[Federal Register Volume 84, Number 107 (Tuesday, June 4, 2019)]
[Notices]
[Pages 25852-25856]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-11564]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-85957; File No. SR-NASDAQ-2019-040]


Self-Regulatory Organizations; The Nasdaq Stock Market LLC; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Relating to the Complementary Services Offered by the Exchange Under 
Rule IM-5900-7

May 29, 2019.
    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 May 16, 2019, The Nasdaq Stock Market LLC (``Nasdaq'' or the 
``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 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 modify the treatment of direct listings 
including Level 2 American Depository Receipts (ADRs) under IM-5900-7, 
specify that an Eligible New Listing includes Level 3 ADRs, update the 
values of certain services, modify the market advisory tools provided 
under IM-5900-7 to certain new listings, and make certain other 
clarifying changes.
    The text of the proposed rule change is available on the Exchange's 
website at http://nasdaq.cchwallstreet.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 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.

[[Page 25853]]

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

1. Purpose
    Nasdaq offers complimentary services under IM-5900-7 to companies 
listing on the Nasdaq Global and Global Select Markets in connection 
with an initial public offering (other than a company listed under IM-
5101-2), upon emerging from bankruptcy, in connection with a spin-off 
or carve-out from another company, or in conjunction with a business 
combination that satisfies the conditions in Nasdaq IM-5101-2(b) 
(``Eligible New Listings'') and to companies (other than a company 
listed under IM-5101-2) switching their listing from the New York Stock 
Exchange (``NYSE'') to the Global or Global Select Markets (``Eligible 
Switches'').\3\ Nasdaq believes that the complimentary service program 
offers valuable services to newly listing companies, designed to help 
ease the transition of becoming a public company or switching markets, 
and makes listing on Nasdaq more attractive to these companies. The 
services offered include a whistleblower hotline, investor relations 
website, disclosure services for earnings or other press releases, 
webcasting, market analytic tools, and may include market advisory 
tools such as stock surveillance (collectively the ``Service 
Package'').\4\
---------------------------------------------------------------------------

    \3\ See Exchange Act Release No. 65963 (December 15, 2011), 76 
FR 79262 (December 21, 2011) (SR-NASDAQ-2011-122) (adopting IM-5900-
7); Exchange Act Release No. 72669 (July 24, 2014), 79 FR 44234 
(July 30, 2014) (SR-NASDAQ-2014-058) (adopting changes to IM-5900-
7); Exchange Act Release No. 78806 (September 9, 2016), 81 FR 63523 
(September 15, 2016) (SR-NASDAQ-2016-098); Exchange Act Release No. 
79366 (November 21, 2016), 81 FR 85663 (November 28, 2016) (SR-
NASDAQ-2016-106); Exchange Act Release No. 82791 (February 28, 
2018), 83 FR 9354 (March 5, 2018) (SR-NASDAQ-2018-15); Exchange Act 
Release No. 82976 (March 30, 2018), 83 FR 14683 (April 5, 2018) (SR-
NASDAQ-2018-23).
    \4\ In addition, all companies listed on Nasdaq receive other 
standard services from Nasdaq, including Nasdaq Online and the 
Market Intelligence Desk.
---------------------------------------------------------------------------

Direct Listing
    Nasdaq recognizes that some companies that have sold common equity 
securities in private placements, which have not been listed on a 
national securities exchange or traded in the over-the-counter market 
pursuant to FINRA Form 211 immediately prior to the initial pricing, 
may wish to list those securities to allow existing shareholders to 
sell their shares. Nasdaq previously adopted requirements under IM-
5315-1 applicable to such companies listing on the Nasdaq Global Select 
Market \5\ and now proposes to include in the definition of an 
``Eligible New Listing'' that receives complimentary services under IM-
5900-7 a company listing in connection with a direct listing. This 
change is consistent with the approach approved by the Commission in 
the rules of NYSE, which provides similar services to direct 
listings.\6\
---------------------------------------------------------------------------

