and rule relief in Rule 36.30,\7\ and has extended the
expiration date of such Commentaries several times.\8\ In July 2021,
the Commission approved the Exchange's proposals to make permanent
several of the rule changes that were the subject of those
Commentaries.\9\ The remaining Commentaries, specified below, are in
effect until the earlier of a full reopening of the Trading Floor
facilities to DMMs or after the Exchange closes on March 31, 2022:
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\7\ See Securities Exchange Act Release Nos. 88413 (March 18,
2020), 85 FR 16713 (March 24, 2020) (SR-NYSE-2020-19) (amending Rule
7.35C to add Commentary .01); 88444 (March 20, 2020), 85 FR 17141
(March 26, 2020) (SR-NYSE-2020-22) (amending Rules 7.35A to add
Commentary .01, 7.35B to add Commentary .01, and 7.35C to add
Commentary .02); 88488 (March 26, 2020), 85 FR 18286 (April 1, 2020)
(SR-NYSE-2020-23) (amending Rule 7.35A to add Commentary .02); 88546
(April 2, 2020), 85 FR 19782 (April 8, 2020) (SR-NYSE-2020-28)
(amending Rule 7.35A to add Commentary .03); 88562 (April 3, 2020),
85 FR 20002 (April 9, 2020) (SR-NYSE-2020-29) (amending Rule 7.35C
to add Commentary .03); 88705 (April 21, 2020), 85 FR 23413 (April
27, 2020) (SR-NYSE-2020-35) (amending Rule 7.35A to add Commentary
.04); 88725 (April 22, 2020), 85 FR 23583 (April 28, 2020) (SR-NYSE-
2020-37) (amending Rule 7.35 to add Commentary .01); 88950 (May 26,
2020), 85 FR 33252 (June 1, 2020) (SR-NYSE-2020-48) (amending Rule
7.35A to add Commentary .05); 89059 (June 12, 2020), 85 FR 36911
(June 18, 2020) (SR-NYSE-2020-50) (amending Rule 7.35C to add
Commentary .04); 89086 (June 17, 2020), 85 FR 37712 (SR-NYSE-2020-
52) (amending Rules 7.35A to add Commentary .06, 7.35B to add
Commentary .03, 76 to add Supplementary Material 20, and
Supplementary Material .30 to Rule 36); 89925 (September 18, 2020)
(SR-NYSE-2020-75) (amending Rule 7.35 to add Commentary .02); and
90810 (December 29, 2020), 86 FR 335 (January 5, 2021) (SR-NYSE-
2020-109) (amending Rule 7.35A to add Commentary .07).
\8\ See Securities Exchange Act Release No. 93780 (December 14,
2021) 86 FR 72012 (December 20, 2021) (SR-NYSE-2021-71) (Notice of
filing and immediate effectiveness of proposed rule change to extend
the temporary period for specified Commentaries to Rules 7.35A and
7.35C and temporary rule relief in Rule 36.30 to end on the earlier
of a full reopening of the Trading Floor facilities to DMMs or after
the Exchange closes on March 31, 2022). See also Securities Exchange
Act Release Nos. 89199 (June 30, 2020), 85 FR 40718 (July 7, 2020)
(SR-NYSE-2020-56) (Notice of filing and immediate effectiveness of
proposed rule change to extend the temporary period for Commentaries
to Rules 7.35, 7.35A, 7.35B, and 7.35C; Supplementary Material .20
to Rule 76; and temporary rule relief in Rule 36.30 to end on the
earlier of a full reopening of the Trading Floor facilities to DMMs
or after the Exchange closes on July 31, 2020); 89368 (July 21,
2020), 85 FR 45272 (July 27, 2020) (SR-NYSE-2020-61) (Notice of
filing and immediate effectiveness of proposed rule change to lift
the temporary suspension to Rule 76 and delete Supplementary
Material .20 to Rule 76); 89425 (July 30, 2020), 85 FR 47446 (August
5, 2020) (SR-NYSE-2020-63) (extending the temporary period specified
in Commentaries to Rules 7.35, 7.35A, 7.35B, and 7.35C and Temporary
Rule Relief in Rule 36.30 to end on the earlier of a full reopening
of the Trading Floor facilities to DMMs or after the Exchange closes
on September 30, 2020); 90005 (September 25, 2020), 85 FR 61999
(October 2020) (SR-NYSE-2020-78) (extending same to end on the
earlier of a full reopening of the Trading Floor facilities to DMMs
or after the Exchange closes on December 31, 2020); 90795 (December
23, 2020), 85 FR 86608 (December 30, 2020) (SR-NYSE-2020-106)
(extending same to end on the earlier of a full reopening of the
Trading Floor facilities to DMMs or after the Exchange closes on
April 30, 2021); 91778 (May 5, 2021) 86 FR 25902 (May 11, 2021) (SR-
NYSE-2021-29) (extending same to end on the earlier of a full
reopening of the Trading Floor facilities to DMMs or after the
Exchange closes on August 31, 2021); and 92802 (August 30, 2021), 86
FR 49587 (September 3, 2021) (SR-NYSE-2021-46) (extending same to
end on the earlier of a full reopening of the Trading Floor
facilities to DMMs or after the Exchange closes on December 31,
2021).
\9\ See Securities Exchange Act Release Nos. 92374 (July 9,
2021), 86 FR 37367 (July 15, 2021) (SR-NYSE-2020-89) (making
permanent the rule changes specified in Commentary .03 to Rule
7.35C); 92373 (July 12, 2021), 86 FR 37779 (July 16, 2021) (SR-NYSE-
2020-93) (making permanent the rule changes specified in
Commentaries .01 and .02 to Rule 7.35); and 92480 (July 23, 2021),
86 FR 40885 (July 29, 2021) (SR-NYSE-2020-95) (making permanent
certain rule changes specified in Commentaries .01 and .06 to Rule
7.35A and Commentaries .01 and .03 to Rule 7.35B).
