Comment Info: =================

General Comment:Please find attached a request for a comment period extension submitted by VMR Products, LLC.


[Federal Register Volume 83, Number 146 (Monday, July 30, 2018)]
[Notices]
[Pages 36647-36652]
[FR Doc No: 2018-16166]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83699; File No. SR-FINRA-2018-026]

Self-Regulatory Organizations; Financial Industry Regulatory
Authority, Inc.; Notice of Filing of a Proposed Rule Change To Amend
the Arbitrator Payment Rule To Pay Each Arbitrator a $200 Honorarium To
Decide Without a Hearing Session a Contested Subpoena Request or a
Contested Order for Production or Appearance

July 24, 2018.
    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 July 13, 2018, Financial Industry Regulatory Authority, Inc.
(``FINRA'') filed with the Securities and Exchange Commission (``SEC''
or ``Commission'') the proposed rule change as described in Items I,
II, and III below, which Items have been prepared by FINRA. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    FINRA is proposing to amend FINRA Rule 12214(c) of the Code of
Arbitration Procedure for Customer Disputes (``Customer Code'') and
FINRA Rule 13214(c) through (e) of the Code of Arbitration Procedure
for Industry Disputes (``Industry Code'' and together, ``Codes''), to
provide that FINRA will pay each arbitrator a $200 honorarium to decide
without a hearing session a contested subpoena request or a contested
order for production or appearance.
    The text of the proposed rule change is available on FINRA's
website at http://www.finra.org, at the principal office of FINRA 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, FINRA 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. FINRA 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
Introduction
    The proposed rule change would amend FINRA Rules 12214 and 13214
that govern the payments (referred to as honorarium) arbitrators
receive for deciding contested requests to issue subpoenas and orders
for production and appearance. The proposed rule change would provide
uniformity regarding when and how much arbitrators receive when
deciding contested subpoenas and orders for production and appearance
without a hearing session.
Background
    In arbitration, the parties exchange documents and information to
prepare for the arbitration through the discovery process. The Codes
require parties to cooperate with each other and exchange documents or
information to expedite the arbitration.\3\ If an individual or entity
objects to a discovery request, the party seeking the documents or
information may request that the arbitrator issue a subpoena \4\ or an
order.\5\
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    \3\ See FINRA Rules 12505 and 13505.
    \4\ See FINRA Rules 12512 and 13512.
    \5\ See FINRA Rules 12513 and 13513.
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Requests to Issue a Subpoena
    Under the Codes, parties may request that the panel issue a
subpoena to parties in an arbitration, non-parties, as well as entities
and individuals who are not FINRA members.\6\ If the subpoena will be
served on a FINRA member, FINRA rules favor the use of orders rather
than subpoenas, unless circumstances dictate otherwise.\7\ A party's
request (or motion) to issue a subpoena becomes a ``contested subpoena
request'' if there is an objection raised to the scope or propriety of
the subpoena.\8\
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    \6\ See FINRA Rules 12512(a)(1) and 13512(a)(1).
    \7\ See FINRA Rules 12512(a)(2) and 13512(a)(2).
    \8\ See FINRA Rules 12512(c) and 13512(c).
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    To decide a contested subpoena request, the arbitrator must review
the motion requesting issuance of the subpoena, the draft subpoena, any
written objections, and any other documents supporting a party's
position.\9\ When arbitrators decide these contested requests, they
must review and consider all parties' objections and render their
decision promptly on the issuance and scope of the subpoena.\10\
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    \9\ See FINRA Rules 12214(d)(2) and 13214(d)(2).
    \10\ See, e.g., FINRA Rules 12512(c) and 13512(c).
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    Currently, under FINRA Rule 12214(d),\11\ each arbitrator who
decides one or more contested subpoenas without a hearing session \12\
receives a one-time honorarium of $250 during the life of the
arbitration case.\13\ The rule caps the total amount that the parties
could pay the arbitrators to decide a contested subpoena request in any
one case at $750.\14\ This means that regardless of the number of
contested subpoena requests that arbitrators decide without a hearing
session in an arbitration case, an arbitrator will receive one
honorarium payment of $250.\15\ The panel allocates the cost of the
honorarium to the parties in the award.\16\
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    \11\ See also FINRA Rule 13214(d).
    \12\ A hearing session is a meeting between the parties and
arbitrators of four hours or less, including a hearing or prehearing
conference. See FINRA Rules 12100(p) and 13100(p).
    \13\ See FINRA Rules 12214(d)(1) and 13214(d)(1).
    \14\ Id. The chairperson of a three-person panel will decide the
contested subpoena request without a hearing session, for which the
chairperson would be paid $250. The honorarium for contested
subpoena requests could increase in $250 increments, if, for
example, the chairperson recuses or withdraws from the panel and the
replacement chairperson must decide another contested subpoena
request without a hearing session. In this instance, the replacement
chairperson would receive a $250 honorarium for this work. In no
event would the parties be charged more than $750 per case.
    \15\ If a hearing session is required to decide the motion, each
arbitrator who participates in the hearing session will receive a
$300 honorarium instead. See FINRA Rules 12214(a) and 13214(a).
    \16\ See FINRA Rules 12214(d)(3) and 13214(d)(3).
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    If a party's request to issue a subpoena does not receive any
objections, it remains unopposed, and arbitrators do not receive an
honorarium for issuing an unopposed subpoena.
Request To Issue an Order for Production or Appearance
    If a party is seeking documents or information, or the appearance
of a witness from a FINRA member, the Codes direct the parties to
request the issuance of an order for production or appearance,\17\
rather than a subpoena.\18\ A party's motion to issue an order becomes
a ``contested order request'' if a party objects to the scope or
propriety of the order.\19\
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    \17\ FINRA Rules 12513(a) and 13513(a) provide that upon a
motion of a party, the panel may order the appearance of any
employee or associated person of a FINRA member or the production of
any documents in the possession or control of such persons or
members, without the use of subpoenas.
    \18\ See FINRA Rules 12512(a)(2) and 13512(a)(2).
    \19\ See FINRA Rules 12513(c) and 13513(c).
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    An arbitrator would decide a contested order request by reviewing
the motion requesting issuance of the order,\20\ the draft order,\21\
and any written objections from the party receiving the motion.\22\
Further, when arbitrators decide these contested order requests, they
must review and consider all parties' objections and render their
decision promptly on the issuance and scope of the order.\23\ Thus,
arbitrators review similar documents and follow the same process when
deciding contested order requests as they do when deciding contested
subpoena requests.
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    \20\ See FINRA Rules 12513(b) and 13513(b).
    \21\ Id.
    \22\ See FINRA Rules 12513(c) and 13513(c).
    \23\ See, e.g., FINRA Rules 12513(c) and 13513(c).
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    The Codes do not expressly provide an honorarium for arbitrators
who decide requests for such orders without a hearing session. Thus,
FINRA categorizes requests to issue orders for production as discovery-
related motions \24\ rather than requests to issue subpoenas and, thus,
FINRA pays the $200 honorarium for each. FINRA pays the $200 honorarium
for an order for production, whether contested or unopposed. FINRA does
not pay the honorarium, however, for an order for appearance,
regardless of whether it is contested or unopposed.
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    \24\ FINRA Rules 12214(c) and 13214(c) provide that FINRA will
pay each arbitrator an honorarium of $200 to decide a discovery-
related motion without a hearing session.
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Concerns About Current Subpoena and Order Honorarium Structure
    Parties label requests for subpoenas or orders interchangeably,
which is understandable given the similarities of the requests and the
work arbitrators do to decide them without a hearing session. However,
the Codes treat the two discovery mechanisms differently. As noted, the
Codes favor the use of orders over subpoenas when a party seeks
documents or witnesses from a FINRA member.\25\ If a request to issue a
subpoena should have been a request to issue an order, a change in the
labelling of the document can result in the arbitrators receiving a
reduced honorarium (i.e., $200 for an order versus $250 for a contested
subpoena or no payment at all if the change is to an order of
appearance).
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    \25\ See FINRA Rules 12512(a)(2) and 13512(a)(2).
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    The Codes also impose a per-case honorarium cap of $250 that each
arbitrator who decides a contested subpoena request without a hearing
session may receive.\26\ Arbitrators do not receive an honorarium for
deciding an unopposed subpoena request. There is no per-case cap on
deciding requests