    \5\ Exchange Act Release No. 85156 (February 15, 2019), 84 FR 
5787 (February 22, 2019).
    \6\ Section 907.00 of the NYSE Listed Company Manual provides 
that for the purposes of this Section 907.00, the term ``Eligible 
New Listing'' means ``any U.S. company that lists common stock on 
the Exchange for the first time and any non-U.S. company that lists 
an equity security on the Exchange under Section 102.01 or 103.00 of 
the Manual for the first time, regardless of whether such U.S. or 
non-U.S. company conducts an offering . . .'' See Exchange Act 
Release No. 68143 (November 2, 2012), 77 FR 67053 (November 8, 2012) 
(SR-NYSE-2012-44); As subsequently amended Section 907.00 of the 
NYSE Listed Company Manual now provides that ``the term ``Eligible 
New Listing'' means (i) any U.S. company that lists common stock on 
the Exchange for the first time and any non-U.S. company that lists 
an equity security on the Exchange under Section 102.01 or 103.00 of 
the Manual for the first time, regardless of whether such U.S. or 
non-U.S. company conducts an offering and (ii) any U.S. or non-U.S. 
company emerging from a bankruptcy, spinoff (where a company lists 
new shares in the absence of a public offering), and carve-out 
(where a company carves out a business line or division, which then 
conducts a separate initial public offering).''
---------------------------------------------------------------------------

American Depository Receipts
    U.S. investors often hold equity securities of foreign issuers in 
the form of ADRs. An ADR is a security that represents an ownership 
interest in a specified number of foreign securities that have been 
placed with a depositary financial institution by the issuer or holders 
of such securities. An ADR is in essence a substitute trading mechanism 
for foreign securities allowing the issuer or holder to transfer title 
to the underlying foreign securities by delivery of the ADR. The 
depositary is typically a U.S. bank or trust company, and it usually 
appoints a custodian to hold the deposited securities in the home 
market of the foreign issuer.\7\ The custodian is often a bank, and may 
be a subsidiary or branch of the depositary or a third-party 
institution with which the depositary has a contractual custodian 
relationship.
---------------------------------------------------------------------------

    \7\ ADRs have many characteristics of a domestic equity security 
but also provide U.S. investors with several attributes that are 
absent in direct ownership of foreign securities. The depositary (or 
the custodian) monitors the declaration of dividends, collects them 
and converts them to U.S. dollars for distribution. In addition, the 
clearance and settlement process for ADRs generally is the same as 
for other domestic securities that are traded in the U.S. markets. 
Thus, investors can own an interest in securities of foreign issuers 
while holding securities that trade, clear and settle within 
automated U.S. systems and within U.S. timeframes.
---------------------------------------------------------------------------

    In order to list ADRs, Nasdaq requires that such ADRs be sponsored. 
A sponsored ADR facility is typically established jointly by an issuer 
and a depositary. The foreign issuer of the deposited securities 
typically enters into a deposit agreement with the depositary. For a 
sponsored ADR, both the depositary and the foreign company sign the F-6 
registration statement under the Securities Act of 1933. The deposit 
agreement sets out the rights and responsibilities of the issuer and 
the depositary, and the ADR holders as third party beneficiaries. Each 
ADR holder becomes a party to such agreement through its holding of the 
ADR.
    Market participants describe sponsored facilities in terms of three 
categories, based on the extent to which the issuer of the deposited 
securities has accessed the U.S. securities market. A ``Level 1 
facility'' is an ADR facility the ADRs of which trade in the U.S. over-
the-counter market and the foreign issuer is not required to register 
with or report to the Commission under Section 12 or 15 of the Exchange 
Act. ``Level 2'' refers to ADRs that are listed on a U.S. stock 
exchange by a foreign issuer that becomes subject to certain SEC 
reporting requirements,\8\ but the foreign issuer has not sold ADRs in 
the United States in order to raise capital or effect an acquisition. 
``Level 3'' denotes ADRs that are listed on a U.S. stock exchange where 
the foreign issuer has sold ADRs in the United States in a registered 
public offering. A foreign issuer can apply to list Level 2 or Level 3 
ADRs on any of Nasdaq's market tiers.
---------------------------------------------------------------------------

    \8\ Following their listing on Nasdaq, such companies will also 
be required to register and file annual reports under the Exchange 
Act with the Commission.
---------------------------------------------------------------------------

