80 FR 29138 - Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Clarify NSCC's Rules & Procedures Relating to the Process by Which NSCC Members Submit Buy-Ins Within NSCC's Continuous Net Settlement System
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 97 (May 20, 2015)
Federal Register Volume 80, Issue 97 (May 20, 2015)
| Page Range | 29138-29139 | |
| FR Document | 2015-12145 |
[Federal Register Volume 80, Number 97 (Wednesday, May 20, 2015)] [Notices] [Pages 29138-29139] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-12145] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-74965; File No. SR-NSCC-2015-002] Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Clarify NSCC's Rules & Procedures Relating to the Process by Which NSCC Members Submit Buy-Ins Within NSCC's Continuous Net Settlement System May 14, 2015. Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of 1934 (``Act'') and Rule 19b-4 \2\ thereunder, notice is hereby given that on May 4, 2015, National Securities Clearing Corporation (``NSCC'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule change as described in Items I, II and III below, which Items have been prepared by NSCC. NSCC filed the proposed rule change pursuant to Section 19(b)(3)(A) \3\ of the Act and Rule 19b-4(f)(1) \4\ thereunder. The proposed rule change was effective upon filing with the Commission. 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. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(1). --------------------------------------------------------------------------- I. Clearing Agency's Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change consists of amendments to NSCC's Rules & Procedures (``Rules'') in order to clarify those Rules relating to the process by which NSCC Members submit buy-ins within NSCC's Continuous Net Settlement (``CNS'') system, as more fully described below. II. Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, NSCC 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. NSCC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. (A) Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose One of NSCC's core services as a central counterparty is trade clearance and settlement through CNS, where compared and recorded transactions in eligible securities for a particular settlement date are netted by issue into one net long (buy) or net short (sell) position. As a continuous net system, those positions are further netted with positions of the same issue that remain open after their originally scheduled settlement date, so that trades or miscellaneous activity scheduled to settle on any day are netted with fail positions to result in a single deliver or receive obligation for each Member for each issue in which it has activity. Currently, under NSCC's Rules, a Member with a long position at the end of the day may submit to NSCC a Notice of Intention to Buy-In (``Buy-In Notice'') specifying a quantity of securities (not exceeding such long position) (``Buy-In Position'') that it intends to purchase to satisfy the fail that resulted in that long position, or ``buy-in''.\5\ Typically, the day the Buy-In Notice is submitted is referred to as N, and N+1 and N+2 refer to the succeeding days (N through N+2 is referred to as the ``Buy-In Period'').\6\ The Buy-In Position is given high priority for allocation from the CNS night cycle on N+1 through completion of the CNS day cycle on N+2. --------------------------------------------------------------------------- \5\ Members are not permitted to submit a Buy-In Notice with respect to securities that are subject to a voluntary corporate reorganization. \6\ NSCC's Rules provide that Members may also submit Buy-in Retransmittal Notices on N+1. This proposed rule clarification would apply to these Buy-in Retransmittal Notices as well. --------------------------------------------------------------------------- The CNS position of a long Member that submits a Buy-In Notice can change during the Buy-In Period as a result of settling trades or miscellaneous activity.\7\ Settling trades or miscellaneous activity that reduce a Member's CNS long position is first applied to the Member's current CNS position that is not represented by the Buy-In Position, and then that activity may be applied to reduce the Member's Buy-In Position. If a Member's Buy-In Position is reduced as a result of settling trades or miscellaneous activity, its Buy-In Position is adjusted to reflect the new amount. If, at any time during the Buy-In Period, settling trades or miscellaneous activity reduce the Member's long position such that the Member becomes either short or flat in that position, or causes the Member's CNS long position to be reduced to less than its outstanding Buy-In Position in that security, NSCC will consider that Member's Buy-In Position with respect to that security complete and satisfied. NSCC will update the Buy-In Notice to reflect the reduced Buy-In Position if only a portion of the Buy-In Position is satisfied, or the Buy-In Notice will be cancelled if the entire Buy-In Position is satisfied by the settling trades or miscellaneous activity. --------------------------------------------------------------------------- \7\ Miscellaneous activity processed by CNS that updates the net position of a security could include, for example, corporate actions and stock dividends. --------------------------------------------------------------------------- This process by which a Buy-In Notice would be updated to