[Federal Register Volume 83, Number 100 (Wednesday, May 23, 2018)]
[Notices]
[Pages 23968-23978]
[FR Doc No: 2018-10986]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83289; File No. SR-NYSENAT-2018-02]

Self-Regulatory Organizations; NYSE National, Inc.; Notice of
Filing of Amendment No. 1 and Order Granting Accelerated Approval of a
Proposed Rule Change, as Amended by Amendment No. 1, To Support the Re-
Launch of NYSE National, Inc. on the Pillar Trading Platform

May 17, 2018.

I. Introduction

    On February 21, 2018, NYSE National, Inc. (``NYSE National'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission''), pursuant to Section 19(b)(1) of the Securities
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a
proposed rule change in connection with the re-launch of the Exchange
on the Pillar trading platform. The proposed rule change was published
for comment in the Federal Register on March 13, 2018.\3\ The
Commission received no comments on the proposed rule change. On April
25, 2018, pursuant to Section 19(b)(2) of the Act,\4\ the Commission
designated a 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.\5\ On May 16, 2018, the Exchange filed Amendment No. 1 to the
proposed rule change, which supersedes and replaces the original filing
in its entirety.\6\ The Commission is approving the proposed rule
change, as modified by Amendment No. 1, on an accelerated basis, and is
soliciting comments on Amendment No. 1.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 82819 (March 7,
2018), 83 FR 11098 (March 13, 2018) (``Notice'').
    \4\ 15 U.S.C. 78s(b)(2).
    \5\ See Securities Exchange Act Release No.83100 (April 25,
2018), 83 FR 19127 (May 1, 2018).
    \6\ In Amendment No. 1, the Exchange proposes, among other
things, to: (i) Delete proposed Rule 8 and modify proposed Rule 5 to
include only those rules that would support the trading on an
unlisted trading privileges (``UTP'') basis of all NMS Stocks and
the trading on a UTP basis of UTP Exchange Traded Products; (ii)
revise the proposed definition of the term ``UTP Exchange Traded
Product''; (iii) propose a grace period of 30 calendar days for ETP
Holders that are eligible for the expedited process for
reinstatement under the proposal to register their Associated
Persons with the Exchange; (iv) commit to working with Commission
staff to update its membership rules and to file a separate filing
relating to its membership rules within 90 days of any approval of
the instant proposal; (v) identify which of the proposed Rules are
based on the rules of NYSE American, as opposed to those based on
the rules of NYSE Arca; (vi) add provisions, based on rules of other
self-regulatory organizations (``SROs''), that were not included in
the original filing; (vii) add a rule relating to the requirements
for listed securities issued by Intercontinental Exchange, Inc.
(``ICE'') or its affiliates; (viii) specifically incorporate by
reference certain rules of the Financial Industry Regulatory
Authority, Inc. (``FINRA'') that were only cited in the original
version of the filing; (ix) add clarifying language to proposed rule
text and the narrative describing the proposal; and (x) correct
various technical errors. The proposed revisions of the proposal
made in Amendment No. 1 are incorporated in the Description of the
Proposal herein. Amendment No. 1 is available at: https://www.sec.gov/comments/sr-nysenat-2018-02/nysenat201802-3653908-162416.pdf.
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II. Description of the Proposal

    On February 1, 2017, the Exchange ceased trading operations.\7\ The
Exchange proposes to re-launch trading operations on Pillar, which is
an integrated trading technology platform designed to use a single
specification for connecting to the equities and options markets
operated by the Exchange and its affiliates, NYSE Arca, Inc. (``NYSE
Arca''), NYSE American LLC (``NYSE American''), and New York Stock
Exchange LLC (``NYSE'').
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    \7\ See Securities Exchange Act Release No. 80018 (February 10,
2017), 82 FR 10947 (February 16, 2017) (SR-NSX-2017-04)
(``Termination Filing''). On January 31, 2017, ICE, through its
wholly-owned subsidiary, NYSE Group, acquired all of the outstanding
capital stock of the Exchange (the ``Acquisition''). See Securities
Exchange Act Release No. 79902 (January 30, 2017), 82 FR 9258
(February 3, 2017) (SR-NSX-2016-16). Prior to the Acquisition, the
Exchange was named ``National Stock Exchange, Inc.'' and was
referred to as ``NSX.''
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    Currently, NYSE Arca's cash equities market,\8\ NYSE American's
cash equities market,\9\ and NYSE securities that trade on an unlisted
trading privileges basis \10\ trade on Pillar. NYSE Arca, NYSE
American, and NYSE have trading rules that are substantially similar
and that are based on the rule numbering framework of NYSE Arca.\11\
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    \8\ For a history of the implementation of Pillar on NYSE Arca,
see Notice, supra note 3, at footnote 6.
    \9\ For a history of the implementation of Pillar on NYSE
American, see Notice, supra note 3, at footnote 7.
    \10\ For a history of the implementation of Pillar on NYSE, see
Notice, supra note 3, at footnote 8.
    \11\ According to the Exchange, NYSE American and NYSE proposed
specific differences to certain trading rules with respect to NYSE
Arca to differentiate their respective trading models, noting, for
example, that NYSE American has a delay mechanism and does not offer
specified order types. See id. The Exchange states that it does not
propose to offer a trading model that is differentiated from NYSE
Arca. It does propose, however, certain differences in some of the
details of its rules, as further discussed below. In addition, in
preparation for the re-launch of trading, the Exchange adopted the
rule numbering framework of the NYSE Arca rules, which at that time
were organized in 14 Rules. See Securities Exchange Act Release No.
81782 (September 29, 2017), 82 FR 81782 (October 5, 2017) (SR-
NYSENat-2017-04) (Notice of Filing and Immediate Effectiveness).

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    The Exchange proposes to re-launch trading on Pillar in all Tape A,
Tape B, and Tape C securities on a UTP basis on a fully automated
price-time priority allocation model. Unlike its affiliated exchanges,
the Exchange does not propose to be a listing venue. Because the
Exchange would trade securities on a UTP basis only, the Exchange
proposes to operate in the same manner as its affiliated exchanges,
NYSE Arca, NYSE American, and NYSE, with respect to securities that
trade on a UTP basis on those exchanges. For example, the Exchange does
not propose to operate any auctions and therefore does not propose
rules to provide for auction functionality on the Exchange.\12\ In
addition, because the Exchange would not be a listing venue, the
Exchange would not provide for either ``lead'' or ``designated'' market
makers, which are available on NYSE Arca, NYSE, and NYSE American,
respectively, for securities listed on those exchanges. As with NYSE
Arca and NYSE American, the Exchange proposes rules that would provide
that ETP Holders may register as market makers in securities that trade
on a UTP basis on the Exchange. And, as with NYSE Arca and NYSE
American, the Exchange proposes not to require that there be a market
maker in a particular security on the Exchange for that security to
trade on a UTP basis on the Exchange. Similar to NYSE American and to
how NYSE trades securities on an unlisted trading privileges basis on
Pillar, the Exchange also does not propose to operate a retail
liquidity program.
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    \12\ However, the Exchange would make available certain order
types that currently exist on NYSE Arca, NYSE American, and NYSE for
securities that trade on a UTP basis, which provide for routing
directly to the primary listing market. In addition, similar to NYSE
Rule 7.31(c), the Exchange would offer ``Auction-only Orders,''
which are orders designated to participate in an auction on the
primary listing market. The Exchange would route all such orders to
the primary listing market. The proposed rules governing such order
types on the Exchange are based on the recently-approved rules
governing trading on Pillar on the NYSE. See Securities Exchange Act
Release No. 82945 (March 26, 2018), 83 FR 13553 (March 29, 2018)
(SR-NYSE-2017-36).
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    While the Exchange proposes trading rules for the re-launch based
on the rules of its affiliated exchanges, it also proposes to retain
and renumber certain of its existing rules relating to membership and
ETP Holder conduct. In certain cases, the Exchange proposes to replace
an existing rule with a rule harmonized with conduct rules of other
SROs.
    Because the Exchange is not proposing new or different rules to
qualify as a member of the Exchange for the re-launch, the Exchange
proposes to reinstate ETP Holder status \13\ using the existing process
described in Interpretation and Policies .01 to current Rule 2.5, which
sets forth an expedited process for reinstatement as an ETP Holder and
to register Associated Persons established when the Exchange re-
launched operations in 2015.\14\ In Amendment No. 1, the Exchange
proposes new Commentary .01 to proposed Rule 2.5, which would provide
those ETP Holders reinstated pursuant to the expedited process 30
calendar days in which to register their Associated Persons with the
Exchange.\15\ Further, in Amendment No. 1, the Exchange represents that
it understands that the rules set forth in Chapter II of the current
rule book may not reflect certain harmonized standards for membership
rules of other SROs. While the Exchange proposes to retain its existing
membership rules, subject to the changes discussed below, for purposes
of the re-launch, the Exchange represents that it commits to working
with Commission staff to update its membership rules and will file a
separate filing relating to its membership rules within 90 days of any
approval of its proposed rule change.\16\
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    \13\ When the Exchange ceased operations, the Exchange
terminated the ETP status of all ETP Holders as of the close of
business on February 1, 2017. See Termination Filing, supra note 7.
    \14\ See Securities Exchange Act Release No. 75098 (June 3,
2015), 80 FR 32644 (June 9, 2015) (Notice of filing and immediate
effectiveness of proposed rule change to establish expedited process
to reinstate ETP Holder status). Pursuant to that rule, approved ETP
Holders that were in good standing as of the close of business on
May 30, 2014, when the Exchange previously ceased trading
operations, had their ETP Holder status reinstated and Associated
Persons registered pursuant to an expedited process.
    \15\ See Amendment No. 1, supra note 6.
    \16\ Id.
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    In addition, the Exchange proposes to amend Article V, Sections 5.1
and 5.8 of the Exchange's Bylaws by revising references to ``Appeals
Committee'' to ``Committee for Review.'' Because the existing NYSE
National rulebook would be replaced with both new and renumbered rules
under the new framework, the Exchange also proposes to delete Chapters
I-XVI of the current rulebook and the rules contained therein.
    The following is a brief overview of each rule section \17\ that
would be included in the Exchange's rulebook, as proposed to be
revised, and that would incorporate proposed changes to individual
sections, as reflected in Amendment No. 1.\18\
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    \17\ Rules 4, 8, and 9 are proposed to be ``Reserved.''
    \18\ See Amendment No. 1, supra note 6.
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Rule 0--Regulation of the Exchange and ETP Holders

    Proposed Rule 0 would establish the framework for the regulation of
the Exchange and its ETP Holders. Proposed Rule 0 acknowledges that the
Exchange and FINRA are parties to a regulatory services agreement in
which FINRA will perform certain functions on behalf of the Exchange,
with the Exchange retaining ultimate legal responsibility for, and
control of, such functions.

