Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Rule 7.18E Regarding Trading Halts

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<title>Federal Register, Volume 91 Issue 164 (Wednesday, August 26, 2026)</title>
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[Federal Register Volume 91, Number 164 (Wednesday, August 26, 2026)]
[Notices]
[Pages 55132-55138]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17363]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106175; File No. SR-NYSEAMER-2026-73]


Self-Regulatory Organizations; NYSE American LLC; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend 
Rule 7.18E Regarding Trading Halts

August 21, 2026.
    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 August 11, 2026, 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 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 amend Rule 7.18E (``Trading Halts'') to 
set forth specific requirements for halting and resuming trading in a 
security that is subject to certain corporate actions. The proposed 
rule change is available on the Exchange's website at <a href="http://www.nyse.com">www.nyse.com</a> and 
at the principal office of the Exchange.

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
    NYSE American LLC (``NYSE American'' or the ``Exchange'') proposes 
to amend Rule 7.18 (``Trading Halts'') to set forth specific 
requirements for halting and resuming trading in a security that is 
subject to certain corporate actions.
    In conjunction with the industry's plans for the introduction of 
trading 23 hours a day, 5 days a week (``23/5 Trading''), the 
Exchange's affiliate exchange, NYSE Arca, Inc. (``NYSE Arca''), filed 
with the Commission a proposal to amend its rules to set forth specific 
requirements for halting trading in a security for which the Exchange 
is the Primary Listing Market that is subject to certain issuer-related 
corporate actions and for resuming trading in that security using a 
Trading Halt Auction. NYSE Arca explained that the proposal would 
expand on the framework already in place with respect to its authority 
to declare a mandatory regulatory halt in advance of a reverse stock 
split, thereby providing greater transparency and clarity with respect 
to the situations in which trading certain securities subject to 
issuer-related corporate actions will be halted and the process through 
which that halt will be implemented and terminated. On July 8, 2026, 
the Commission published a notice of filing and immediate effectiveness 
of NYSE Arca's proposal.\4\
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    \4\ See Securities Exchange Release No. 105862 (July 8, 2026), 
91 FR 42999 (July 13, 2026) (SR-NYSEARCA-2026-71) (Notice of Filing 
and Immediate Effectiveness of Proposed Rule Change to Amend Rule 
7.18-E Regarding Regulatory Halts for Corporate Actions and Issuer-
Related Events).
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    The Exchange now proposes to make the same changes to its own 
rules. The Exchange understands that the other Primary Listing Markets 
also plan to implement substantially identical versions of this rule to 
ensure consistent treatment of corporate actions across the market.
Background
    In 2024, the Commission noticed for immediate effectiveness the 
Exchange's filing establishing the Exchange's authority to declare a 
mandatory regulatory halt in a security for which the Exchange is the 
Primary Listing Market when that security is subject to a reverse stock 
split.\5\ Specifically, the Exchange proposed halting such a security 
before the end of the Late Trading Session on the day immediately 
before the effective date of a reverse stock split, with trading to 
resume with a Trading Halt Auction at 9:00 a.m. Eastern Time (``ET'')--
instead of 4:00 a.m. ET--on the next trading day. The Exchange noted 
that because it processes reverse stock splits overnight, having the 
security reopen for trading at 4:00 a.m. ET raised the ``potential for 
errors resulting in a material effect on the market resulting from 
market participants' processing of the reverse stock split, including 
incorrect adjustment or entry of orders.'' \6\ The Exchange explained 
that this concern could be rectified by imposing a trading halt, 
``which would prohibit pre-market trading immediately after a reverse 
stock split'' and open trading in such securities at 9:00 a.m. ET 
instead of 4:00 a.m. ET.\7\ The Exchange further noted that imposing 
such a trading halt and deferring the opening of the security until 
9:00 a.m. ET would ``allow the Exchange and market participants to 
better detect any errors or problems with orders for the security 
resulting from the reverse stock split before trading in the security 
begins and thereby avoid any material effect on the market.'' \8\ In 
approving the substantively identical proposal of

