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[Release No. 34-106442; File No. SR-NYSETEX-2026-36]

Self-Regulatory Organizations; NYSE Texas, Inc.; Notice of Filing and Immediate

Effectiveness of Proposed Rule Change to Amend Rule 7.10 Clearly Erroneous Executions

September 21, 2026.

Pursuant to Section 19(b)(1)1 of the Securities Exchange Act of 1934 (“Act”) 2 and Rule

19b-4 thereunder,3 notice is hereby given that, on September 14, 2026, the NYSE Texas, Inc.

(“NYSE Texas” or the “Exchange”) filed with the Securities and Exchange Commission (the

“Commission”) the proposed rule change as described in Items I and II 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.

Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed

Rule Change

The Exchange proposes to amend Rule 7.10 (“Clearly Erroneous Executions”) in light of

the Commission’s approval of Overnight Protected Bands for 23/5 Trading. The proposed rule

change is available on the Exchange’s website at www.nyse.com and at the principal office of

the Exchange.

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

15 U.S.C. 78s(b)(1).

15 U.S.C. 78a.

17 CFR 240.19b-4.

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.

Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory

Basis for, the Proposed Rule Change

Purpose

NYSE Texas, Inc. (“NYSE Texas” or the “Exchange”) proposes to amend proposes to

amend Rule 7.10 (“Clearly Erroneous Executions”) in light of the Commission’s approval of

Overnight Protected Bands under the LULD Plan for 23/5 Trading.

Background

In conjunction with the industry’s plans for the introduction of trading 23 hours a day, 5

days a week (“23/5 Trading”), the Operating Committee of the Plan to Address Extraordinary

Market Volatility (“LULD Plan”) filed proposed Amendment 27 to the LULD Plan, which

proposed to establish price band protections during overnight trading hours (“Overnight Price

Bands”).4 The Operating Committee proposed that the Overnight Price Bands would initially be

temporary static bands 20% above and below two reference points, and that after

implementation, the Operating Committee would evaluate the performance of such Overnight

Price Bands and propose appropriate changes in a new plan amendment. 5 On August 5, 2026,

the Commission approved the proposal. 6

In light of the Commission’s approval of these changes to the LULD Plan, the Exchange

See Securities Exchange Act Release No. 105596 (June 1, 2026), 91 FR 33774 (June 4, 2026) (File No. 4631) (Notice of Filing of 27th Amendment to the National Market System Plan).

See id.

See Securities Exchange Act Release No. 106042 (August 5, 2026), 91 FR 51515 (August 10, 2026) (File

No. 4-631) (Order Granting Approval of the 27th Amendment to the National Market System Plan to

Address Extraordinary Market Volatility to Establish Temporary Price Band Protections in Overnight

Trading).

now proposes several amendments to Rule 7.10 regarding Clearly Erroneous Executions. In

general, the rule describes the process a market participant may use to request cancellation of a

transaction that was “clearly erroneous.” The current rule’s central premise is that if LULD

Price Bands under the LULD Plan were available and correct at the time the transaction was

executed, the transaction is not eligible for clearly erroneous review. Specifically, Rule

7.10(c)(1) currently provides that “[i]f the execution time of the transaction(s) under review is

during the Core Trading Session, the transaction will not be reviewable as clearly erroneous”

except in certain limited circumstances, including when (A) the transaction is in an NMS stock

that is not subject to the LULD Plan (e.g., rights and warrants), (B) the transaction was executed

at a time with LULD Price Bands were unavailable or trading should have been prevented due to

a regulatory halt or other halt, or (C) several other limited circumstances.7 In approving the

existing version of the rule, the Commission noted that restricting clearly erroneous review in

this way during times when LULD Price Bands were in effect was “consistent with the Act and

will further the goal of providing greater certainty to market participants that trades executed

within the Price Bands will stand and not be broken. . . . Thus, the proposal is designed to limit

the potential discordance between the LULD mechanism and CEE review process.” 8

Currently, LULD Price Bands are available only during the Core Trading Session,

meaning that the restrictions on clearly erroneous review described above apply only during the

Core Trading Session. With the introduction of Overnight Price Bands, the Exchange now

proposes to extend the existing restrictions on clearly erroneous review to the period when

See Rule 7.10(c)(1)(A), (B), and (C).

