Notice2022-27910
Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Change to Increase Certain Annual Fees Set Forth in Section 141 of the NYSE American Company Guide
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
December 23, 2022
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 87 Issue 246 (Friday, December 23, 2022)</title>
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[Federal Register Volume 87, Number 246 (Friday, December 23, 2022)]
[Notices]
[Pages 79024-79026]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-27910]
[[Page 79024]]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-96530; File No. SR-NYSEAMER-2022-56]
Self-Regulatory Organizations; NYSE American LLC; Notice of
Filing and Immediate Effectiveness of Proposed Change to Increase
Certain Annual Fees Set Forth in Section 141 of the NYSE American
Company Guide
December 19, 2022.
Pursuant to section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on December 13, 2022, NYSE American LLC (``NYSE American'' 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 Section 141 of the NYSE American
Company Guide (the ``Company Guide') to amend its annual fees charged
to issuers of listed equity securities. 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 its annual fees charged to issuers
of listed equity securities as set forth in Section 141 of the Company
Guide. The proposed changes will take effect from the beginning of the
calendar year commencing on January 1, 2023.
The Exchange currently charges an annual fee of $50,000 to issuers
with 50 million or fewer shares outstanding and an annual fee of
$70,000 to issuers with more than 50 million shares outstanding. The
Exchange proposes to increase the annual fee for issuers with 50
million or fewer shares outstanding to $55,0000 [sic], and to increase
the annual fee for issuers with more than 50 million shares outstanding
to $75,000.
The proposed increase in the annual fee rates reflects increases in
the costs the Exchange incurs in providing services to listed companies
on an ongoing basis, as well as increases in the costs of conducting
its related regulatory activities. As described below, the Exchange
proposes to make the aforementioned fee increases to better reflect the
Exchange's costs related to listing equity securities and the
corresponding value of such listing to companies.
The revised annual fees will be applied in the same manner to all
issuers with listed securities in the affected categories and the
Exchange believes that the changes will not disproportionately affect
any specific category of issuers.
The Exchange also proposes to remove from Section 141 text
referring to fee rates that are no longer applied as this reference is
no longer relevant.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with section 6(b) of the Act,\4\ in general, and furthers the
objectives of section 6(b)(4) \5\ of the Act, in particular, in that it
is designed to provide for the equitable allocation of reasonable dues,
fees, and other charges. The Exchange also believes that the proposed
rule change is consistent with section 6(b)(5) of the Act,\6\ in that
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, or dealers.
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\4\ 15 U.S.C. 78f(b).
\5\ 15 U.S.C. 78f(b)(4).
\6\ 15 U.S.C. 78f(b)(5).
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The Exchange believes that it is not unfairly discriminatory and
represents an equitable allocation of reasonable fees to amend Section
141 to increase the annual fees for listed equity securities as set
forth above because of the increased costs incurred by the Exchange
since it established the current rates.
The Proposed Changes Are Reasonable
The Exchange believes that the proposed changes to its annual fee
schedule are reasonable. In that regard, the Exchange notes that its
general costs to support its listed companies have increased, including
due to price inflation. The Exchange also continues to expand and
improve the services it provides to listed companies. Specifically, the
Exchange has (among other things) increased expenditure on listed
companies and the value of an NYSE American listing by: making
improvements to NYSE Connect, an online service that provides listed
companies with access to in-depth information to better understand the
trading of their securities; and launching the NYSE Institute, whose
focus includes providing thought leadership and advocacy on behalf of
listed companies. The Exchange notes that companies listed on both the
New York Stock Exchange and NYSE American all benefit from the
foregoing services.
The Exchange operates in a highly competitive marketplace for the
listing of the various categories of securities affected by the
proposed annual fee adjustments. The Commission has repeatedly
expressed its preference for competition over regulatory intervention
in determining prices, products, and services in the securities
markets. Specifically, in Regulation NMS,\7\ the Commission highlighted
the importance of market forces in determining prices and SRO revenues
and, also, recognized that current regulation of the market system
``has been remarkably successful in promoting market competition in its
broader forms that are most important to investors and listed
companies.'' \8\
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\7\ Release No. 34-51808 (June 9, 2005); 70 FR 37496 (June 29,
2005).