reflect settling trades or miscellaneous activity is not currently described in NSCC's Rules. As such, NSCC is proposing to update Rule 11, Section 7 of its Rules in order to describe the effect of settling trades or miscellaneous activity on a Member's Buy-In Position. Pursuant to this proposed rule change, NSCC's Rules will make clear that any portion of a Member's Buy-In Position would be considered complete and satisfied if, at any time during the Buy-in Period that Member's CNS long position is reduced to less than the outstanding Buy-In Position, or its Buy-In Position is reduced such that the Member is either flat or short in that security. If the entire Buy-In Position is considered complete and satisfied, it will be removed from the system. The proposed rule change would also make a technical correction to Procedure X, as marked on Exhibit 5 hereto. 2. Statutory Basis The proposed rule change is consistent with the Act and the rules and regulations thereunder, in particular Section 17A(b)(3)(F) \8\ because it will promote the prompt and accurate clearance and settlement of securities transactions in that it will provide clarity to NSCC's Members regarding the process by which a Buy-In Notice would be updated to reflect settling trades or miscellaneous activity. Additionally, the proposed rule change constitutes a stated policy, practice, or interpretation [[Page 29139]] with respect to the meaning, administration, or enforcement of an existing rule. --------------------------------------------------------------------------- \8\ 15 U.S.C. 78q-1(b)(3)(F). --------------------------------------------------------------------------- (B) Clearing Agency's Statement on Burden on Competition The proposed rule change will not have any impact, or impose any burden, on competition. (C) Clearing Agency's Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments relating to the proposed rule change have not yet been solicited or received. NSCC will notify the Commission of any written comments received by NSCC. III. Date of Effectiveness of the Proposed Rule Change, and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A) \9\ of the Act and paragraph (f) of Rule 19b-4 \10\ thereunder. At any time within 60 days of the filing of the 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. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78s(b)(3)(A). \10\ 17 CFR 240.19b-4(f). --------------------------------------------------------------------------- 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 CommentsUse the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or Send an email to [email protected]. Please include File Number SR-NSCC-2015-002 on the subject line. Paper Comments Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090. All submissions should refer to File Number SR-NSCC-2015-002. 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 Web site (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 Web site 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 the filing also will be available for inspection and copying at the principal office of NSCC and on DTCC's Web site (http://dtcc.com/legal/sec-rule-filings.aspx). All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR-NSCC-2015-002 and should be submitted on or before June 10, 2015. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\11\ --------------------------------------------------------------------------- \11\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2015-12145 Filed 5-19-15; 8:45 am] BILLING CODE 8011-01-P
![29138 Federal Register / Vol. 80, No. 97 / Wednesday, May 20, 2015 / Notices
the Commission does not edit personal II. Clearing Agency’s Statement of the Member’s CNS long position is first
identifying information from Purpose of, and Statutory Basis for, the applied to the Member’s current CNS
submissions. You should submit only Proposed Rule Change position that is not represented by the
information that you wish to make In its filing with the Commission, Buy-In Position, and then that activity
available publicly. All submissions NSCC included statements concerning may be applied to reduce the Member’s
should refer to File Number SR–ISE the purpose of and basis for the Buy-In Position. If a Member’s Buy-In
Gemini–2015–09 and should be proposed rule change and discussed any Position is reduced as a result of settling
submitted by June 10, 2015. comments it received on the proposed trades or miscellaneous activity, its Buy-
For the Commission, by the Division of rule change. The text of these statements In Position is adjusted to reflect the new
Trading and Markets, pursuant to delegated may be examined at the places specified amount. If, at any time during the Buy-
authority.16 in Item IV below. NSCC has prepared In Period, settling trades or
Robert W. Errett, summaries, set forth in sections A, B, miscellaneous activity reduce the
Deputy Secretary. and C below, of the most significant Member’s long position such that the
[FR Doc. 2015–12150 Filed 5–19–15; 8:45 am] aspects of such statements. Member becomes either short or flat in
that position, or causes the Member’s
BILLING CODE 8011–01–P
(A) Clearing Agency’s Statement of the CNS long position to be reduced to less
Purpose of, and Statutory Basis for, the than its outstanding Buy-In Position in
Proposed Rule Change that security, NSCC will consider that
SECURITIES AND EXCHANGE
COMMISSION 1. Purpose Member’s Buy-In Position with respect
to that security complete and satisfied.