Rule 1--Definitions

    Proposed Rule 1 would contain definitions applicable to trading on
the Exchange's Pillar platform.\19\ In Amendment No. 1, the Exchange
proposes to modify Rule 1.1(m) from the initial filing to define the
term ``UTP Exchange Traded Product'' to mean one of a list of specified
classes of Exchange Traded Products that the Exchange intends to trade
pursuant to unlisted trading privileges. The enumerated Exchange Traded
Products that would be eligible to trade on the Exchange pursuant to
unlisted trading privileges would include the following: Equity Linked
Notes, Investment Company Units, Index-Linked Exchangeable Notes,
Equity Gold Shares, Equity Index-Linked Securities, Commodity-Linked
Securities, Currency-Linked Securities, Fixed-Income Index-Linked
Securities, Futures-Linked Securities, Multifactor-Index-Linked
Securities, Trust Certificates, Currency and Index Warrants, Portfolio
Depository Receipts, Trust Issued Receipts, Commodity-Based Trust
Shares, Currency Trust Shares, Commodity Index Trust Shares, Commodity
Futures Trust Shares, Partnership Units, Paired Trust Shares, Trust
Units, Managed Fund Shares and Managed Trust Shares.
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    \19\ The proposed definitions are based on the rules of NYSE
Arca, NYSE American, and NSX.
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Rule 2--Trading Permits

    Proposed Rule 2 would set forth the membership rules for the
Exchange, including the eligibility requirements,\20\

continuing education requirements,\21\ and application requirements
\22\ to become an ETP Holder. It also would set forth rules relating to
revocation,\23\ voluntary termination,\24\ and transfer and sale \25\
of an ETP.\26\ Proposed Rule 2 would provide jurisdiction \27\ to the
Exchange to discipline ETP Holders \28\ and Persons Associated with ETP
Holders for violations of, among other things, the Act and the rules
thereunder.\29\ It also would provide the Exchange the ability to
prescribe reasonable dues, assessments, and charges \30\ and would
include rules concerning the mandatory testing of the Exchange's
business continuity and disaster recovery plans.\31\ In Amendment No.
1, the Exchange represents that there are no categories of persons on
the Exchange that would fall outside of the membership categories and
requirements set forth in proposed Rule 2.\32\
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    \20\ See proposed Rules 2.2, 2.3, and 2.4.
    \21\ See proposed Rule 2.2.
    \22\ See proposed Rule 2.5.
    \23\ See proposed Rule 2.6.
    \24\ See proposed Rule 2.7.
    \25\ See proposed Rule 2.8.
    \26\ See proposed Rule 1.1(h) (defining ``ETP'').
    \27\ See proposed Rule 2.2(a).
    \28\ See proposed Rule 1.1(i) (defining ``ETP Holder'').
    \29\ Rules 2.10, 2.11, and 2.12 are marked ``Reserved.''
    \30\ See proposed Rule 2.9.
    \31\ See proposed Rule 2.13.
    \32\ See Amendment No. 1, supra note 6.
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    The proposed rules are based on the Exchange's existing membership
rules with the following substantive differences: (1) The Exchange
proposes to delete Rule 2.10, as proposed Rule 3.9 would cover the
relationship between ETP Holders and Exchange affiliates; (2)
Archipelago Securities LLC would replace NSX Securities LLC as the
routing broker for the Exchange, so the Exchange proposes to delete
current Rules 2.11 and 2.12,\33\ and instead adopt proposed Rule
7.45,\34\ which is based on NYSE Arca Rule 7.45-E, to cover the
Exchange's routing function.
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    \33\ By its terms, NSX Rule 2.12 expired on September 30, 2008.
See current Rule 2.12.
    \34\ See proposed Rule 7.45.
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    NYSE National also proposes an expedited process for reinstating
ETP Holders. The ETP Holder would be able to submit a short form
application to reinstate its status as an ETP Holder and to register
Persons Associated with the ETP Holder if the ETP Holder was in good
standing at the close of business on February 1, 2017, is a member of
another SRO, and each proposed Person Associated with such ETP Holder
holds an active and recognized securities industry registration and
meets the requirements of proposed Rule 2.2(b).\35\
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    \35\ See Commentary .01 to proposed Rule 2.5.
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    In Amendment No. 1, the Exchange proposes a grace period of 30
calendar days from the effective date of proposed Rule 2.5 for ETP
Holders that are eligible for the expedited process for reinstatement
to register Persons Associated with the ETP Holder with the
Exchange.\36\ According to the Exchange, to be eligible for the
expedited process and the temporary grace period, the ETP Holder
already must have Persons Associated with the ETP Holder registered in
the FINRA Central Registration Depository System (``CRD'').\37\ ETP
Holders that take advantage of the proposed grace period would be able
to begin trading on the Exchange before they complete registering their
Persons Associated with the Exchange.
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    \36\ See id.; see also Amendment No. 1, supra note 6.
    \37\ See Commentary .01 to proposed Rule 2.5; see also Amendment
No. 1, supra note 6.
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    As noted above, the Exchange proposes to retain its existing rules
relating to membership, which may not reflect certain harmonized
standards for membership rules of other SROs. However, in Amendment No.
1, the Exchange commits to working with Commission staff to update its
membership rules and to file a separate filing relating to its
membership rules within 90 days of any approval of the Exchange's
proposed rule change.\38\
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    \38\ See Amendment No. 1, supra note 6.
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    Proposed Rule 2.3, as a prerequisite to membership, would require
an ETP Holder to be a member of a registered national securities
association or of a registered national securities exchange. As a
member of two or more SROs, an ETP Holder would be required to comply
with whichever rules impose a higher standard.

Rule 3--Organization and Administration

    Proposed Rule 3 would include rules relating to: (1) The potential
actions the Exchange may take for ETP Holder's failure to pay any
assessments, dues or other changes to the Exchange within 45 days after
they become payable; (2) a prohibition on an ETP Holder being
affiliated with NYSE Group, Inc.; (3) prompt written notification to
the Exchange whenever an ETP Holder is expelled or suspended from any
SRO, encounters financial difficulty or operating inadequacies, fails
to perform contracts or becomes insolvent; and (4) requirements for
fingerprint-based background checks of Exchange employees and others.
In Amendment No. 1, the Exchange proposes to add a rule relating to
additional requirements to be undertaken by the Exchange if securities
issued by ICE or its affiliates are traded on the Exchange.\39\
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    \39\ Id.
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Rule 5--Trading on an Unlisted Trading Privileges Basis

    Proposed Rule 5 would provide for rules to trade all Tape A, Tape
B, and Tape C securities, including Exchange Traded Products (also
referred to herein as ``ETPs''), on a UTP basis.\40\ In Amendment No.
1, the Exchange states that it does not believe that it is necessary
for an exchange that trades securities only on a UTP basis to have
listing rules for ETPs.\41\ The Exchange further states that, as a non-
listing venue, the Exchange would not have a relationship with any ETP
issuers; thus, to the extent ETP listing rules include initial and
continued listing standards, the Exchange would not be in a position to
evaluate issuer compliance with such rules.\42\ Similarly, the Exchange
states its belief that it should not be necessary for a non-listing
venue to file with the Commission a Form 19b-4(e) if it begins trading
an ETP on a UTP basis, because Rule 19b-4(e)(1) under the Act refers to
the ``listing and trading'' of a ``new derivative securities product.''
\43\ The Exchange therefore believes that the requirements of that rule
refer to when an exchange lists and trades an ETP, and not when an
exchange seeks only to trade such product on a UTP basis pursuant to
Rule 12f-2 under the Act.\44\ Accordingly, the proposal, as amended by
Amendment No. 1, contains only those rules that would support the
trading on a UTP basis of all NMS Stocks, and the trading on a UTP
basis for UTP Exchange Trading Products, which are set forth in
proposed Rule 5.1. Further, the Exchange does not propose rules other
than Rule 5.1 or any of the provisions it previously had