to issue orders of production however. Moreover, arbitrators receive an
honorarium for deciding such requests, whether they are contested or
unopposed.
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    \26\ See FINRA Rules 12214(d)(1) and 13214(d)(1).
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Proposed Rule Change
    FINRA believes that the subpoena or order label on a discovery-
related motion should not dictate the amount of honorarium that
arbitrators receive or the frequency with which they are paid. The
honoraria that arbitrators receive should reflect the time and effort
they spend in deciding requests without a hearing session and fairly
compensate them for this work. Accordingly, FINRA is proposing to amend
FINRA Rules 12214(c) and 13214(c) to provide that FINRA would pay each
arbitrator an honorarium of $200 to decide, without a hearing session:
(i) A discovery-related motion; \27\ (ii) a motion that contains one or
more contested subpoena requests \28\ or contested orders for
production or appearance; or (iii) a motion that contains one or more
contested subpoena requests and contested orders for production or
appearance. FINRA believes that unifying the honorarium structure for
these discovery mechanisms would remove inconsistencies from FINRA's
rules and make them more transparent as well as eliminate confusion for
parties, arbitrators and staff that can occur when a discovery request
is mislabeled.
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    \27\ Under the proposed rule change, FINRA would add a contested
subpoena request and a contested order for production or appearance
to the discovery-related motions rule; however, FINRA would not
change the rule language explaining what constitutes a discovery-
related motion.
    \28\ The proposal would retain what constitutes a contested
subpoena by moving the description from FINRA Rule 12214(d)(2) to
FINRA Rule 12214(c)(2)(ii).
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Contested Subpoena Requests
    The proposed rule change would reduce the honorarium that an
arbitrator receives to decide a contested subpoena request from $250 to
$200; however, it would also remove the per-case cap on these payments.
Thus, under the proposed rule change, an arbitrator would receive a
$200 honorarium for each contested subpoena request that he or she
decides.\29\
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    \29\ As is current practice, arbitrators would not receive an
honorarium for an unopposed subpoena request.
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    FINRA recognizes that removing the per-case cap on contested
subpoena requests could result in an increase in fees for the parties.
In response to this concern, the proposed rule change would permit a
party or parties to use one motion to request the issuance of one or
more subpoenas.\30\ FINRA is proposing to include this current practice
in the rule, so that parties may mitigate their costs. Thus, under the
proposed rule change, if parties request one or more subpoenas in one
motion, for example, and one or all of the subpoena requests become
contested, each arbitrator who decides the motion would receive one
honorarium payment of $200. In addition to helping to minimize costs,
requesting multiple subpoenas in one motion helps expedite the
arbitration, which benefits parties and arbitrators.
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    \30\ The proposed rule change would also permit parties to
request the issuance of one or more orders in the same motion or a
combination of subpoena and order requests.
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    FINRA believes that reducing the honorarium for contested subpoena
requests and removing the per-case cap on these payments would provide
consistency and fairness to the arbitrator payment rules by ensuring
that the payment arbitrators receive for deciding these requests is
commensurate with the time and effort spent on each motion.
Contested Orders for Production or Appearance
    FINRA would amend Rule 12214(c) to provide a $200 honorarium for
deciding a contested order for production or appearance without a
hearing session. This means that arbitrators would receive an
honorarium for deciding without a hearing session, a contested
arbitrator order for appearance as well as for production. Under the
proposed rule change, arbitrators would no longer receive an honorarium
for unopposed requests to issue an order for production as these
requests do not require the amount of time and effort needed to resolve
contested requests.
    The proposed rule change would describe what constitutes a
contested order for production or appearance by modeling the
description on that of a contested subpoena request. Thus, proposed
FINRA Rule 12214(c)(2)(iii) would provide that a contested order for
production or appearance shall include a motion requesting the issuance
of an order for production or appearance, a written objection from the
party opposing the issuance of the order, and any other documents
supporting a party's position.
    Moreover, like a contested subpoena request, a party would be
permitted to request the issuance of one or more orders in one
motion,\31\ and if one or all of the arbitrator orders become
contested, each arbitrator who decides the motion would receive one
honorarium payment of $200. In addition to helping to minimize costs,
requesting multiple orders in one motion helps expedite the
arbitration, which benefits parties and arbitrators.
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    \31\ The proposed rule change would also permit parties to
request the issuance of one or more subpoenas in the same motion or
a combination of subpoena and order requests.
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    FINRA believes that adding contested orders for production or
appearance to its honorarium rules would make the rules more
transparent, so that parties and arbitrators understand how and when
the honorarium and fees are assessed for contested orders. Moreover,
FINRA believes that limiting honorarium to contested orders makes the
honorarium rules more consistent and more equitable to the parties, as
the fees FINRA would assess for arbitrators to decide contested orders
for production or appearance would be proportionate with the time and
effort that they spend deciding such orders.
Nonsubstantive Changes
    In addition to the amendments discussed above to simplify the
honorarium structure for contested subpoenas requests and contested
orders for production and appearance, the proposed rule change would
also amend Rules 12214(a) and 13214(a) to make a few nonsubstantive
changes.
    As noted in Item 2 of this filing, if the Commission approves the
proposed rule change, FINRA will announce the effective date of the
proposed rule change in a Regulatory Notice to be published no later
than 60 days following Commission approval. The effective date will be
no later than 30 days following publication of the Regulatory Notice
announcing Commission approval.
2. Statutory Basis
    FINRA believes that the proposed rule change is consistent with the
provisions of Section 15A(b)(6) of the Act,\32\ which requires, among
other things, that FINRA rules must be designed to prevent fraudulent
and manipulative acts and practices, to promote just and equitable
principles of trade, and, in general, to protect investors and the
public interest, and Section 15A(b)(5) of the Act,\33\ which requires,
among other things, that FINRA rules provide for the equitable
allocation of reasonable dues, fees and other charges among members and
issuers and other persons using any facility or system that FINRA
operates or controls.
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    \32\ 15 U.S.C. 78o-3(b)(6).
    \33\ 15 U.S.C. 78o-3(b)(5).
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    FINRA believes that the proposed rule change would simplify the
structure of arbitrator honorarium for deciding

