[Federal Register Volume 88, Number 22 (Thursday, February 2, 2023)]
[Notices]
[Pages 7127-7128]
[FR Doc No: 2023-02149]

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

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2022-0004; Notice 1]

Notice of Receipt of Petition for Decision That Nonconforming
Model Year 2020 Henan Webetter WB-400ST Food Service Trailers Are
Eligible for Importation

AGENCY: National Highway Traffic Safety Administration, Department of
Transportation (DOT).

ACTION: Receipt of petition.

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

SUMMARY: This document announces the National Highway Traffic Safety
Administration (NHTSA) receipt of a petition for a decision that model
year (MY) 2020 Henan Webetter WB-400ST food service trailers that were
not originally manufactured to comply with all applicable Federal motor
vehicle safety standards (FMVSS), are eligible for importation into the
United States because they are capable of being readily altered to
conform to the standards.

DATES: The closing date for comments on the petition is March 6, 2023.

ADDRESSES: Interested persons are invited to submit written data,
views, and arguments on this petition. Comments must refer to the
docket and notice number cited in the title of this notice and may be
submitted by any of the following methods:
     Mail: Send comments by mail addressed to the U.S.
Department of Transportation, Docket Operations, M-30, West Building
Ground Floor, Room W12-140, 1200 New Jersey Avenue SE, Washington, DC
20590.
     Hand Delivery: Deliver comments by hand to the U.S.
Department of Transportation, Docket Operations, M-30, West Building
Ground Floor, Room W12-140, 1200 New Jersey Avenue SE, Washington, DC
20590. The Docket Section is open on weekdays from 10 a.m. to 5 p.m.
except for Federal holidays.
     Electronically: Submit comments electronically by logging
onto the Federal Docket Management System (FDMS) website at https://www.regulations.gov/. Follow the online instructions for submitting
comments.
     Comments may also be faxed to<PHONE_NUMBER>.
    Comments must be written in the English language, and be no greater
than 15 pages in length, although there is no limit to the length of
necessary attachments to the comments. If comments are submitted in
hard copy

form, please ensure that two copies are provided. If you wish to
receive confirmation that comments you have submitted by mail were
received, please enclose a stamped, self-addressed postcard along with
the comments. Note that all comments received will be posted without
change to https://www.regulations.gov, including any personal
information provided.
    All comments and supporting materials received before the close of
business on the closing date indicated above will be filed in the
docket and will be considered. All comments and supporting materials
received after the closing date will also be filed and will be
considered to the fullest extent possible.
    All comments, background documentation, and supporting materials
submitted to the docket may be viewed by anyone at the address and
times given above. The documents may also be viewed on the internet at
https://www.regulations.gov by following the online instructions for
accessing the dockets. The docket ID number for this petition is shown
in the heading of this notice.
    DOT's complete Privacy Act Statement is available for review in a
Federal Register notice published on April 11, 2000, (65 FR 19477-78).

FOR FURTHER INFORMATION CONTACT: Robert Mazurowski, Office of Vehicle
Safety Compliance, NHTSA<PHONE_NUMBER>).

SUPPLEMENTARY INFORMATION:

Background

    Under 49 U.S.C. 30141(a)(1)(A), a motor vehicle that was not
originally manufactured to conform to all applicable FMVSS shall be
refused admission into the United States unless NHTSA has decided that
the motor vehicle is substantially similar to a motor vehicle
originally manufactured for importation into and sale in the United
States, certified under 49 U.S.C. 30115, and of the same MY as the
model of the motor vehicle to be compared, and is capable of being
readily altered to conform to all applicable FMVSS.
    Petitions for eligibility decisions may be submitted by either
manufacturers or importers who have registered with NHTSA pursuant to
49 CFR part 592. As specified in 49 CFR 593.7, NHTSA publishes notice
of each petition that it receives in the Federal Register, and affords
interested persons an opportunity to comment on the petition. At the
close of the comment period, NHTSA decides, on the basis of the
petition and any comments that it has received, whether the vehicle is
eligible for importation. The agency then publishes this decision in
the Federal Register.
    Wallace Environmental Testing Laboratories, Inc. (WETL),
(Registered Importer R-90-005), of Houston, Texas has petitioned NHTSA
to decide whether nonconforming MY 2020 Henan Webetter WB-400ST food
service trailers are eligible for importation into the United States.
The petitioner believes the vehicles are capable of being readily
altered to conform to all applicable FMVSS. The vehicle is a tandem
axle trailer with a stated GVWR of 7,054 lbs. (3,200 kg).
    Wallace Environmental Testing Laboratories, Inc. (WETL) submitted
information with its petition intended to demonstrate that non-U.S.
certified MY 2020 Henan Webetter WB-400ST food service trailers, as
originally manufactured, conform to many applicable FMVSS, or are
capable of being readily altered to conform to those standards.
Specifically, the petitioner claims that the non-U.S. certified MY 2020
Henan Webetter WB-400ST food service trailers, as originally
manufactured, are only subject to: FMVSS No. 108, Lamps, Reflective
Devices and Associated Equipment and FMVSS No. 110, Tire Selection and
Rims and Motor Home/Recreation Vehicle Trailer Load Carrying Capacity
Information for Motor Vehicles with a GVWR of 4,536 kilograms (10,000
pounds) or Less. The petitioner also contends that the subject non-U.S.
certified vehicles are capable of being readily altered to meet the
following FMVSS, in the manner indicated:
    FMVSS No. 108, Lamps, Reflective Devices and Associated Equipment:
installation of rear reflectors, side markers, side reflectors,
clearance lamps, identification lamps and upper lights, front side
marker lamps and reflectors, intermediate side marker lamps and
reflectors, and license plate lamp. The petitioner states ``On the
rear, 3 lamps will be installed as close as practical to the top of the
vehicle at the same height and as close as practical to the center line
with lamp centers spaced not less than 6 inches or more than 12 inches.
The two red lamps on the rear and two amber lamps on the front must be
replaced with lamps conforming to the requirements. The brake and turn
signal lamps must be replaced as well. These parts can easily be found
at local auto parts retailers.''
    FMVSS No. 110, Tire Selection and Rims and Motor Home/Recreation
Vehicle Trailer Load Carrying Capacity Information for Motor Vehicles
with a GVWR of 4,536 kilograms (10,000 pounds) or Less: the petitioner
claims the tires rims are within conformity of this standard.
    Authority: 49 U.S.C. 30141(a)(1)(A), (a)(1)(B), and (b)(1); 49 CFR
593.7; delegation of authority at 49 CFR 1.95 and 501.8.