proposed in Rule 8, which would be designated as Reserved.\45\
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    \40\ In the Notice, the Exchange proposed both Rules 5 and 8 to
establish listing rules for Exchange Traded Products that are based
on NYSE American Rules 5E and 8E and NYSE Rules 5P and 8P. See
Notice, supra note 3. Because the Exchange would not be a listing
venue, in Amendment No. 1, the Exchange proposes to modify its
proposal to eliminate the listing rules contained in Rules 5 and 8.
See Amendment No. 1, supra note 6. In particular, in Amendment No.
1, the Exchange proposes to delete proposed Rule 8 and modify
proposed Rule 5 to include only those rules that would support the
trading on a UTP basis of all NMS Stocks, and the trading on a UTP
basis of UTP Exchange Traded Products.
    \41\ See Amendment No. 1, supra note 6.
    \42\ Id.
    \43\ 17 CFR 240.19b-4(e). See Amendment No. 1, supra note 6.
    \44\ 17 CFR 240.12f-2. See Amendment No. 1, supra note 6.
    \45\ See note 41, supra. In Amendment No. 1, the Exchange states
its belief that its proposed rule text in Rule 5, together with the
proposed definition of UTP Exchange Traded Products in proposed Rule
1.1, which would enumerate the classes of Exchange Traded Products
that the Exchange proposes to trade on a UTP basis, would satisfy
the requirements of Rule 12f-5 under the Act, 17 CFR 240.12f-5, for
a national securities exchange to have a rule or rules providing for
transactions in a class or type of security to which the Exchange
extends unlisted trading privileges. See Amendment No. 1, supra note
6.
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    Proposed Rule 5.1 would establish the Exchange's authority to trade
securities on a UTP basis. Proposed Rule 5.1(a)(1) would provide that
the Exchange may extend UTP to any security that is an NMS Stock that
is listed on another national securities exchange or with respect to
which UTP may otherwise be extended in accordance with Section 12(f) of
the Exchange Act.\46\
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    \46\ 15 U.S.C. 78l(f). See also 17 CFR 242.600. The term ``NMS
Stock'' is defined in proposed Rule 1.1(u).
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    Proposed Rule 5.1(a)(1) would further provide that any such
security would be subject to all Exchange rules applicable to trading
on the Exchange, unless otherwise noted. The Exchange notes that this
proposed rule text is based in part on NYSE Arca Rule 5.1-E(a) and EDGA
Rule 14.1, but with a proposed difference to refer generally to
Exchange rules, and not limit such reference to Exchange trading rules.
This would make clear that all Exchange rules would be applicable to
the trading of securities on a UTP basis on the Exchange, including
business conduct and sales practice rules set forth in proposed Rule
11.
    Proposed Rule 5.1(a)(2) would establish additional rules for
trading of UTP Exchange Traded Products, which are defined in Rule 1.1
(described above).\47\ Specifically, the requirements in subparagraphs
(A)-(E) of proposed Rule 5.1(a)(2) would apply to UTP Exchange Traded
Products traded on the Exchange. Because the Exchange is not proposing
that the Exchange would file with the Commission a Form 19b-4(e) with
respect to each UTP Exchange Traded Product within five business days
after commencement of trading, the Exchange does not propose rule text
based on NYSE American Rule 5.1E(a)(2)(A) or NYSE Rule 5.1(a)(2)(A).
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    \47\ See Proposed Rule 1.1(m).
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    Proposed Rule 5.1(a)(2)(A) would provide that the Exchange would
distribute an information circular prior to the commencement of trading
in an Exchange Traded Product that generally would include the same
information as the information circular provided by the listing
exchange, including (a) the special risks of trading the Exchange
Traded Product, (b) the Exchange's rules that will apply to the
Exchange Traded Product and (c) information about the dissemination of
value of the underlying assets or indices. Under proposed Rule
5.1(a)(2)(C), the Exchange would halt trading in a UTP Exchange Traded
Product as provided for in proposed Rule 7.18.
    Proposed Rule 5.1(a)(2)(E) would provide that the Exchange's
surveillance procedures for Exchange Traded Products traded on the
Exchange pursuant to UTP would be similar to the procedures used for
equity securities traded on the Exchange and would incorporate and rely
upon existing Exchange surveillance systems.
    Proposed Rules 5.1(a)(2)(B) and (D) would establish the following
requirements for ETP Holders that have customers that trade UTP
Exchange Traded Products:
     Prospectus Delivery Requirements. Proposed Rule
5.1(a)(2)(B)(i) would remind ETP Holders that they are subject to the
prospectus delivery requirements under the Securities Act of 1933, as
amended (the ``Securities Act''), unless the Exchange Traded Product is
the subject of an order by the Commission exempting the product from
certain prospectus delivery requirements under Section 24(d) of the
Investment Company Act of 1940, as amended (the ``1940 Act''), and the
product is not otherwise subject to prospectus delivery requirements
under the Securities Act. ETP Holders would also be required to provide
a prospectus to a customer requesting a prospectus.\48\
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    \48\ Proposed Rule 5.1(a)(2)(B)(iii).
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     Written Description of Terms and Conditions. Proposed Rule
5.1(a)(2)(B)(ii) would require ETP Holders to provide a written
description of the terms and characteristics of UTP Exchange Traded
Products to purchasers of such securities, not later than the time of
confirmation of the first transaction, and with any sales materials
relating to UTP Exchange Traded Products.
     Market Maker Restrictions. Proposed Rule 5.1(a)(2)(D)
would establish certain restrictions for any ETP Holder registered as a
market maker in an UTP Exchange Traded Product that derives its value
from one or more currencies, commodities, or derivatives based on one
or more currencies or commodities, or is based on a basket or index
composed of currencies or commodities (collectively, ``Reference
Assets''). Specifically, such an ETP Holder must file with the Exchange
and keep current a list identifying all accounts for trading the
underlying physical asset or commodity, related futures or options on
futures, or any other related derivatives (collectively with Reference
Assets, ``Related Instruments''), which the ETP Holder acting as
registered market maker may have or over which it may exercise
investment discretion.\49\ If an account in which an ETP Holder acting
as a registered market maker, directly or indirectly, controls trading
activities, or has a direct interest in the profits or losses thereof,
has not been reported to the Exchange as required by this Rule, an ETP
Holder acting as registered market maker in the UTP Exchange Traded
Product would not be permitted to trade in the underlying physical
asset or commodity, related futures or options on futures, or any other
related derivatives. Finally, a market maker could not use any material
nonpublic information in connection with trading a Related Instrument.
According to the Exchange, proposed Rule 5.1(a)(2)(D) is based in part
on BZX Rule 14.11(j)(5).\50\
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    \49\ The proposed rule would also, more specifically, require a
market maker to file with the Exchange and keep current a list
identifying any accounts (``Related Instrument Trading Accounts'')
for which related instruments are traded (1) in which the market
maker holds an interest, (2) over which it has investment
discretion, or (3) in which it shares in the profits and/or losses.
In addition, a market maker would not be permitted to have an
interest in, exercise investment discretion over, or share in the
profits and/or losses of a Related Instrument Trading Account that
has not been reported to the Exchange as required by the proposed
rule.
    \50\ See Amendment No. 1, supra note 6.
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Rule 6--Consolidated Audit Trail and Order Audit Trail System

    Proposed Rule 6 would incorporate the Exchange's existing rules
relating to the Consolidated Audit Trail National Market System Plan
(``CAT NMS Plan'') without any substantive changes. Proposed Rule 6
would include 12 rules covering the following areas: (1) Definitions;
(2) Clock Synchronization; (3) Industry Member Data Reporting; (4)
Customer Information Reporting; (5) Industry Member Information
Reporting; (6) Time Stamps; (7) Clock Synchronization Rule Violation;
(8) Connectivity and Data Transmission; (9) Development and Testing;
(10) Recordkeeping; (11) Timely, Accurate and Complete Data; and (12)
Compliance Dates. Proposed Rule 6.6900 would establish procedures for
resolving potential disputes related to CAT Fees charged to Industry
Members.
    Proposed Rule 6.7400 would contain a series of rules that implement
Order Audit Trail rules relating to definitions; applicability;
synchronization of ETP Holder business clocks; recording of

order information; order data transmission requirements; violation of
order audit trail system rules; and exemption to the order recording
and data transmission requirements.\51\
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    \51\ The Exchange notes that at the time that it ceased
operations, it did not require its ETP Holders to maintain order
information pursuant to an order tracking system and, therefore, did
not have the proposed OATS rules or similar rules in its rulebook.
According to the Exchange, requiring ETP Holders to comply with the
proposed OATS requirements in connection with its re-launch of
trading would not impose an undue burden on such ETP Holders or
their associated persons because nearly all ETP Holders are expected
to be members of another SRO that requires compliance with OATS
requirements and because order information pursuant to the OATS
rules need only be submitted upon request.
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Rule 7--Equities Trading

    Rule 7 establishes the rules for trading on the Exchange. As noted
above, the Exchange proposes to re-launch on the same trading platform
as the cash equities trading platform of NYSE Arca. Thus, the
provisions of proposed Rule 7 are, in large part, based on equivalent
rules of NYSE Arca for this platform. In some instances, however, the
proposed trading rules reflect a choice to adopt the version of a
particular provision used by NYSE American and NYSE.\52\
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    \52\ The Exchange has identified which of its proposed rules are
based on the rules of NYSE American, as opposed to those based on
the rules of NYSE Arca. See Amendment No. 1, supra note 6. The
Exchange also has identified certain trading rules of NYSE Arca and
NYSE American that it is not proposing to adopt. For example, the
Exchange states that, because it would not be a listing venue, it is
not proposing to adopt rules relating to lead or designated market
makers. The Exchange also states that it would not operate auctions,
and therefore is not proposing rules pertaining to auction
procedures.
---------------------------------------------------------------------------

    Proposed Rule 7 is divided into six sections. Section 1, ``General
Provisions,'' \53\ includes provisions relating to hours of business on
the Exchange and holidays when it will not be open; responsibilities of
ETP Holders and associated persons with respect to their roles in
transactions and their charging of commissions; ex-dividend and ex-
rights dates; units of trading; trading differentials; anonymity of
bids and offers; settlement terms; binding prices; clearly erroneous
executions; Exchange compliance with the Limit Up-Limit Down National
Market System Plan; trading halts and suspensions; clearance and
settlement; stock option transactions of market makers; short sales;
and firmness of quotes.
---------------------------------------------------------------------------

    \53\ Section 1 comprises proposed Rules 7.1 through 7.18.
---------------------------------------------------------------------------

    Section 2 of proposed Rule 7, ``Market Makers,'' \54\ includes
provisions relating to registration of Market Makers. The section also
includes proposed rules pertaining to access to quotations, private
linkages, and compliance with Regulation NMS under the Act.
---------------------------------------------------------------------------

    \54\ Section 2 comprises proposed Rules 7.19 through 7.28.
---------------------------------------------------------------------------

    Section 3 of proposed Rule 7, ``Exchange Trading,'' \55\ after
setting forth provisions regarding authorized access to the Exchange,
establishes rules relating to the kinds of order types available on the
Exchange and how they are designed to trade. Section 3 of proposed Rule
7 also would set forth the rules of the Exchange relating to order
entry; the codes by which the ETP Holder submitting an order must
indicate whether it is acting in a principal, agency, or riskless
principal capacity; and the three trading sessions for which the
Exchange will be open (early, core, and late), including the securities
that may be traded in each and the disclosures that ETP Holders must
make to non-ETP Holders that send orders to them for trading in the
early or late session regarding, among other things, the risks that may
apply to such orders.\56\
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    \55\ Section 3 comprises proposed Rules 7.29 through 7.41 (with
Rules 7.42 through 7.44 reserved for future use).
    \56\ See proposed Rules 7.32 (Order Entry); 7.33 (Capacity
Codes); and 7.34 (Trading Sessions).
---------------------------------------------------------------------------