contested subpoena requests and contested orders for production or
appearance without a hearing session by making the honorarium amount
the same ($200) for each request. Further, the proposed rule change
makes the honorarium structure more transparent by including expressly
the current practice of paying arbitrators for deciding contested
orders for production without a hearing session in the Codes' payment
rules. For consistency and fairness, the proposed rule change would
also extend the honorarium to include contested orders for appearance
without a hearing session. These changes, FINRA believes, make the
arbitrator honorarium structure easier to understand for parties and
arbitrators and easier for FINRA to apply, and, therefore, will help
parties, arbitrators and staff conserve resources that they might
otherwise spend in trying to interpret the rules and understand the
honorarium structure.
    Further, FINRA believes structuring the arbitrator honorarium rules
so that arbitrators receive an honorarium for each contested subpoena
request or contested order for production or appearance they decide
without a hearing session ensures that the honoraria arbitrators
receive are proportionate with the time and effort they spend deciding
such requests and the fees parties are assessed are equitable in
relation to the services that they receive. Last, the proposed rule
change allows parties to combine multiple requests for subpoenas or
orders into one motion as a way to minimize costs and expedite the
discovery process. For these reasons, FINRA believes that the proposed
rule change is an equitable allocation of a reasonable fee to use the
forum.
    Moreover, FINRA believes that the proposed rule change would
protect investors and the public interest by ensuring that arbitrators
are compensated equitably for the services that they provide, which
would enhance FINRA's ability to retain qualified arbitrators willing
to devote the time and effort necessary to consider thoroughly the
discovery issues presented. Retaining qualified arbitrators is an
essential element, FINRA believes, in maintaining its ability to
operate an effective arbitration forum for the purposes of investor
protection and market integrity.