Otto G. Matheke III,
Director, Office of Vehicle Safety Compliance.
[FR Doc. 2023-02149 Filed 2-1-23; 8:45 am]
BILLING CODE 4910-59-P


[Federal Register Volume 87, Number 52 (Thursday, March 17, 2022)]
[Notices]
[Pages 15286-15292]
[FR Doc No: 2022-05597]

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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-94400; File No. SR-NASDAQ-2022-021]

Self-Regulatory Organizations; The Nasdaq Stock Market LLC;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Amend the Exchange Registration Rules in General 4

March 11, 2022.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on March 7, 2022, The Nasdaq Stock Market LLC (``Nasdaq'' or
``Exchange'') filed with the Securities and Exchange Commission
(``SEC'' or ``Commission'') the proposed rule change as described in
Items I and II below, which Items have been substantially prepared by
the Exchange. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend General 4, Rule 1240 (Continuing
Education Requirements). While these amendments are effective upon
filing, the Exchange has designated the proposed amendments to be
operative on March 15, 2022.
    The text of the proposed rule change is available on the Exchange's
website at https://www.listingcenter.nasdaq.com/rulebook/nasdaq/rules,
at the principal office of the Exchange, and at the Commission's Public
Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to amend its continuing education
requirements in General 4, Rule 1240. This proposed rule change is
based on a filing recently submitted by the Financial Industry
Regulatory Authority, Inc. (``FINRA''), and is intended to harmonize
the Exchange's continuing education rules with those of FINRA so as to
promote uniform standards across the securities industry.\3\ The
Exchange also proposes to amend its manual signature requirements in
General 4, Rule 1250 (Form U4 Filing Requirements) to align with
changes FINRA has made to similar rules.\4\ Each change is discussed in
detail below.
---------------------------------------------------------------------------

    \3\ See Securities Exchange Act Release No. 93097 (September 21,
2021), 86 FR 53358 (September 27, 2021) (SR-FINRA-2021-015) (``FINRA
Rule Change'').
    \4\ See Securities Exchange Release No. 91262 (March 5, 2021),
86 FR 13935 (March 11, 2021) (SR-FINRA-2021-003).
---------------------------------------------------------------------------

    The proposed changes are based on the changes approved by the
Commission in the approval order for SR-FINRA-2021-015 and as noticed
in SR-FINRA-2021-003.\5\ The Exchange is proposing to adopt such
changes substantially in the same form as proposed by FINRA, with only
minor changes necessary to conform to the Exchange's existing rules
such as to remove cross-references and rules that are applicable to
FINRA members but not to Exchange members.
---------------------------------------------------------------------------

    \5\ See supra notes 3 and 4.
---------------------------------------------------------------------------

Continuing Education Rules
(i) Background
    The continuing education program for registered persons of broker-
dealers (``CE Program'') currently requires registered persons to
complete continuing education consisting of a Regulatory Element and a
Firm Element. The Regulatory Element, which is administered by FINRA,
focuses on regulatory requirements and industry standards, while the
Firm Element is provided by each firm and focuses on securities
products, services and strategies the firm offers, firm policies and
industry trends. The CE Program is codified under the rules of the
self-regulatory organizations (``SROs''). The CE Program for registered
persons of Exchange members is codified under General 4, Rule 1240.\6\
---------------------------------------------------------------------------

    \6\ See also General 4, Rule 1210.07 (All Registered Persons
Must Satisfy the Regulatory Element of Continuing Education).
---------------------------------------------------------------------------

a. Regulatory Element
    General 4, Rule 1240(a) (Regulatory Element) currently requires a
registered person to complete the applicable Regulatory Element
initially within 120 days after the person's second registration
anniversary date and, thereafter, within 120 days after every third
registration anniversary date.\7\ The Exchange may extend these time
frames for good cause shown.\8\ Registered persons who have not
completed the Regulatory Element within the prescribed time frames will
have their Exchange registrations deemed inactive and will be
designated as ``CE inactive'' in the CRD system until the requirements
of the Regulatory Element have been satisfied.\9\ A CE inactive person
is prohibited from performing, or being compensated for, any activities
requiring FINRA registration, including supervision. Moreover, if
registered persons remain CE inactive for two consecutive years, they
must requalify by retaking required examinations (or obtain a waiver of
the applicable qualification examinations).\10\
---------------------------------------------------------------------------

    \7\ See General 4, Rules 1240(a)(1) (Requirements) and (a)(4)
(Reassociation in a Registered Capacity). An individual's
registration anniversary date is generally the date they initially
registered with the Exchange in the Central Registration Depository
(``CRD[supreg]'') system. However, an individual's registration
anniversary date would be reset if the individual has been out of
the industry for two or more years and is required to requalify by
examination, or obtain an examination waiver, in order to
reregister. An individual's registration anniversary date would also
be reset if the individual obtains a conditional examination waiver
that requires them to complete the Regulatory Element by a specified
date. Non-registered individuals who are participating in the waiver
program under General 4, Rule 1210.09 (Waiver of Examinations for
Individuals Working for a Financial Services Industry Affiliate of a
Member) (``FSAWP participants'') are also subject to the Regulatory
Element. See also General 4, Rule 1240(a)(5) (Definition of Covered
Person). The Regulatory Element for FSAWP participants correlates to
their most recent registration(s), and it must be completed based on
the same cycle had they remained registered. FSAWP participants are
eligible for a single, fixed seven-year waiver period from the date
of their initial designation, subject to specified conditions.
Registered persons who become subject to a significant disciplinary
action, as specified in General 4, Rule 1240(a)(3) (Disciplinary
Actions), may be required to retake the Regulatory Element within
120 days of the effective date of the disciplinary action, if they
remain registered. Further, their cycle for participation in the
Regulatory Element may be adjusted to reflect the effective date of
the disciplinary action rather than their registration anniversary
date.
    \8\ See General 4, Rule 1240(a)(2) (Failure to Complete).
    \9\ See supra note 8. Individuals must complete the entire
Regulatory Element session to be considered to have ``completed''
the Regulatory Element; partial completion is the same as non-
completion.
    \10\ This CE inactive two-year period is calculated from the
date such persons become CE inactive, and it continues to run
regardless of whether they terminate their registrations before the
end of the two-year period. Therefore, if registered persons
terminate their registrations while in a CE inactive status, they
must satisfy all outstanding Regulatory Element prior to the end of
the CE inactive two-year period in order to reregister with a member
without having to requalify by examination or having to obtain an
examination waiver.
---------------------------------------------------------------------------

    The Regulatory Element consists of a subprogram for registered
persons generally, and a subprogram for principals and supervisors.\11\
While some of the current Regulatory Element content is unique to
particular registration categories, most of the content has broad
application to both representatives and principals.\12\
---------------------------------------------------------------------------

    \11\ The S101 (General Program for Registered Persons) and the
S201 (Registered Principals and Supervisors).
    \12\ The current content is presented in a single format leading
individuals through a case that provides a story depicting
situations that they may encounter in the course of their work.
---------------------------------------------------------------------------