    Further, Section 3 of proposed Rule 7 would establish rules
relating to the display and non-display of various order types, the
ranking of orders in the Exchange book with respect to execution
priority, and the role of price and time in determining such
priority.\57\ The section also includes proposed rules that pertain to
routing of orders to away markets; the prohibition of trading through
protected quotations and exceptions thereto; and compliance with other
aspects of Regulation NMS under the Act.\58\ It also lists the data
feeds that the Exchange proposes to use for the handling, execution,
and routing of orders, as well as regulatory compliance.\59\ Additional
proposed rules in Section 3 relate to odd lot and mixed lot trading on
the Exchange; trade execution and reporting; and clearance and
settlement of trades.\60\
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    \57\ See proposed Rules 7.36 (Order Ranking and Display).
    \58\ See proposed Rules 7.37 (Order Execution and Routing).
    \59\ Id.
    \60\ See proposed Rules 7.38, 7.40, and 7.41, respectively.
(Rule 7.39 is reserved for future use, as are Rules 7.42, 7.43, and
7.44.)
---------------------------------------------------------------------------

    Section 4 of proposed Rule 7, ``Operation of Routing Broker,''
would define ``routing broker'' as ``the broker-dealer affiliate of the
Exchange and/or any other non-affiliate third-party broker-dealer that
acts as a facility of the Exchange for routing orders entered into
Exchange systems to other market centers for execution whenever such
routing is required by Exchange rules or the federal securities laws,''
and would set forth rules regarding the outbound routing function.\61\
---------------------------------------------------------------------------

    \61\ See proposed Rule 7.45, which comprises the whole of
Section 4.
---------------------------------------------------------------------------

    Section 4 also would provide that, for so long as the Exchange is
affiliated with NYSE American, NYSE Arca, and NYSE, and Archipelago
Securities LLC (``Arca Securities) in its capacity as a facility of
those exchanges is utilized by those affiliated exchanges for the
routing of any approved types of orders from those exchanges to NYSE
National, Arca Securities may provide inbound routing services to NYSE
National from those affiliated exchanges.\62\ This provision is
contingent on the Exchange maintaining an agreement pursuant to Rule
17d-2 under the Act \63\ with a non-affiliated SRO and establishing
controls and procedures to prevent Arca Securities from benefitting
from or acting on non-public information obtained as a result of the
affiliation.\64\
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    \62\ Proposed Rule 3.9 would provide that, unless approved by
the Commission, neither NYSE Group, Inc., nor any of its affiliates
(as such term is defined in Rule 12b-2 under the Act) shall hold,
directly or indirectly, an ownership interest in any ETP Holder.
Arca Securities would be covered by this provision.
    \63\ 17 CFR 240.17d-2.
    \64\ See id. Proposed Rule 7.45 also includes provisions
regarding cancellation of orders and error accounts in connection
with the arrangement of the Exchange with Arca Securities.
---------------------------------------------------------------------------

    Section 5 of proposed Rule 7, ``Plan to Implement a Tick Size Pilot
Program'' \65\ would establish requirements relating to the Tick Size
Pilot Program adopted as a joint industry plan under Regulation NMS
under the Act, and is based on the similar rule of NYSE Arca.\66\
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    \65\ Section 5 is comprised solely of proposed Rule 7.46.
    \66\ See NYSE Arca 7.46-E.
---------------------------------------------------------------------------

    Section 6 of proposed Rule 7, ``Contracts in Securities,'' \67\
would provide that contracts in municipal securities be compared,
settled, and cleared in accordance with regulations of the Municipal
Securities Rulemaking Board; set forth requirements relating to ETP
contracts of an ETP Holder with another ETP Holder; and establish
requirements relating to the book entry settlement of transactions.\68\
---------------------------------------------------------------------------

    \67\ Section 6 would include proposed Rules 7.60 through 7.62.
    \68\ See proposed Rules 7.61, 7.62, and 7.63, respectively.
---------------------------------------------------------------------------

Rule 10--Disciplinary Proceedings, Other Hearings, and Appeals

    Proposed Rule 10 consists of proposed Rule 10.8000, Investigations
and Sanctions, and proposed Rule 10.9000, Code of Procedure, (``Rule

10.8000 and Rule 10.9000 Series''), which are based on NYSE American
Rule 8000 and Rule 9000 Series of the Office Rules, with certain
modifications.\69\ Together, the rules would be the Exchange's
Disciplinary rules. Other than the differences specified in Amendment
No. 1, the proposed Rule 10.8000 and 10.9000 Series are based on the
individual counterpart NYSE American Rule 8000 and 9000 Series.\70\
Given the different membership structures, lack of a physical trading
floor,\71\ and differences in terminology throughout the rules, the
proposed Rule 10.8000 and Rule 10.9000 Series would differ from the
NYSE American rules as follows:
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    \69\ NYSE American Rule 8000 and Rule 9000 Series are
substantially the same as the Rule 8000 and Rule 9000 Series of NYSE
and of FINRA. See Securities Exchange Act Release No. 77241
(February 26, 2016), 81 FR 11311 (March 3, 2016) (SR-NYSEMKT-2016-
30). See also Securities Exchange Act Release No. 78959 (September
28, 2016), 81 FR 68481 (October 4, 2016) (SR-NYSEMKT-2016-71). The
NYSE American disciplinary rules were implemented on April 15, 2016.
See NYSE American Information Memorandum 16-02 (March 14, 2016).
    \70\ See Amendment No. 1, supra note 6.
    \71\ Because the Exchange would not have a floor, it would not
have Floor-Based Panelists. See NYSE American Rules 9120(q),
9212(a)(2)(B), 9221(a)(3), 9231(b)(2) and (c)(2), and 9232(c).
---------------------------------------------------------------------------

     The term ``ETP Holder'' is used rather than ``member and
member organization'' or ``member organization or ATP Holder'';
     the terms ``Associated Person'' and ``Person Associated
with an ETP Holder,'' which are defined terms on the Exchange are used
rather than the term ``covered person'';
     not adopt NYSE American Rules 8001 and 9001, which
describe the effective date of the NYSE American rules;
     not retain the text of NYSE American's legacy minor rules;
     add the following sentence, from NYSE Arca Rule 10.2(a),
to Rule 10.8210(a): ``No member of the Board of Directors or non-
Regulatory Staff may interfere with or attempt to influence the process
or resolution of any pending investigation or disciplinary
proceeding'';
     exclude the definition of the following terms in Rule
10.9120: ``Board of Directors,'' ``covered person,'' ``Exchange,'' and
``Floor-Based Panelist,'' because they are defined elsewhere in the
rules or are not applicable to the Exchange, and would mark those
paragraphs as ``Reserved'';
     add the following sentence to proposed Rule 10.9120(v)'s
definition of ``Panelist'': ``Hearing Panel members will be drawn from
the Exchange Business Conduct Committee (`BCC')'';
     merge the current Rule 8.15 and NYSE American Rule 9217 to
create proposed Rule 10.9217, which sets forth the Exchange's Minor
Rule Violation Plan; \72\
---------------------------------------------------------------------------

    \72\ See Amendment No. 1, supra note 6. The Minor Rule Violation
Plan provides an alternative method for the Exchange to address a
violation of its rules. The Exchange is always free to pursue formal
disciplinary action against a member that violates its rules.
---------------------------------------------------------------------------

     replace the phrase ``an ETP Holder that is an affiliate''
from NYSE American Rule 9268(e)(2) with ``an affiliate of the Exchange
as such term is defined in Rule 12b-2 under the Exchange Act,'' in
proposed Rules 10.9268 and 10.9310(a)(1); and
     propose non-substantive grammatical differences in
specified rules, as needed, and update internal cross references to the
appropriate Exchange rule.

Rule 11--Business Conduct

    The Exchange proposes to maintain certain current NYSE National
rules regarding rules of fair practice, books and records,
supervisions, extensions of credit, and trading practices and relocate
these rules to proposed Rule 11. The Exchange also proposes to adopt
conduct rules that are based on FINRA rules and to incorporate certain
FINRA rules by reference.\73\
---------------------------------------------------------------------------

    \73\ See Amendment No. 1, supra note 6. In Amendment No. 1, the
Exchange proposes to revise or relocate certain rules in Rule 11
that were included in the original proposed rule change.
---------------------------------------------------------------------------

    Section 1 of proposed Rule 11 would be designated as Rules of Fair
Practice and the preamble thereto would state that ``References to the
term ETP Holder in Section 1 to Rule 11 also mean Associated Persons of
ETP Holders.'' The rules in Section 1 to proposed Rule 11 relate to
Business Conduct of ETP Holders,\74\ Violations Prohibited,\75\ Use of
Fraudulent Devices,\76\ False Statements,\77\ Advertising
Practices,\78\ Fair Dealing with Customers,\79\ The Prompt Receipt and
Delivery of Securities,\80\ Charges for Services Performed,\81\ Use of
Information,\82\ Publication of Transactions and Quotations,\83\ Offers
at Stated Prices,\84\ Payment Designed to Influence Market Prices,
Other than Paid Advertising,\85\ Disclosure of Control,\86\
Discretionary Accounts,\87\ Customer's Securities or Funds,\88\
Prohibition Against Guarantees,\89\ Sharing in Accounts; Extent
Permissible,\90\ and Telephone Solicitation.\91\
---------------------------------------------------------------------------

    \74\ Proposed Rule 11.3.1.
    \75\ Proposed Rule 11.3.2.
    \76\ Proposed Rule 11.3.3.
    \77\ Proposed Rule 11.3.4.
    \78\ Proposed Rule 11.3.5.
    \79\ Proposed Rule 11.3.6.
    \80\ Proposed Rule 11.3.8.
    \81\ Proposed Rule 11.3.9.
    \82\ Proposed Rule 11.3.10.
    \83\ Proposed Rule 11.3.11.
    \84\ Proposed Rule 11.13.12.
    \85\ Proposed Rule 11.13.13.
    \86\ Proposed Rule 11.13.15.
    \87\ Proposed Rule 11.13.16.
    \88\ Proposed Rule 11.13.17.
    \89\ Proposed Rule 11.13.18.
    \90\ Proposed Rule 11.13.19.
    \91\ Proposed Rule 11.13.21.
---------------------------------------------------------------------------