[[Page 55133]]

another market, the Commission noted that the proposal was ``designed 
to promote fair and orderly trading on the Exchange by reducing the 
potential for order entry or other system-related errors associated 
with a reverse stock split in a security for which [the Exchange] is 
the Primary Listing Market.'' \9\
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    \5\ See Securities Exchange Act Release No. 99863 (March 27, 
2024), 89 FR 22757 (April 2, 2024) (SR-NYSEAMER-2024-22) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change to Amend 
Rule 7.18E) (``Reverse Stock Split Proposal'').
    \6\ Id., 89 FR at 22769.
    \7\ Id., 89 FR at 22758.
    \8\ Id.
    \9\ See Securities Exchange Act Release No. 98878 (November 7, 
2023), 88 FR 78081 (November 14, 2023) SR-NASDAQ-2023-036) (Notice 
of Filing of Amendment No. 1 and Order Granting Accelerated Approval 
of Proposed Change, as Modified by Amendment No. 1, Relating to 
Nasdaq Rules 4120 and 4753).
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    With the launch of 23/5 Trading later this year, the concerns that 
led the Exchange to adopt a regulatory halt framework for reverse stock 
splits will likewise arise with respect to a broader set of corporate 
actions. Although the Exchange does not currently plan to extend its 
own trading hours, the Exchange is a primary listing market whose 
listed securities may trade on any venue, including NYSE Arca and other 
exchanges that opt to offer 23/5 Trading. Under the current market 
structure, the Exchange processes corporate action-related changes and 
updates for its listed securities during overnight hours. Other market 
participants, including broker-dealers, likewise use that overnight 
period to process corporate action-related information and adjust 
quotes, orders, and related instructions accordingly.
    Under 23/5 Trading, however, trading in the Exchange's listed 
securities will resume on other markets at 9:00 p.m., only one hour 
after the close of trading at 8:00 p.m. Consequently, there will no 
longer be a substantial non-trading window during which the Exchange 
and market participants can process such corporate actions without 
potentially impacting overnight trading on other markets. These 
corporate actions require coordinated updates across Exchange and 
market-participant systems--including adjustments to orders, quotes, 
and related instructions--to ensure orderly trading and accurate 
pricing and execution in the affected security. With only a one-hour 
pause between trading days, neither the Exchange nor other market 
participants would have sufficient time to process and incorporate 
corporate action-related information--such as adjustments to systems, 
orders, quotes, and related instructions--without the risk that trading 
could occur in the affected security based on incomplete or 
inconsistent information. In short, the continued trading of securities 
undergoing such corporate actions could potentially result in price 
dislocations, investor confusion, erroneous executions, and general 
operational risk.
    To address these concerns, the Exchange proposes to implement the 
same changes that the Commission recently noticed for immediate 
effectiveness on NYSE Arca. The Exchange proposes to build on the 
framework established under Rule 7.18E for reverse stock splits by 
extending that rule's mandatory regulatory halt requirement to 
additional corporate actions that, much like reverse stock splits, 
require a clearly defined and transparent pause in trading to permit 
coordinated processing. As proposed, under 23/5 Trading, if a security 
is affected by any of the corporate actions enumerated in the proposal, 
the Exchange would implement a mandatory regulatory halt \10\ in that 
security before the start of overnight trading on other markets at 9:00 
p.m. ET, and trading would resume with a Trading Halt Auction at 8:00 
a.m. ET.\11\ The Exchange believes these changes would provide 
important operational safeguards by ensuring that both the Exchange and 
market participants have adequate time to process such corporate 
actions in a nearly continuous trading environment, thereby preserving 
a protection that has historically been implicit in a market structure 
with limited trading hours.
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    \10\ Notification of the declaration and termination of the 
proposed regulatory halt would be provided in accordance with Rule 
7.18E.
    \11\ As described below, the Exchange also proposes a conforming 
change to move the time for the Trading Halt Auction that re-opens 
trading after a reverse stock split regulatory halt to 8:00 a.m. ET, 
from the current time of 9:00 a.m. ET.
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Proposed Rule Change
    Implicit in Rule 7.18E is the recognition that certain corporate 
actions--such as reverse stock splits--require a clearly defined and 
transparent pause in trading to permit their coordinated processing and 
thereby avoid the risks associated with concurrent trading in the 
affected security while that processing is underway. The same principle 
applies to the categories of corporate actions addressed in this 
proposal, particularly in the context of nearly continuous trading.
    In the context of 23/5 Trading, the Exchange has determined--based 
on discussions both internal and with industry participants, including 
the other Primary Listing Markets--that, similar to reverse stock 
splits, certain other corporate actions require a clearly defined and 
transparent pause in trading to facilitate their coordinated processing 
by the Exchange and other market participants before orderly trading 
may resume in the affected security.
    Specifically, the Exchange believes that the following issuer-
related corporate actions are analogous to reverse stock splits with 
respect to processing requirements and thus warrant analogous treatment 
with respect to their categorization and regulatory response: (1) 
changes in trading symbol, (2) changes in CUSIP number, (3) dividends 
equal to at least 25% of the Official Closing Price; \12\ (4) stock 
splits (including forward and reverse stock splits); (5) De-SPAC 
transactions; (6) spin-off transactions; (7) security-type changes; (8) 
mergers or similar mandatory exchanges of shares; and (9) any other 
corporate action or issuer-related event not enumerated above, for 
which the Exchange determines that a regulatory halt is appropriate for 
the maintenance of fair and orderly markets, the protection of 
investors, or otherwise in the public interest, as described below. 
Like reverse stock splits, these corporate actions all involve non-
discretionary changes to core security characteristics that require 
synchronized updates across Exchange and market-participant systems.
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    \12\ The term ``Official Closing Price'' is defined in Rule 
1.1E(gg).
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    Accordingly, the Exchange proposes to amend Rule 7.18E and make 
certain conforming changes to incorporate such corporate actions into 
the regulatory framework established for corporate actions consisting 
of reverse stock splits, as follows.
    The Exchange proposes to amend Rule 7.18E(b)(1)(A)(iii) to extend 
the current reverse stock split regulatory halt framework to the 
categories of other corporate actions discussed above that, in addition 
to reverse stock splits, would be subject to the mandatory regulatory 
requirements of that rule. The Exchange accordingly proposes to delete 
the current text of Rule 7.18E(b)(1)(A)(iii) and replace it with 
revised text stating that the Exchange will declare a Regulatory Halt:

