60 Day Notice

3235-0510 60 day notice.pdf

Rule 302 (17 CFR 242.302) Recordkeeping Requirements for Alternative Trading Systems

60 Day Notice

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Federal Register / Vol. 84, No. 119 / Thursday, June 20, 2019 / Notices

waive the 30-day operative delay to
permit the Fund to immediately employ
an investment strategy that would allow
the Fund to hold listed derivatives
based on a single underlying reference
asset (i.e., S&P 500 Options) in a manner
that may not comply with the generic
listing standards under Rule
14.11(i)(4)(C)(iv)(b). The Commission
notes that the proposed rule change in
this regard is similar to previously
submitted proposals to list and trade
series of Index Fund Shares and
Managed Fund Shares with exposure to
a single underlying reference asset (i.e.,
the S&P 500 Index) that were either
approved by the Commission or
effective upon filing.29 Thus, the
Commission believes that waiver of the
30-day operative delay is consistent
with the protection of investors and the
public interest and hereby waives the
30-day operative delay and designates
the proposed rule change operative
upon filing.30
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.
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

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• Use the Commission’s internet
comment form (http://www.sec.gov/
rules/sro.shtml); or
29 See supra note 6. In the approval order for
proposed rule change SR–CboeBZX–2018–029, the
Commission noted that the proposing exchange
stated that ‘‘SPX options are among the most liquid
index options in the U.S. and derive their value
from the actively traded S&P 500 components. SPX
options are cash-settled with no delivery of stocks
or ETFs, and trade in competitive auction markets
with price and quote transparency. The Exchange
believes that the highly regulated S&P 500 options
markets, and the broad base and scope of the S&P
500 Index, make securities that derive their value
from that index, including S&P 500 options, less
susceptible to potential market manipulation in
view of market capitalization and liquidity of the
S&P 500 Index components, price and quote
transparency, and arbitrage opportunities.’’ See
Securities Exchange Act Release No. 77045, supra
note 6, 81 FR at 6917 n.15.
30 For purposes only of waiving the operative
delay, the Commission has considered the proposed
rule’s impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).

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• Send an email to rule-comments@
sec.gov. Please include File Number SR–
CboeBZX–2019–055 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–CboeBZX–2019–055.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
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 such
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–CboeBZX–2019–055 and
should be submitted on or before July
11, 2019.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.31
Vanessa A. Countryman,
Acting Secretary.
[FR Doc. 2019–13069 Filed 6–19–19; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
Proposed Collection; Comment
Request
Upon Written Request, Copies Available
From: Securities and Exchange
31 17

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CFR 200.30–3(a)(12).

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Commission, Office of FOIA Services,
100 F Street NE, Washington, DC
20549–2736.
Extension:
Rule 302, SEC File No. 270–453, OMB
Control No. 3235–0510