    Section 2 of proposed Rule 11 would be designated as Books and
Records and the rules thereunder would relate to Requirements,\92\
Furnishing of Records,\93\ Record of Written Complaints,\94\ and
Disclosure of Financial Condition.\95\
---------------------------------------------------------------------------

    \92\ Proposed Rule 11.4.1.
    \93\ Proposed Rule 11.4.2.
    \94\ Proposed Rule 11.4.3.
    \95\ Proposed Rule 11.4.4.
---------------------------------------------------------------------------

    Section 3 of proposed Rule 11 would be designated as Supervision
and the rules thereunder would relate to Written Procedures,\96\
Responsibility of ETP Holders,\97\ Records,\98\ Review of Activities
and Annual Inspection,\99\ Prevention of the Misuse of Material,
Nonpublic Information,\100\ and Annual Certification of Compliance and
Supervisory Processes.\101\
---------------------------------------------------------------------------

    \96\ Proposed Rule 11.5.1.
    \97\ Proposed Rule 11.5.2.
    \98\ Proposed Rule 11.5.3.
    \99\ Proposed Rule 11.5.4.
    \100\ Proposed Rule 11.5.5.
    \101\ Proposed Rule 11.5.7.
---------------------------------------------------------------------------

    Section 4 of proposed Rule 11 would be designated as Extensions of
Credit and the rules thereunder would relate to Extensions of Credit--
Prohibitions and Exemptions \102\ and Day Trading Margin.\103\
---------------------------------------------------------------------------

    \102\ Proposed Rule 11.6.1.
    \103\ Proposed Rule 11.6.2.
---------------------------------------------------------------------------

    Section 5 of proposed Rule 11 would be designated as Trading
Practice Rules and the preamble thereto would state that ``References
to the term ETP Holder in Section 5 to Rule 11 also mean Associated
Persons of ETP Holders.'' The rules in Section 5 of proposed Rule 11
relate to Market Manipulation,\104\ Fictitious Transactions,\105\
Excessive Sales by an ETP Holder,\106\ Manipulative Transactions,\107\
Dissemination of False Information,\108\ Joint Activity,\109\
Influencing the Consolidated Tape,\110\ Options,\111\ Best

Execution,\112\ and Prearranged Trades.\113\
---------------------------------------------------------------------------

    \104\ Proposed Rule 11.12.1.
    \105\ Proposed Rule 11.12.2.
    \106\ Proposed Rule 11.12.3.
    \107\ Proposed Rule 11.12.4.
    \108\ Proposed Rule 11.12.5.
    \109\ Proposed Rule 11.12.7.
    \110\ Proposed Rule 11.12.8.
    \111\ Proposed Rule 11.12.9.
    \112\ Proposed Rule 11.12.10.
    \113\ Proposed Rule 11.12.11.
---------------------------------------------------------------------------

    The Exchange proposes to adopt new conduct rules in Section 6 of
proposed Rule 11 (Harmonized Conduct Rules). The rules in Section 6 of
proposed Rule 11 relate to Suitability,\114\ Communications with the
Public,\115\ Customer Confirmations,\116\ Anti-Money Laundering
Compliance Program,\117\ Disruptive Quoting and Trading Activity
Prohibited,\118\ and Prohibition Against Trading Ahead of Customer
Orders.\119\ Other than proposed Rule 11.5220, relating to Disruptive
Quoting and Trading Activity Prohibited, the Section 6 rules would
incorporate by reference a specific FINRA rule or, in the case of
proposed Rule 11.5320, would set forth the complete rule and also
incorporate by reference the relevant FINRA rule.\120\
---------------------------------------------------------------------------

    \114\ Proposed Rule 11.2111.
    \115\ Proposed Rule 11.2210.
    \116\ Proposed Rule 11.2232.
    \117\ Proposed Rule 11.3310.
    \118\ Proposed Rule 11.5220.
    \119\ Proposed Rule 11.5320.
    \120\ In its proposed rule change, as amended, the Exchange
states that it proposes to file a request that the Commission
exercise its authority under Section 36 of the Act and Rule 0-12
thereunder, and grant the Exchange an exemption from the rule filing
requirements of Section 19(b) of the Act for changes to Exchange
rules that will be effected by a cross-reference to a FINRA rule,
including FINRA rules designated as NASD rules.
---------------------------------------------------------------------------

Rule 12--Arbitration

    The Exchange proposes new Rule 12 (Arbitration) to replace rules
set forth in Chapter IX relating to arbitration. Proposed Rule 12 would
incorporate by reference the Rule 12000 Series and the Rules 13000
Series of the FINRA Manual (Code of Arbitration Procedures for Customer
Disputes and Code of Arbitration for Industry Disputes) (the ``FINRA
Code of Arbitration'').\121\ Proposed Rule 12 would govern jurisdiction
and the circumstances under which disputes may be arbitrated; \122\
pre-dispute arbitration agreements between ETP Holders and their
customers, which would incorporate by reference FINRA Rule 2268; \123\
arbitrators' referrals to the Exchange; \124\ any failures to honor an
arbitrator's award; \125\ and the effect of arbitration on the
Exchange's rights as an SRO.\126\
---------------------------------------------------------------------------

    \121\ See Amendment No. 1, supra note 6.
    \122\ Proposed Rule 12(b).
    \123\ Proposed Rule 12(c).
    \124\ Proposed Rule 12(d).
    \125\ Proposed Rule 12(e).
    \126\ Proposed Rule 12(f).
---------------------------------------------------------------------------

Rule 13--Liability of Directors and Exchange

    The Exchange proposes new Rule 13, which would set forth the rules
governing the liability of its Directors and the Exchange. Proposed
Rules 13.1 and 13.2 would set forth limitations on liability of the
Directors and the Exchange, respectively.\127\ Proposed Rule 13.3 would
limit legal proceedings against any Directors, officer, employee, agent
or other official of the Exchange or any subsidiary of the
Exchange.\128\ Proposed Rule 13.4 relates to responsibility for the
Exchange's costs in defending a legal proceeding brought against the
Exchange.\129\
---------------------------------------------------------------------------

    \127\ Proposed Rule 13.1 and 13.2.
    \128\ Proposed Rule 13.3.
    \129\ Proposed Rule 13.4.
---------------------------------------------------------------------------

III. Discussion and Commission Findings

    After careful review, the Commission finds that the proposed rule
change, as modified by Amendment No. 1, is consistent with the
requirements of the Act and rules and regulations thereunder applicable
to a national securities exchange.\130\ In particular, the Commission
finds that the amended proposed rule change is consistent with Section
6(b)(5) of the Act,\131\ which requires, among other things, that the
rules of a national securities exchange be 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, and are not
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers. The Commission further finds that the amended
proposed rule change is consistent with Section 6(b)(7) of the
Act,\132\ which requires, among other things, that the rules of a
national securities exchange provide a fair procedure for the
disciplining of members and persons associated with members.
---------------------------------------------------------------------------

    \130\ In approving the proposed rule changes, the Commission has
considered their impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
    \131\ 15 U.S.C. 78f(b)(5).
    \132\ 15 U.S.C. 78f(b)(7).
---------------------------------------------------------------------------

1. Re-Launch of the Exchange on the Pillar Trading Platform
    The Exchange's proposal would re-launch the Exchange on the Pillar
platform as a fully-automated cash equities trading market with a
price-time priority allocation model. As discussed at length in
Amendment No. 1, the re-launched Exchange would neither list securities
nor operate an auction and instead, would trade securities solely on a
UTP basis.
    The Commission notes that the Exchange's amended proposal, in
addition to retaining certain of the Exchange's existing rules, would
establish new rules that are based on, and are substantially similar
to, the rules of its affiliated exchanges and FINRA, which were filed
and approved by the Commission (or which became immediately effective)
pursuant to Section 19(b) of the Act.\133\ Several of its affiliated
exchanges currently operate using the Pillar trading platform, and a
number of other national securities exchanges operate fully electronic
markets. Accordingly, the Commission finds that the amended proposal
raises no novel regulatory issues, that it is reasonably designed to
protect investors and the public interest, and that it is consistent
with the requirements of the Act. The Commission highlights below its
views on certain of the more significant aspects of the Exchange's
proposal.
---------------------------------------------------------------------------

    \133\ See 78 U.S.C 78s(b).
---------------------------------------------------------------------------

Rule 2--Trading Permits

    As noted above, the Exchange proposes to retain its existing
membership rules,\134\ which may not reflect certain harmonized
standards in the membership rules of other SROs. The Commission notes
that the Exchange commits to working with Commission staff to update
its membership rules and to file a separate filing relating to its
membership rules within 90 days of any approval of the Exchange's
proposed rule change.\135\ Also, an ETP Holder, as a prerequisite to
membership, would be required to be a member of a registered national
securities association or of a registered national securities
exchange.\136\ As a member of two or more SROs, an ETP Holder would be
required to comply with whichever rules impose a higher standard.
---------------------------------------------------------------------------

    \134\ The Commission notes the Exchange represents that there
are no categories of persons on the Exchange that would fall outside
of the membership categories and requirements set forth in proposed
Rule 2. See supra note 31.
    \135\ See supra note 37.
    \136\ See proposed Rule 2.3.
---------------------------------------------------------------------------

    In Amendment No. 1, the Exchange proposes a grace period of 30
calendar days for ETP Holders eligible for the expedited reinstatement
process \137\ to register Persons Associated with the ETP Holder with
the Exchange. ETP Holders who take advantage of the grace period would
be able to begin trading on the Exchange before completing the

registration of Persons Associated with the Exchange. The Commission
notes that, based on the requirements of the expedited process for
reinstatement, such ETP Holders would be required to already have
Persons Associated with the ETP Holder registered on CRD. The
Commission believes that the grace period would remove impediments to
and perfect the mechanism of a free and open market and a national
market system by allowing ETP Holders to begin trading on the Exchange
immediately, without completing the manual process of entering into CRD
an additional registration for their Associated Persons, as of the
Exchange's re-launch of trading.
---------------------------------------------------------------------------

    \137\ See Commentary .01 to proposed Rule 2.5.
---------------------------------------------------------------------------