for a security for which the Exchange is the Primary Listing Market 
that is the subject of an issuer corporate action or other issuer-
related event referenced below after the end of the Late Trading 
Session and before 9:00 p.m. ET on the day immediately preceding the 
market effective date of such issuer corporate action or issuer-
related event (``Corporate Action Halt''). A security subject to an 
issuer corporate action or issuer event-related Regulatory Halt 
pursuant to this rule will resume trading with a Trading Halt 
Auction at 8:00 a.m. ET on the market

[[Page 55134]]

effective date of such corporate action or issuer-related event.

    The Exchange proposes to further amend Rule 7.18E(b)(1)(A)(iii) to 
provide that ``[f]or purposes of this rule, the following shall be 
deemed corporate actions or issuer-related events subject to the 
mandatory Regulatory Halt provisions of this rule,'' followed by the 
nine categories of corporate actions discussed above that would be 
subject to a mandatory regulatory halt under that provision. As 
proposed, the nine categories of enumerated corporate actions subject 
to a mandatory regulatory halt would consist of the following corporate 
actions: (1) trading symbol changes; \13\ (2) changes in CUSIP; \14\ 
(3) dividends equal to at least 25% of the Official Closing Price; \15\ 
(4) forward (and reverse) stock splits; \16\ (5) de-SPAC transactions; 
\17\ (6) spin-off transactions; \18\ (7) security-type changes; \19\ 
(8) mergers/mandatory exchanges; \20\ and (9) other corporate actions 
or issuer-related events not specifically enumerated in (1)-(8) above 
as more particularly described below.\21\
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    \13\ As proposed, Rule 7.18E(b)(1)(A)(iii)(1) would define 
changes to any ``Trading Symbol'' as ``a change in the issuer's 
trading symbol.''
    \14\ As proposed, Rule 7.18E(b)(1)(A)(iii)(2) would define 
changes in ``CUSIP'' as ``[a] change in the issuer's Committee on 
Uniform Securities Identification Procedures (``CUSIP'').''
    \15\ As proposed, Rule 7.18E(b)(1)(A)(iii)(3) would define 
``Dividend'' transactions as ``[s]tock dividends, whether payable in 
cash, stock, or another security of the issuer (or a subsidiary or 
other affiliate of the issuer), or any combination thereof, other 
than stock splits or similar adjustments described in paragraph (4), 
where the Exchange determines that such dividend has an aggregate 
value per share that is equal to at least 25% of the Official 
Closing Price of the affected security on the date immediately 
preceding the ex-date of such dividend; provided, however, that if 
no such Official Closing Price is available, the Exchange shall use 
the most recent available Official Closing Price for such shares (or 
other securities).''
    \16\ As proposed, Rule 7.18E(b)(1)(A)(iii)(4) would define 
``Forward, Reverse Stock Splits'' as ``[a]ny stock split or similar 
adjustment that affects the number of outstanding shares of an 
issuer or changes the relative equity ownership of holders of such 
shares, including any forward or reverse stock split, subdivision, 
reclassification, or combination of shares, or any similar 
transaction that has the effect of adjusting the number of 
outstanding shares or the relative equity ownership of holders, 
whether effected pursuant to a fixed or variable exchange ratio or 
otherwise, and whether occurring as a stand-alone action or in 
conjunction with any other corporate action or issuer-related 
event.''
    \17\ As proposed, Rule 7.18E(b)(1)(A)(iii)(5) would define a 
``De-SPAC'' transaction as ``[a]ny De-SPAC transaction, as that term 
is defined in Item 1601(a) of Regulation S-K.''
    \18\ As proposed, Rule 7.18E(b)(1)(A)(iii)(6) would define a 
``Spin-off'' transactions as ``[a]ny transaction in which an issuer 
distributes to its security holders, on a pro rata basis, (i) equity 
securities of a subsidiary or other business that is separated into 
a new or existing standalone issuer; or (ii) any different class of 
securities.''
    \19\ As proposed, Rule 7.18E(b)(1)(A)(iii)(7) would define a 
``Security Type Change'' as ``[a]ny change in the form, type, class, 
or designation of a listed security, including, without limitation, 
(i) American Depositary Receipts or American Depositary Shares 
(``ADR''/``ADS'') to ordinary shares (and ordinary shares to ADR/
ADS); (ii) conversions between ordinary shares and common stock (in 