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

    FINRA does not believe that the proposed rule change will result in
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act. A discussion of the economic
impacts of the proposed amendments follows.
(a) Need for the Rule
    The existing structure for payments to arbitrators for deciding
requests to issue subpoenas or orders without a hearing session has
been difficult for parties and arbitrators to understand due to the
differences between when and under what circumstances arbitrators will
receive payments.\34\ Parties can incur different fees, and arbitrators
can receive different honorarium, for contested and unopposed requests
to issue subpoenas and orders. The existing structure can also make it
confusing for FINRA to apply. Under the proposed amendments, the
payments arbitrators receive would be more commensurate with their time
and effort to consider the requests. The proposed amendments would also
simplify the structure of the payments.
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    \34\ For example, arbitrators raised issues with FINRA
concerning the inconsistencies in the existing honorarium structure
for requests to issue subpoenas or orders without a hearing session.
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(b) Economic Baseline
    The economic baseline for the proposal is the current rules under
the Codes that address the payments to arbitrators for deciding
discovery-related motions and requests to issue subpoenas or orders.
The proposal is expected to affect the parties to an arbitration, their
counsel, and FINRA arbitrators.
    The existing fee structure for payments to arbitrators for deciding
requests to issue subpoenas or orders without a hearing session has led
to confusion and uncertainty with respect to the amount of fees that
parties incur. As a result, parties and their counsel may incur time
and other expenses to interpret the rules and understand the payment
structure, as well as the possible time and expense to communicate and
receive clarification from FINRA.
    Arbitrators incur more costs to decide contested requests to issue
subpoenas or orders without a hearing session than unopposed requests.
The costs to arbitrators for deciding contested requests include the
time to review the materials and the effort to make a decision.
Alternatively, arbitrators spend less time and effort to review
unopposed requests.\35\
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    \35\ For most unopposed requests, arbitrators can resolve them
by signing the subpoena or order that accompanies the request.
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    The honorarium that arbitrators receive, and the fees parties
incur, may not be commensurate with the effort expended by arbitrators
to decide the requests. The existing fee structure can result in
instances where arbitrators do not receive an honorarium for their time
and effort to consider a contested request (i.e., contested orders of
appearance decided without a hearing session). Arbitrators also do not
receive additional honorarium to decide multiple contested requests for
subpoenas. In general, the absence of an honorarium when arbitrators
decide certain contested requests may serve as a disincentive for
arbitrators to give their best efforts or the time necessary to make a
decision. The existing fee structure can also result in instances where
arbitrators receive an honorarium even though they incur little time or
effort to decide a request (e.g., unopposed orders of production).
    There were 7,370 arbitration cases closed in 2016 and 2017. Among
the 7,370 cases, there were 497 cases (6.7 percent) with contested
requests for subpoenas, 1,210 cases (16.4 percent) with unopposed
requests for subpoenas, and 1,334 cases (18.1 percent) with requests
for orders. The information available does not distinguish between
contested and unopposed requests for orders of production and
appearance. We are therefore not able to estimate the potential change
to the fees parties would incur and the honorarium that arbitrators
would receive as a result of the proposed amendments.
    Although the majority of the cases with contested subpoenas (454 or
91.3 percent) have three arbitrators, in the experience of FINRA staff,
typically only one arbitrator decides contested subpoenas without a
hearing session. Thus, although parties could currently incur fees of
$750 for contested subpoenas if three arbitrators decide the requests
without a hearing session, the typical fee parties currently incur is
$250.
(c) Economic Impact
    The proposed amendments would simplify and make uniform the
structure for payments to arbitrators for deciding requests to issue
subpoenas or orders without a hearing session. The benefits of the
proposed amendments include a decrease in the time and expense parties
would incur to understand the payment structure, an increase in the
incentives of arbitrators to decide contested subpoenas and orders, and
an increase in the efficiency of the forum. Depending on the
composition and timing of the requests, however, the fees parties incur
could either increase or decrease. The honorarium payments arbitrators
receive could also increase or decrease. The benefits and costs of the

proposed amendments, including the changes to the fees parties incur
and the honorarium arbitrators receive, are discussed in further detail
below.
    A benefit of the proposed amendments is the reduction in the
complexity of the fee schedule. Parties and their counsel would be more
certain with respect to the assessment of fees, and would therefore
incur less time and expense to interpret the fee schedule. Parties and
their counsel would also be less likely to incur the time and expense
from requesting clarification from FINRA.
    Another benefit of the proposed amendments is that the honorarium
arbitrators receive would be more commensurate with their time and
effort to decide requests to issue subpoenas or orders. Arbitrators
would receive an honorarium to decide all contested requests to issue
subpoenas or orders without a hearing session. Arbitrators would
therefore have more incentive to devote the time and effort necessary
to decide these requests. Arbitrators would also receive no honorarium
to decide unopposed requests to issue subpoenas or orders, which
reflects the minimal time and effort needed to review such requests.
    The changes to the fee schedule would also increase the efficiency
of the arbitration process. Parties and their counsel could minimize
the amount of fees assessed by filing a request to issue multiple
subpoenas or orders in one motion instead of several separate motions.
This could also increase the arbitrators' efficiency by having them
decide at the same time requests to issue multiple subpoenas or orders
that are based largely on the same facts or arguments. The filing of
one motion that requests the issuance of multiple subpoenas or orders
could also expedite the discovery process, and decrease the amount of
time to an arbitration decision.
    The proposed amendments would also benefit the parties that incur
fewer fees and the arbitrators who receive additional honorarium, but
would impose costs on the parties that incur additional fees and the
arbitrators who receive less honorarium. A decrease in the fees that
parties incur would correspond to a decrease in the honorarium that
arbitrators receive, and an increase in the fees that parties incur
would correspond to an increase in the honorarium that arbitrators
receive.
    The total fees parties incur, and the total honorarium that
arbitrators receive, could either increase or decrease depending on the
composition and timing of the requests. For example, parties would be
subject to fees for contested requests to issue orders of appearance
without a hearing session, but would not be subject to fees for
unopposed requests to issue orders of production. In addition, the fees
for submitting contested requests to issue subpoenas without a hearing
session would decrease from $250 to $200 per arbitrator. The per-case
cap on these payments, however, would be removed. Therefore, parties
would be assessed additional fees if they submit multiple contested
requests for subpoenas.
    Among the 497 cases with contested subpoenas, 399 cases (or 80.3
percent) had only one contested request for subpoenas, whereas 98 cases
(or 19.7 percent) had more than one contested request for subpoenas.
For the cases with two or more contested requests for subpoenas, the
median number of days between requests is less than two months. This
suggests that contested requests for subpoenas are often submitted
within short periods of time, and that counsel could reasonably
anticipate these requests and submit the requests at one time. The
potential additional fees to parties from submitting multiple contested
requests for subpoenas from the removal of the per-case cap, therefore,
is likely to be minimal.
    If parties file a contested request to issue one or more subpoenas
or orders at one time and these are not based on the same facts or
arguments (i.e., unrelated), then arbitrators may not receive
honorarium payments commensurate with their time and effort to decide
the request. This could serve as a disincentive for arbitrators to give
their best efforts or the time necessary to make decisions on these
requests. The Director, however, could separate the motions and pay the
arbitrators accordingly, thereby mitigating these potential effects.
(d) Alternatives Considered
    Arbitrators raised issues with FINRA concerning the inconsistencies
in the existing honorarium structure for requests to issue subpoenas or
orders without a hearing session. Along with the proposed amendments,
FINRA considered other changes to the existing honorarium structure.
Other changes would have included an increase in the honorarium that
arbitrators receive to decide discovery-related motions, contested
subpoena requests, and requests for contested orders for production or
appearance. The honorarium payments would have been similar to the
honorarium that arbitrators receive for currently deciding contested
subpoenas ($250) or for deciding motions in discovery prehearings
($300).
    FINRA believes that the fee structure under the proposed amendments
would provide arbitrators with honoraria that are commensurate with
their efforts to decide these requests. FINRA also believes that the
proposed amendments provide incentives for parties to combine their
requests for submission simultaneously to minimize their costs.