    Based on the fact that ETP Holders are currently subject to the
registration requirements of the other exchange or association of which
they are members, as well as on the Commission's expectation that the
Exchange will file a proposal within 90 days to conform its membership
rules to the membership rules of other SROs, the Commission finds that
the Exchange's proposed membership rules are consistent with the
requirements of the Act.
    The Commission notes that proposed Rule 3.9 provides that, without
prior Commission approval, no ETP Holder shall be affiliated with NYSE
Group, Inc. or any of its affiliated entities.\138\ The Commission
finds that it is consistent with the Act to permit Arca Securities to
become affiliated with the Exchange for the purposes of providing
routing services for the Exchange, subject to conditions described in
proposed Rule 7.45.
---------------------------------------------------------------------------

    \138\ See proposed Rule 3.9(a). See also supra note 62.
---------------------------------------------------------------------------

Rule 5--Trading on an Unlisted Trading Privileges Basis

    As discussed above, in Amendment No. 1 the Exchange states that it
does not believe that it is necessary for an exchange that trades
securities only on a UTP basis to have listing rules for ETPs.\139\
Similarly, the Exchange states its belief that it should not be
necessary for a non-listing venue to file a Form 19b-4(e) if it begins
trading an ETP on a UTP basis, because Rule 19b-4(e)(1) under the Act
refers to the ``listing and trading'' of a ``new derivative securities
product.'' \140\ Accordingly, the Exchange proposes to adopt only those
rules that would support the trading on a UTP basis of all NMS Stocks,
and the trading on a UTP basis for UTP Exchange Trading Products.\141\
---------------------------------------------------------------------------

    \139\ See Amendment No. 1, supra note 6.
    \140\ 17 CFR 240.19b-4(e). See Amendment No. 1, supra note 6.
    \141\ See supra note 41.
---------------------------------------------------------------------------

    Proposed Rule 5.1 would establish the Exchange's authority to trade
securities on a UTP basis. Proposed Rule 5.1(a)(1) would provide that
the Exchange may extend UTP to any security that is an NMS Stock that
is listed on another national securities exchange or with respect to
which UTP may otherwise be extended in accordance with Section 12(f) of
the Act.\142\ Proposed Rule 5.1(a)(1) further would provide that any
such security would be subject to all Exchange rules applicable to
trading on the Exchange, unless otherwise noted.
---------------------------------------------------------------------------

    \142\ 15 U.S.C. 781(f).
---------------------------------------------------------------------------

    Proposed Rule 5.1(a)(2) would establish additional rules for
trading of UTP Exchange Traded Products, which are defined in Rule 1.1
(described above). Proposed Rule 5.1(a)(2)(A) would provide that the
Exchange would distribute an information circular prior to the
commencement of trading in an Exchange Traded Product that generally
would include the same information as the information circular provided
by the listing exchange, including (a) the special risks of trading the
Exchange Traded Product, (b) the Exchange's rules that would apply to
the Exchange Traded Product and (c) information about the dissemination
of value of the underlying assets or indices. Proposed Rule
5.1(a)(2)(E) would provide that the Exchange's surveillance procedures
for Exchange Traded Products traded on the Exchange pursuant to UTP
would be similar to the procedures used for equity securities traded on
the Exchange and would incorporate and rely upon existing Exchange
surveillance systems. Proposed Rules 5.1(a)(2)(B) and (D) would
establish certain requirements for ETP Holders that have customers that
trade UTP Exchange Traded Products.\143\
---------------------------------------------------------------------------

    \143\ Proposed Rule 5.1(a)(2)(B)(i) would remind ETP Holders
that they are subject to the prospectus delivery requirements under
the Securities Act, unless the Exchange Traded Product is the
subject of an order by the Commission exempting the product from
certain prospectus delivery requirements under Section 24(d) of the
1940 Act, and the product is not otherwise subject to prospectus
delivery requirements under the Securities Act. ETP Holders also
would be required to provide a prospectus to a customer requesting a
prospectus. Proposed Rule 5.1(a)(2)(B)(ii) would require ETP Holders
to provide a written description of the terms and characteristics of
UTP Exchange Traded Products to purchasers of such securities, not
later than the time of confirmation of the first transaction, and
with any sales materials relating to UTP Exchange Traded Products.
Proposed Rule 5.1(a)(2)(D) also would establish certain requirements
for any ETP Holder registered as a market maker in an UTP Exchange
Traded Product that derives its value from one or more currencies,
commodities, or derivatives based on one or more currencies or
commodities, or is based on a basket or index composed of currencies
or commodities.
---------------------------------------------------------------------------

    The Commission finds that the Exchange's proposed approach to the
trading of securities on a UTP basis, as set forth in proposed Rule 5,
as amended by Amendment No. 1, is consistent with Section 6(b)(5) of
the Act.\144\ The Commission notes that the provisions in proposed Rule
5 are based upon existing rules of other exchanges.\145\ Proposed Rule
5.1 includes a provision that any security traded UTP on the Exchange
``shall be subject to all Exchange rules applicable to trading on the
Exchange, unless otherwise noted.'' Importantly, the Exchange notes
that this language is intended to make clear that all Exchange rules
would be applicable to the trading of UTP on the Exchange, including
business conduct and sales practice rules set forth in proposed Rule
11.\146\ The Commission notes that, in Amendment No. 1, the Exchange
would delete and reserve Rule 8, which it had previously proposed to
include listing standards and related provisions for the trading of
certain exchange derivatives on the Exchange.\147\ The Commission
believes that Rule 8, as previously proposed, is not necessary insofar
as proposed Rules 5 and 11 would cover all categories of securities
traded on the Exchange on a UTP basis.
---------------------------------------------------------------------------

    \144\ 15 U.S.C. 78f(b)(5).
    \145\ See discussion of proposed Rule 5 in Section II., supra.
    \146\ See Amendment No. 1, supra note 6.
    \147\ Id.
---------------------------------------------------------------------------

    In sum, the Commission believes that the changes proposed by the
Exchange in Amendment No. 1, including the proposed revisions to Rule 5
and the addition of the definitions of ``Exchange Traded Product'' and
``UTP Exchange Traded Product'' that enumerate the classes of Exchange
Traded Products to be traded on a UTP basis,\148\ as well as the
proposed requirement to distribute an information circular prior to the
commencement of trading, the business conduct and sales practice rules
set forth in Rule 11 (which apply to all securities traded UTP on the
Exchange), and the proposed deletion of Rule 8, taken together,
establish an appropriate framework for the trading of Exchange Traded
Products on a UTP basis on the Exchange.\149\ Accordingly, for these
reasons, the Commission finds that the

proposed rules governing trading on a UTP basis on the Exchange are
consistent with Section 6(b)(5) of the Act.
---------------------------------------------------------------------------

    \148\ See Amendment No. 1, supra note 6. As noted in the
description of Rule 1 above, the Exchange proposes a definition of
UTP Exchange Traded Products, which would enumerate in proposed Rule
1.1 the classes of Exchange Traded Products that the Exchange
proposes to trade on a UTP basis. See Proposed Rule 1.1(m).
    \149\ In addition, the Commission believes that the filing of a
Form 19b-4(e) is not required when an Exchange is trading a new
derivative securities product on a UTP basis only.
---------------------------------------------------------------------------

Rule 10--Disciplinary Proceedings, Other Hearings and Appeals

    The Exchange states that it is proposing to adopt the current
disciplinary rules of NYSE American, which are substantially similar to
those of NYSE and FINRA.\150\ The Exchange indicates in Amendment No.
1, as discussed above, where proposed Rule 10 differs from the NYSE
American disciplinary rules.\151\ The Exchange proposes disciplinary
rules substantially similar to those of the NYSE American in order to
harmonize the rules among the different NYSE Group exchanges and
minimize any potential regulatory burden on members arising from
differing processes. The Exchange represents that all but one of its
ETP Holders are also members of FINRA, NYSE Arca, NYSE American, NYSE,
or Nasdaq, and thus they would be familiar with the proposed
rules.\152\ The Commission believes that the proposed Rule 10.8000 and
Rule 10.9000 Series furthers the objectives of Section 6(b)(7) of the
Act,\153\ in that it provides fair procedures for the disciplining of
ETP Holders and persons associated with an ETP Holder, the denial of
membership to any person seeking membership therein, and the barring of
any person from becoming a person associated with an ETP Holder. For
the reasons discussed above, the Commission finds that the proposed
changes are consistent with Section 6(b)(7) of the Act.
---------------------------------------------------------------------------

    \150\ See Amendment No. 1, supra note 6. See also Securities
Exchange Act Release Nos. 68678 (January 16, 2013), 78 FR 5213
(January 24, 2013) (SR-NYSE-2013-02) (NYSE disciplinary rule
notice), 69045 (March 5, 2013), 78 FR 15394 (March 11, 2013) (NYSE-
2013-02) (NYSE disciplinary rule approval order), 69963 (July 10,
2013), 78 FR 42573 (July 16, 2013) (SR-NYSE-2013-49), and 58643
(September 25, 2008), 73 FR 57174 (October 1, 2008) (order approving
NASD disciplinary rules).
    \151\ See Amendment No. 1, supra note 6.
    \152\ See Amendment No. 1, supra note 6, fn. 51. See also
Securities Exchange Act Release No. 56204 (August 3, 2007), 72 FR
45288 (August 13, 2007) (NASDAQ-2007-070) (``To ensure that FINRA
members did not incur significant regulatory burdens as a result of
Nasdaq separating from FINRA and registering as a national
securities exchange, Nasdaq based its rules governing regulatory
standards and disciplinary processes on FINRA rules, to a
significant extent.'').
    \153\ See 15 U.S.C. 78f(b)(7).
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2. Section 11(a) of the Act
    Section 11(a)(1) of the Act \154\ prohibits a member of a national
securities exchange from effecting transactions on that exchange for
its own account, the account of an associated person, or an account
over which it or its associated person exercises investment discretion
(collectively, ``covered accounts'') unless an exception applies. Rule
11a2-2(T) under the Act,\155\ known as the ``effect versus execute''
rule, provides exchange members with an exemption from the Section
11(a)(1) prohibition. Rule 11a2-2(T) permits an exchange member,
subject to certain conditions, to effect transactions for covered
accounts by arranging for an unaffiliated member to execute
transactions on the exchange. To comply with Rule 11a2-2(T)'s
conditions, a member: (i) Must transmit the order from off the exchange
floor; (ii) may not participate in the execution of the transaction
once the order has been transmitted to the member performing the
execution; \156\ (iii) may not be affiliated with the executing member;
and (iv) with respect to an account over which the member or an
associated person has investment discretion, neither the member nor an
associated person may retain any compensation in connection with
effecting the transaction except as provided in the Rule. For the
reasons set forth below, the Commission believes that ETP Holders
entering orders into the Exchange's Pillar trading system would satisfy
the requirements of Rule 11a2-2(T).
---------------------------------------------------------------------------