    The Regulatory Element was originally designed at a time when most
individuals had to complete the Regulatory Element at a test center,
and its design was shaped by the limitations of the test center-based
delivery model. In 2015, FINRA transitioned the delivery of the
Regulatory Element to an online platform (``CE Online''), which allows
individuals to complete the content online at a location of their
choosing, including their private residence. This online delivery
provides the Exchange with much greater flexibility in updating content
in a timelier fashion, developing content tailored to each registration
category and presenting the material in an optimal learning format.
b. Firm Element
    General 4, Rule 1240(b) (Firm Element) currently requires each firm
to develop and administer an annual Firm Element training program for
covered registered persons.\13\ The rule requires firms to conduct an
annual needs analysis to determine the appropriate training.\14\
Currently, at a minimum, the Firm Element must cover training in ethics
and professional responsibility as well as the following items
concerning securities products, services and strategies offered by the
member: (1) General investment features and associated risk factors;
(2) suitability and sales practice considerations; and

(3) applicable regulatory requirements.\15\
---------------------------------------------------------------------------

    \13\ The rule defines ``covered registered persons'' as any
registered person who has direct contact with customers in the
conduct of a member's securities sales and trading activities, and
the immediate supervisors of any such persons. See General 4, Rule
1240(b)(1) (Persons Subject to the Firm Element).
    \14\ See General 4, Rule 1240(b)(2) (Standards for the Firm
Element).
    \15\ See supra note 14.
---------------------------------------------------------------------------

    A firm, consistent with its needs analysis, may determine to apply
toward the Firm Element other required training. The current rule does
not expressly recognize other required training, such as training
relating to the anti-money laundering (``AML'') compliance program and
training relating to the annual compliance meeting,\16\ for purposes of
satisfying Firm Element training.
---------------------------------------------------------------------------

    \16\ See General 9, Sections 20 and 37.
---------------------------------------------------------------------------

c. Termination of a Registration
    Currently, individuals whose registrations as representatives or
principals have been terminated for two or more years may reregister as
representatives or principals only if they requalify by retaking and
passing the applicable representative- or principal-level examination
or if they obtain a waiver of such examination(s) (the ``two-year
qualification period'').\17\ The two-year qualification period was
adopted prior to the creation of the CE Program and was intended to
ensure that individuals who reregister are relatively current on their
regulatory and securities knowledge.
---------------------------------------------------------------------------

    \17\ See General 4, Rule 1210.08 (Lapse of Registration and
Expiration of SIE). The two-year qualification period is calculated
from the date individuals terminate their registration and the date
the Exchange receives a new application for registration. The two-
year qualification period does not apply to individuals who
terminate a limited registration category that is a subset of a
broader registration category for which they remain qualified. For
instance, it would not apply to an individual who maintains his
registration as a General Securities Representative but who
terminates his registration as an Investment Company and Variable
Contracts Products Representative. Such individuals have the option
of reregistering in the more limited registration category without
having to requalify by examination or obtain an examination waiver
so long as they continue to remain qualified for the broader
registration category. Further, the two-year qualification period
only applies to the representative- and principal-level
examinations; it does not extend to the Securities Industry
Essentials (``SIE'') examination. The SIE examination is valid for
four years, but having a valid SIE examination alone does not
qualify an individual for registration as a representative or
principal. Individuals whose registrations as representatives or
principals have been revoked pursuant to General 5, Rule 8310
(Sanctions for Violation of the Rules) may only requalify by
retaking the applicable representative- or principal-level
examination in order to reregister as representatives or principals,
in addition to satisfying the eligibility conditions for association
with a firm. Waivers are granted either on a case-by-case basis
under General 4, Rule 1210.03 (Qualification Examinations and
Waivers of Examinations) or as part of the waiver program under
General 4, Rule 1210.09.
---------------------------------------------------------------------------

(ii) Proposed Rule Change
    After extensive work with the Securities Industry/Regulatory
Council on Continuing Education (``CE Council'') and discussions with
stakeholders, including industry participants and the North American
Securities Administrators Association (``NASAA''), FINRA adopted the
following changes to the CE Program under its rules.\18\ In order to
promote uniform standards across the securities industry, the Exchange
now proposes to adopt the same changes to its continuing education
rules.
---------------------------------------------------------------------------

    \18\ See supra note 3. FINRA's changes are based on the CE
Council's September 2019 recommendations to enhance the CE Program.
See Recommended Enhancements for the Securities Industry Continuing
Education Program, available at http://cecouncil.org/media/266634/council-recommendations-final-.pdf. The CE Council is composed of
securities industry representatives and representatives of SROs. The
CE Council was formed in 1995 upon a recommendation from the
Securities Industry Task Force on Continuing Education and was
tasked with facilitating the development of uniform continuing
education requirements for registered persons of broker-dealers.
---------------------------------------------------------------------------

a. Transition to Annual Regulatory Element for Each Registration
Category
    As noted above, currently, the Regulatory Element generally must be
completed every three years, and the content is broad in nature. Based
on changes in technology and learning theory, the Regulatory Element
content can be updated and delivered in a timelier fashion and tailored
to each registration category, which would further the goals of the
Regulatory Element.\19\ Therefore, to provide registered persons with
more timely and relevant training on significant regulatory
developments, the Exchange proposes amending General 4, Rule 1240(a) to
require registered persons to complete the Regulatory Element annually
by December 31.\20\ The proposed amendment would also require
registered persons to complete Regulatory Element content for each
representative or principal registration category that they hold, which
would also further the goals of the Regulatory Element.\21\
---------------------------------------------------------------------------

    \19\ When the CE Program was originally adopted in 1995,
registered persons were required to complete the Regulatory Element
on their second, fifth and 10th registration anniversary dates. See
Securities Exchange Act Release No. 35341 (February 8, 1995), 60 FR
8426 (February 14, 1995) (Order Approving File Nos. SR-AMEX-94-59;
SR-CBOE-94-49; SR-CHX-94-27; SR-MSRB-94-17; SR-NASD-94-72; SR-NYSE-
94-43; SR-PSE-94-35; and SR-PHLX-94-52). The change to the current
three-year cycle was made in 1998 to provide registered persons more
timely and effective training, consistent with the overall purpose
of the Regulatory Element. See Securities Exchange Act Release No.
39712 (March 3, 1998), 63 FR 11939 (March 11, 1998) (Order Approving
File Nos. SR-CBOE-97-68; SR-MSRB-98-02; SR-NASD-98-03; and SR-NYSE-
97-33).
    \20\ See proposed General 4, Rules 1240(a)(1) and (a)(4).
    \21\ See proposed General 4, Rules 1210.07 and 1240(a)(1).
---------------------------------------------------------------------------