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

    Written comments were neither solicited nor received.

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

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period (i) as the Commission may
designate up to 90 days of such date if it finds such longer period to
be appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be 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-FINRA-2018-026 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-FINRA-2018-026. 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 FINRA.
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-FINRA-2018-026 and should be
submitted on or before August 20, 2018.
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    \36\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\36\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-16166 Filed 7-27-18; 8:45 am]
 BILLING CODE 8011-01-P


[Federal Register Volume 81, Number 50 (Tuesday, March 15, 2016)]
[Rules and Regulations]
[Pages 13719-13721]
[FR Doc No: 2016-05833]

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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Chapter I

[Docket No. FAA-2015-2022]

Petition of the Aircraft Owner and Pilots Association (AOPA) To
Amend FAA Policy Concerning Flying Club Operations at Federally
Obligated Airports

AGENCY: Federal Aviation Administration (FAA), DOT.

ACTION: Final policy.

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SUMMARY: The policy statement clarifies the FAA's policy interpretation
regarding the operation of flying clubs at federally-obligated
airports. Specifically, this policy statement amends FAA Order 5190.6B,
Airport Compliance Requirements, Section 10.6 Flying Clubs to allow the
clubs to compensate instructors and mechanics who are club members for
services rendered to the Club. This policy statement also amends the
FAA's definition of flying clubs.

DATES: This action becomes effective April 4, 2016.

FOR FURTHER INFORMATION CONTACT: Miguel Vasconcelos, Airport Compliance
Division, ACO-100, Federal Aviation Administration, 800 Independence
Avenue SW., Washington, DC 20591, telephone<PHONE_NUMBER>; facsimile:
(202) 267-4620.

SUPPLEMENTARY INFORMATION:

Introduction and Background

    On April 3, 2015, the Aircraft Owners and Pilots Association (AOPA)
Senior Vice President for Government Affairs & Advocacy wrote to the
FAA's Director of the Office of Airport Compliance and Management
Analysis proposing revisions to FAA's current policy regarding
compensation for flight instructors and persons maintaining aircraft
within the context of flying club operations. AOPA stated in its letter
that it sought ``to help current flying clubs and airport sponsors
comply with the FAA guidance outlined in 5190.6B, and to provide future
flying clubs the opportunity to strengthen and unify general aviation
pilots.'' AOPA said that its goal is ``to provide guidance that is
attainable and ensures educated compliance from all airport users,''
and asked for ``updated guidance regarding compensation for flight
instructors and maintainers'' because ``flight instructors and aviation
mechanics are valuable assets to the aviation industry, and should be
granted the privilege of fair compensation for their efforts on a local
level.''
    AOPA proposes clubs be permitted to compensate member flight
instructors and member mechanics for services rendered to the club or
club members. Such compensation, AOPA suggests, should be monetary or
in the form of credit against payment of dues or flight time.
    The FAA requested comments on whether AOPA's recommendations are
consistent with the FAA's general policies regarding commercial
aeronautical services and on-airport flying clubs, and if so, whether
the stated agency policy on flying clubs should be revised to amend its
definition of flying clubs. In particular, the FAA sought comments from
commercial service providers that engage in flight training and
aircraft rental, from associations representing such service providers,
and other interested parties. Public comments were received and
considered, and changes to the existing policy were adopted.

I. Current Policy

    FAA Order 5190.6B, FAA Airport Compliance Manual (Order), paragraph
10(6)(a), published on September 30, 2009, defines a flying club as:
``a nonprofit or not-for-profit entity (e.g., corporation, association,
or partnership) organized for the express purpose of providing its
members with aircraft for their personal use and enjoyment only.'' The
Order states that,

the ownership of the club aircraft must be vested in the name of the
flying club or owned by all its members. The property rights of the
members of the club shall be equal; no part of the net earnings of
the club will inure to the benefit of any individual in any form,
including salaries, bonuses, etc. The flying club may not derive
greater revenue from the use of its aircraft than the amount needed
for the operation, maintenance, and replacement of its aircraft. FAA
Order 5190.6B at para. 10(6)(b).

    The Order also notes that ``flying clubs may not offer or conduct .
. . aircraft rental operations. They may conduct aircraft flight
instruction for regular members only, and only members of the flying
club may operate the aircraft.'' FAA Order 5190.6B at para. 10.6(c)(1).
The Order also states that ``no flying club shall permit its aircraft
to be used for flight instruction for any person, including members of
the club owning the aircraft, when such person pays or becomes
obligated to pay for such instruction. FAA Order 5190.6B at para.
10.6(c)(3). An exception applies when the instruction is given by a
lessee based on the airport who provides flight training and the person
receiving the training is a member of the flying club. Id. Flight
instructors who are also club members may not receive payment for
instruction except that they may be compensated by credit against
payment of dues or flight time'' and that ``any qualified mechanic who
is a registered member and part owner of the aircraft owned and
operated by a flying club may perform maintenance work on aircraft
owned by the club. The flying club may not become obligated to pay for
such maintenance work except that such mechanics may be compensated by
credit against payment of dues or flight time.'' Flying clubs are
defined in such a way as to differentiate from for-profit aeronautical
businesses offering aeronautical services to general public, e.g.,
FBOs, flight schools and aircraft rental providers.