    \154\ 15 U.S.C. 78k(a)(1).
    \155\ 17 CFR 240.11a2-2(T).
    \156\ This prohibition also applies to associated persons of the
initiating member. The member may, however, participate in clearing
and settling the transaction.
---------------------------------------------------------------------------

    Rule 11a2-2(T)'s first requirement is that orders for covered
accounts be transmitted from off the exchange floor. The Exchange
represents that it will not have a physical trading floor when it re-
launches trading and the Exchange's Pillar trading system will receive
orders from members electronically through remote terminals or
computer-to-computer interfaces.\157\ In the context of other automated
trading systems, the Commission has found that the off-floor
transmission requirement is met if a covered account is transmitted
from a remote location directly to an exchange's floor by electronic
means.\158\ Because the Pillar trading system receives orders
electronically through remote terminals or computer-to-computer
interfaces, the Commission believes that the Pillar trading system
would satisfy this off-floor transmission requirement.
---------------------------------------------------------------------------

    \157\ See Amendment No. 1, supra note 6.
    \158\ In the context of other all-electronic systems, the
Commission has similarly found that the off-floor transmission
requirement is met if the system receives orders electronically
through remote terminals or computer-to-computer interfaces. See,
e.g., Securities Exchange Act Release Nos. 61419 (January 26, 2010),
75 FR 5157 (February 1, 2010) (SR-BATS-2009-031) (approving BATS
options trading); 59154 (December 23, 2008), 73 FR 80468 (December
31, 2008) (SR-BSE-2008-48) (approving equity securities listing and
trading on BSE); 57478 (March 12, 2008), 73 FR 14521 (March 18,
2008) (SR-NASDAQ-2007-004 and SR-NASDAQ-2007-080) (approving NOM
options trading); 53128 (January 13, 2006), 71 FR 3550 (January 23,
2006) (File No. 10-131) (granting the application of The Nasdaq
Stock Market LLC for registration as a national securities
exchange); and 44983 (October 25, 2001), 66 FR 55225 (November 1,
2001) (SR-PCX-00-25) (approving the establishment of the Archipelago
Exchange as the equities trading facility of PCX Equities, Inc., a
subsidiary of the Pacific Exchange, Inc.).
---------------------------------------------------------------------------

    Second, Rule 11a2-2(T) requires that neither the initiating member
nor an associated person of the initiating member participate in the
execution of the transaction at any time after the order for the
transaction has been transmitted. The Exchange represents that the
Pillar trading system would at no time following the submission of an
order allow an ETP Holder or an associated person of the ETP Holder to
acquire control or influence over the result or timing of the order's
execution.\159\ According to the Exchange, the execution of an ETP
Holder's order would be determined solely by the quotes and orders that
are present in the system at the time the member submits the order and
by the order priority under the Exchange rules.\160\ Accordingly, the
Commission believes that an Exchange member and its associated persons
would not participate in the execution of an order submitted to the
Pillar trading system.
---------------------------------------------------------------------------

    \159\ See Amendment No. 1, supra note 6.
    \160\ See id. The Exchange notes that Rule 11a2-2(T) does not
preclude a member from cancelling or modifying orders, or from
modifying the instructions for executing orders, after they have
been transmitted, provided that such cancellations or modifications
are transmitted from off an exchange floor. See id. The Commission
has stated that the non-participation requirement is satisfied under
such circumstances so long as the modifications or cancellations are
also transmitted from off the floor. See Securities Exchange Act
Release No. 14563 (March 14, 1978), 43 FR 11542 (March 17, 1978)
(``1978 Release'') (stating that the ``non-participation requirement
does not prevent initiating members from canceling or modifying
orders (or the instructions pursuant to which the initiating member
wishes orders to be executed) after the orders have been transmitted
to the executing member, provided that any such instructions are
also transmitted from off the floor'').
---------------------------------------------------------------------------

    Third, Rule 11a2-2(T) requires that the order be executed by an
exchange member that is not associated with the member initiating the
order. The Commission has stated that this requirement is satisfied
when automated exchange facilities are used, as long as the design of
these systems ensures that members do not possess any special or unique
trading advantages in handling their orders after

transmitting them to the exchange.\161\ The Exchange represents that
the design of the Pillar trading system ensures that no ETP Holder has
any special or unique trading advantage in the handling of its orders
after transmitting its orders to the Exchange.\162\ Based on the
Exchange's representation, the Commission believes that the Pillar
trading system would satisfy this requirement.
---------------------------------------------------------------------------

    \161\ In considering the operation of automated execution
systems operated by an exchange, the Commission noted that, while
there is not an independent executing exchange member, the execution
of an order is automatic once it has been transmitted into the
system. Because the design of these systems ensures that members do
not possess any special or unique trading advantages in handling
their orders after transmitting them to the exchange, the Commission
has stated that executions obtained through these systems satisfy
the independent execution requirement of Rule 11a2-2(T). See
Securities Exchange Act Release No. 15533 (January 29, 1979), 44 FR
6084 (January 31, 1979).
    \162\ See Amendment No. 1, supra note 6.
---------------------------------------------------------------------------

    Fourth, in the case of a transaction effected for an account with
respect to which the initiating member or an associated person thereof
exercises investment discretion, neither the initiating member nor any
associated person may retain any compensation in connection with
effecting the transaction, unless the person authorized to transact
business for the account has expressly provided otherwise by written
contract referring to Section 11(a) of the Act and Rule 11a2-2(T)
thereunder.\163\ ETP Holders trading for covered accounts over which
they exercise investment discretion must comply with this condition in
order to rely on the rule's exemption.\164\
---------------------------------------------------------------------------

    \163\ In addition, Rule 11a2-2(T)(d) requires that, if a member
or associated person is authorized by written contract to retain
compensation in connection with effecting transactions for covered
accounts over which the member or associated person thereof
exercises investment discretion, the member or associated person
must furnish at least annually to the person authorized to transact
business for the account a statement setting forth the total amount
of compensation retained by the member or any associated person
thereof in connection with effecting transactions for the account
during the period covered by the statement. See 17 CFR 240.11a2-
2(T)(d). See also 1978 Release, supra note 107 (``The contractual
and disclosure requirements are designed to assure that accounts
electing to permit transaction-related compensation do so only after
deciding that such arrangements are suitable to their interests'').
    \164\ The Exchange represents that it will advise its membership
through the issuance of a Regulatory Bulletin that those ETP Holders
trading for covered accounts over which they exercise investment
discretion must comply with this condition in order to rely on the
exemption in Rule 11a2-2(T). See Amendment No. 1, supra note 6.
---------------------------------------------------------------------------

IV. Solicitation of Comments on Amendment No. 1 to the Proposed Rule
Change

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether Amendment No. 1
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-NYSENAT-2018-02 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-NYSENAT-2018-02. 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 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-NYSENAT-2018-02 and should be submitted
on or before June 13, 2018.

V. Accelerated Approval of Proposed Rule Change, as Modified by
Amendment No. 1

    The Commission finds good cause to approve the proposed rule
change, as modified by Amendment No. 1, prior to the thirtieth day
after the date of publication of notice of the filing of Amendment No.
1 in the Federal Register. As discussed above, in Amendment No. 1, the
Exchange proposes, among other things, to: (i) Delete proposed Rule 8
and modify proposed Rule 5 to include only those rules that would
support the trading on a UTP basis of all NMS Stocks and the trading on
a UTP basis of UTP Exchange Traded Products; (ii) revise the proposed
definition of the term ``UTP Exchange Traded Product''; (iii) propose a
grace period of thirty days for ETP Holders that are eligible for the
expedited process for reinstatement under the proposal to register
their Associated Persons with the Exchange; (iv) commit to working with
Commission staff to update its membership rules and to file a separate
filing relating to its membership rules within 90 days of any approval
of the instant proposal; (v) identify which of the proposed Rules are
based on the rules of NYSE American, as opposed to those based on the
rules of NYSE Arca; (vi) add provisions, based on rules of other SROs,
that were not included in the original filing; (vii) add a rule
relating to the requirements for listed securities issued by ICE or its
affiliates; (viii) specifically incorporate by reference certain FINRA
rules that were only cited in the original version of the filing; (ix)
add clarifying language to proposed rule text and the narrative
describing the proposal; and (x) correct various technical errors.
    The Commission notes that the proposed changes in Amendment No. 1
provide clarifying details, harmonize certain proposed rules with rules
of other exchanges, incorporate certain other SRO rules by reference,
and otherwise streamline the Exchange's proposed rulebook. The proposed
changes do not introduce any rules that differ in any substantive
manner from rules that previously have been approved by the Commission,
or that have become immediately effective, pursuant to Section 19(b) of
the Act. Accordingly, the Commission finds good cause, pursuant to
Section 19(b)(2) of the Act,\165\ to approve the proposed rule change,
as modified by Amendment No. 1, on an accelerated basis so that the

Exchange can re-commence operating without unnecessary delay.
---------------------------------------------------------------------------

    \165\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

VI. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\166\ that the proposed rule change (SR-NYSENAT-2018-02), as
modified by Amendment No. 1, be and hereby is approved on an
accelerated basis.
---------------------------------------------------------------------------

    \166\ Id.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\167\
---------------------------------------------------------------------------

    \167\ 17 CFR 200.30-3(a)(31).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-10986 Filed 5-22-18; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 84, Number 135 (Monday, July 15, 2019)]
[Notices]
[Pages 33807-33808]
[FR Doc No: 2019-14974]

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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

[Docket No. FMCSA-2010-0203; FMCSA-2014-0381]

Qualification of Drivers; Exemption Applications; Epilepsy and
Seizure Disorders

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Notice of final disposition.