[Release No. 34–74965; File No. SR–NSCC– One of NSCC’s core services as a NSCC will update the Buy-In Notice to
2015–002] central counterparty is trade clearance reflect the reduced Buy-In Position if
and settlement through CNS, where only a portion of the Buy-In Position is
Self-Regulatory Organizations; compared and recorded transactions in satisfied, or the Buy-In Notice will be
National Securities Clearing eligible securities for a particular cancelled if the entire Buy-In Position is
Corporation; Notice of Filing and settlement date are netted by issue into satisfied by the settling trades or
Immediate Effectiveness of Proposed one net long (buy) or net short (sell) miscellaneous activity.
Rule Change To Clarify NSCC’s Rules position. As a continuous net system, This process by which a Buy-In
& Procedures Relating to the Process those positions are further netted with Notice would be updated to reflect
by Which NSCC Members Submit Buy- positions of the same issue that remain settling trades or miscellaneous activity
Ins Within NSCC’s Continuous Net open after their originally scheduled is not currently described in NSCC’s
Settlement System settlement date, so that trades or Rules. As such, NSCC is proposing to
miscellaneous activity scheduled to update Rule 11, Section 7 of its Rules in
May 14, 2015.
settle on any day are netted with fail order to describe the effect of settling
Pursuant to Section 19(b)(1) 1 of the
positions to result in a single deliver or trades or miscellaneous activity on a
Securities Exchange Act of 1934 (‘‘Act’’)
receive obligation for each Member for Member’s Buy-In Position. Pursuant to
and Rule 19b–4 2 thereunder, notice is each issue in which it has activity.
hereby given that on May 4, 2015, this proposed rule change, NSCC’s
Currently, under NSCC’s Rules, a Rules will make clear that any portion
National Securities Clearing Corporation Member with a long position at the end
(‘‘NSCC’’) filed with the Securities and of a Member’s Buy-In Position would be
of the day may submit to NSCC a Notice considered complete and satisfied if, at
Exchange Commission (‘‘Commission’’) of Intention to Buy-In (‘‘Buy-In Notice’’)
the proposed rule change as described any time during the Buy-in Period that
specifying a quantity of securities (not Member’s CNS long position is reduced
in Items I, II and III below, which Items exceeding such long position) (‘‘Buy-In
have been prepared by NSCC. NSCC to less than the outstanding Buy-In
Position’’) that it intends to purchase to Position, or its Buy-In Position is
filed the proposed rule change pursuant satisfy the fail that resulted in that long
to Section 19(b)(3)(A) 3 of the Act and reduced such that the Member is either
position, or ‘‘buy-in’’.5 Typically, the flat or short in that security. If the entire
Rule 19b–4(f)(1) 4 thereunder. The day the Buy-In Notice is submitted is
proposed rule change was effective Buy-In Position is considered complete
referred to as N, and N+1 and N+2 refer and satisfied, it will be removed from
upon filing with the Commission. The to the succeeding days (N through N+2
Commission is publishing this notice to the system. The proposed rule change
is referred to as the ‘‘Buy-In Period’’).6 would also make a technical correction
solicit comments on the proposed rule The Buy-In Position is given high
change from interested persons. to Procedure X, as marked on Exhibit 5
priority for allocation from the CNS hereto.
