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Federal Register / Vol. 86, No. 168 / Thursday, September 2, 2021 / Notices
lotter on DSK11XQN23PROD with NOTICES2

securities 288 or the trading of units.289
The Exchange believes that the departures from the NYSE American rules upon which the proposed Rules are based, as described above, are nonsubstantive e.g., by not including provisions relating to instruments that will not trade on the Exchange, would apply to all issuers in the same manner and are therefore not designed to permit unfair discrimination, consistent with Section 6b5 of the Exchange Act.290
The Exchange proposes in Rule 26507
to prohibit the issuance of fractional Securities and to provide that cash must be paid in lieu of any distribution or part of a distribution that might result in fractional interests in Securities.291
The Exchange believes that disallowing fractional shares reduces complexity. By extension, the requirement to provide cash in lieu of fractional shares simplifies the process related to share transfer and tracking of share ownership. The Exchange believes that this simplification promotes just and equitable principles of trade, fosters cooperation and coordination with persons engaged in regulating, clearing, settling, processing information with respect to, and facilitating transactions in securities, removes impediments to and perfect the mechanism of a free and open market and a national market system, and, in general, protects investors and the public interest, consistent with Section 6b5 of the Exchange Act.292
Proposed BSTX Rule 26130 Original Listing Applications would require listing applicants to furnish a legal opinion that the applicants Security is a security under applicable United States securities laws. Such a requirement provides assurance to the Exchange that Security trading relates to appropriate asset classes. The Exchange believes that this Rule promotes just and equitable principles of trade and, in general, protects investors and the public interest, consistent with Section 6b5 of the Exchange Act.293
The Exchange proposes to adopt corporate governance listing standards as its Rule 26800 Series that are substantially similar to the corporate governance listing standards set forth in Part 8 of the NYSE American Listing 288 See e.g., NYSE American Sections 1003biv and e.
289 See e.g., NYSE American Sections 106f, 401i, and 1003g.
290 15 U.S.C. 78fb5.
291 The Exchange also proposes certain conforming changes in Rule 26503 Form of Notice to reiterate that fractional interests in Securities are not permitted by the Exchange.
292 15 U.S.C. 78fb5.
293 Id.

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Manual. However, it includes certain clarifications, most notably that certain proposed provisions are not intended to restrict the number of terms that a director may serve 294 and that, if a limited partnership is managed by a general partner rather than a board of directors, the audit committee requirements applicable to the listed entity should be satisfied by the general partner.295 The Exchange also notes that, unlike the current NYSE American rules upon which the proposed Rules are based, the proposed Rules on corporate governance do not include provisions on asset-backed securities and foreign issues other than those from Canada, since the Exchange does not proposed to allow for such foreign issuers to list on BSTX at this time.
The Exchange proposes to adopt additional listing rules as its Rule 26900
Series that are substantially similar to the corporate governance listing standards set forth in Part 9 of the NYSE
American Listing Manual. The only significant difference from the baseline NYSE American rules is that the proposed BSTX Rules do not include provisions related to certificated securities, since Securities listed on BSTX will be uncertificated.
The Exchange proposes to adopt suspension and delisting rules as its Rule 27000 Series that are substantially similar to the corporate governance listing standards set forth in Parts 10, 11, and 12 of the NYSE American Listing Manual. The proposed rules do not include concepts from the baseline NYSE American rules regarding foreign, fixed income securities, or other nonequity securities because the Exchange is not proposing to allow for listing of such securities at this time.296
The Exchange believes that the proposals in the Rule 26800 to Rule 27000 Series, which are based on the rules of NYSE American with the differences explained above, are designed to foster cooperation and coordination with persons engaged in facilitating transactions in securities, 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. Further, the differences in the proposals compared to the 294 See
proposed Rule 26802d.
proposed Rule 26801b.
296 As with all sections of the proposed rules, references to securities have been changed to Securities where appropriate and, in the Rule 27000 Series, certain references have been conformed from the baseline NYSE American provisions to account for the differences in governance structure and naming conventions of BSTX.
295 See
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analogous NYSE American provisions appropriately reflect the differences between the two exchanges. The Exchange believes that ensuring that its systems are appropriately described in the BSTX Rules facilitates market participants review of such Rules, which serves to remove impediments to and perfect the mechanism of a free and open market and a national market system by ensuring that market participants can easily navigate, understand and comply with the Exchanges rulebook. Therefore, the Exchange believes its proposals are consistent with Section 6b5 of the Exchange Act.297
Trading and Listing Rules for ExchangeTrade Products Rule 28000 Series The Exchange proposes as the Rule 28000 Series rules related to trading and listing ETPs. These proposed Rules allow for an array of different types of ETPs to be traded and listed on the Exchange and would provide individuals and institutions with diverse range of products in which to invest. The proposed Rules would set forth requirements and initial as well as continued listing standards for a variety of ETPs noted in the bulleted list below.
The proposed Rules have been adapted from, and are substantially similar to, rules found in the NYSE Arca Inc.
NYSE Arca rulebook. Below is a list of the proposed Rules in the 28000
Series and the NYSE Arca rules on which it is based:
Proposed Rule 28000 Investment Company Units is based on NYSE Arca Rule 5.2Ej3.
Proposed Rule 28001 Equity IndexLinked Securities, Commodity-Linked Securities, Currency-Linked Securities, Fixed Income Index-Linked Securities, Futures-Linked Securities and Multifactor Index-Linked Securities is based on NYSE Arca Rule 5.2Ej6.
Proposed Rule 28002 ExchangeTraded Fund Shares is based on NYSE
Arca Rule 5.2Ej8.
Proposed Rule 28003 Trust Issued Receipts is based on NYSE Arca Rule 8.200E.
Proposed Rule 28004 CommodityBased Trust Shares is based on NYSE
Arca Rule 8.201E.
Proposed Rule 28005 Managed Fund Shares is based on NYSE Arca Rule 8.600E.
Proposed Rule 28006 Active Proxy Portfolio Shares is based on NYSE Arca Rule 8.601E.
Proposed Rule 28007 Managed Portfolio Shares is based on NYSE Arca Rule 8.900E.
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