-----------------------------------------------------------------------

SUMMARY: FMCSA announces its decision to renew exemptions for two
individuals from the requirement in the Federal Motor Carrier Safety
Regulations (FMCSRs) that interstate commercial motor vehicle (CMV)
drivers have ``no established medical history or clinical diagnosis of
epilepsy or any other condition which is likely to cause loss of
consciousness or any loss of ability to control a CMV.'' The exemptions
enable these individuals who have had one or more seizures and are
taking anti-seizure medication to continue to operate CMVs in
interstate commerce.

DATES: The exemptions were applicable on March 10, 2019. The exemptions
expire on March 10, 2021.

FOR FURTHER INFORMATION CONTACT: Ms. Christine A. Hydock, Chief,
Medical Programs Division,<PHONE_NUMBER><EMAIL_ADDRESS>FMCSA,
Department of Transportation, 1200 New Jersey Avenue SE, Room W64-224,
Washington, DC 20590-0001. Office hours are from 8:30 a.m. to 5 p.m.,
ET, Monday through Friday, except Federal holidays. If you have
questions regarding viewing or submitting material to the docket,
contact Docket Services, telephone<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Public Participation

A. Viewing Documents and Comments

    To view comments, as well as any documents mentioned in this notice
as being available in the docket, go to http://www.regulations.gov.
Insert the docket number, FMCSA-2010-0203 or FMCSA-2014-0381, in the
keyword box, and click ``Search.'' Next, click the ``Open Docket
Folder'' button and choose the document to review. If you do not have
access to the internet, you

may view the docket online by visiting the Docket Management Facility
in Room W12-140 on the ground floor of the DOT West Building, 1200 New
Jersey Avenue SE, Washington, DC 20590, between 9 a.m. and 5 p.m., ET,
Monday through Friday, except Federal holidays.

B. Privacy Act

    In accordance with 5 U.S.C. 553(c), DOT solicits comments from the
public to better inform its rulemaking process. DOT posts these
comments, without edit, including any personal information the
commenter provides, to www.regulations.gov, as described in the system
of records notice (DOT/ALL-14 FDMS), which can be reviewed at
www.dot.gov/privacy.

II. Background

    On April 18, 2019, FMCSA published a notice announcing its decision
to renew exemptions for two individuals from the epilepsy and seizure
disorders prohibition in 49 CFR 391.41(b)(8) to operate a CMV in
interstate commerce and requested comments from the public (84 FR
16331). The public comment period ended on May 20, 2019, and no
comments were received.
    As stated in the previous notice, FMCSA has evaluated the
eligibility of these applicants and determined that renewing these
exemptions would achieve a level of safety equivalent to, or greater
than, the level that would be achieved by complying with the current
regulation 49 CFR 391.41(b)(8).
    The physical qualification standard for drivers regarding epilepsy
found in 49 CFR 391.41(b)(8) states that a person is physically
qualified to drive a CMV if that person has no established medical
history or clinical diagnosis of epilepsy or any other condition which
is likely to cause the loss of consciousness or any loss of ability to
control a CMV.
    In addition to the regulations, FMCSA has published advisory
criteria to assist Medical Examiners in determining whether drivers
with certain medical conditions are qualified to operate a CMV in
interstate commerce. [49 CFR part 391, APPENDIX A TO PART 391--MEDICAL
ADVISORY CRITERIA, section H. Epilepsy: Sec.  391.41(b)(8), paragraphs
3, 4, and 5.]

III. Discussion of Comments

    FMCSA received no comments in this proceeding.

IV. Conclusion

    Based on its evaluation of the two renewal exemption applications,
FMCSA announces its decision to exempt the following drivers from the
epilepsy and seizure disorders prohibition in 49 CFR 391.41(b)(8).
    As of March 10, 2019, and in accordance with 49 U.S.C. 31136(e) and
31315, the following two individuals have satisfied the renewal
conditions for obtaining an exemption from the epilepsy and seizure
disorders prohibition in the FMCSRs for interstate CMV drivers (84 FR
16331): John C. Griffith (ND) and Denton Hineline (WA).
    The drivers were included in docket numbers FMCSA-2010-0203; FMCSA-
2014-0381. Their exemptions are applicable as of March 10, 2019, and
will expire on March 10, 2021.
    In accordance with 49 U.S.C. 31315, each exemption will be valid
for two years from the effective date unless revoked earlier by FMCSA.
The exemption will be revoked if the following occurs: (1) The person
fails to comply with the terms and conditions of the exemption; (2) the
exemption has resulted in a lower level of safety than was maintained
prior to being granted; or (3) continuation of the exemption would not
be consistent with the goals and objectives of 49 U.S.C. 31136 and
31315.

    Issued on: July 5, 2019.
Larry W. Minor,
Associate Administrator for Policy.
[FR Doc. 2019-14974 Filed 7-12-19; 8:45 am]
BILLING CODE 4910-EX-P


[Federal Register: June 19, 2009 (Volume 74, Number 117)]
[Notices]
[Page 29201-29202]
[DOCID:fr19jn09-67]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

Combined Notice of Filings 1

June 11, 2009.
    Take notice that the Commission received the following electric
rate filings:

    Docket Numbers: ER99-2311-010; ER97-2846-013.
    Applicants: Carolina Power & Light Company; Florida Power
Corporation.
    Description: Revisions to Updated Market Power Analysis of Progress
Energy, Inc.
    Filed Date: 06/10/2009.
    Accession Number: 20090610-5157.
    Comment Date: 5 p.m. Eastern Time on Wednesday, July 1, 2009.

    Docket Numbers: ER05-6-108; EL02-111-129; EL03-212-125; EL04-135-
112.
    Applicants: PJM Interconnection; Midwest Independent Transmission
System Operator, Inc.
    Description: PJM Interconnection, LLC et al. submits joint response
to the 5/8/09 deficiency notice issue by the Commission.
    Filed Date: 06/08/2009.
    Accession Number: 20090610-0052.
    Comment Date: 5 p.m. Eastern Time on Monday, June 29, 2009.

    Docket Numbers: ER08-1574-005.
    Applicants: ORNI 18, LLC.
    Description: Notice of Non-Material Change in Status of ORNI 18,
LLC.
    Filed Date: 06/10/2009.
    Accession Number: 20090610-5144.
    Comment Date: 5 p.m. Eastern Time on Wednesday, July 1, 2009.

    Docket Numbers: ER09-1013-001.
    Applicants: PacifiCorp.
    Description: PacfiCorp submits executed Appendix A, Exhibit 3.
    Filed Date: 06/09/2009.
    Accession Number: 20090610-0109.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Docket Numbers: ER09-1127-001.
    Applicants: Wheelabrator South Broward Inc.
    Description: Wheelabrator South Broward Inc submits substitute
tariff sheet correcting a typo error.
    Filed Date: 06/09/2009.
    Accession Number: 20090610-0110.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Docket Numbers: ER09-1281-000.
    Applicants: California Independent System Operator Corporation.
    Description: California Independent System Operator submits an
executed signature page.
    Filed Date: 06/09/2009.
    Accession Number: 20090611-0034.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Docket Numbers: ER09-1288-000.
    Applicants: Saracen Energy LP.
    Description: Saracen Energy LP submits a Notice of Cancellation of
Rate Schedule FERC No. 1.
    Filed Date: 06/09/2009.
    Accession Number: 20090610-0115.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Docket Numbers: ER09-1289-000.
    Applicants: Saracen Energy Partners, LP.
    Description: Saracen Energy Partners, LP submits a Notice of
Cancellation of Rate Schedule FERC No. 1.
    Filed Date: 06/09/2009.
    Accession Number: 20090610-0116.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Docket Numbers: ER09-608-001.
    Applicants: Tucson Electric Power Company.
    Description: Tucson Electric Power Company submits revised tariff
sheet to its Open Access Transmission to reflect that is has received a
waiver of North American Energy Standards Board.
    Filed Date: 06/09/2009.
    Accession Number: 20090610-0108.
    Comment Date: 5 p.m. Eastern Time on Tuesday, June 30, 2009.

    Take notice that the Commission received the following electric
reliability filings:

    Docket Numbers: RR09-5-000.
    Applicants: North American Electric Reliability Corporation.
    Description: Petition of the North American Electric Reliability
Corporation for Approval of Proposed Revisions to the Standards
Development Process of Texas Regional Entity and Related Regional
Entity Rules.
    Filed Date: 06/08/2009.
    Accession Number: 20090608-5132.
    Comment Date: 5 p.m. Eastern Time on Monday, June 29, 2009.

    Any person desiring to intervene or to protest in any of the above
proceedings must file in accordance with Rules 211 and 214 of the
Commission's Rules of Practice and Procedure (18 CFR 385.211 and
385.214) on or before 5 p.m. Eastern time on the specified comment
date. It is not necessary to separately intervene again in a subdocket
related to a compliance filing if you have previously intervened in the
same docket. Protests will be considered by the Commission in
determining the appropriate action to be taken, but will not serve to
make protestants parties to the proceeding. Anyone filing a motion to
intervene or protest must serve a copy of that document on the
Applicant. In reference to filings initiating a new proceeding,
interventions or protests submitted on or before the comment deadline
need not be served on persons other than the Applicant.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper, using the FERC Online links at http://
www.ferc.gov. To facilitate electronic service, persons with Internet
access who will eFile a document and/or be listed as a contact for an
intervenor must create and validate an eRegistration account using the
eRegistration link. Select the eFiling link to log on and submit the
intervention or protests.
    Persons unable to file electronically should submit an original and
14 copies of the intervention or protest to the Federal Energy
Regulatory Commission, 888 First St., NE., Washington, DC 20426.
    The filings in the above proceedings are accessible in the
Commission's eLibrary system by clicking on the

appropriate link in the above list. They are also available for review
in the Commission's Public Reference Room in Washington, DC. There is
an eSubscription link on the Web site that enables subscribers to
receive e-mail notification when a document is added to a subscribed
dockets(s). For assistance with any FERC Online service, please e-mail
<EMAIL_ADDRESS>or call<PHONE_NUMBER> (toll free). For
TTY, call<PHONE_NUMBER>.

Nathaniel J. Davis, Sr.,
Deputy Secretary.
[FR Doc. E9-14467 Filed 6-18-09; 8:45 am]

BILLING CODE 6717-01-P