[Federal Register Volume 86, Number 10 (Friday, January 15, 2021)]
[Notices]
[Pages 4147-4149]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-00819]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-90891; File No. SR-NYSE-2021-03]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend its Price List To Extend a Waiver of New Firm Application Fees 
for Certain Applications and of Bond Trading License Fees

January 11, 2021.
    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 January 4, 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 Exchange. 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 to (1) extend a fee 
waiver for new firm application fees for applicants seeking only to 
obtain a bond trading license (``BTL'') for 2021; and (2) waive the BTL 
fee for 2021. The Exchange proposes to implement the fee changes 
effective January 4, 2021. The proposed rule change is available on the 
Exchange's website at www.nyse.com, 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 Price List to (1) extend a fee 
waiver for new firm application fees for applicants seeking only to 
obtain a BTL for 2021; and (2) waive the BTL fee for 2021.\4\ The 
Exchange proposes to implement the fee changes effective January 4, 
2021.
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    \4\ The Exchange initially filed to adopt the fee waiver and 
waive the BTL fee in 2015. See Securities Exchange Act Release No. 
74031 (January 12, 2015), 80 FR 2462 (January 16, 2015) (SR-NYSE-
2014-78). The Exchange has filed to extend the fee waiver and waive 
the BTL fee for each calendar year since 2017. See Securities 
Exchange Act Release Nos. 79710 (December 29, 2016), 82 FR 1395 
(January 5, 2017) (SR-NYSE-2016-89); 82418 (December 28, 2017), 83 
FR 568 (January 4, 2018) (SR-NYSE-2017-70); 84899 (December 20, 
2018), 83 FR 67395 (December 28, 2018) (SR-NYSE-2018-65); and 87952 
(January 13, 2020), 85 FR 3089 (January 17, 2020) (SR-NYSE-2019-73).
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    The Exchange currently charges a New Firm Fee ranging from $2,500 
to $20,000, depending on the type of firm, which is charged per 
application for any broker-dealer that applies to be approved as an 
Exchange member organization. The Exchange proposes to amend the Price 
List to waive the New Firm Fee for 2021 for new member organization 
applicants that are seeking only to obtain a BTL and not trade equities 
at the Exchange. The proposed waiver of the New Firm Fee would be 
available only to applicants seeking approval as a new member 
organization, including carrying firms, introducing firms, or non-
public organizations, which would be seeking to obtain a BTL at the 
Exchange and not trade equities. Further, if a new firm that is 
approved as a member organization and has had the New Firm Fee waived 
converts a BTL to a full trading license within one year of approval, 
the New Firm Fee would be charged in full retroactively. The Exchange 
believes that charging the New Firm Fee retroactively within a year of 
approval is appropriate because it would discourage applicants to claim 
that they are applying for a BTL solely to avoid New Firm Fees.
    Additionally, the Exchange currently charges a BTL fee of $1,000 
per year. The Exchange proposes to amend the

[[Page 4148]]

Price List to waive the BTL fee for 2021 for all member organizations.
    The Exchange believes that the proposed fee changes would provide 
increased incentives for bond trading firms that are not currently 
Exchange member organizations to apply for Exchange membership and a 
BTL. The Exchange believes that having more member organizations 
trading on the Exchange's bond platform would benefit investors through 
the additional display of liquidity and increased execution 
opportunities in Exchange-traded bonds at the Exchange.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\5\ in general, and furthers the 
objectives of Sections 6(b)(4) and 6(b)(5) of the Act,\6\ 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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    \5\ 15 U.S.C. 78f(b).
    \6\ 15 U.S.C. 78f(b)(4), (5).
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    The Exchange believes that it is reasonable to waive the New Firm 
Fee and the annual BTL fee for 2021 to provide an incentive for bond 
trading firms to apply for Exchange membership and a BTL. The Exchange 
believes that providing an incentive for bond trading firms that are 
not currently Exchange member organizations to apply for membership and 
a BTL would encourage market participants to become members of the 
Exchange and bring additional liquidity to a transparent bond market. 
To the extent the existing New Firm Fees or the BTL fee serves as a 
disincentive for bond trading firms to become Exchange member 
organizations, the Exchange believes that the proposed fee change could 
expand the number of firms eligible to trade bonds on the Exchange. The 
Exchange believes creating incentives for bond trading firms to trade 
bonds on the Exchange protects investors and the public interest by 
increasing the competition and liquidity on a transparent market for 
bond trading. The proposed waiver of the New Firm Fee and BTL fee is 
equitable and not unfairly discriminatory because it would be offered 
to all market participants that wish to trade at the Exchange the 
narrower class of debt securities only.

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

    In accordance with Section 6(b)(8) of the Act,\7\ the Exchange 
believes that the proposed rule change would not impose any burden on 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. Debt securities typically trade in a decentralized 
over-the-counter (``OTC'') dealer market that is less liquid and 
transparent than the equities markets. The Exchange believes that the 
proposed change would increase competition with these OTC venues by 
reducing the cost of being approved as and operating as an Exchange 
member organization that solely trades bonds at the Exchange, which the 
Exchange believes will enhance market quality through the additional 
display of liquidity and increased execution opportunities in Exchange-
traded bonds at the Exchange.
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    \7\ 15 U.S.C. 78f(b)(8).
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    The Exchange notes that it operates in a highly competitive market 
in which market participants can readily favor competing venues that 
are not transparent. In such an environment, the Exchange must 
continually review, and consider adjusting its fees and rebates to 
remain competitive with other exchanges as well as with alternative 
trading systems and other venues that are not required to comply with 
the statutory standards applicable to exchanges. Because competitors 
are free to modify their own fees and credits in response, and because 
market participants may readily adjust their order routing practices, 
the Exchange believes that the degree to which fee changes in this 
market may impose any burden on competition is extremely limited. As a 
result of all of these considerations, the Exchange does not believe 
that the proposed change will impair the ability of member 
organizations or competing order execution venues to maintain their 
competitive standing in the financial markets.

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) \8\ of the Act and subparagraph (f)(2) of Rule 19b-
4 \9\ thereunder, because it establishes a due, fee, or other charge 
imposed by the Exchange.
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    \8\ 15 U.S.C. 78s(b)(3)(A).
    \9\ 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) \10\ of the Act to determine whether the proposed 
rule change should be approved or disapproved.
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    \10\ 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

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File No. SR-NYSE-2021-03 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File No. SR-NYSE-2021-03. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's internet website (http://www.sec.gov/rules/sro.shtml). 
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

[[Page 4149]]

printing in the Commission's Public Reference Room, 100 F Street NE, 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change. Persons submitting 
comments are cautioned that we do not redact or edit personal 
identifying information from comment submissions. You should submit 
only information that you wish to make available publicly. All 
submissions should refer to File No. SR-NYSE-2021-03, and should be 
submitted on or before February 5, 2021.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
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    \11\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-00819 Filed 1-14-21; 8:45 am]
BILLING CODE 8011-01-P