\8\ See Regulation NMS, 70 FR at 37499.
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[[Page 79025]]
The Exchange believes that the ever-shifting market share among the
exchanges with respect to new listings and the transfer of existing
listings between competitor exchanges demonstrates that issuers can
choose different listing markets in response to fee changes.
Accordingly, competitive forces constrain exchange listing fees. Stated
otherwise, changes to exchange listing fees can have a direct effect on
the ability of an exchange to compete for new listings and retain
existing listings.
Given this competitive environment, the adoption of an increase to
the annual fees for various categories of equity securities represents
a reasonable attempt to address the Exchange's increased costs in
servicing these listings while continuing to attract and retain
listings.
The Exchange proposes to make the aforementioned fee increases in
Section 141 to better reflect the value of such listing to issuers.
The Proposal Is An Equitable Allocation of Fees
The Exchange believes its proposal equitably allocates its fees
among its market participants.
The Exchange believes that the proposed amendments to the annual
fees for equity securities are equitable because they do not change the
existing framework for such fees, but simply increase the amount of
certain of the fees to reflect increased operating costs. Similarly, as
the fee structure remains effectively unchanged apart from increases in
the rates paid by all issuers, the changes to annual fees for equity
securities neither target nor will they have a disparate impact on any
particular category of issuer of equity securities.
The Proposal Is Not Unfairly Discriminatory
The Exchange believes that the proposal is not unfairly
discriminatory. The proposed fee changes are not unfairly
discriminatory among issuers of operating company equity securities
because the same fee schedule will apply to all such issuers. The
Exchange does not propose to increase the minimum annual fees charged
for any of the various classes of derivative securities products,
closed end funds, bonds, or warrants for which annual fees are also set
forth in Section 141. The Exchange believes that this is not unfairly
discriminatory to the issuers of operating company equity securities as
the benefits the issuers of these other classes of securities receive
in connection with their listings are consistent with the current fee
levels paid by those issuers. This is because those types of listings
do not generally benefit to the same extent from services provided by
the Exchange as do issuers of operating company equity securities.
Further, the Exchange operates in a competitive environment and its
fees are constrained by competition in the marketplace. Other venues
currently list all of the categories of securities covered by the
proposed fees and if a company believes that the Exchange's fees are
unreasonable it can decide either not to list its securities or to list
them on an alternative venue.
For the foregoing reasons, the Exchange believes that the proposal
is consistent with the Act.
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. The proposed rule change is
designed to ensure that the fees charged by the Exchange accurately
reflect the services provided and benefits realized by listed
companies. The market for listing services is extremely 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
fee changes impose a burden on competition.
Intramarket Competition
The proposed amended fees will be charged to all listed issuers on
the same basis. The Exchange does not believe that the proposed amended
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 new securities on other exchanges
and transfer listings to other exchanges if they deem fee levels at
those other venues to be more favorable. Because competitors are free
to modify their own fees, and because issuers may change their chosen
listing venue, the Exchange does not believe its proposed fee change
can impose any burden on intermarket competition.
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 has become effective upon filing pursuant
to section 19(b)(3)(A) \9\ of the Act and paragraph (f) thereunder. At
any time within 60 days of the filing of the 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.
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\9\ 15 U.S.C. 78s(b)(3)(A).
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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#3f4d4a535a125c5052525a514b4c7f4c5a5c11585049"><span class="__cf_email__" data-cfemail="9defe8f1f8b0fef2f0f0f8f3e9eeddeef8feb3faf2eb">[email protected]</span></a>. Please include
File Number SR-NYSEAMER-2022-56 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-NYSEAMER-2022-56. 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
[[Page 79026]]
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-NYSEAMER-2022-56 and should
be submitted on or before January 13, 2023.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
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\10\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2022-27910 Filed 12-22-22; 8:45 am]
BILLING CODE 8011-01-P
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