I. Clearing Agency’s Statement of the night cycle on N+1 through completion
Terms of Substance of the Proposed of the CNS day cycle on N+2. 2. Statutory Basis
Rule Change The CNS position of a long Member The proposed rule change is
that submits a Buy-In Notice can change consistent with the Act and the rules
The proposed rule change consists of during the Buy-In Period as a result of
amendments to NSCC’s Rules & and regulations thereunder, in
settling trades or miscellaneous particular Section 17A(b)(3)(F) 8 because
Procedures (‘‘Rules’’) in order to clarify activity.7 Settling trades or
those Rules relating to the process by it will promote the prompt and accurate
miscellaneous activity that reduce a clearance and settlement of securities
which NSCC Members submit buy-ins
within NSCC’s Continuous Net transactions in that it will provide
5 Members are not permitted to submit a Buy-In
mstockstill on DSK4VPTVN1PROD with NOTICES
Settlement (‘‘CNS’’) system, as more clarity to NSCC’s Members regarding the
Notice with respect to securities that are subject to
fully described below. a voluntary corporate reorganization. process by which a Buy-In Notice would
6 NSCC’s Rules provide that Members may also be updated to reflect settling trades or
16 17 CFR 200.30–3(a)(12).
submit Buy-in Retransmittal Notices on N+1. This miscellaneous activity. Additionally,
proposed rule clarification would apply to these the proposed rule change constitutes a
1 15 U.S.C. 78s(b)(1). Buy-in Retransmittal Notices as well.
2 17 CFR 240.19b–4. 7 Miscellaneous activity processed by CNS that stated policy, practice, or interpretation
3 15 U.S.C. 78s(b)(3)(A).
updates the net position of a security could include,
4 17 CFR 240.19b–4(f)(1). for example, corporate actions and stock dividends. 8 15 U.S.C. 78q–1(b)(3)(F).
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![Federal Register / Vol. 80, No. 97 / Wednesday, May 20, 2015 / Notices 29139
with respect to the meaning, post all comments on the Commission’s prepared by the Exchange. The
administration, or enforcement of an Internet Web site (http://www.sec.gov/ Exchange has designated the proposed
existing rule. rules/sro.shtml). Copies of the rule change as one establishing or
submission, all subsequent changing a member due, fee, or other
(B) Clearing Agency’s Statement on
amendments, all written statements charge imposed by the Exchange under
Burden on Competition with respect to the proposed rule Section 19(b)(3)(A)(ii) of the Act 3 and
The proposed rule change will not change that are filed with the Rule 19b–4(f)(2) thereunder,4 which
have any impact, or impose any burden, Commission, and all written renders the proposed rule change
on competition. communications relating to the effective upon filing with the
proposed rule change between the Commission. The Commission is
(C) Clearing Agency’s Statement on
Commission and any person, other than publishing this notice to solicit
Comments on the Proposed Rule
those that may be withheld from the comments on the proposed rule change
Change Received From Members,
public in accordance with the from interested persons.
Participants, or Others
provisions of 5 U.S.C. 552, will be
Written comments relating to the available for Web site viewing and I. Self-Regulatory Organization’s
proposed rule change have not yet been printing in the Commission’s Public Statement of the Terms of Substance of
solicited or received. NSCC will notify Reference Room, 100 F Street NE., the Proposed Rule Change
the Commission of any written Washington, DC 20549 on official
comments received by NSCC. business days between the hours of The Exchange filed a proposal to
10:00 a.m. and 3:00 p.m. Copies of the amend the fee schedule applicable to
III. Date of Effectiveness of the Members 5 and non-members of the
Proposed Rule Change, and Timing for filing also will be available for
inspection and copying at the principal Exchange pursuant to BATS Rules
Commission Action 15.1(a) and (c). Changes to the fee
office of NSCC and on DTCC’s Web site
The foregoing rule change has become (http://dtcc.com/legal/sec-rule- schedule pursuant to this proposal are
effective pursuant to Section filings.aspx). All comments received effective upon filing.
