[Federal Register Volume 85, Number 190 (Wednesday, September 30, 2020)]
[Notices]
[Page 61793]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-21598]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 90001/September 25, 2020/SR-NYSE-2019-67]


Securities Exchange Act of 1934; Order Granting Petition for 
Review, Scheduling Filing of Statements, and Denying New York Stock 
Exchange LLC's Motion To Lift the Stay; In the Matter of the New York 
Stock Exchange LLC Regarding an Order Approving a Proposed Rule Change, 
as Modified by Amendment No. 2, To Modify Chapter One of the Listed 
Company Manual To Modify the Provisions Relating to Direct Listings

    This matter comes before the Securities and Exchange Commission 
(``Commission'') on petition to review the approval, pursuant to 
delegated authority, of the New York Stock Exchange LLC (``NYSE'') 
proposed rule change to amend Chapter One of the Listed Company Manual 
to modify the provisions relating to direct listings.\1\
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    \1\ The proposed rule change relates to direct listings that 
also involve a primary capital raising. This matter does not affect 
NYSE's current rules related to direct listings that do not involve 
a primary capital raising.
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    On December 20, 2019, the Commission issued a notice of filing of 
the proposed rule change, as modified by Amendment No. 1, filed with 
the Commission pursuant to Section 19(b)(1) of the Securities Exchange 
Act of 1934 (``Exchange Act'') \2\ and Rule 19b-4 \3\ thereunder.\4\ On 
February 13, 2020, a longer time period was designated within which to 
act on the proposed rule change.\5\ On March 26, 2020, proceedings were 
instituted under Section 19(b)(2)(B) of the Exchange Act \6\ to 
determine whether to approve or disapprove the proposed rule change.\7\ 
On June 22, 2020, NYSE filed Amendment No. 2 to the proposed rule 
change, replacing the proposed rule change, as modified by Amendment 
No. 1, in its entirety. On June 24, 2020, the Commission issued a 
notice of filing of Amendment No. 2 to the proposed rule change.\8\ On 
June 24, 2020, a longer time period was designated for Commission 
action on proceedings to determine whether to approve or disapprove the 
proposed rule change.\9\ On August 26, 2020, after consideration of the 
record for the proposed rule change, the Division of Trading and 
Markets (``Division''), pursuant to delegated authority,\10\ approved 
the proposed rule change, as modified by Amendment No. 2 (``Approval 
Order'').\11\
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    \2\ 15 U.S.C. 78s(b)(1).
    \3\ 17 CFR 240.19b-4.
    \4\ See Exchange Act Release No. 87821, 84 FR 72065 (Dec. 30, 
2019). NYSE filed the proposed rule change on December 11, 2019. On 
December 13, 2019, NYSE filed Amendment No. 1 to the proposed rule 
change, which amended and replaced the proposed rule change in its 
entirety.
    \5\ See Exchange Act Release No. 88190, 85 FR 8981 (Feb. 20, 
2020).
    \6\ 15 U.S.C. 78s(b)(2)(B).
    \7\ See Exchange Act Release No. 88485, 85 FR 18292 (Apr. 1, 
2020).
    \8\ See Exchange Act Release No. 89148, 85 FR 39246 (June 30, 
2020).
    \9\ See Exchange Act Release No. 89147, 85 FR 39226 (June 30, 
2020).
    \10\ 17 CFR 200.30-3(a)(12).
    \11\ See Exchange Act Release No. 89684, 85 FR 54454 (Sept. 1, 
2020).
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    On August 31, 2020, pursuant to Commission Rule of Practice 
430,\12\ the Council of Institutional Investors (``CII'') filed with 
the Commission a notice of intention for review of the Approval Order. 
Pursuant to Commission Rule of Practice 431(e), the Approval Order was 
stayed by the CII filing with the Commission the notice of intention to 
petition for review.\13\ On September 4, 2020, NYSE filed a motion for 
the Commission to lift the automatic stay of the Approval Order and a 
brief in support of its motion to lift the stay. On September 8, 2020, 
CII filed a brief in opposition to NYSE's motion to lift the automatic 
stay. On September 8, 2020, pursuant to Commission Rule of Practice 
430,\14\ the CII filed a petition for review of the Approval Order. On 
September 11, 2020, NYSE filed a reply brief in support of its motion 
to lift the stay.
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    \12\ 17 CFR 201.430.
    \13\ 17 CFR 201.431(e).
    \14\ 17 CFR 201.430.
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    Pursuant to Rule 431 of the Rules of Practice,\15\ the petition for 
review of the Approval Order of CII is granted. Further, the Commission 
hereby establishes that any party to the action or other person may 
file a written statement in support of or in opposition to the Approval 
Order on or before October 16, 2020.
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    \15\ 17 CFR 201.431.
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    Finally, the Commission finds that it is inappropriate to lift the 
automatic stay during the pendency of the Commission's review.\16\ CII 
argues that the proposed rule change makes changes to the initial 
public offering (``IPO'') market that are ``so significant that the 
Commission should maintain the stay'' while it considers ``the adequacy 
of investor protections'' and other policy issues under the proposed 
rule change. We do not believe that NYSE has identified a compelling 
reason that lifting the automatic stay furthers the public interest, 
particularly in light of the policy considerations CII has identified. 
We do not believe it to be in the public interest to alter the status 
quo while the Commission considers the issues raised by the proposed 
rule change before it becomes effective. We accordingly deny NYSE's 
motion to lift the stay.
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    \16\ See Exchange Act Release No. 60988 (Nov. 12, 2009) 
(refusing to lift automatic stay because the petitioner ``raised 
important policy issues that warrant Commission consideration prior 
to allowing'' rule change to go into effect).
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    For the reasons stated above, it is hereby:
    ORDERED that the petition of CII for review of the Division's 
action to approve the proposed rule change by delegated authority be 
GRANTED; and
    It is further ORDERED that any party or other person may file a 
statement in support of or in opposition to the action made pursuant to 
delegated authority on or before October 16, 2020.
    It is further ORDERED that NYSE's Motion to Lift the Automatic Stay 
is hereby denied; and
    It is further ORDERED that the August 26, 2020, order approving the 
proposed rule change, as modified by Amendment No. 2 (File No. SR-NYSE-
2019-67), shall remain stayed.

    By the Commission.
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-21598 Filed 9-29-20; 8:45 am]
BILLING CODE 8011-01-P