See Securities Exchange Act Release No. 95658 (September 1, 2022), 87 FR 55060 at 55063 (September 8,

2022) (SR-CboeBZX-2022-037) (Order Approving a Proposed Rule Change, as Modified by Amendment

Nos. 1 and 2, to Amend BZX Rule 11.17, Clearly Erroneous Executions).

Overnight Price Bands are in place. This proposed change would be consistent with the

Commission’s rationale in approving the current version of the rule because it would limit any

potential discordance between the LULD mechanism and CEE review in the overnight trading

session, providing greater certainty to market participants that trades executed with the

Overnight Price Bands will stand and not be broken.

Proposed Changes to Rule 7.10(c)(1)

To implement this change, the Exchange proposes to add several definitions to Rule

7.10(c)(1). First, the Exchange would add that the term “LULD Protected Hours” includes the

Core Trading Session and “Overnight Protected Hours” defined in Section VIII of the LULD

Plan. Second, the Exchange would define “LULD Price Bands” or “Price Bands” to mean the

Price Bands defined in Section V of the LULD Plan (i.e., the Price Bands that apply during the

Core Trading Session) and “Overnight Price Bands” as defined in Section VIII of the LULD

Plan (i.e., the Price Bands that apply to the Overnight Protected Hours from 9:00 p.m. ET

through 4:00 a.m. ET).

The Exchange proposes to amend the current first sentence of Rule 7.10(c)(1) to replace

the phrase “Core Trading Session” with “LULD Protected Hours,” to provide that “[i]f the

execution time of the transaction(s) under review is during LULD Protected Hours, the

transaction will not be reviewable as clearly erroneous . . . .” This change would extend the

LULD-based restrictions on clearly erroneous review currently in place during the Core Trading

Session to the Overnight Protected Hours.

The Exchange also proposes to amend Rule 7.10(c)(1)(B)’s reference to “Percentage

Parameter” to incorporate the Percentage Parameter that applies to Overnight Protected Hours.

The amended provision would provide for the applicability of clearly erroneous review if the

price of the transaction to buy (sell) that is the subject of the clearly erroneous complaint is

greater than (less than) the Reference Price by an amount that equals or exceeds the applicable

Percentage Parameter defined in Appendix A to the LULD Plan (with respect to the Price Bands

that apply during the Core Trading Session) or the “Overnight Percentage Parameter defined in

Section VIII of the LULD Plan” (with respect to Overnight Protected Hours).

In addition to these changes, the Exchange also proposes to make a non-substantive

change to Rule 7.10(c)(1)(A), substituting the term “LULD Plan” for the current text “the Plan to

Address Extraordinary Market Volatility Pursuant to Rule 608 of Regulation NMS under the Act

(the ‘Limit Up-Limit Down Plan’ or ‘LULD Plan,’)” as the “LULD Plan” would be defined in

the proposed revision to Rule 7.10(c)(1).

Proposed Changes to Rule 7.10(c)(2), (d)(3), and (f)

As noted above, current Rule 7.10(c)(1)(A) permits clearly erroneous review even during

the Core Trading Session when the transaction in question is in an NMS Stock that is not subject

to the LULD Plan, i.e., rights and warrants. Such transactions are reviewed for clearly erroneous

status using the procedures set out in Rule 7.10(c)(2), including the Numerical Guidelines set out

in the table accompanying Rule 7.10(c)(2)(A). The Exchange now proposes to introduce a

similar provision regarding transactions in NMS Stocks not subject to the LULD Plan that are

executed during the Overnight Protected Hours; such transactions would be subject to the same

Numerical Guidelines as transactions occurring in the Early and Late Trading Sessions.