19(b)(3)(A) 9 of the Act and paragraph (f) will be posted without change; the The text of the proposed rule change
of Rule 19b–4 10 thereunder. At any time Commission does not edit personal is available at the Exchange’s Web site
within 60 days of the filing of the identifying information from at www.batstrading.com, at the
proposed rule change, the Commission submissions. You should submit only principal office of the Exchange, and at
summarily may temporarily suspend information that you wish to make the Commission’s Public Reference
such rule change if it appears to the available publicly. All submissions Room.
Commission that such action is should refer to File Number SR–NSCC–
necessary or appropriate in the public 2015–002 and should be submitted on II. Self-Regulatory Organization’s
interest, for the protection of investors, or before June 10, 2015. Statement of the Purpose of, and
or otherwise in furtherance of the Statutory Basis for, the Proposed Rule
For the Commission, by the Division of Change
purposes of the Act. Trading and Markets, pursuant to delegated
IV. Solicitation of Comments authority.11 In its filing with the Commission, the
Robert W. Errett, Exchange included statements
Interested persons are invited to Deputy Secretary.
submit written data, views and concerning the purpose of and basis for
arguments concerning the foregoing,
[FR Doc. 2015–12145 Filed 5–19–15; 8:45 am] the proposed rule change and discussed
including whether the proposed rule BILLING CODE 8011–01–P any comments it received on the
change is consistent with the Act. proposed rule change. The text of these
Comments may be submitted by any of statements may be examined at the
SECURITIES AND EXCHANGE places specified in Item IV below. The
the following methods: COMMISSION Exchange has prepared summaries, set
Electronic Comments [Release No. 34–74968; File No. SR–BATS– forth in Sections A, B, and C below, of
• Use the Commission’s Internet 2015–38] the most significant parts of such
comment form (http://www.sec.gov/ statements.
rules/sro.shtml); or Self-Regulatory Organizations; BATS
Exchange, Inc.; Notice of Filing and A. Self-Regulatory Organization’s
• Send an email to rule-comments@ Statement of the Purpose of, and
sec.gov. Please include File Number SR– Immediate Effectiveness of a Proposed
Rule Change Related to Fees for Use Statutory Basis for, the Proposed Rule
NSCC–2015–002 on the subject line. Change
of BATS Exchange, Inc.
Paper Comments 1. Purpose
May 14, 2015.
• Send paper comments in triplicate Pursuant to Section 19(b)(1) of the
to Brent J. Fields, Secretary, Securities The Exchange proposes to modify the
Securities Exchange Act of 1934 (the ‘‘Options Pricing’’ section of its fee
and Exchange Commission, 100 F Street ‘‘Act’’),1 and Rule 19b–4 thereunder,2
NE., Washington, DC 20549–1090. schedule, effective immediately, in
notice is hereby given that on May 6, order to modify pricing charged by the
All submissions should refer to File 2015, BATS Exchange, Inc. (the
Number SR–NSCC–2015–002. This file Exchange’s options platform (‘‘BATS
‘‘Exchange’’ or ‘‘BATS’’) filed with the Options’’) including: (i) add a new
mstockstill on DSK4VPTVN1PROD with NOTICES
number should be included on the Securities and Exchange Commission
subject line if email is used. To help the standard rate and a fee code NM
(‘‘Commission’’) the proposed rule
Commission process and review your change as described in Items I, II, and 3 15 U.S.C. 78s(b)(3)(A)(ii).
comments more efficiently, please use III below, which Items have been 4 17 CFR 240.19b–4(f)(2).
only one method. The Commission will 5 The term ‘‘Member’’ is defined as ‘‘any
11 17 CFR 200.30–3(a)(12). registered broker or dealer that has been admitted
9 15 U.S.C. 78s(b)(3)(A). 1 15 U.S.C. 78s(b)(1). to membership in the Exchange.’’ See Exchange
10 17 CFR 240.19b–4(f). 2 17 CFR 240.19b–4. Rule 1.5(n).
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Document Created: 2018-02-21 10:29:56
Document Modified: 2018-02-21 10:29:56
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
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| Section | Notices | |
| FR Citation | 80 FR 29138 |
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