either direction); and (iii) similar transactions.''
    \20\ As proposed, Rule 7.18E(b)(1)(A)(iii)(8) would define a 
``Merger/Mandatory Exchange'' as ``[a]ny merger, consolidation, 
statutory share exchange, or similar business combination or 
corporate action that results in the affected security being 
mandatorily exchanged, converted, redeemed, or cancelled for cash, 
securities, or other consideration (including an exchange into 
securities of a successor issuer); provided, however, that this 
paragraph (8) does not include transactions that solely effect a 
change in the issuer's (company) name without a mandatory exchange 
of the affected security.''
    \21\ As proposed, Rule 7.18E(b)(1)(A)(iii)(9) would define any 
``Other Corporate Action or Issuer-Related Event'' as ``[a]ny other 
corporate action or issuer-related event not enumerated in (1)-(8) 
above for which the Exchange determines, based on the totality of 
the circumstances and any information available to it, including 
without limitation information obtained from the issuer, that a 
Regulatory Halt is necessary or appropriate for the maintenance of 
fair and orderly markets, the protection of investors, or otherwise 
in the public interest.''
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    Specifically, proposed Rule 7.18E(b)(1)(A)(iii)(9) would require 
the Exchange to declare a regulatory halt for any other corporate 
action or issuer-related event not enumerated in (1)-(8) above for 
which the Exchange determines, based on the totality of the 
circumstances and any information available to it, including without 
limitation information obtained from the issuer, that a regulatory halt 
is necessary or appropriate for the maintenance of fair and orderly 
markets, the protection of investors, or otherwise in the public 
interest.
    This residual provision is designed to capture issuer-related 
corporate actions that, while not enumerated in Rule 
7.18E(b)(1)(A)(iii)(1)-(8), raise operational or market-integrity 
concerns comparable to those actions. Once the Exchange determines that 
such a corporate action warrants a Regulatory Halt based on its 
application of the standards in Rule 7.18E(b)(1)(A)(iii)(9), 
implementation of the regulatory halt would be required.\22\ 
Accordingly, the provision is intended to promote consistent regulatory 
treatment across comparable corporate actions and to preserve 
transparency and uniformity in the application of the proposed 
framework in a 23/5 Trading environment.
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    \22\ Such determination would be made by the Exchange's senior 
trading and regulatory officials in advance of the corporate action 
effective date.
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Timing of Corporate Action Regulatory Halts
    The Exchange proposes that under 23/5 Trading, the mandatory 
regulatory halts described above in proposed Rule 7.18E(b)(1)(A)(iii) 
would be implemented after the conclusion of the Late Trading Session 
and before the start of overnight trading on other markets at 9:00 p.m. 
ET. This timing differs from the Exchange's current process for reverse 
stock split regulatory halts, pursuant to which the Exchange implements 
the mandatory regulatory halt at 7:50 p.m. ET, before the end of the 
Late Trading Session, on the day immediately before the reverse split 
becomes effective. That approach has been feasible in the reverse stock 
split context, but this proposal would extend the mandatory regulatory 
halt framework beyond reverse stock splits to a broader set of 
corporate actions that, although differing in form, share the need for 
coordinated systems and reference-data updates before trading may 
resume in an orderly manner. Because some of those actions may involve 
entirely new symbols or CUSIPs that would not yet exist at 7:50 p.m. ET 
on the prior trading day, the Exchange does not believe that the 
current reverse stock split timing can practicably be applied across 
the full set of covered corporate actions. The Exchange therefore 
believes it is reasonable, in the context of 23/5 Trading, to adopt a 
single, uniform implementation time for all halts under proposed Rule 
7.18E(b)(1)(A)(iii)--after the Late Trading Session and before 
overnight trading begins on other markets at 9:00 p.m. ET--which would 
facilitate consistent treatment of covered corporate actions and enable 
the halts to be implemented through an automated process.\23\ This 
timing would apply to