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<bullet> Commentaries .01, .02, .03, .04, .05, and .07 to Rule
7.35A;
<bullet> Commentaries .01 and .02 to Rule 7.35C; and
<bullet> Amendments to Rule 36.30.
The first and second phases of the reopening of the Trading Floor
are subject to safety measures designed to prevent the spread of COVID-
19. To meet these safety measures, Floor brokers and DMM units that
have chosen to return to the Trading Floor are operating with reduced
staff. The Exchange is therefore proposing to extend Commentaries .01,
.02, .03, .04, 05, and .07 to Rule 7.35A, Commentaries .01 and .02 to
Rule 7.35C, and the amendments to Rule 36.30 until the earlier of July
31, 2022 or such time that there is a full reopening of the Trading
Floor facilities to DMMs.
The Exchange is not proposing any substantive changes to these
Rules.
2. Statutory Basis
The proposed rule change is consistent with Section 6(b) of the
Act,\10\ in general, and furthers the objectives of Section 6(b)(5) of
the Act,\11\ in particular, in that it 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 facilitating transactions in securities, and to
remove impediments to and perfect the mechanism of a free and open
market and a national market system.
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\10\ 15 U.S.C. 78f(b).
\11\ 15 U.S.C. 78f(b)(5).
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To reduce the spread of COVID-19, the CEO of the Exchange made a
determination under Rule 7.1(c)(3) that beginning March 23, 2020, the
Trading Floor facilities located at 11 Wall Street in New York City
would close and the Exchange would move, on a temporary basis, to fully
electronic trading. On May 14, 2020, the CEO made a determination under
Rule 7.1(c)(3) that, beginning May 26, 2020, the Trading Floor would be
partially reopened to allow a subset of Floor brokers to return to the
Trading Floor. On June 15, 2020, the CEO made a determination under
Rule 7.1(c)(3) that, beginning June 17, 2020, DMM units may choose to
return a subset of staff to the Trading Floor.
The Exchange believes that the proposed rule change would remove
impediments to and perfect the mechanism of a free and open market and
a national market system because the Trading Floor has not yet reopened
in full to DMMs or Floor brokers. Accordingly, the Exchange believes
that the temporary rule changes in effect pursuant to the Commentaries
to Rules 7.35A and 7.35C and amendments to Rule 36.30, which are
intended to be in effect during the temporary period while the Trading
Floor has not yet opened in full to DMMs, should be extended until such
time that there is a full reopening of the Trading Floor facilities to
DMMs. The Exchange is not proposing any substantive changes to these
Rules.
The Exchange believes that, by clearly stating that this relief
will be in effect through the earlier of a full reopening of the
Trading Floor facilities to DMMs or the close of the Exchange on July
31, 2022, market participants will have advance notice of the temporary
period during which the Commentaries to Rules 7.35A and 7.35C and
amendments to Rule 36.30 will be in effect.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change would
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed rule change is
not designed to address any competitive issues but rather would extend
the period during which Commentaries .01, .02, .03, .04, 05, and .07 to
Rule 7.35A; Commentaries .01 and .02 to Rule 7.35C; and amendments to
Rule 36.30 will be in effect. These Commentaries are intended to be in
effect during the temporary period while the Trading Floor has not yet
been opened in full to DMMs and Floor brokers and are currently due to
expire on March 31, 2022. Because the Trading Floor has not been opened
in full to DMMs, the Exchange proposes to extend the
[[Page 20481]]
temporary period for these temporary rules to end on the earlier of a
full reopening of the Trading Floor facilities to DMMs or after the
Exchange closes on July 31, 2022.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were solicited or received with respect to the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A)(iii) of the Act \12\ and Rule 19b-4(f)(6) thereunder.\13\
Because the proposed rule change does not: (i) Significantly affect the
protection of investors or the public interest; (ii) impose any
significant burden on competition; and (iii) become operative prior to
30 days from the date on which it was filed, or such shorter time as
the Commission may designate, if consistent with the protection of
investors and the public interest, the proposed rule change has become
effective pursuant to Section 19(b)(3)(A) of the Act and Rule 19b-
4(f)(6)(iii) thereunder.
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\12\ 15 U.S.C. 78s(b)(3)(A)(iii).
\13\ 17 CFR 240.19b-4(f)(6).
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A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b4(f)(6)(iii),\15\ the Commission
may designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposal
may become operative immediately upon filing.
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\14\ 17 CFR 240.19b-4(f)(6).
\15\ 17 CFR 240.19b-4(f)(6)(iii).
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The Commission believes that waiver of the operative delay is
consistent with the protection of investors and the public interest
because it will allow the rules discussed above to remain in effect
during the temporary period during which the Trading Floor has not yet
been reopened in full to DMMs because of health precautions related to
the Covid-19 pandemic. Accordingly, the Commission hereby waives the
30-day operative delay and designates the proposal operative upon
filing.\16\
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\16\ For purposes only of accelerating the operative date of
this proposal, the Commission has considered the proposed rule's
impact on efficiency, competition, and capital formation. 15 U.S.C.
78c(f).
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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) \17\ of the Act to determine whether the proposed
rule change should be approved or disapproved.
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\17\ 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="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#5624233a337b35393b3b333822251625333578313920"><span class="__cf_email__" data-cfemail="2654534a430b45494b4b434852556655434508414950">[email protected]</span></a>. Please include
File Number SR-NYSE-2022-18 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-2022-18. 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 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-2022-18 and should be submitted on
or before April 28, 2022.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12), (59).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2022-07343 Filed 4-6-22; 8:45 am]
BILLING CODE 8011-01-P
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