    The owner of any federally-obligated airport (airport sponsor) is
required by the sponsor grant assurances to operate that airport for
the use and benefit of the public and to make that airport available to
all types, kinds, and classes of aeronautical activity on fair and
reasonable terms, without unjust discrimination.

II. AOPA Proposal

    AOPA states that its recommendations are designed to promote flying
clubs by allowing flight instructors and mechanics who are club members
to receive monetary compensation for services conducted for other club
members or club aircraft:

AOPA Policy Proposal Item 1

    ``No flying club shall permit its aircraft to be used for flight
instruction for any person, including members of the club owning the
aircraft, when such person pays or becomes obligated to pay for such
instruction except in the following circumstances; (a) The flight
instruction is provided to a club member by a commercial operator
authorized by the airport sponsor to provide flight instruction on
field. (b) The flight instruction is provided to a club member by a
flight instructor who is also a club member that is in good
standings according to the club bylaws. In either case, the flight
instructor may receive monetary compensation; however the flying
club is prohibited from holding itself out to the public as a fixed
based operator, a specialized aviation service operation, or a
flight school. In the case of (b) above, the Airport Sponsor has the
right to limit flight instruction for monetary compensation but must
permit the club to compensate club instructors with credit against
payment of dues or flight time.''

AOPA Policy Proposal Item 2

    ``Any qualified mechanic who is a member of the flying club may
perform maintenance work on aircraft owned or exclusively used by
the flying club. The flying club may not become obligated to pay for
such maintenance work except that such mechanics may be compensated
not to exceed a reasonable rate for the work performed at the
discretion of club members. The club however may not hold out to the
public as operating as a fixed base operator, a specialized aviation
service operation, or maintenance facility. The Airport Sponsor has
the right to limit maintenance work for monetary compensation but
must permit the club to compensate club mechanics with credit
against payment of dues or flight time.''

III. Comments Received

    The FAA received comments from 44 airport users including flight
instructors, pilots and flying club members. Thirty-seven of the
airport users were flying club members who submitted a letter
identifying themselves as ``Flying Club Participants at Air Venture
2015''. The remaining seven airport users submitted individual
comments. Two industry groups submitted comments: Flight School
Association of North America (FSANA) and National Air Transportation
Association of North America (NATA). FSANA is a membership-based
association representing flight schools and firms involved in flight
training. NATA is an organization representing the interest of aviation
businesses such as aircraft fueling, maintenance, parts sales, storage,
rental, airline servicing, flight training, Part 135 on-demand air
charter, and fractional aircraft program management.
    Forty-three airport users offered support of both AOPA Policy
Proposals: An individual commenter believes that the policy change
would provide an incentive for pilots who belong to flying clubs to
remain current and continue their education in a convenient, cost-
effective, and familiar environment. Another commenter indicated that
small airports rely on flying clubs because there is not enough
business activity to support a flight school. This commenter is an
inactive pilot because there is no aircraft rental or flight training
available at the airport. However, the club at a local airport has
several certificated flight instructors (CFI). Many CFIs have full time
jobs and are not interested in donating their evenings and weekends
without compensation. The president of a nonprofit flying club at
Skyhaven Airport in Rochester, New Hampshire, indicates that the
airport does not have a flight school. None of the club members can
receive proficiency checkouts or additional training in club aircraft
without violating the airport's policy. There are several CFIs in the
community that would join the club if they could be compensated.
    Supporters of the AOPA proposal believe the proposed policy change
would (1) provide enhanced opportunities for students to fulfill their
educational needs in surroundings they find appealing and accessible;
(2) provide incentive for pilots who are members of flying clubs to
remain current; and (3) create additional opportunities and incentives
for certificated flight instructors to actively participate in flying
clubs.
    A commenter is opposed to a change in policy. He believes it will
weaken ``for profit'' flight schools which have suffered financially
for the past eight years.
    FSANA believes that flying clubs can be a positive asset to the
community. FSANA recognizes that flying clubs that are not for profit
have a business advantage over for profit flight schools. They also
believe a flying club should not be classified as a commercial
operator. FSANA supports compensation for certificated flight
instructors and mechanics as long as flying clubs serve the needs of
their members and not promote their services to the general public and
do not compete with commercial operators. FSANA encouraged the FAA to
create awareness and enforce transparency for the flying club community
and airport sponsors to ensure that flying clubs do not compete with
commercial operators and promote themselves to the general public.
    NATA recognizes AOPA's initiative is intended to increase public
interest in flying by strengthening flying clubs. Of concern to NATA
are those entities that classify themselves as flying clubs but are
commercial aviation businesses thus avoiding compliance with an airport
sponsor's minimum standards. NATA asserts that flying clubs that offer
their services to the general public should not be able to enjoy the
protection of a non-profit flying club to avoid complying with an
airport's minimum standards. NATA does not object to either of AOPA's
proposals but recommends that CFIs and mechanics receive either (1)
monetary compensation or (2) discounted/waived regular club member dues
or flying time, but not both. NATA believes that without such a
restriction, outside instructors or mechanics could receive waived dues
and monetary compensation for performing work without ever having
invested in the club as would a bona-fide member. NATA suggests that
the policy change with these limitations will be beneficial and will
create a more level playing field.
    FSANA and NATA suggest that any clarification of the policy should
emphasize that (1) flying clubs should at no time hold themselves out
as fixed based operators, flight schools, or as businesses at which
people can learn to fly; and (2) CFIs and mechanics should be permitted
to receive monetary compensation as long as flying clubs of which they
are members meet adequate criteria, which may include the airport
sponsor's authorization and/or sponsor-imposed conditions. FSANA and
NATA also recommended that flying clubs must not indicate in any form
of marketing and/or communications that they are a flight school, and
flying clubs must not indicate in any form of marketing and/or
communications that they are a business where people can learn to fly.