[[Page 55135]]

each of the corporate actions addressed in this filing, as well as to 
the Exchange's existing reverse stock split regulatory halt. The 
proposed change to the timing for the implementation of the reverse 
stock split regulatory halt is therefore conforming in nature, as it is 
intended only to align that halt with the trading session structure 
under 23/5 Trading.
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    \23\ See Exchange proposed Rule 7.18E(b)(1)(A)(iii). Shifting 
the implementation time for such regulatory halts from 7:50 p.m. to 
before 9:00 p.m. would not have a material effect on market 
participants. The Exchange notes that market participants, including 
alternative trading systems (``ATSs''), would have advance notice of 
the types of issuer corporate actions addressed in this proposal 
through the Exchange's existing issuer notification, market notice, 
and public dissemination mechanisms. Under the Exchange's existing 
listing and related rules and/or procedures, listed issuers are 
required in various circumstances to provide the Exchange advance 
notice of corporate actions and to publicly disclose such events 
before they become effective. In addition, the Exchange's 
established corporate action processing and market notification 
procedures generally result in the Exchange receiving notice of, and 
disseminating information concerning, other covered corporate 
actions sufficiently in advance of their effectiveness to support 
the orderly implementation of the proposed halt process. 
Accordingly, the Exchange believes that ATSs and other market 
participants would have adequate advance awareness of the types of 
corporate actions addressed by this proposal to make informed 
business decisions with respect to the affected securities, and that 
proposed Rule 7.18E(b)(1)(A)(iii) thus provides a transparent and 
appropriate mechanism for addressing such corporate actions in a 23/
5 Trading environment.
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Resumption of Trading After Corporate Action-Related Regulatory Halts
    The Exchange proposes to amend Rule 7.18E(b)(5)(B)(iii) to provide 
that under 23/5 Trading, trading in a security halted pursuant to 
proposed Rule 7.18E(b)(1)(A)(iii) would resume ``at 8:00 a.m. ET with a 
Trading Halt Auction on the market effective date of such corporate 
action or issuer-related event.'' \24\ This is similar to the 
Exchange's current process with respect to reverse stock split 
regulatory halts, where the Exchange resumes trading at 9:00 a.m. ET, 
with a modification to 8:00 a.m. ET from 9:00 a.m. ET.
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    \24\ See proposed Rule 7.18E(b)(5)(B)(iii).
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    In supporting its reverse stock split-related proposal, the 
Exchange explained that re-opening the security at 9:00 a.m. ET, 
``which is after the start of early trading on other markets and the 
Exchange but before the opening of the Exchange's Core Trading Session 
at 9:30 a.m., would promote fair and orderly trading, protect 
investors, and promote the public interest by allowing market 
participants and the Exchange a better opportunity to notice errors or 
problems with orders for the security because it would be opening for 
trading at a unique time, and not at a time when thousands of other 
securities open for trading.'' \25\
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    \25\ See Reverse Stock Split Proposal, supra note 5, 89 FR at 
22758.
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    Since the introduction of the reverse stock split regulatory halt 
in 2024, the Exchange has determined that it would be preferable to re-
open from a reverse stock split halt at 8:00 a.m. ET instead of 9:00 
a.m. ET. That alteration would provide for an additional hour of 
liquidity formation and price discovery before the 9:30 a.m. ET Core 
Opening Auction, while still being consistent with the rationales cited 
above for re-opening trading at a ``unique'' time. Specifically, the 
Exchange believes that resuming trading in the affected securities at 
8:00 a.m. ET is appropriate because the proposed pause in trading 
provides a sufficient and transparent interval for the Exchange and 
market participants to complete the processing of such corporate 
actions and the earlier resumption of trading would provide the 
affected securities with additional price discovery and liquidity 
formation opportunities before participating in the Core Opening 