The heading of Rule 7.10(c)(2) addresses “[r]eview of transactions occurring during the

Early or Late Trading Session or eligible for review pursuant to paragraph (c)(1)(A).” The

Exchange proposes to replace the phrase “eligible for review pursuant to paragraph (c)(1)(A)”

(which, in the current rule, means transactions executed during the Core Trading Session in NMS

Stocks not subject to the LULD Plan) with “during LULD Protected Hours in NMS Stocks not

subject to the LULD Plan.” This proposed language would cover transactions in NMS Stocks

not subject to the LULD Plan in the Core Trading Session and expand the same treatment to

transactions executed in NMS Stocks not subject to the LULD Plan during Overnight Protected

Hours. As such, the proposed change is not novel.

The Exchange proposes to make the same change everywhere else such language appears

in the rule – namely, in the text of paragraphs (c)(2)(A), (c)(2)(B), (c)(2)(C), (c)(2)(D), (d)(3),

and (f).9 In each case, the Exchange proposes to replace the phrase “transactions occurring

during the Early or Late Trading Session or eligible for review pursuant to paragraph (c)(1)(A)”

with “transactions occurring during the Early or Late Trading Session or during LULD Protected

Hours in NMS Stocks not subject to the LULD Plan.”

The Exchange also proposes to make corresponding changes to the headings of the table

accompanying Rule 7.10(c)(2)(A). The Exchange proposes to change the heading of the second

column from “Core Trading Session Numerical Guidelines for transactions eligible for review

pursuant to paragraph (c)(1)(A)” to “Numerical Guidelines for Transactions Executed During the

Core Trading Session in NMS Stocks Not Subject to the LULD Plan.” This change would

simply replace the shorthand “eligible for review pursuant to paragraph (c)(1)(A)” with the fuller

description that such transactions are “executed during the Core Trading Session in NMS Stocks

not subject to the LULD Plan,” and is not a substantive change.

Similarly, the Exchange proposes to change the heading of the third column from “Early

Rule 7.10(c)(2)(A)-(D) specifies general rules for applying clearly erroneous review to transactions where

such review is not precluded by paragraph (c)(1). Rule 7.10(d)(3) specifies conditions where the Exchange

may use a revised Reference Price for the purpose of clearly erroneous review in certain transactions where

such review is not precluded by paragraph (c)(1). Rule 7.10(f) specifies that for transactions where clearly

erroneous review is not precluded by paragraph (c)(1), an officer may initiate clearly erroneous review on

his or her own motion.

and Late Trading Session Numerical Guidelines” to “Numerical Guidelines for Transactions

Executed During the Early and Late Trading Session or During Overnight Protected Hours in

NMS Stocks Not Subject to the LULD Plan.” The proposed change addresses the fact that

transactions executed during Overnight Protected Hours in NMS Stocks not subject to the LULD

Plan are eligible for clearly erroneous review – just as are transactions in NMS Stocks not

subject to the LULD Plan executed during the Core Trading Sesion – but at the Numerical

Guidelines that apply outside of the Core Trading Session.

Together, these proposed changes would extend the eligibility of clearly erroneous

review for transactions in NMS Stocks not subject to the LULD Plan that is currently in place

during the Core Trading Session to the Overnight Protected Hours, and would apply the

Commission’s recent approval of Overnight Price Bands to the clearly erroneous executions rule.

Implementation

The Exchange understands that the other national securities exchanges and FINRA will

also file similar proposals, the substance of which are identical to this proposal. The Exchange

proposes that this rule change would become operative at the commencement of 23/5 Trading,

which is scheduled to commence industry-wide on December 6, 2026.