    Under the proposed rule change, firms would have the flexibility to
require their registered persons to complete the Regulatory Element
sooner than December 31, which would allow firms to coordinate the
timing of the Regulatory Element with other training requirements,
including the Firm Element.\22\ For example, a firm could require its
registered persons to complete both their Regulatory Element and Firm
Element by October 1 of each year.
---------------------------------------------------------------------------

    \22\ See proposed General 4, Rules 1240(a)(1) and (a)(4).
---------------------------------------------------------------------------

    Individuals who would be registering as a representative or
principal for the first time on or after the implementation date of the
proposed rule change would be required to complete their initial
Regulatory Element for that registration category in the next calendar
year following their registration.\23\ In addition, subject to
specified conditions, individuals who would be reregistering as a
representative or principal on or after the implementation date of the
proposed rule change would also be required to complete their initial
Regulatory Element for that registration category in the next calendar
year following their reregistration.\24\
---------------------------------------------------------------------------

    \23\ See proposed General 4, Rule 1240(a)(1).
    \24\ See proposed General 4, Rule 1240(a)(4).
---------------------------------------------------------------------------

    Consistent with current requirements, individuals who fail to
complete their Regulatory Element within the prescribed period would be
automatically designated as CE inactive.\25\ However, the proposed rule
change preserves the Exchange's ability to extend the time by which a
registered person must complete the Regulatory Element for good cause
shown.\26\
---------------------------------------------------------------------------

    \25\ See proposed General 4, Rule 1240(a)(2).
    \26\ See supra note 25. The proposed rule change clarifies that
the request for an extension of time must be in writing and include
supporting documentation, which is consistent with current practice.
---------------------------------------------------------------------------

    The Exchange also proposes amending General 4, Rule 1240(a) to
clarify that: (1) Individuals who are designated as CE inactive would
be required to complete all of their pending and upcoming annual
Regulatory Element, including any annual Regulatory Element that
becomes due during their CE inactive period, to return to active
status; \27\ (2) the two-year CE inactive period is calculated from the
date individuals become CE inactive, and it continues to run regardless
of whether individuals

terminate their registrations; \28\ (3) individuals who become subject
to a significant disciplinary action may be required to complete
assigned continuing education content as prescribed by the Exchange;
\29\ (4) individuals who have not completed any Regulatory Element
content for a registration category in the calendar year(s) prior to
reregistering would not be approved for registration for that category
until they complete that Regulatory Element content, pass an
examination for that registration category or obtain an unconditional
examination waiver for that registration category, whichever is
applicable; \30\ and (5) the Regulatory Element requirements apply to
individuals who are registered, or in the process of registering, as a
representative or principal.\31\ In addition, the Exchange proposes
making conforming amendments to General 4, Rule 1210.07.
---------------------------------------------------------------------------

    \27\ See supra note 25.
    \28\ See supra note 25.
    \29\ See proposed General 4, Rule 1240(a)(3). As previously
noted, General 4, Rule 1240(a)(3) currently provides that such
individuals may be required to retake the Regulatory Element. See
supra note 7.
    \30\ See proposed General 4, Rule 1240(a)(4).
    \31\ See proposed General 4, Rule 1240(a)(5).
---------------------------------------------------------------------------

    Under the proposed rule change, the amount of content that
registered persons would be required to complete in a three-year,
annual cycle for a particular registration category is expected to be
comparable to what most registered persons are currently completing
every three years. In some years, there may be more required content
for some registration categories depending on the volume of rule
changes and regulatory issues. In addition, an individual who holds
multiple registrations may be required to complete additional content
compared to an individual who holds a single registration because, as
noted above, individuals would be required to complete content specific
to each registration category that they hold.\32\ However, individuals
with multiple registrations would not be subject to duplicative
regulatory content in any given year. The more common registration
combinations would likely share much of their relevant regulatory
content each year. For example, individuals registered as General
Securities Representatives and General Securities Principals would
receive the same content as individuals solely registered as General
Securities Representatives, supplemented with a likely smaller amount
of supervisory-specific content on the same topics. The less common
registration combinations may result in less topic overlap and more
content overall.
---------------------------------------------------------------------------

    \32\ As discussed in the economic impact assessment in the FINRA
Rule Change, individuals with multiple registrations represent a
smaller percentage of the population of registered persons.
---------------------------------------------------------------------------

b. Recognition of Other Training Requirements for Firm Element and
Extension of Firm Element to All Registered Persons
    To better align the Exchange's rulebook with FINRA's rulebook, and,
in addition, to better align the Firm Element requirement with other
required training, the Exchange proposes amending General 4, Rule
1240(b) to expressly allow firms to consider training relating to the
AML compliance program and the annual compliance meeting toward
satisfying an individual's annual Firm Element requirement.\33\ The
Exchange also proposes amending the rule to extend the Firm Element
requirement to all registered persons, including individuals who
maintain solely a permissive registration consistent with General 4,
Rule 1210.02 (Permissive Registrations), thereby further aligning the
Firm Element requirement with other broadly-based training
requirements.\34\ In conjunction with this proposed change, the
Exchange proposes modifying the current minimum training criteria under
General 4, Rule 1240(b) to instead provide that the training must cover
topics related to the role, activities or responsibilities of the
registered person and to professional responsibility.\35\
---------------------------------------------------------------------------

    \33\ See proposed General 4, Rule 1240(b)(2)(D).
    \34\ See proposed General 4, Rule 1240(b)(1). As noted earlier,
the current requirement only applies to ``covered registered
persons'' and not all registered persons.
    \35\ See proposed General 4, Rule 1240(b)(2)(B).
---------------------------------------------------------------------------

c. Maintenance of Qualification After Termination of Registration
    The Exchange proposes adopting paragraph (c) under General 4, Rule
1240 and Supplementary Material .01 and .02 to General 4, Rule 1240 to
provide eligible individuals who terminate any of their representative
or principal registrations the option of maintaining their
qualification for any of the terminated registrations by completing
continuing education.\36\ The proposed rule change would not eliminate
the two-year qualification period. Rather, it would provide such
individuals an alternative means of staying current on their regulatory
and securities knowledge following the termination of a
registration(s). Eligible individuals who elect not to participate in
the proposed continuing education program would continue to be subject
to the current two-year qualification period. The proposed rule change
is generally aligned with other professional continuing education
programs that allow individuals to maintain their qualification to work
in their respective fields during a period of absence from their
careers (including an absence of more than two years) by satisfying
continuing education requirements for their credential.
---------------------------------------------------------------------------