Auction at 9:30 a.m. ET.
    Consistent with that rationale, the Exchange proposes that the 
securities subject to the mandatory regulatory halts addressed in this 
filing, including reverse stock splits, would re-open at 8:00 a.m. 
ET.\26\ To effectuate this change, the Exchange proposes to amend the 
re-opening time for securities subject to a reverse stock split-related 
regulatory halt to 8:00 a.m. ET (from 9:00 a.m. ET) and to apply that 
same 8:00 a.m. ET re-opening time to the additional corporate action-
related regulatory halts covered under proposed Rule 
7.18E(b)(1)(A)(iii). This proposed change is based on the Exchange's 
experience with reverse stock splits and is designed to promote 
uniformity and transparency with respect to the resumption of trading 
in securities subject to a corporate actions-related regulatory halt 
under proposed Rule 7.18E(b)(1)(A)(iii).
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    \26\ See proposed Rule 7.18E(b)(1)(A)(iii).
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    In sum, the corporate actions addressed in this proposal raise 
operational and market integrity concerns in a 23/5 Trading environment 
that mirror the concerns addressed by the Commission in approving the 
Exchange's Reverse Stock Split Proposal. Under 23/5 Trading, the 
Exchange will no longer have a substantial non-trading window during 
which it and other market participants can process these corporate 
actions before trading resumes. With only one hour between trading 
days, neither the Exchange nor other market participants would have 
sufficient time to process and incorporate corporate action-related 
information, resulting in a risk of price dislocations, investor 
confusion, erroneous executions, and broader operational issues. The 
Exchange believes that extending its reverse stock split regulatory 
framework to the additional corporate actions described herein would 
appropriately preserve, in a 23/5 Trading environment, the safeguard 
implicit in the current market structure--specifically, the overnight 
pause in trading that allows for coordinated processing and related 
systems and reference-data updates. Accordingly, the proposal would 
promote fair and orderly trading, mitigate operational risk, and help 
ensure that trading resumes only after those updates have been 
completed.
Implementation
    The Exchange understands that the other Primary Listing Exchanges 
plan to implement substantially identical versions of this rule to 
ensure consistent treatment of corporate actions across the market. The 
Exchange proposes that the changes in this proposal and in the other 
Primary Listing Exchanges' similar filings would become operative at 
the commencement of 23/5 Trading.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\27\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\28\ in particular, in that it is designed to 
promote just and equitable principles of trade, 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. The Exchange believes that the proposed rules will provide 
greater transparency and clarity with respect to the situations in 
which trading will be halted due to certain corporate actions and the 
process through which that halt will be implemented and terminated, as 
discussed below.
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    \27\ 15 U.S.C. 78f(b).
    \28\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that extending the reverse stock split 
regulatory halt framework to the additional, analogous corporate 
actions addressed in this proposal would promote free and open trade, 
protect investors, and serve the public interest by helping to ensure 
fair and orderly markets. Specifically, the proposal would preserve and 
apply an established, transparent framework for pausing and resuming 
trading in securities subject to reverse stock splits to certain 
corporate actions with analogous processing requirements, so that 
trading in an affected security does not occur before the corporate 
action has been processed and the related systems and reference-data 
updates have been completed and applied across the market.
    With respect to the specific categories of corporate actions 
addressed in this proposal, the Exchange believes that it is reasonable 
and appropriate to extend the regulatory halt framework applicable to 
reverse stock splits to certain categories of corporate actions with 
analogous processing requirements, as more specifically described 
above. Like reverse stock splits, these corporate actions all

