[Federal Register Volume 86, Number 239 (Thursday, December 16, 2021)]
[Notices]
[Pages 71531-71533]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-27180]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-93748; File No. SR-NYSE-2021-70]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend Its Price List To Eliminate the Underutilized Supplemental 
Liquidity Provider National Best Bid and Offer Setter Tier Credits

December 10, 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 November 30, 2021, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the self-
regulatory organization. The Commission is publishing this notice to 
solicit comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend its Price List to eliminate the 
underutilized Supplemental Liquidity Provider (``SLP'') National Best 
Bid and Offer (``NBBO'') Setter Tier credits. 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 
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its Price List to eliminate the 
underutilized SLP NBBO Setter Tier credits.
    The Exchange proposes to implement the rule change on December 1, 
2021.
    The Exchange adopted the SLP NBBO Setter Tier in August 2020 for 
securities with a per share price of $1.00 or above that offers four 
sets of tiered credits for orders from SLPs that set the NBBO or 
provide other displayed liquidity in Tape A, B and C Securities, on a 
monthly basis, in addition to the tiered or non-tiered SLP credit for 
adding displayed liquidity. The purpose of the change was to 
incentivize member organizations that are SLPs to increase aggressively 
priced liquidity-providing orders that improve the market by setting 
the NBBO, thereby encouraging higher levels of liquidity that would 
support the quality of price discovery on the Exchange consistent with 
the overall goal of enhancing market quality.\4\
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    \4\ See Securities Exchange Act Release No. 89754 (September 2, 
2020), 85 FR 55550, 55554 (September 8, 2020) (SR-NYSE-2020-71) 
(adopting SLP NBBO Setter credits applicable to SLPs and member 
organizations affiliated with SLPs); Securities Exchange Act Release 
No. 90947 (January 19, 2021), 86 FR 7138 (January 26, 2021) (SR-
NYSE-2021-02) (restricting SLP NBBO Setter credits to member 
organizations that are SLPs).
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    The Exchange proposes to eliminate and remove the SLP NBBO Setter 
Tier credits from the Price List. The credits have been underutilized 
by member organizations insofar as only one SLP has achieved any of the 
four tiers since the tiers were adopted and that firm's volume has 
declined over time. Moreover, no SLP has achieved the higher levels of 
liquidity or sent in additional liquidity to support the quality of 
price discovery on the Exchange that the Exchange expected when 
adopting the tiers. The Exchange does not anticipate that any 
additional member organization in the near future would qualify for the 
tiered credits that are the subject of this proposed rule change.
    The proposed change is not otherwise intended to address any other 
issues, and the Exchange is not aware of any problems that member 
organizations

[[Page 71532]]

would have in complying with the proposed changes.
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 Proposed Change Is Reasonable
    The Exchange believes that the proposed elimination of the 
underutilized SLP NBBO Setter Tier credits for member organizations 
that are SLPs is reasonable because member organizations have 
underutilized these incentives. As noted, only one SLP has achieved any 
of the four tiers since the tiers were adopted and that firm's volume 
has declined over time. Moreover, no SLP has achieved the higher levels 
of liquidity or sent in additional liquidity to support the quality of 
price discovery on the Exchange that the Exchange expected when 
adopting the tiers. The Exchange does not anticipate that any 
additional member organization in the near future would qualify for the 
tiered credits that are the subject of this proposed rule change. The 
Exchange believes it is reasonable to eliminate credits when such 
incentives become underutilized. The Exchange also believes eliminating 
underutilized incentives would add clarity and transparency to the 
Price List.
The Proposal Is an Equitable Allocation of Fees
    The Exchange believes the proposal equitably allocates fees among 
its market participants because the underutilized credits the Exchange 
proposes to eliminate would be eliminated in their entirety, and would 
no longer be available to any member organization in any form. 
Similarly, the Exchange believes the proposal equitably allocates fees 
among its market participants because elimination of the underutilized 
credits would apply to all similarly-situated member organizations that 
are SLPs on an equal basis. All such member organizations would 
continue to be subject to the same fee structure, and access to the 
Exchange's market would continue to be offered on fair and 
nondiscriminatory terms.
The Proposal Is Not Unfairly Discriminatory
    The Exchange believes that the proposal is not unfairly 
discriminatory because it neither targets nor will it have a disparate 
impact on any particular category of market participant. The Exchange 
believes that the proposal is not unfairly discriminatory because the 
proposed elimination of the underutilized NBBO Setter Tier credits 
would affect all similarly-situated market participants on an equal and 
non-discriminatory basis. The Exchange believes that eliminating 
credits that are underutilized and ineffective would no longer be 
available to any member organization on an equal basis. The Exchange 
also believes that the proposed change would protect investors and the 
public interest because the deletion of underutilized credits would 
make the Price List more accessible and transparent.
    Finally, the Exchange believes that it is subject to significant 
competitive forces, as described below in the Exchange's statement 
regarding the burden on competition.
    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

    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. Instead, as discussed above, the proposal relates 
to the elimination of an underutilized credits and, as such, would not 
have any impact on intra- or inter-market competition because the 
proposed change is solely designed to accurately reflect the services 
that the Exchange currently offers, thereby adding clarity to the Price 
List.
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    \7\ 15 U.S.C. 78f(b)(8).
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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 Number SR-NYSE-2021-70 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 Number SR-NYSE-2021-70. 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

[[Page 71533]]

Commission and any person, other than those that may be withheld from 
the public in accordance with the provisions of 5 U.S.C. 552, will be 
available for website viewing and printing in the Commission's Public 
Reference Room, 100 F Street NE, Washington, DC 20549, on official 
business days between the hours of 10:00 a.m. and 3:00 p.m. Copies of 
the filing also will be available for inspection and copying at the 
principal office of the Exchange. All comments received will be posted 
without change. Persons submitting comments are cautioned that we do 
not redact or edit personal identifying information from comment 
submissions. You should submit only information that you wish to make 
available publicly. All submissions should refer to File Number SR-
NYSE-2021-70, and should be submitted on or before January 6, 2022.
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    \11\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\11\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2021-27180 Filed 12-15-21; 8:45 am]
BILLING CODE 8011-01-P