    \36\ The proposed option would also be available to individuals
who terminate any permissive registrations as provided under General
4, Rule 1210.02. However, the proposed option would not be available
to individuals who terminate a limited registration category that is
a subset of a broader registration category for which they remain
qualified. As previously noted, such individuals currently have the
option of reregistering in the more limited registration category
without having to requalify by examination or obtain an examination
waiver so long as they continue to remain qualified for the broader
registration category. In addition, the proposed option would not be
available to individuals who are maintaining an eliminated
registration category, such as the category for Corporate Securities
Representative, or individuals who have solely passed the Securities
Industry Essentials examination, which does not, in and of itself,
confer registration.
---------------------------------------------------------------------------

    The proposed rule change would impose the following conditions and
limitations:
     Individuals would be required to be registered in the
terminated registration category for at least one year immediately
prior to the termination of that category; \37\
---------------------------------------------------------------------------

    \37\ See proposed General 4, Rule 1240(c)(1).
---------------------------------------------------------------------------

     individuals could elect to participate when they terminate
a registration or within two years from the termination of a
registration; \38\
---------------------------------------------------------------------------

    \38\ See proposed General 4, Rule 1240(c)(2). Individuals who
elect to participate at the later date would be required to
complete, within two years from the termination of their
registration, any continuing education that becomes due between the
time of their Form U5 (Uniform Termination Notice for Securities
Industry Registration) submission and the date that they commence
their participation. In addition, FINRA would enhance its systems to
notify individuals of their eligibility to participate, enable them
to affirmatively opt in, and notify them of their annual continuing
education requirement if they opt in.
---------------------------------------------------------------------------

     individuals would be required to complete annually all
prescribed continuing education; \39\
---------------------------------------------------------------------------

    \39\ See proposed General 4, Rule 1240(c)(3). However, upon a
participant's request and for good cause shown, the Exchange would
have the ability to grant an extension of time for the participant
to complete the prescribed continuing education. A participant who
is also a registered person must directly request an extension of
the prescribed continuing education from the Exchange. The
continuing education content for participants would consist of a
combination of Regulatory Element content and content selected by
FINRA and the CE Council from the Firm Element content catalog
discussed below. The content would correspond to the registration
category for which individuals wish to maintain their
qualifications. Participants who are maintaining their qualification
status for a principal registration category that includes one or
more corequisite representative registrations must also complete
required annual continuing education for the corequisite
registrations in order to maintain their qualification status for
the principal registration category. The proposed rule change
clarifies that the prescribed continuing education must be completed
by December 31 of the calendar year, which is consistent with the
timing for the proposed annual Regulatory Element.

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

     individuals would have a maximum of five years in which to
reregister; \40\
---------------------------------------------------------------------------

    \40\ See proposed General 4, Rule 1240(c). In addition,
individuals applying for reregistration must satisfy all other
requirements relating to the registration process (e.g., submit a
Form U4 (Uniform Application for Securities Industry Registration or
Transfer) and undergo a background check).
---------------------------------------------------------------------------

     individuals who have been CE inactive for two consecutive
years, or who become CE inactive for two consecutive years during their
participation, would not be eligible to participate or continue; \41\
and
---------------------------------------------------------------------------

    \41\ See proposed General 4, Rules 1240(c)(4) and (c)(5).
---------------------------------------------------------------------------

     individuals who are subject to a statutory
disqualification, or who become subject to a statutory disqualification
following the termination of their registration or during their
participation, would not be eligible to participate or continue.\42\
---------------------------------------------------------------------------

    \42\ See proposed General 4, Rules 1240(c)(1) and (c)(6).
Further, any content completed by participants would be
retroactively nullified upon disclosure of the statutory
disqualification. The following example illustrates the application
of the proposed rule change to individuals who become subject to a
statutory disqualification while participating in the proposed
continuing education program. Individual A participates in the
proposed continuing education program for four years and completes
the prescribed content for each of those years. During year five of
his participation, he becomes subject to a statutory
disqualification resulting from a foreign regulatory action. In that
same year, the Exchange receives a Form U4 submitted by a member on
behalf of Individual A requesting registration with the Exchange.
The Form U4 discloses the statutory disqualification event. The
Exchange would then retroactively nullify any content that
Individual A completed while participating in the proposed
continuing education program. Therefore, in this example, in order
to become registered with the Exchange, he would be required to
requalify by examination. This would be in addition to satisfying
the eligibility conditions for association with an Exchange member
firm. See Exchange Act Sections 3(a)(39) and 15(b)(4) and General 3,
Rule 1002.
---------------------------------------------------------------------------

    The proposed rule change also includes a look-back provision that
would, subject to specified conditions, extend the proposed option to
individuals who have been registered as a representative or principal
within two years immediately prior to the implementation date of the
proposed rule change and individuals who have been FSAWP participants
immediately prior to the implementation date of the proposed rule
change.\43\
---------------------------------------------------------------------------

    \43\ See proposed Supplementary Material .01 to General 4, Rule
1240. Such individuals would be required to elect whether to
participate by the implementation date of the proposed rule change.
If such individuals elect to participate, they would be required to
complete their initial annual content by the end of the calendar
year in which the proposed rule change is implemented. In addition,
if such individuals elect to participate, their initial
participation period would be adjusted based on the date that their
registration was terminated. The current waiver program for FSAWP
participants would not be available to new participants upon
implementation of the proposed rule change. See proposed General 4,
Rule 1210.09. However, individuals who are FSAWP participants
immediately prior to the implementation date of the proposed rule
change could elect to continue in that waiver program until the
program has been retired. As noted above, FSAWP participants may
participate for up to seven years in that waiver program, subject to
specified conditions. See supra note 7. As discussed above, the
proposed rule change provides a five-year participation period for
participants in the proposed continuing education program. So as not
to disadvantage FSAWP participants, the Exchange has determined to
preserve that waiver program for individuals who are participating
in the FSAWP immediately prior to the implementation date of the
proposed rule change. Because the proposed rule change transitions
the Regulatory Element to an annual cycle, FSAWP participants who
remain in that waiver program following the implementation of the
proposed rule change would be subject to an annual Regulatory
Element requirement. See proposed General 4, Rule 1240(a)(1).
Finally, the proposed rule change preserves the Exchange's ability
to extend the time by which FSAWP participants must complete the
Regulatory Element for good cause shown. See proposed General 4,
Rule 1240(a)(2).
---------------------------------------------------------------------------

    In addition, the proposed rule change includes a re-eligibility
provision that would allow individuals to regain eligibility to
participate each time they reregister with a firm for a period of at
least one year and subsequently terminate their registration, provided
that they satisfy the other participation conditions and
limitations.\44\ Finally, the Exchange proposes making conforming
amendments to General 4, Rule 1210, including adding references to
proposed Rule 1240(c) under General 4, Rule 1210.08.
---------------------------------------------------------------------------

    \44\ See proposed Supplementary Material .02 to General 4, Rule
1240.
---------------------------------------------------------------------------