IV. Final Policy Changes

    FAA's primary concern is that flying clubs operating at federally-
obligated

airports must conform to the FAA definition found in FAA Order 5190.6B,
paragraph 10.6. As stated, the Order defines ``a flying club as a
nonprofit or not-for-profit entity (e.g., corporation, association, or
partnership) organized for the express purpose of providing its members
with aircraft for their personal use and enjoyment only.'' In addition,
the ownership of the club aircraft must be vested in the name of the
flying club or owned by all its members, the property rights of the
members of the club shall be equal and no part of the net earnings of
the club will inure to the benefit of any individual in any form,
including salaries, bonuses, etc. These flying clubs can be
distinguished from commercial service providers that use the term
``flying club'' to describe their operation in order to avoid having to
comply with the airport's minimum standards for commercial service
providers Those ``flying clubs'' do not conform to the FAA definition
and put other commercial aeronautical service providers at an economic
disadvantage. Generally, they hold themselves out to the public as
alternatives to traditional flight schools and aircraft rental
providers, and charge only nominal annual ``club fees.''
    FAA policy will emphasize three points: (1) Flying clubs should at
no time hold themselves out as fixed based operators, flight schools,
or as businesses offering services to the general public; and (2) CFIs
and mechanics should be permitted to receive either monetary
compensation or discounted/waived regular club member dues but not
both; (3) flying clubs must not indicate, in any form of marketing and/
or communications, that they are a flight school and flying clubs must
not indicate in any form of marketing and/or communications that they
are a business where people can learn to fly. FAA agrees with NATA that
flight instructors and mechanics should be bona-fide club members
paying dues as a condition to receiving compensation for services or a
bona-fide member receiving a discount or waiver of dues with no
compensation. To offer both compensation and discounted/waived dues may
result in abuse and the use of outside instructors and mechanics who
have no investment of time or commitment to the club. Additionally, FAA
agrees with NATA and FSANA that flying clubs must distinguish
themselves from other aeronautical service providers.
    FAA expects that sponsors of federally-obligated airports will take
appropriate action to ensure that commercial operators and flying clubs
are properly classified, and the sponsor's actions are consistent with
its grant assurances, specifically Grant Assurance 22, Economic
Nondiscrimination.
    FAA's policy regarding flying clubs is amended by revising FAA
Order 5190.6B paragraphs 10.6(c)(3) and (4) and by adding paragraphs
10.6 (c)(8) and (9):
    b. General The ownership of the club aircraft must be vested in the
name of the flying club or owned by all its members. The property
rights of the members of the club shall be equal; no part of the net
earnings of the club will inure to the benefit of any individual in any
form, including salaries, bonuses, etc. The flying club may not derive
greater revenue from the use of its aircraft than the amount needed for
the operation, maintenance and replacement of its aircraft.
    (c)(3). A flying club may permit its aircraft to be used for flight
instruction in a club-owned aircraft as long as both the instructor
providing instruction and person receiving instruction are members of
the club owning the aircraft, or when the instruction is given by a
lessee based on the airport who provides flight training and the person
receiving the training is a member of the flying club. In either
circumstance, a flight instructor may receive monetary compensation for
instruction or may be compensated by credit against payment of dues or
flight time; however that individual may not receive both compensation
and waived or discounted dues or flight time concurrently. The airport
sponsor may set limits on the amount of instruction that may be
performed for compensation.
    (c)(4). A qualified mechanic who is a registered member and part
owner of the aircraft owned and operated by a flying club may perform
maintenance work on aircraft owned by the club. The mechanic may
receive monetary compensation for such maintenance work or may be
compensated by credit against payment of dues or flight time; however
that individual may not receive both compensation and waived or
discounted dues or flight time concurrently. The airport sponsor may
set limits on the amount of maintenance that may be performed for
compensation.
    (c)(8). Flying Clubs may not hold themselves out to the public as
fixed based operators, a specialized aviation service operation,
maintenance facility or a flight school and are prohibited from
advertisements as such or be required to comply with the appropriate
airport minimum standards.
    (c)(9). Flying Clubs may not indicate in any form of marketing and/
or communications that they are a flight school, and Flying Clubs must
not indicate in any form of marketing and/or communications that they
are a business where people can learn to fly.

    Issued in Washington, DC, on March 9, 2016.
Byron Huffman,
Acting Director, Office of Airport Compliance and Management Analysis.
[FR Doc. 2016-05833 Filed 3-14-16; 8:45 am]
BILLING CODE 4910-13-P


[Federal Register: March 11, 2009 (Volume 74, Number 46)]
[Notices]
[Page 10640-10642]
[DOCID:fr11mr09-158]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-59521; File No. SR-NYSEArca-2009-15]

Self-Regulatory Organizations; Notice of Filing and Immediate
Effectiveness of Rule Change by NYSE Arca, Inc. Implementing Fee Change

March 5, 2009.
    Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (the ``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby
given that, on February 27, 2009, NYSE Arca, Inc. (``NYSE Arca'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. The Commission is publishing this notice to solicit
comments on the proposed rule change from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 15 U.S.C. 78a.
    \3\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    The Exchange proposes to amend the section of its Schedule of Fees
and Charges for Exchange Services (the ``Schedule''). While changes to
the Schedule pursuant to this proposal will be effective upon filing,
the changes will become operative on March 2, 2009. The amended section
of the Schedule is included as Exhibit 5 hereto.\4\ A copy of this
filing is available on the Exchange's Web site at http://www.nyse.com,
at the Exchange's principal office and at the Commission's Public
Reference Room.
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    \4\ The Commission notes that while provided in Exhibit 5 to the
filing, the text of the proposed rule change is not attached to this
notice but is available at the Commission's Public Reference Room
and at http://www.nyse.com.
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II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