[[Page 55136]]

involve non-discretionary changes to core security characteristics that 
require synchronized updates across Exchange and market-participant 
systems.
    Under the current market structure, an overnight pause in trading 
has historically provided a defined non-trading window during which the 
Exchange and other market participants have sufficient time to process 
such corporate actions in an orderly and coordinated manner prior to 
the resumption of trading. But in the 23/5 Trading environment, with 
only one hour of non-trading time between trading days, there is a 
substantial chance that trading in an impacted security could occur 
based on incomplete, inconsistent, or partially updated information, 
giving rise to pricing anomalies, investor confusion, erroneous 
executions, and heightened operational risk. The Exchange believes the 
proposed approach promotes fair and orderly markets by helping to 
ensure that trading resumes only once systems and reference data 
concerning these corporate actions have been fully and consistently 
updated across the marketplace.
    With respect to the mandatory regulatory halts specifically 
enumerated in proposed Rule 7.18E(b)(1)(A)(iii)(1)-(8), if the 
corporate action falls within the categories enumerated in the rule, 
the Exchange will not have discretion about whether to declare a 
trading halt in the affected security.
    In addition, proposed Rule 7.18E(b)(1)(A)(iii)(9) is intended to 
operate as a residual provision covering issuer-related corporate 
actions not enumerated in Rule 7.18E(b)(1)(A)(iii)(1)-(8) that 
nonetheless raise operational or market-integrity concerns comparable 
to those presented by the enumerated actions. Under that provision, 
when the Exchange determines, based on the totality of the 
circumstances and the information available to it, including 
information obtained from the issuer, that it is necessary or 
appropriate for the maintenance of fair and orderly markets, the 
protection of investors, or otherwise in the public interest, it would 
be required to declare a regulatory halt in that security. Once the 
Exchange makes that determination, the regulatory halt would be 
mandatory, thereby avoiding ad hoc treatment once the applicable 
standard has been met. In that respect, proposed Rule 
7.18E(b)(1)(A)(iii)(9) serves as a narrow residual mechanism designed 
to promote consistent regulatory treatment across comparable corporate 
actions and to preserve transparency and uniformity in the application 
of proposed Rule 7.18E(b)(1)(A)(iii) in a 23/5 Trading environment by 
requiring the Exchange to declare a regulatory halt in such cases. The 
Exchange therefore believes that it is reasonable and appropriate to 
extend its authority to declare a regulatory halt in this instance.
    In all cases under proposed Rule 7.18E(b)(1)(A)(iii), a mandatory 
regulatory halt in the affected security would be implemented after the 
conclusion of the Late Trading Session and before the start of 
overnight trading on other markets at 9:00 p.m. ET on the date 
immediately preceding the market-effective date of the corporate 
action.
    The Exchange also believes it is reasonable and appropriate to use 
a Trading Halt Auction under Rule 7.35E to re-open trading in a 
security that is subject to a regulatory halt pursuant to this proposal 
because it is consistent with the process that the Exchange currently 
uses to re-open a security after a reverse stock split regulatory halt, 
and the operational complexity and processing demands associated with 
such corporate actions are comparable to those involved regarding 
reverse stock splits. Furthermore, using a Trading Halt Auction to re-
open trading after the regulatory halts addressed in this proposal is 
consistent with the process that is typically used by the Exchange when 
re-opening a security that has been halted under Rule 7.18E. Applying a 
uniform, previously approved framework enhances transparency and 
predictability for issuers, investors, and market participants.
    The Exchange believes that resuming trading in the corporate 
action-impacted securities addressed in this proposal at 8:00 a.m. ET 
would promote fair and orderly markets, protect investors, and serve 
the public interest by providing the Exchange and market participants 
sufficient time to process the relevant corporate actions correctly. 
The Exchange further believes that resuming trading in the affected 
securities through a Trading Halt Auction at 8:00 a.m. ET, rather than 
at 9:30 a.m. ET through a Core Open Auction, would provide a more 
focused re-opening window and a better opportunity to identify and 
address potential order-entry or processing issues before the broader 
market opening, when thousands of other securities are undergoing their 
opening process.
    The Exchange's proposal to make conforming changes to its existing 
reverse stock split regulatory halt structure to harmonize the halt 
time and re-opening time with the times proposed in this filing is 
reasonable and would promote transparency and predictability for 
issuers, investors, and market participants. As described above, the 
current practice of implementing a mandatory regulatory halt for a 
security undergoing a reverse stock split at 7:50 p.m. ET has been 
feasible in the reverse stock split context, but this proposal would 
extend the mandatory regulatory halt framework beyond reverse stock 
splits to a broader set of corporate actions that, although differing 
in form, share the need for coordinated systems and reference-data 
updates before trading may resume in an orderly manner. Because some of 
those actions may involve entirely new symbols or CUSIPs that would not 
yet exist at 7:50 p.m. ET on the prior trading day, the Exchange does 
not believe that the current reverse stock split timing can practicably 
be applied across the full set of covered corporate actions. The 
Exchange therefore believes it is reasonable, in the context of 23/5 
Trading, to adopt a single, uniform implementation time for all halts 
under proposed Rule 7.18E(b)(1)(A)(iii)--after the Late Trading Session 
and before overnight trading begins on other markets at 9:00 p.m. ET--
which would facilitate consistent treatment of comparable corporate 
actions, enhance transparency and predictability for issuers, 
investors, and market participants, and support the orderly and 
automated implementation of such halts. The Exchange also believes that 
the proposal is consistent with Section 6(b)(5) of the Act because the 
Exchange's existing issuer notification, market notice, and public 
dissemination mechanisms generally provide market participants with 
advance awareness of the types of corporate actions addressed herein, 
thereby supporting the orderly implementation of the proposed halt 
process and helping to protect investors and the public interest.
    Similarly, the Exchange believes its proposal to move the re-
opening time for a symbol after a reverse stock split regulatory halt 
to 8:00 a.m. ET from 9:00 a.m. ET would remove impediments to and 
perfect the mechanism of a free and open market and a national market 
system by creating uniformity in the re-opening times for securities 
after a corporate action regulatory halt. As discussed above, the 
Exchange believes that the proposed duration of the regulatory halt is 
appropriate to permit full processing of the proposed corporate actions 
and resuming trading in the security at an earlier time, as proposed, 
would provide the security with opportunities for enhancing price 
discovery and liquidity before