    The proposed rule change will have several important benefits. It
will provide individuals with flexibility to address life and career
events and necessary absences from registered functions without having
to requalify each time. It will also incentivize them to stay current
on their respective securities industry knowledge following the
termination of any of their registrations. The continuing education
under the proposed option will be as rigorous as the continuing
education of registered persons, which promotes investor protection.
Further, the proposed rule change will enhance diversity and inclusion
in the securities industry by attracting and retaining a broader and
diverse group of professionals.
    Significantly, the proposed rule change will be of particular value
to women, who continue to be the primary caregivers for children and
aging family members and, as a result, are likely to be absent from the
industry for longer periods.\45\ In addition, the proposed rule change
will provide longer-term relief for women, individuals with low incomes
and other populations, including older workers, who are at a higher
risk of a job loss during certain economic downturns and who are likely
to remain unemployed for longer periods.\46\
---------------------------------------------------------------------------

    \45\ See The Female Face of Family Caregiving (November 2018),
available at https://www.nationalpartnership.org/our-work/resources/economic-justice/female-face-family-caregiving.pdf.
    \46\ See The COVID-19 Recession is the Most Unequal in Modern
U.S. History (September 30, 2020), available at https://www.washingtonpost.com/graphics/2020/business/coronavirus-recession-equality/ and Unemployment's Toll on Older Workers Is Worst in Half
a Century (October 21, 2020), available at https://www.aarp.org/work/working-at-50-plus/info-2020/pandemic-unemployment-older-workers.
---------------------------------------------------------------------------

d. CE Program Implementation
    As stated in the FINRA Rule Change, FINRA and the CE Council also
plan to enhance the CE Program in other ways, and these additional
enhancements do not require any changes to the FINRA rules.\47\ As it
relates to the rule changes themselves, the changes relating to the
Maintaining Qualifications Program (paragraph (c) of General 4, Rule
1240) and the Financial Services Affiliate Waiver Program (FSAWP)
(Supplementary Material .09 to General 4, Rule 1210) will become
effective March 15, 2022. All other changes related to the FINRA Rule
Change, including the changes relating to the Regulatory Element, Firm
Element and the two-year qualification period, will become effective
January 1, 2023.\48\
---------------------------------------------------------------------------

    \47\ See supra note 3. As described in more detail in the FINRA
Rule Change, FINRA will work with the CE Council to develop and
incorporate additional resources in connection with the Regulatory
and Firm Elements. Similar to FINRA, these additional enhancements
do not require any changes to the Exchange rules.
    \48\ See FINRA Regulatory Notice 21-41 at https://www.finra.org/rules-guidance/notices/21-41.
---------------------------------------------------------------------------

Manual Signature
    General 4, Rule 1250(c) currently provides that every initial and
transfer electronic Form U4 filing and any amendments to the disclosure
information on Form U4 must be based on a manually signed Form U4
provided to the member or applicant for membership by the person on
whose behalf the Form U4 is being filed, consistent with FINRA Rule
1010(c). Similarly, the Exchange's Supplementary Material .03 currently

provides that in the event a member is not able to obtain an associated
person's manual signature or written acknowledgement of amended
disclosure information on that person's Form U4 prior to filing of such
amendment reflecting the information pursuant to Rule 1250(c)(3), the
member must enter ``Representative Refused to Sign/Acknowledge'' or
``Representative Not Available'' or a substantially similar entry in
the electronic Form U4 field for the associated person's signature.
However, FINRA has since amended their Rule 1010(c) to permit firms to
choose to rely on electronic signatures to satisfy the signature
requirements when filing Form U4.\49\ Cboe Exchange, Inc. (``CBOE'')
has also updated its Rule 3.34 to reflect FINRA's updated Rule
1010(c).\50\
---------------------------------------------------------------------------

    \49\ See Securities Exchange Release No. 91262 (March 5, 2021),
86 FR 13935 (March 11, 2021) (SR-FINRA-2021-003).
    \50\ See Securities Exchange Release No. 92562 (August 4, 2021),
86 FR 143701 (August 10, 2021) (SR-CBOE-2021-043).
---------------------------------------------------------------------------

    The Exchange proposes to amend Rule 1250(c) and Supplementary
Material .03 to similarly allow firms to rely on electronic signatures
when filing Form U4, consistent with FINRA Rule 1010(c). Specifically,
the Exchange proposes to remove the term ``manual'' from ``manual
signature'' and the term ``manually'' from ``manually signed.'' The
proposed rule change provides members, and applicants for membership,
with an opportunity to better manage operational challenges.
Particularly, the COVID-19 pandemic amplified the need to better manage
operational challenges like those that arose during the pandemic and
that may continue to arise in the future. Additionally, the proposed
rule change would not require the use of a particular type of
technology to obtain a valid electronic signature from the associated
person. The Exchange believes that some firms may be unable to obtain
the manual signature of applicants for registration resulting in a
significant operational backlog. By permitting these firms to rely on
electronic signatures to satisfy the signature requirements of Exchange
Rule 1250 and Supplementary Material .03, the proposed rule change may
reduce or eliminate this backlog. For purposes of the proposed rule
change, a valid electronic signature would be any electronic mark that
clearly identifies the signatory and is otherwise in compliance with
the Electronic Signatures in Global and National Commerce Act (``E-Sign
Act'') and the guidance issued by the SEC relating to the E-Sign
Act.\51\
---------------------------------------------------------------------------

    \51\ See accord Securities Exchange Act Release No. 85282 (March
11, 2019), 84 FR 9573 (March 15, 2019) (Order Approving File No. SR-
FINRA-2018-040) (discussing valid electronic signatures under
existing guidance).
---------------------------------------------------------------------------

2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\52\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\53\ in particular, in that it is designed to
promote just and equitable principles of trade, to remove impediments
to and perfect the mechanism of a free and open market and a national
market system, and, in general to protect investors and the public
interest.
---------------------------------------------------------------------------

    \52\ 15 U.S.C. 78f(b).
    \53\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