Notice is hereby given that, pursuant
to the Paperwork Reduction Act of 1995
(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the
Securities and Exchange Commission
(‘‘Commission’’) is soliciting comments
on the existing collection of information
provided for in Rule 302 (17 CFR
242.302) of Regulation ATS (17 CFR
242.300 et seq.) under the Securities and
Exchange Act of 1934 (‘‘Act’’) (15 U.S.C.
78a et seq.). The Commission plans to
submit this existing collection of
information to the Office of
Management and Budget (‘‘OMB’’) for
extension and approval.
Regulation ATS sets forth a regulatory
regime for ‘‘alternative trading systems’’
(‘‘ATSs’’). An entity that meets the
definition of an exchange must register,
pursuant to Section 5 of the Exchange
Act, as a national securities exchange
under Section 6 of the Exchange Act 1 or
operate pursuant to an appropriate
exemption.2 One of the available
exemptions is for ATSs.3 Exchange Act
Rule 3a1–1(a)(2) exempts from the
definition of ‘‘exchange’’ under Section
3(a)(1) an organization, association, or
group of persons that complies with
Regulation ATS.4 Regulation ATS
requires an ATS to, among other things,
register as a broker-dealer with the
Securities and Exchange Commission
(‘‘SEC’’), file a Form ATS with the
Commission to notice its operations,
and establish written safeguards and
procedures to protect subscribers’
confidential trading information. An
ATS that complies with Regulation ATS
and operates pursuant to the Rule 3a1–
1(a)(2) exemption would not be required
by Section 5 to register as a national
securities exchange.
Rule 302 of Regulation ATS (17 CFR
242.302) describes the recordkeeping
requirements for ATSs. Under Rule 302,
1 See 15 U.S.C. 78e and 78f. A ‘‘national securities
exchange’’ is an exchange registered as such under
Section 6 of the Exchange Act.
2 15 U.S.C. 78a et seq.
3 Rule 300(a) of Regulation ATS provides that an
ATS is ‘‘any organization, association, person,
group of persons, or system: (1) [t]hat constitutes,
maintains, or provides a market place or facilities
for bringing together purchasers and sellers of
securities or for otherwise performing with respect
to securities the functions commonly performed by
a stock exchange within the meaning of [Exchange
Act Rule 3b-16]; and (2) [t]hat does not: (i) [s]et
rules governing the conduct of subscribers other
than the conduct of subscribers’ trading on such
[ATS]; or (ii) [d]iscipline subscribers other than by
exclusion from trading.’’
4 See 17 CFR 240.3a1–1(a)(2).

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Federal Register / Vol. 84, No. 119 / Thursday, June 20, 2019 / Notices
ATSs are required to, among other
things, make a record of subscribers to
the ATS, daily summaries of trading in
the ATS, and time-sequenced records of
order information in the ATS.
The information required to be
collected under Rule 302 should
increase the abilities of the Commission,
state securities regulatory authorities,
and the self-regulatory organizations to
ensure that ATSs are in compliance
with Regulation ATS as well as other
applicable rules and regulations. If the
information is not collected or collected
less frequently, the regulators would be
limited in their ability to comply with
their statutory obligations, provide for
the protection of investors, and promote
the maintenance of fair and orderly
markets.
Respondents consist of ATSs that
choose to operate pursuant to the
exemption provided by Regulation ATS
from registration as national securities
exchanges. There are currently 83
respondents. These respondents will
spend approximately 3,735 hours per
year (83 respondents at 45 burden
hours/respondent) to comply with the
recordkeeping requirements of Rule 302.
At an average cost per burden hour of
$73, the resultant total related internal
cost of compliance for these
respondents is $272,655 per year (3,735
burden hours multiplied by $73/hour).
Written comments are invited on (a)
whether the proposed collection of
information is necessary for the proper
performance of the functions of the
Commission, including whether the
information shall have practical utility;
(b) the accuracy of the Commission’s
estimates of the burden of the proposed
collection of information; (c) ways to
enhance the quality, utility, and clarity
of the information collected; and (d)
ways to minimize the burden of the
collection of information on
respondents, including through the use
of automated collection techniques or
other forms of information technology.
Consideration will be given to
comments and suggestions submitted in
writing within 60 days of this
publication.
An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid OMB
control number.
Please direct your written comments
to: Charles Riddle, Acting Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Candace
Kenner, 100 F Street NE, Washington,
DC 20549, or send an email to: PRA_
[email protected].

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Dated: June 14, 2019.
Vanessa A. Countryman,
Acting Secretary.
[FR Doc. 2019–13056 Filed 6–19–19; 8:45 am]
BILLING CODE 8011–01–P

SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–86117; File No. SR–NYSE–
2018–46]

Self-Regulatory Organizations; New
York Stock Exchange LLC; Order
Disapproving a Proposed Rule Change
To Amend the Listed Company Manual
for Special Purpose Acquisition
Companies To Reduce the Continued
Listing Standards for Public Holders
From 300 to 100 and To Enable the
Exchange To Exercise Discretion To
Allow Special Purpose Acquisition
Companies a Reasonable Time Period
Following a Business Combination to
Demonstrate Compliance With the
Applicable Quantitative Listing
Standards
June 14, 2019.

