On 4 April 2025, the United States Securities and Exchange Commission (US SEC) published a notice notifying the receipt and commencing the review of an application by Texas Stock Exchange LLC (TXSE) for registration as a national securities exchange under Section 6 of the United States Securities Exchange Act of 1934. This notice, published and documented in SEC Release No. 34-102773; File No. 10-249, invites public comment and takes up the notice to scrutinise for US SEC to evaluate TXSE’s compliance with federal securities laws.
TXSE initially filed its Form 1 application on 31 January 2025, followed by Amendment No. 1 on 02 April 2025, by which they updated the exhibits and detailed operational information. The US SEC’s Division of Trading and Markets is reviewing the submission to determine whether the proposed exchange satisfies all applicable statutory and regulatory requirements for national securities exchanges under the Exchange Act.
According to the application, TXSE proposes to operate a fully automated limit order book that ranks orders based on price and time priority. The exchange would not maintain a physical trading floor and would instead rely on electronic submissions by registered broker-dealer members. TXSE intends to support one class of membership, allowing registered broker-dealers to participate and optionally register as market makers, subject to compliance with specific operational obligations outlined in the TXSE Rulebook. Notably, the system is designed to remain relatively simple compared to other exchanges, limiting complex order types and instructions.
TXSE would be a wholly owned subsidiary of TXSE Group Inc., whose ownership structure is defined by a Stockholders’ Agreement. This agreement imposes caps on beneficial ownership, including a 40% limit for any individual shareholder or related group and a 20% cap for TXSE members. The governing documents and corporate structure are detailed in Exhibits A, C, and J of the Form 1 filing.
Public comments are invited on the application by interested stakeholders who may submit written data and views electronically via the US SEC’s rule comment page or by emailing rule-comments@sec.gov with the subject line including File No. 10-249. Paper comments may also be mailed to the Commission’s Secretary at 100 F Street NE, Washington, DC. All submissions must be received within 45 days of publication in the Federal Register. The US SEC will consider all feedback as it assesses whether TXSE meets the legal and regulatory criteria under the United States Exchange Act. The full application and supporting exhibits are available for public inspection at the US SEC’s website at www.sec.gov and in the Commission’s Public Reference Room.
(Source: https://www.sec.gov/files/rules/other/2025/34-102773.pdf)