    The Exchange believes that the proposed changes to the Regulatory
Element and Firm Element will ensure that all registered persons
receive timely and relevant training, which will, in turn, enhance
compliance and investor protection. Further, the Exchange believes that
establishing a path for individuals to maintain their qualification
following the termination of a registration will reduce unnecessary
impediments to requalification and promote greater diversity and
inclusion in the securities industry without diminishing investor
protection.
    As it relates to the proposed changes to General 4, Rule 1250(c),
the Exchange believes the proposed rule change provides firms with the
flexibility to rely on electronic signatures to satisfy the signature
requirements of Rule 1250(c). Specifically, the Exchange proposes to
amend Exchange Rule 1250(c) and Supplementary Material .03, similar to
the amendments made by FINRA and CBOE, to provide the option of filing
an initial or a transfer Form U4 based on a manually or an
electronically signed copy of the form provided to the member, or
applicant for membership, by the individual on whose behalf the form is
being filed. Considering the technological advancements that provide
for enhanced authentication and security of electronic signatures, the
Exchange believes that it is appropriate to amend Rule 1250(c) and
Supplementary Material .03 to provide such flexibility. The proposed
rule change also addresses the ongoing public health risks stemming
from the outbreak of COVID-19 and the operational challenges that firms
continue to face as a result of pandemic repercussions. By permitting
these firms to rely on electronic signatures to satisfy the signature
requirements of Rule 1250(c) and Supplementary Material .03, the
proposed rule change may reduce or eliminate an operational backlog due
to the difficulty firms may have faced in obtaining the manual
signature of applicants for registration as a result of the impact of
the pandemic on daily work environments.
    The Exchange believes the proposal is consistent with the Act for
the reasons described above and for the reasons outlined in the
approval order for SR-FINRA-2021-015 and as noticed in SR-FINRA-2021-
003.\54\
---------------------------------------------------------------------------

    \54\ See supra notes 3 and 4.
---------------------------------------------------------------------------

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

    The Exchange does not believe that the proposed rule change will
impose any burden on competition not necessary or appropriate in
furtherance of the purposes of the Act. All members would be subject to
the proposed rule change. The proposed rule change relating to the
Exchange's CE Program, which is materially identical to the FINRA Rule
Change, is designed to result in a more efficient CE Program that
addresses relevant regulatory requirements and provides individuals
with improved tools and resources to understand and comply with such
requirements, enhancing investor protection. Moreover, the proposed
rule change would provide new channels for individuals to maintain
their qualification status for a terminated registration category and,
in so doing, could increase the likelihood that professionals who need
to step away from the industry for a period could return, subject to
satisfying all other requirements relating to the registration process.
    As it relates to the proposed amendments to General 4, Rule 1250,
the proposed rule change relating to manual signatures is, in all
material respects, substantively identical to recent rule changes
adopted by FINRA and CBOE. The Exchange believes the proposed change
will reduce a regulatory filing burden for members by allowing them to
rely on Form U4 copies with an electronic signature. All members will
have the option to rely on such forms with an electronic signature (or
continue to rely on forms with a manual signature).

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    No written comments were either solicited or received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Because the foregoing proposed rule change does not: (i)
Significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A) of the Act \55\ and Rule 19b-
4(f)(6) thereunder.\56\
---------------------------------------------------------------------------

    \55\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \56\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) normally does
not become operative for 30 days after the date of filing. However,
pursuant to Rule 19b-4(f)(6)(iii), the Commission may designate a
shorter time if such action is consistent with the protection of
investors and the public interest. The Exchange has asked the
Commission to waive the 30-day operative delay so that this proposed
rule change may become operative immediately upon filing. Rule 19b-
4(f)(6)(iii) \57\ requires a self-regulatory organization to give the
Commission written notice of its intent to file a proposed rule change
under that subsection at least five business days prior to the date of
filing, or such shorter time as designated by the Commission. The
Exchange has provided such notice.
---------------------------------------------------------------------------

    \57\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    Waiver of the 30-day operative delay would allow the Exchange to
implement proposed changes to the Maintaining Qualifications Program
and the FSAWP by March 15, 2022 to coincide with FINRA's announced
implementation date, thereby eliminating the possibility of a
significant regulatory gap between the FINRA and Nasdaq rules and
providing more uniform standards across the securities industry. For
the proposal related to the manual signature requirement, waiver of the
30-day operative delay would provide immediate relief to firms
currently experiencing a significant operational backlog because of the
requirement to obtain manual signatures, ultimately benefitting the
investing public. The proposed rule change to Rule 1250(c) and
Supplementary Material .03 will provide immediate relief to these firms
by allowing them to rely on electronic signatures to clear the backlog.
Moreover, as noted above, the proposed manual signature rule change is
based on a similar rule change by FINRA that has already taken effect.
For these reasons, the Commission believes that waiver of the 30-day
operative delay for this proposal is consistent with the protection of
investors and the public interest. Accordingly, the Commission hereby
waives the 30-day operative delay and designates the proposal operative
upon filing.\58\
---------------------------------------------------------------------------

    \58\ For purposes only of waiving the 30-day operative delay,
the Commission has considered the proposed rule change's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule should be approved or disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include
File Number SR-NASDAQ-2022-021 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-NASDAQ-2022-021. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549, on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of such filing also will be available for inspection
and copying at the principal office of the Exchange. All comments
received will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-NASDAQ-2022-021 and should be submitted
on or before April 7, 2022.
---------------------------------------------------------------------------

    \59\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\59\
Eduardo Aleman,
Assistant Secretary.
[FR Doc. 2022-05597 Filed 3-16-22; 8:45 am]
BILLING CODE 8011-01-P


thereunder, then the proposed changes would not be effective until
filed with or filed with and approved by the Commission, as the case
may be.\215\
---------------------------------------------------------------------------

    \214\ See proposed CHX Holdings Certificate Article ELEVENTH;
proposed CHX Holdings Bylaws Article VIII; proposed NA Casin
Holdings Certificate Article X; proposed NA Casin Bylaws, Article
11.1.
    \215\ See id.
---------------------------------------------------------------------------

    The Commission believes that these provisions are consistent with
the Exchange Act because they enable continued oversight of CHX
Holdings and NA Holdings by the Exchange and the Commission, which
should help assure that the Exchange remains organized in a manner that
will allow it to fulfill its self-regulatory obligations and to comply
with the requirements of the Exchange Act.

D. Waiver of CHX Holdings' Ownership and Voting Limitations

    With respect to the Transaction, pursuant to the CHX Holdings
Certificate, CHX has filed for approval of a waiver of certain
restrictions on ownership and voting contained in the CHX Holdings
Certificate. Specifically, the current certificate prohibits, among
other things: (1) Any Person, either alone or together with its Related
Persons, from owning, directly or indirectly, of record or
beneficially, shares of stock of the CHX Holdings representing in the
aggregate more than 40% of the then outstanding votes entitled to be
cast on any matter; and (2) any Person, either alone or together with
its Related Persons, from directly, indirectly or pursuant to any
voting trust, agreement, plan or other arrangement, voting or causing
the voting of shares of the capital stock (whether such shares be
common stock or preferred stock) of CHX Holdings or giving any consent
or proxy with respect to shares representing more than 20% of the
voting power of the then issued and outstanding capital stock of CHX
Holdings.\216\ A waiver of these ownership and voting limitations is
required to effect the Transaction because, after the closing of the
Transaction, CHX Holdings would become a wholly-owned subsidiary of NA
Casin Holdings. CHX states that the board of directors of CHX Holdings
adopted resolutions necessary to waive the ownership and voting
limitations, and that Commission approval of the proposed rule change
will effectuate a waiver of these requirements under the CHX Holdings
Bylaws.\217\
---------------------------------------------------------------------------