I. Introduction
On October 1, 2018, New York Stock
Exchange LLC (‘‘NYSE’’ or ‘‘Exchange’’)
filed with the Securities and Exchange
Commission (‘‘Commission’’), pursuant
to Section 19(b)(1) of the Securities
Exchange Act of 1934 (‘‘Act’’ or
‘‘Exchange Act’’) 1 and Rule 19b–4
thereunder,2 a proposed rule change to
amend the NYSE Listed Company
Manual (‘‘Manual’’) for Special Purpose
Acquisition Companies (‘‘SPACs’’) 3 to
reduce the minimum number of public
holders required for continued listing
from 300 to 100, and to enable the
Exchange to exercise discretion to allow
SPACs a reasonable time period
following a business combination to
demonstrate compliance with the
applicable quantitative listing
standards. The proposed rule change
was published for comment in the
Federal Register on October 18, 2018.4
The Commission received one comment
letter on the proposal.5 On November
29, 2018, the Commission designated a
1 15

U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 The Commission notes that throughout this
order we have used the term ‘‘SPAC’’ or ‘‘SPACs.’’
These terms have the same meaning as ‘‘Acquisition
Company’’ which is the term used by the Exchange
in the Manual.
4 See Securities Exchange Act Release No. 84420
(October 12, 2018), 83 FR 52854 (October 18, 2018)
(‘‘Notice’’).
5 See Letter to Secretary, Commission, from
Jeffrey P. Mahoney, General Counsel, Council of
Institutional Investors, dated November 8, 2018
(‘‘CII Letter’’).
2 17

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longer period within which to approve
the proposed rule change, disapprove
the proposed rule change, or institute
proceedings to determine whether to
approve or disapprove the proposed
rule change.6 On January 15, 2019, the
Commission issued an order instituting
proceedings (‘‘OIP’’ or ‘‘Order
Instituting Proceedings’’) under Section
19(b)(2)(B) of the Act to determine
whether to approve or disapprove the
proposed rule change.7 The Commission
received one additional comment letter,
from the same commenter, on the OIP.8
On April 15, 2019, the Commission
designated a longer period within which
to issue an order approving or
disapproving the proposed rule change.9
This order disapproves the proposed
rule change.
II. Description of the Proposal
A. Background on SPACs
A SPAC is a special purpose
acquisition company whose business
plan is to raise capital in an initial
public offering (‘‘IPO’’) and, within a
specific period of time, engage in a
merger or acquisition with one or more
unidentified companies. Among other
things, a SPAC must keep 90% of the
gross proceeds of its IPO in an escrow
account until the date of a business
combination.10 The SPAC must
complete one or more business
combinations, having an aggregate fair
market value of at least 80% of the value
of the escrow account, within 36
months of the effectiveness of the IPO
registration statement.11 Additionally,
public shareholders who object to a
business combination have the right to
convert their common stock into a pro
rata share of the funds held in escrow.12
Following a business combination, the
combined company must meet the
Exchange’s requirements for initial
listing of an operating company.13
6 See Securities Exchange Act Release No. 84680
(November 29, 2018), 83 FR 62942 (December 8,
2018).
7 See Securities Exchange Act Release No. 84984
(January 15, 2019), 84 FR 0855 (January 31, 2019).
8 See Letter to Secretary, Commission, from
Jeffrey P. Mahoney, General Counsel, Council of
Institutional Investors, dated February 11, 2019
(‘‘CII Letter II’’).
9 See Securities Exchange Act Release No. 85644
(April 15, 2019), 84 FR 16299 (April 18, 2019). The
date was extended until June 15, 2019.
10 See Section 102.06 of the Manual. Section
102.06 also contains additional quantitative
requirements to list a SPAC.
11 See id.
12 See Section 102.06(b) of the Manual.
13 This includes the requirement to maintain a
minimum of 400 round lot holders. See Sections
102.01A and 802.01B of the Manual.

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