
[Federal Register Volume 78, Number 204 (Tuesday, October 22, 2013)]
[Notices]
[Pages 62889-62891]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-24637]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-70628; File No. SR-NYSE-2013-68]


Self-Regulatory Organizations; New York Stock Exchange LLC; 
Notice of Filing of Proposed Rule Change Amending Section 907.00 of the 
Listed Company Manual To Expand the Suite of Complimentary Products and 
Services That Are Offered to Certain Current and Newly Listed Companies

October 8, 2013.
    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 October 1, 2013, New York Stock Exchange LLC (``NYSE'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(the ``Commission'') the proposed rule change as described in Items I, 
II, and III below, which Items have been prepared by the Exchange. 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 Section 907.00 of the Listed Company 
Manual to expand the suite of complimentary products and services that 
are offered to certain current and newly listed companies. The text of 
the proposed rule change is available on the Exchange's Web site at 
www.nyse.com, at the principal office of the Exchange, and at the 
Commission's Public Reference Room.

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

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

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

1. Purpose
    The Exchange proposed to amend Section 907.00 of the Manual to 
expand the suite of complimentary products and services that it offers 
to certain listed companies. All listed issuers receive some 
complimentary products and services through NYSE Market Access Center. 
Presently, the Exchange offers products and services in the following 
general categories to certain current and newly listed companies: 
Market surveillance, web-hosting, market analytics and news 
distribution. The available products and services have approximate 
commercial values ranging from $10,000 to $45,000 annually \4\ and are 
offered to companies under a tiered system based on shares outstanding 
or global market value, as the case may be.
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    \4\ The market surveillance products and services have a 
commercial value of approximately $45,000 annually, web-hosting 
products and services have a commercial value of approximately 
$12,000-$16,000 annually, market analytics products and services 
have a commercial value of approximately $20,000 annually and news 
distribution products and services have a commercial value of 
approximately $10,000 annually.
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    With respect to currently listed companies, the Exchange offers 
complimentary products and services based on the number of shares such 
company has issued and outstanding. Companies that have more than 270 
million shares issued and outstanding (each a ``Tier One Company'') are 
offered (i) a choice of market surveillance or market analytics 
products and services, and (ii) web-hosting products and services on a 
complimentary basis. Companies that have between 160 million and 269.9 
million shares issued and outstanding (each a ``Tier Two Company'') are 
offered a choice of market analytics or web-hosting products and 
services.

[[Page 62890]]