    \216\ See CHX Holdings Certificate Article FIFTH, Sections
(b)(ii)(A) and (C). The CHX Holdings board of directors may waive
these voting and ownership limitations, if, in connection with
taking such action, the board of directors adopts a resolution
determining that: (1) The waiver will not impair the ability of CHX
to carry out its functions and responsibilities as an ``exchange''
under the Exchange Act, and the rules under the Exchange Act; (2)
the waiver is otherwise in the best interests of CHX Holdings, its
stockholders, and CHX; (3) the waiver will not impair the ability of
the Commission to enforce the Exchange Act; and (4) the action will
not be effective until approved by the Commission. See CHX Holdings
Certificate Article FIFTH, Section (b)(iii)(B).
    \217\ See Notice, supra note 3, 81 FR at 89551-52.
---------------------------------------------------------------------------

    The Commission believes that it is consistent with the Exchange Act
to allow NA Casin Holdings to own and vote all of the outstanding
common stock of CHX Holdings. In particular, NA Casin Holdings will be
subject to the ownership and voting limitations described above, which
are consistent with CHX Holdings' current ownership and voting
limitations.\218\ In addition, and as discussed above, CHX Holdings and
NA Casin Holdings have also included in their corporate documents
certain provisions designed to maintain the independence of the
Exchange's regulatory functions.\219\ Accordingly, the Commission
believes that the revised rules of the Exchange, including the
corporate documents of NA Casin Holdings, CHX Holdings, and the
Exchange, are reasonably designed to support the ability of the
Exchange to carry out its responsibilities under the Exchange Act and
the rules and regulations promulgated thereunder and the Commission to
enforce the Exchange Act and the rules and regulations promulgated
thereunder.
---------------------------------------------------------------------------

    \218\ See text accompanying notes 28-33.
    \219\ See supra Section III.A.
---------------------------------------------------------------------------

    Going forward, the proposed CHX Holdings Certificate provides that,
for any Person to acquire ownership or exercise voting rights in excess
of the ownership and voting limitations: \220\ (1) Such Person must
deliver, not less than 45 days prior to such acquisition of ownership
or exercise of voting rights, a notice in writing to the board of
directors expressing its intention to

acquire such ownership or exercise such voting rights; (2) the CHX
Holdings board must resolve to expressly permit such ownership or
exercise of voting rights; \221\ and (3) such resolution must be filed
with and approved by the Commission under Section 19(b) of the Exchange
Act.\222\ The proposed NA Casin Holdings Certificate contains
substantially identical provisions.\223\ The Commission believes that
these provisions are reasonably designed to assist the Exchange in
fulfilling its self-regulatory obligations, and in administering and
complying with the requirements of the Exchange Act, by ensuring that
the Commission will review and approve, if appropriate, any future
change in ownership or voting power that gives rise to its concerns
about a stockholder exercising undue control over the operation of the
Exchange.\224\ Similarly, the Commission believes that this protection
against such future changes in ownership or voting concentration
without careful Commission review and approval is reasonably designed
to promote just and equitable principles of trade and to protect
investors and the public interest under the standards set forth in
Section 6(b)(5) of the Exchange Act. The Commission also notes that
these requirements for acquiring ownership or exercising voting rights
in excess of the ownership and voting limitations are consistent with
other such provisions previously approved by the Commission.\225\
---------------------------------------------------------------------------

    \220\ The ownership and voting of CHX Holdings stock would
continue to be subject to certain limitations discussed above
following the Transaction. See supra notes 57-66 and accompanying
text.
    \221\ The CHX Holdings Bylaws require that the board must make a
determination that: (1) Such acquisition of ownership or exercise of
voting rights will not impair any of CHX Holdings' or the Exchange's
ability to discharge its responsibilities under the Exchange Act and
the rules and regulations thereunder and is otherwise in the best
interests of CHX Holdings and its stockholders; (2) such acquisition
of ownership or exercise of voting rights will not impair the
Commission's ability to enforce the Exchange Act; and (3) neither
such Person nor any of its Related Persons is subject to any
statutory disqualification as defined in Section 3(a)(39) of the
Exchange Act. See CHX Holdings Certificate Article FOURTH, Sections
(b)(iii) and (c)(i)(B).
    \222\ See CHX Holdings Certificate Article FOURTH, Sections
(b)(ii)-(iii) and (c)(ii)(A)-(B).
    \223\ See NA Casin Holdings Certificate Article IX, Sections
(6)-(7), and (9).
    \224\ See supra Section III.A.
    \225\ See, e.g., NSX Approval Order, supra note 153, 80 FR at
9288-89.
---------------------------------------------------------------------------

IV. Solicitation of Comments on Amendment No. 1

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether Amendment No. 1
to the proposed rule change is consistent with the Exchange 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_ADDRESS>Please include
File Number SR-CHX-2016-20 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-CHX-2016-20. 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 Web site (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 Web site 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 this filing will also be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change; the Commission does
not edit personal identifying information from submissions. You should
submit only information that you wish to make available publicly. All
submissions should refer to File Number SR-CHX-2016-20 and should be
submitted on or before September 5, 2017.

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 30th day after the
date of publication of notice of Amendment No. 1 in the Federal
Register. As noted above, Amendment No. 1 does not change the structure
or purpose of the proposed rule change as it was previously published
for notice and comment.\226\ Rather, the Exchange modified its proposed
rule change to address certain concerns raised by commenters. The
Commission believes that an additional notice and comment period for
Amendment No. 1 before approval of the proposed rule change would not
be in furtherance of the public interest or the protection of
investors. Accordingly, the Commission finds good cause, pursuant to
Section 19(b)(2) of the Exchange Act,\227\ to approve the proposed rule
change, as modified by Amendment No. 1, on an accelerated basis.
---------------------------------------------------------------------------

    \226\ See supra note 10.
    \227\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

VI. Conclusion

    For the foregoing reasons, the Commission finds that the proposed
rule change, as modified by Amendment No. 1, is consistent with the
Exchange Act and the rules and regulations thereunder applicable to a
national securities exchange.
    It is therefore ordered, pursuant to Section 19(b)(2) of the
Exchange Act \228\ that the proposed rule change (SR-CHX-2016-20), as
modified by Amendment No. 1, be, and hereby is, approved on an
accelerated basis.
---------------------------------------------------------------------------

    \228\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\229\
---------------------------------------------------------------------------

    \229\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2017-17179 Filed 8-14-17; 8:45 am]
 BILLING CODE 8011-01-P