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

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

1. Purpose
    The Exchange proposes to make multiple changes to its Schedule that
will take effect on March 2, 2009. A more detailed description of the
proposed changes follows.
Tier 1 Rate Changes
    Tier 1 rates are applied to customers with an average daily share
volume per month greater than 90 million shares in Tape A, B and C,
including adding liquidity of more than 45 million shares. In Tape A
and Tape C securities the Exchange will continue its inverted pricing
structure, but proposes a new rebate of $0.0029 for orders that add
liquidity and new fee of $0.0028 for orders that remove liquidity.
Previously in Tape A and Tape C securities the Exchange paid a rebate
of $0.0028 for orders that added liquidity and charged a fee of $0.0027
for orders that removed liquidity.
Mid-Point Passive Liquidity Orders
    The Exchange proposes a rebate of $0.0020 per share for resting
Mid-point Passive Liquidity (``MPL'') Orders \5\ in Tape A and Tape C
securities for all customers. Previously the Exchange paid a rebate of
$0.0015 for resting MPL orders in Tape A and Tape C securities. The
Exchange proposes a rebate of $0.0010 per share for resting MPL orders

in Tape B securities for all customers. Previously the Exchange did not
pay a rebate for resting MPL orders in Tape B securities.
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    \5\ The MPL order is an undisplayed limit order that offers
price improvement to customers by executing at the mid-point of the
National Best Bid and Offer (NBBO). MPL orders will generally
interact with all order types including contra MPLs, but excluding
cross or directed orders.
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Orders Routed to the NYSE in Tape A
    The Exchange proposes a $0.0018 per share fee for orders in Tape A
securities routed outside the Book to the NYSE for customers qualifying
for Tier 1, Tier 2 or the Take Tier. Previously the Exchange charged
$0.0008 per share for orders in Tape A securities routed outside the
Book to the NYSE in Tier 1, Tier 2, and the Take Tier. The Exchange
proposes a $0.0020 per share fee for orders in Tape A securities routed
outside the Book to the NYSE for customers qualifying for Basic Rates.
    The following changes apply universally to all tiered pricing and
basic rate pricing in Tape A securities. The Exchange proposes a
$0.0016 per share fee for Primary Sweep Orders in Tape A securities
routed outside the book to the NYSE. Previously the Exchange charged
$0.0006 per share fee for Primary Sweep Orders in Tape A securities
routed outside the book to the NYSE. The Exchange also proposes a
$0.0018 per share fee for Primary Only Plus (``PO+'') Orders routed to
the NYSE that remove liquidity. Previously the Exchange charged an
$0.0008 per share fee for Primary Only Plus (``PO+'') Orders routed to
the NYSE that removed liquidity. The Exchange will continue to charge
no fee for PO and PO+ Orders routed to the NYSE for participation at
the open. To compliment the new PO+ fee, the Exchange proposes a
$0.0010 per share credit for PO+ Orders that provide liquidity to the
NYSE. Previously the Exchange did not pay a rebate for PO+ Orders
providing liquidity to the NYSE. For PO+ Market-On-Close (``MOC'') and
Limit-On-Close (``LOC'') Orders routed to the NYSE, the Exchange
proposes a $0.0005 per share fee. Previously the Exchange charged a
$0.0004 per share fee PO+ MOC and LOC Orders routed to the NYSE.
Basic Rate Changes
    Basic Rates apply to those customers that do not reach one of the
volume tiered pricing levels. The Exchange proposes a Basic Rate fee of
$0.0030 for orders that remove liquidity in Tape A and Tape C
securities. This fee was previously $0.0029. The rebate for orders that
add liquidity will remain unchanged at $0.0023.
IOI Tier Changes
    The Exchange also proposes adding an additional IOI Tier. The new
Tier 1 will pay a rebate of $.0012 per share for ETP Holders and Market
Makers that send an IOI to the Exchange resulting in an execution with
an average daily share volume per month greater than or equal to 10
million shares. The current Tier 1 will become the new Tier 2 and will
pay a rebate of $0.001 per share for ETP Holders and Market Makers that
send an IOI to the Exchange resulting in an execution with an average
daily share volume per month between 5 million shares and 9,999,999
shares. Finally, the current Tier 2 will become the new Tier 3 and will
pay a rebate of $0.0005 per share for ETP Holders and Market Makers
that send an IOI to the Exchange resulting in an execution with an
average daily share volume per month between 2.5 million shares and
4,999,999 shares.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6 of the Securities Exchange Act of 1934
(the ``Act''), in general, and Section 6(b)(4) of the Act, in
particular, in that it is designed to provide for the equitable
allocation of reasonable dues, fees, and other charges among its
members and other persons using its facilities. The proposed rates are
part of the Exchange's continued effort to attract and enhance
participation on the Exchange, by offering attractive rebates for
liquidity providers and volume-based incentives. The Exchange believes
that the proposed changes to the Schedule are equitable in that they
apply uniformly to our Users.

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 that is not necessary or appropriate
in furtherance of the purposes of the Act.

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

    No written comments were solicited or received with respect to the
proposed rule change.

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

    The foregoing rule change is effective upon filing pursuant to
Section 19(b)(3)(A) \6\ of the Act and subparagraph (f)(2) of Rule 19b-
4 \7\ thereunder, because it establishes a due, fee, or other charge
imposed by NYSE Arca on its members. At any time within 60 days of the
filing of the proposed rule change, the Commission may summarily
abrogate 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.
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    \6\ 15 U.S.C. 78s(b)(3)(A).
    \7\ 17 CFR 240.19b-4(f)(2).
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IV. Solicitation of Comments

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

Electronic Comments

     Use the Commission's Internet comment form (http://
www.sec.gov/rules/sro.shtml); or
     Send an e-mail to<EMAIL_ADDRESS>Please include
File Number SR-NYSEArca-2009-15 on the subject line.

Paper Comments

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

All submissions should refer to File Number SR-NYSEArca-2009-15. This
file number should be included on the subject line if e-mail 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 inspection
and copying in the Commission's Public Reference Room, 100 F Street,
NE., Washington, DC 20549, on official business days between the hours
of 10 a.m. and 3 p.m. Copies of the filing will also be available for
inspection and copying at the principal office of the self-regulatory
organization. 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-NYSEArca-2009-15 and should be submitted
on or before April 1, 2009.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E9-5204 Filed 3-10-09; 8:45 am]

BILLING CODE 8011-01-P