[[Page 55137]]

participating in the Core Open Auction at 9:30 a.m. ET.
    The Exchange notes that these timing harmonization changes are 
purely conforming and that, by aligning the reverse stock split 
provisions with the corporate action-related halts described in this 
filing, the proposal promotes a consistent and harmonized rule 
structure, enhances transparency and predictability for issuers, 
investors, and market participants, and reduces the potential for 
confusion.
    Overall, establishing mandatory trading halts for securities that 
are subject to the corporate actions addressed in this filing and 
resuming trading thereafter promotes fair and orderly markets and the 
protection of investors, because it allows the Exchange to protect the 
broader interests of the national market system and addresses potential 
concerns that system errors may affect immediate trading in those 
securities. The Exchange believes that with the advent of 23/5 Trading, 
the proposed rules will help the Exchange reduce the potential for 
errors resulting in a material effect on the market resulting from the 
challenge of processing such corporate actions with only a one-hour 
non-trading window between trading days. As discussed above, in a 23/5 
Trading environment, overnight trading on other markets will begin only 
one hour after trading closes on the Exchange, meaning that there will 
no longer be a substantial overnight period during which the Exchange 
can process corporate actions of the type addressed in this proposal. 
By extending the existing reverse stock split regulatory halt framework 
to those categories of corporate actions, the proposal is designed to 
preserve the safeguards currently afforded by that overnight pause.
    For these reasons, the Exchange believes that the proposed rule 
change is designed to remove impediments to and perfect the mechanism 
of a free and open market and a national market system by mitigating 
operational and market integrity risks that would otherwise arise in a 
nearly continuous trading environment. By helping to ensure that 
trading resumes only after corporate action processing has been 
completed in an orderly and coordinated manner, the proposed rule 
change promotes just and equitable principles of trade and protects 
investors and the public interest, consistent with Sections 6(b) and 
6(b)(5) of the Act.

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

    The Exchange believes the proposal will not impose a burden on 
intermarket competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because the proposed rule change 
is designed to protect investors and facilitate a fair and orderly 
market, which are both important purposes of the Act. To the extent 
that there is any impact on intermarket competition, it is incidental 
to these objectives.
    Rather, the proposed changes will promote competition by ensuring 
that trading in corporate action-affected securities resumes only when 
the Exchange has processed corporate actions in a coordinated manner 
across Exchange and market participants' systems, consistent with its 
obligations as a primary listing market, thereby avoiding concurrent 
trading and potential confusion with respect to the affected securities 
while such corporate action processing is underway. In addition, the 
Exchange believes that the proposal does not impose any burden on 
competition because it applies equally to all issuers and market 
participants. The proposal builds on an established, uniform, and 
transparent framework governing the timing of trading halts and 
resumptions in trading in connection with certain corporate actions and 
is designed to address operational and market-integrity concerns, 
rather than competitive considerations. In substance, the proposal 
preserves an operational safeguard implicit in the current market 
structure and adapts that safeguard to a nearly continuous trading 
environment by extending the well-established reverse stock split 
framework to analogous corporate actions. By helping to ensure that 
trading resumes only after systems and reference data have been updated 
in a coordinated manner, the proposal promotes fair and orderly markets 
and enhances, rather than burdens, competition.
    The Exchange does not believe that the proposed rule change imposes 
a burden on intra-market competition because the provisions apply to 
all market participants and issuers equally. In addition, information 
regarding the halting and resumption of trading will be disseminated 
using several freely accessible sources to ensure the widespread 
availability of that information.

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

    Because the foregoing 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 for 30 days after the date of the filing, or such 
shorter time as the Commission may designate, it has become effective 
pursuant to Section 19(b)(3)(A)(iii) of the Act \29\ and subparagraph 
(f)(6) of Rule 19b-4 thereunder.\30\
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    \29\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \30\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 
requires a self-regulatory organization to give the Commission 
written notice of its intent to file the proposed rule change, along 
with a brief description and text of the proposed rule change, at 
least five business days prior to the date of filing of the proposed 
rule change, or such shorter time as designated by the Commission. 
The Exchange has satisfied this requirement.
---------------------------------------------------------------------------

    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) \31\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \31\ 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#84f6f1e8e1a9e7ebe9e9e1eaf0f7c4f7e1e7aae3ebf2"><span class="__cf_email__" data-cfemail="057770696028666a6868606b7176457660662b626a73">[email&#160;protected]</span></a>. Please include 
file number SR-NYSEAMER-2026-73 on the subject line.

[[Page 55138]]

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-2026-73. 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 filing will be available for inspection and 
copying at the principal office of the Exchange. Do not include 
personal identifiable information in submissions; you should submit 
only information that you wish to make available publicly. We may 
redact in part or withhold entirely from publication submitted material 
that is obscene or subject to copyright protection. All submissions 
should refer to file number SR-NYSEAMER-2026-73 and should be submitted 
on or before September 16, 2026.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\32\
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    \32\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2026-17363 Filed 8-25-26; 8:45 am]
BILLING CODE 8011-01-P


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