    Nasdaq proposes to include Level 2 ADRs in the definition of an 
``Eligible New Listing'' that receives complimentary services under IM-
5900-7 when the ADRs are listed in connection with a direct listing 
under IM-5315-1(c). Nasdaq also proposes to specify that an Eligible 
New Listing includes Level 3 ADRs by stating that the rule reference in 
IM-5900-7 to listing ``in connection with [the company's] initial 
public offering'' means the initial public offering in the United 
States, including ADRs, rather than the initial public offering of the 
underlying foreign securities in the company's home market. Such 
companies would receive the same services under IM-5900-7, with the 
same value, as any other Eligible New

[[Page 25854]]

Listing. This change is consistent with the approach approved by the 
Commission in the rules of NYSE, which provides similar services to 
companies listing ADRs in connection with initial public offering or 
through a direct listing.\9\
---------------------------------------------------------------------------

    \9\ See footnote 6 above. Section 907.00 of the NYSE Listed 
Company Manual provides that ``an ``equity security'' means common 
stock or common share equivalents such as ordinary shares, New York 
shares, global shares, American Depository Receipts, or Global 
Depository Receipts.'' See Exchange Act Release No. 68143 (November 
2, 2012), 77 FR 67053 (November 8, 2012) (SR-NYSE-2012-44).
---------------------------------------------------------------------------

Other Changes
    As part of the Service Package, Eligible New Listings and Eligible 
Switches with a market capitalization of $750 million or more currently 
receive a choice of market advisory tools, including a monthly 
ownership analytics and event driven targeting tool, as described in 
IM-5900-7(a)(iii). Nasdaq has determined to discontinue providing this 
tool because over time Nasdaq observed that it receives minimal 
interest from Nasdaq customers, in particular because there is 
considerable overlap in services with the stock surveillance tool.\10\ 
Accordingly, Nasdaq proposes to remove the monthly ownership analytics 
and event driven targeting tool from the list of available market 
advisory tools under IM-5900-7(a) and to renumber the remaining market 
advisory tools accordingly.\11\
---------------------------------------------------------------------------

    \10\ Currently no company receives the monthly ownership 
analytics and event driven targeting service from Nasdaq.
    \11\ The revised package of services will maintain the same 
approximate retail value as the one currently provided because 
Nasdaq presumed that a company would use stock surveillance, which 
has an approximate retail value of $56,500 as revised ($56,000 
previously), and global targeting, which has an approximate retail 
value of $44,000 rather than the monthly ownership analytics and 
event driven targeting, which has an approximate retail value of 
$48,000, because there is considerable overlap between the latter 
and the stock surveillance service.
---------------------------------------------------------------------------

    Nasdaq also proposes to update the values of the services contained 
in IM-5900-7 to their current values. Depending on a company's market 
capitalization and whether it is an Eligible New Listing or an Eligible 
Switch, the total revised value of the services provided ranges from 
$151,000 to $828,000, and one-time development fees of approximately 
$5,000 are waived.\12\
---------------------------------------------------------------------------

    \12\ The exact values are set forth in proposed IM-5900-7. Under 
the current rule the stated value of the services provided ranges 
from $150,000 to $824,000, and one-time development fees of 
approximately $5,000 are waived. In describing the total value of 
the services for companies that can select more than one market 
advisory tool, Nasdaq presumes that a company would use stock 
surveillance, which has an approximate retail value of $56,500 as 
revised ($56,000 previously), and global targeting, which has an 
approximate retail value of $44,000. Companies could, of course, 
select different combinations of the three services offered, but 
these other combinations would have lower total approximate retail 
values. See Exchange Act Release No. 78392 (July 22, 2016), 81 FR 
49705, 49706 n.10 (July 28, 2016) (Notice of Filing for SR-NASDAQ-
2016-098).
---------------------------------------------------------------------------