    For newly listed companies, the Exchange offers different product 
and service options for an initial period of two years based on such 
company's global market value. A company with a global market value of 
$400 million or more (each a ``Tier A Company'') is offered (i) a 
choice of market surveillance products and services for a period of 
twelve months or market analytics products and services for a period of 
24 months, and (ii) web-hosting and news distribution products and 
services for a period of 24 months. Newly-listed companies with a 
global market value of less than $400 million (each a ``Tier B 
Company'') are offered web-hosting and news distribution products and 
services for a period of 24 months.
    The Exchange proposes to amend Section 907.00 of the Manual to add 
three additional categories of complimentary products and services that 
will be offered to certain current and newly listed companies. 
Specifically, the Exchange proposes to include corporate governance 
tools and advisory services with a commercial value of approximately 
$45,000 annually (the ``Enhanced Package''), corporate governance tools 
with a commercial value of approximately $20,000 annually (the ``Basic 
Package'') and data room services and virtual investor relation tools 
\5\ (with a commercial value of approximately $15,000-$20,000 annually) 
to the list of complimentary products and services offered to certain 
listed companies. The Enhanced Package will be offered to Tier One 
Companies as a third alternative to the market surveillance and market 
analytics products they are already offered. The Basic Package will be 
offered to Tier Two Companies as a third alternative to the market 
analytics and web-hosting products they are already offered. The Basic 
Package will be offered to Tier A Companies as a second alternative to 
the market analytics products and services they are already offered. 
The data room services and virtual investor relation tools will be 
offered to all listed companies on an annual basis.
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    \5\ A data room is a password-protected Web site used for 
document storage. It is typically used to store due diligence 
materials to be reviewed in connection with transactional activity. 
Virtual investor relations tools are Web sites used to present 
roadshows and other investor presentations on a short-term basis, 
typically in connection with a specific transaction.
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    In an increasingly complex and constantly evolving regulatory 
environment, the management and boards of directors of listed companies 
are eager to understand corporate governance best practices and to 
adopt high quality corporate governance policies. To that end, the 
Exchange has seen a growing demand among listed companies for pragmatic 
tools that will enable them to develop comprehensive corporate 
governance policies. Due to this demand, the Exchange believes it is 
attractive and helpful to listed companies to add corporate governance 
tools to the suite of products and services that it offers to certain 
current and newly listed companies. The Exchange proposes to offer 
these tools through an affiliated service provider and may engage 
additional third-party providers in the future.
    As discussed above, the Exchange proposes to offer two tiers of 
corporate governance products. The Basic Package, offered to Tier Two 
and Tier A Companies, will consist of a combination of governance, 
risk, compliance and board tools for company directors and executives. 
The Exchange expects that these tools will provide generic, easily 
implemented corporate governance advice and/or educational tools that 
are applicable to a wide range of listed companies.
    The Enhanced Package, offered to Tier One Companies, will be an 
expanded version of the Basic Package. It will offer the same tools as 
the Basic Package but will also include access to advisory services. 
Such advisory services may include ongoing, periodic review of a 
company's corporate governance policies as well as benchmarking such 
polices against a company's peer group. The advisory services will 
offer companies a more individualized assessment of their corporate 
governance practices particular to the specific nature of their 
industry and organization.
    The Exchange believes it is appropriate to offer the Enhanced 
Package to Tier One Companies. It is the Exchange's experience that 
Tier One Companies tend to be larger, more complex organizations. In 
many cases they have more divisions and product lines and operate 
across multiple jurisdictions thereby increasing their need for 
comprehensive corporate governance and compliance policies. Tier One 
Companies tend to be very large and complex organizations and the 
Exchange believes that such companies would benefit most from the 
individualized attention offered by the advisory services element of 
the Enhanced Package. By comparison, Tier Two and Tier A Companies tend 
to be mid-sized companies and therefore are smaller, less complex 
organizations than Tier One companies that can benefit from the general 
tools offered by the Basic Package. Given that most Tier B Companies 
are smaller and, less complex organizations than Tier Two and Tier A 
Companies, the Exchange believes they are unlikely to require the tools 
offered by the Basic Package.
    The specific tools and services offered by these products will be 
developed by the Exchange or by third-party vendors. Companies that are 
offered these products are under no obligation to accept them and a 
company's listing on the Exchange is not conditioned upon acceptance of 
any product or service. The Exchange notes that, from time to time, 
companies elect to purchase products and services from other vendors at 
their own expense rather than accepting comparable products and 
services offered by the Exchange.
    The proposed expansion of additional complimentary products and 
services will not benefit any category of listed companies over another 
one. The additional corporate governance packages discussed above will 
not increase the overall value of complimentary products and services 
offered to companies by the Exchange. The commercial value of the two 
corporate governance packages is approximately equal to the commercial 
value of other products already being offered to listed companies in 
each tier and are simply being offered as an additional alternative 
choice. Additionally, the data room services and virtual investor 
relation tools are being offered to all listed companies.
2. Statutory Basis
    The Exchange believes that the proposed rule change is consistent 
with Section 6(b) of the Act,\6\ in general, and furthers the 
objectives of Sections 6(b)(4) \7\ 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 issuers and other 
persons using its facilities. The Exchange also believes that the 
proposed rule change is consistent with Section 6(b)(5) \8\ of the Act 
in that it is not designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
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    \6\ 15 U.S.C. 78f(b).
    \7\ 15 U.S.C. 78f(b)(4).
    \8\ 15 U.S.C. 78f(b)(5).
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    The Exchange believes that it is reasonable to offer complimentary 
products and services to attract new listings, retain currently listed 
issuers, and respond to competitive pressures. The Exchange faces 
competition in the market for listing services, and it competes in part 
by improving the quality of the services that it offers to

[[Page 62891]]

listed companies. By offering products and services on a complimentary 
basis and ensuring that it is offering the services most valued by its 
listed issuers, the Exchange will improve the quality of the services 
that listed companies receive. Because Tier B Companies are typically 
smaller organizations that pay lower listing fees to the Exchange than 
other categories of listed companies, the Exchange believes it is 
reasonable to keep the suite of complimentary products and services 
offered to Tier B Companies unchanged.
    With respect to the addition of the two corporate governance 
packages, the Exchange believes that it is reasonable, equitable and 
not unfairly discriminatory to allow companies to choose whether they 
receive corporate governance products or one of the other complimentary 
products offered by the Exchange. With respect to the addition of the 
data room services and virtual investor relation tools, the Exchange 
believes it is reasonable, equitable and not unfairly discriminatory to 
offer an additional product to all listed companies. The Exchange 
further notes that the proposed rule change is equitable and not 
unfairly discriminatory because the criteria for satisfying the tiers 
are the same for all similarly situated companies. Companies are not 
forced or required to utilize the complimentary products and services 
as a condition of listing. All companies will continue to receive some 
level of free services.

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. The proposed change simply 
expands the universe of products and services offered to certain listed 
companies. While the value of complimentary products and services 
offered by the Exchange will increase marginally, such increased value 
will be offered to all listed companies without regard to size or 
status. Accordingly, the Exchange does not believe that the proposed 
change will impose any burden on competition.

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

    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 the 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 rule-comments@sec.gov. Please include 
File Number SR-NYSE-2013-68 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-NYSE-2013-68. 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 the filing also will be available 
for inspection and copying at the principal office of the Exchange. All 
comments received will be posted without change; 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-NYSE-2013-68 and should be 
submitted on or before November 12, 2013.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\9\
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    \9\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2013-24637 Filed 10-21-13; 8:45 am]
BILLING CODE 8011-01-P