Statutory Basis

The Exchange believes that its proposal is consistent with the requirements of the Act and

the rules and regulations thereunder that are applicable to a national securities exchange, and, in

particular, with the requirements of Section 6(b) of the Act. 10 Specifically, the proposal is

consistent with Section 6(b)(5) of the Act11 because it would promote just and equitable

15 U.S.C. 78f(b).

15 U.S.C. 78f(b)(5).

principles of trade, remove impediments to, and perfect the mechanism of, a free and open

market and a national market system, and, in general, protect investors and the public interest.

The Exchange believes that the proposed change is consistent with just and equitable

principles of trade because it extends the basic premise of the current rule that clearly erroneous

review should be generally unavailable any time a transaction is executed within LULD Price

Bands at a time the Price Bands were available and correct. Currently, LULD Price Bands are

available only during the Core Trading Session, meaning that the restrictions on clearly

erroneous review described above apply only during the Core Trading Session. With the

introduction of Overnight Price Bands, the Exchange believes that extending such restrictions on

clearly erroneous review to the period when Overnight Price Bands are in place would remove

impediments to and perfect the mechanism of a free and open market and a national market

system by enhancing the transparency and consistency of the rule.

The resulting rule would thus extend the LULD-related limits on clearly erroneous

review that are applicable in the Core Trading Session to the overnight period. The proposed

change would also be consistent with the Commission’s rationale in approving the current

version of the rule because it would limit any potential discordance between the LULD

mechanism and CEE review in the overnight trading session, providing greater certainty to

market participants that trades executed with the Overnight Price Bands will stand and not be

broken.12

Self-Regulatory Organization’s Statement on Burden on Competition

The Exchange believes the proposal is consistent with Section 6(b)(8) of the Act 13 in that

See 87 FR 55060 at 55063, supra note 8.

15 U.S.C. 78f(b)(8).

it does not impose any burden on competition that is not necessary or appropriate in furtherance

of the purposes of the Act. Rather than impacting competition, the proposed change would

simply extend the basic premise of the current rule that clearly erroneous review should be

generally unavailable any time a transaction is executed within LULD Price Bands at a time the

Price Bands were available and correct. The Exchange understands that the other national

securities exchanges and FINRA will also file similar proposals, the substance of which are

identical to this proposal. Thus, the proposed rule change will help to ensure consistency across

SROs without implicating any competitive issues.

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 Exchange has filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of

the Act14 and Rule 19b-4(f)(6) thereunder.15 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 prior to 30 days from the date on which it was

filed, or such shorter time as the Commission may designate, if consistent with the protection of

investors and the public interest, the proposed rule change has become effective pursuant to

Section 19(b)(3)(A) of the Act and Rule 19b-4(f)(6)(iii) thereunder.

A proposed rule change filed under Rule 19b-4(f)(6)16 normally does not become

15 U.S.C. 78s(b)(3)(A)(iii).

17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6) 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.

17 CFR 240.19b-4(f)(6).

operative prior to 30 days after the date of the filing. However, pursuant to Rule 19b4(f)(6)(iii),17 the Commission may designate a shorter time if such action is consistent with the

protection of investors and the public interest. 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. If the

Commission takes such action, the Commission shall institute proceedings under Section

19(b)(2)(B)18 of the Act to determine whether the proposed rule change should be approved or

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

(https://www.sec.gov/rules/sro.shtml); or

•

Send an email to rule-comments@sec.gov. Please include file number

SR-NYSETEX-2026-36 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.

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

15 U.S.C. 78s(b)(2)(B).

All submissions should refer to file number SR-NYSETEX-2026-36. 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 (https://www.sec.gov/rules/sro.shtml).

Copies of the filing will be available for inspection and copying at the principal office of the

Exchange. Do not include personal identifiable information in submissions; you should submit

only information that you wish to make available publicly. We may redact in part or withhold

entirely from publication submitted material that is obscene or subject to copyright protection.

All submissions should refer to file number SR-NYSETEX-2026-36 and should be submitted on

or before [INSERT DATE 21 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL

For the Commission, by the Division of Trading and Markets, pursuant to delegated

authority.19

Sherry R. Haywood,

Assistant Secretary.

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

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.