    The proposed rule change will be operative for new listings on or 
after the effectiveness of this rule filing. Companies that list before 
that date will continue to receive services as described in the current 
rule.
    Finally, Nasdaq also proposes to make non-substantive changes to 
update the introductory note in IM-5900-7 and to include the specific 
operative date of the proposed rule change to ease understanding of the 
rule.
    Nasdaq represents, and this proposed rule change will help ensure, 
that individual listed companies, including ADRs and direct listings, 
are not given specially negotiated packages of products or services to 
list, or remain listed, which the Commission has previously stated 
would raise unfair discrimination issues under the Exchange Act.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Exchange Act,\13\ in general, and furthers the objectives 
of Section 6(b)(5) of the Exchange Act,\14\ 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. Nasdaq also believes that the 
proposed rule change is consistent with the provisions Sections 
6(b)(4),\15\ 6(b)(5),\16\ and 6(b)(8),\17\ in that the proposal is 
designed, among other things, to provide for the equitable allocation 
of reasonable dues, fees, and other charges among Exchange members and 
issuers and other persons using its facilities and to promote just and 
equitable principles of trade, and is not designed to permit unfair 
discrimination between issuers, and that the rules of the Exchange do 
not impose any burden on competition not necessary or appropriate in 
furtherance of the purposes of the Exchange Act.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78f(b).
    \14\ 15 U.S.C. 78f(b)(5).
    \15\ 15 U.S.C. 78f(4).
    \16\ 15 U.S.C. 78f(5).
    \17\ 15 U.S.C. 78f(8).
---------------------------------------------------------------------------

    Nasdaq faces competition in the market for listing services,\18\ 
and competes, in part, by offering valuable services to companies. 
Nasdaq believes that it is reasonable to offer complimentary services 
to attract and retain listings as part of this competition. All 
similarly situated companies are eligible for the same package of 
services. Nasdaq previously created different tiers of services based 
on a market capitalization. As noted in the Service Package filings, 
Nasdaq believes that it is appropriate to offer different services 
based on a company's market capitalization given that larger companies 
generally will need more and different governance, communication and 
intelligence services.\19\
---------------------------------------------------------------------------

    \18\ The Justice Department has noted the intense competitive 
environment for exchange listings. See ``NASDAQ OMX Group Inc. and 
IntercontinentalExchange Inc. Abandon Their Proposed Acquisition Of 
NYSE Euronext After Justice Department Threatens Lawsuit'' (May 16, 
2011), available at http://www.justice.gov/atr/public/press_releases/2011/271214.htm.
    \19\ Exchange Act Release No. 65963, 76 FR at 79265.
---------------------------------------------------------------------------

    Nasdaq also believes it is reasonable, and not unfairly 
discriminatory, to offer complimentary services to a foreign company 
listing Level 2 ADRs or a domestic company listing in connection with a 
direct listing under IM-5315-1. Such companies are similar to other 
Eligible New Listings, such as initial public offerings of domestic 
companies, and will have increased need to focus on identifying and 
communicating with its shareholders because they are listing on a 
national securities exchange in the U.S. for the first time. Like the 
other Eligible New Listings that receive complimentary services under 
the existing rule, these companies are transitioning to the traditional 
U.S. public company model and the complimentary services provided will 
help ease that transition.\20\ In addition, these companies will be 
purchasing many of these services for the first time, and offering 
complimentary services will provide Nasdaq Corporate Solutions and 
third-party service providers the opportunity to demonstrate the value 
of its services and forge a relationship with the company at a time 
when it is choosing its service providers. For these reasons, Nasdaq 
believes it is not an inequitable allocation of fees nor unfairly 
discriminatory to offer the services to a foreign company listing Level 
2 ADRs or a domestic company listing in connection with a direct 
listing under IM-5315-1. To the contrary, this

[[Page 25855]]

proposed change will eliminate a distinction between companies listing 
common stock or ADRs through a direct listing and companies listing 
through an IPO.
---------------------------------------------------------------------------

    \20\ Although companies listing Level 2 ADRs may have prior 
experience being a public company in their home country, they, 
nonetheless, will be transitioning to the traditional public company 
model in the United States. Following their listing on Nasdaq, such 
companies will also be required to register and file annual reports 
under the Exchange Act with the Commission.
---------------------------------------------------------------------------

    Nasdaq believes that the proposed change to specify that the rule 
reference in IM-5900-7 to listing ``in connection with [the company's] 
initial public offering'' means the initial public offering in the 
United States, including ADRs, rather than the initial public offering 
of the underlying foreign securities in the company's home market is 
consistent with Section 6(b)(5) of the Exchange Act because it will 
provide transparency in the rules and address an ambiguity by 
specifying that listing of Level 3 ADRs on Nasdaq is considered an 
initial public offering notwithstanding that the issuer of ADRs may 
already be a public company in their home country.
    As described above, Nasdaq faces competition in the market for 
listing services, and competes, in part, by offering valuable services 
to companies. As part of the Service Package, Eligible New Listings and 
Eligible Switches with a market capitalization of $750 million or more 
currently receive a choice of market advisory tools, including a 
monthly ownership analytics and event driven targeting tool, as 
described in IM-5900-7(a)(iii). Based on Nasdaq's experience with 
offering this service, Nasdaq has determined to discontinue providing 
this tool because over time Nasdaq observed that this tool receives 
minimal interest from Nasdaq customers, in particular because the stock 
surveillance tool and the monthly ownership analytics and event driven 
targeting tool have considerable overlap between these services. Nasdaq 
believes that the removal of the monthly ownership analytics and event 
driven targeting tool is not unfairly discriminatory because all 
similarly situated companies are eligible for the same package of 
services. Moreover, no company currently uses this service.
    The Commission has previously indicated pursuant to Section 19(b) 
of the Exchange Act \21\ that updating the values of the services 
within the rule is necessary,\22\ and Nasdaq does not believe this 
update has an effect on the allocation of fees nor does it permit 
unfair discrimination, as issuers will continue to receive the same 
services, except for the monthly ownership analytics and event driven 
targeting tool, which will be removed as described above. Further, this 
update will enhance the transparency of Nasdaq's rules and the value of 
the services it offers companies, thus promoting just and equitable 
principles of trade. As such, the proposed rule change is consistent 
with the requirements of Section 6(b)(4) and (5) of the Exchange Act.
---------------------------------------------------------------------------

    \21\ 15 U.S.C. 78s(b).
    \22\ See Exchange Act Release No. 72669 (July 24, 2014), 79 FR 
44234 (July 30, 2014) (SR-NASDAQ-2014-058) (footnote 39 and 
accompanying text: ``We would expect Nasdaq, consistent with Section 
19(b) of the Exchange Act, to periodically update the retail values 
of services offered should they change. This will help to provide 
transparency to listed companies on the value of the free services 
they receive and the actual costs associated with listing on 
Nasdaq.'')
---------------------------------------------------------------------------

    Finally, Nasdaq notes that the proposed change to update the 
introductory note in IM-5900-7 and to include the specific operative 
date of the proposed rule change is consistent with Section 6(b)(5) of 
the Exchange Act because it will clarify the rule without making any 
substantive change.
    Nasdaq represents, and this proposed rule change will help ensure, 
that individual listed companies are not given specially negotiated 
packages of products or services to list, or remain listed, which the 
Commission has previously stated would raise unfair discrimination 
issues under the Exchange Act.\23\
---------------------------------------------------------------------------

    \23\ See Exchange Act Release No. 79366, 81 FR 85663 at 85665 
(citing Securities Exchange Act Release No. 65127 (August 12, 2011), 
76 FR 51449, 51452 (August 18, 2011) (approving NYSE-2011-20)).
---------------------------------------------------------------------------

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 Exchange Act. As noted above, Nasdaq 
faces competition in the market for listing services, and competes, in 
part, by offering valuable services to companies. The proposed rule 
changes reflect that competition, but do not impose any burden on the 
competition with other exchanges. Rather, Nasdaq believes the proposed 
changes will result in more potential listings being eligible to 
receive the package and therefore will enhance competition for new 
listings of ADRs and companies listing in connection with a direct 
listing under IM-5315-1. Finally, the clarification that listing of 
Level 3 ADRs on Nasdaq is considered an initial public offering in the 
United States will not impose any burden on competition because it will 
provide transparency in the rules and eliminate an ambiguity. This 
change is consistent with the approach approved by the Commission in 
the rules of NYSE, which provides similar services to companies listing 
ADRs in connection with initial public offering.\24\
---------------------------------------------------------------------------

    \24\ See footnote 9 above.
---------------------------------------------------------------------------

    Other exchanges can also offer similar services to companies, 
thereby increasing competition to the benefit of those companies and 
their shareholders. Accordingly, Nasdaq does not believe the proposed 
rule change will impose any burden on competition that is not necessary 
or appropriate in furtherance of the purposes of the Exchange Act, as 
amended.

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

    The Exchange has filed the proposed rule change pursuant to Section 
19(b)(3)(A) of the Act \25\ and Rule 19b-4(f)(6) thereunder.\26\ 
Because the 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 and Rule 19b-4(f)(6)(iii) thereunder. \27\
---------------------------------------------------------------------------

    \25\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \26\ 17 CFR 240.19b-4(f)(6).
    \27\ In addition, Rule 19b-4(f)(6)(iii) requires a self-
regulatory organization to give the Commission written notice of its 
intent to file the proposed rule change at least five business days 
prior to the date of filing of the proposed rule change, or such 
shorter time as designated by the Commission. The Exchange has 
satisfied this requirement.
---------------------------------------------------------------------------

    A proposed rule change filed under Rule 19b-4(f)(6) \28\ normally 
does not become operative for 30 days after the date of the filing. 
However, pursuant to Rule 19b-4(f)(6)(iii),\29\ the Commission may 
designate a shorter time if such action is consistent with the 
protection of investors and the public interest. In its filing with the 
Commission, Nasdaq has asked the Commission to waive the 30-day 
operative delay to allow Nasdaq to offer the Service Package to any 
companies listing ADRs or common stock through a direct listing during 
such 30-day period. In addition, Nasdaq has asked the Commission to 
waiver the 30-day operative delay in order to immediately (i) reflect 
the accurate values of the complimentary services in Nasdaq's rules, 
(ii) specify that

[[Page 25856]]

companies listing Level 3 ADRs on Nasdaq are considered to be listing 
in connection with an initial public offering in the United States, and 
(iii) remove the monthly ownership analytics and event driven targeting 
tool from the list of available market advisory tools under IM-5900-
7(a).
---------------------------------------------------------------------------

    \28\ 17 CFR 240.19b-4(f)(6).
    \29\ 17 CFR 240.19b-4(f)(6)(iii).
---------------------------------------------------------------------------

    The Commission notes that Nasdaq's proposal to offer the Service 
Package to any companies listing ADRs or common stock through a direct 
listing is substantially similar to the rules of another exchange that 
were approved previously by the Commission as consistent with the Act 
after being published in the Federal Register for notice and 
comment.\30\ In addition, the Commission notes that the other proposed 
amendments to Nasdaq's rules would enhance the transparency of IM-5900-
7 and eliminate a service that is not used by any listed company. For 
these reasons, the Commission believes that waiver of the 30-day 
operative delay is consistent with the protection of investors and the 
public interest and hereby waives the 30-day operative delay and 
designates the proposed rule change operative upon filing.\31\
---------------------------------------------------------------------------

    \30\ See Securities Exchange Act Release No. 68143, note 6 
supra.
    \31\ For purposes only of waiving the operative delay, the 
Commission has considered the proposed rule's impact on efficiency, 
competition, and capital formation. See 15 U.S.C. 78c(f).
---------------------------------------------------------------------------

    At any time within 60 days of the filing of such proposed rule 
change, the Commission summarily may temporarily suspend such rule 
change if it appears to the Commission that such action is necessary or 
appropriate in the public interest, for the protection of investors, or 
otherwise in furtherance of the purposes of the Act.

IV. Solicitation of Comments

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

Electronic Comments

     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-NASDAQ-2019-040 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-2019-040. 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-2019-040, and should be submitted 
on or before June 25, 2019.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\32\
---------------------------------------------------------------------------

    \32\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Eduardo A. Aleman,
Deputy Secretary.
[FR Doc. 2019-11564 Filed 6-3-19; 8:45 am]
BILLING CODE 8011-01-P


