80 FR 36028 - Joint Industry Plan; Order Approving Amendment No. 1 to the National Market System Plan Governing the Process of Selecting a Plan Processor and Developing a Plan for the Consolidated Audit Trail by BATS Exchange, Inc., BATS-Y Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., International Securities Exchange, LLC, ISE Gemini, LLC, Miami International Securities Exchange LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The NASDAQ Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc.
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 80, Issue 120 (June 23, 2015)
Federal Register Volume 80, Issue 120 (June 23, 2015)
| Page Range | 36028-36030 | |
| FR Document | 2015-15365 |
[Federal Register Volume 80, Number 120 (Tuesday, June 23, 2015)] [Notices] [Pages 36028-36030] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2015-15365] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-75192; File No. 4-668] Joint Industry Plan; Order Approving Amendment No. 1 to the National Market System Plan Governing the Process of Selecting a Plan Processor and Developing a Plan for the Consolidated Audit Trail by BATS Exchange, Inc., BATS-Y Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., International Securities Exchange, LLC, ISE Gemini, LLC, Miami International Securities Exchange LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The NASDAQ Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc. June 17, 2015. I. Introduction On December 12, 2014, BATS Exchange, Inc., BATS-Y Exchange, Inc., BOX Options Exchange LLC, C2 Options Exchange, Incorporated, Chicago Board Options Exchange, Incorporated, Chicago Stock Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc., Financial Industry Regulatory Authority, Inc., International Securities Exchange, LLC, ISE Gemini, LLC, Miami International Securities Exchange LLC, NASDAQ OMX BX, Inc., NASDAQ OMX PHLX LLC, The NASDAQ Stock Market LLC, National Stock Exchange, Inc., New York Stock Exchange LLC, NYSE MKT LLC, and NYSE Arca, Inc. (collectively, ``SROs'' or ``Participants'') filed with the Securities and Exchange Commission (``Commission'' or ``SEC'') pursuant to section 11A of the Securities Exchange Act of 1934 (``Act''),\1\ and Rule 608 thereunder,\2\ an amendment (``Amendment No. 1'') to the National Market System (``NMS'') Plan Governing the Process of Selecting a Plan Processor and Developing a Plan for the Consolidated Audit Trail (``Selection Plan'').\3\ Amendment No. 1 was published for comment in the Federal Register on February 11, 2015.\4\ The Commission received one comment letter \5\ and the SROs submitted a response to that comment letter.\6\ This order approves Amendment No. 1 to the Selection Plan. --------------------------------------------------------------------------- \1\ 15 U.S.C. 78k-1. \2\ 17 CFR 242.608. \3\ The Selection Plan is an NMS Plan approved by the Commission pursuant to Section 11A of the Act and Rule 608 thereunder. See Securities Exchange Act Release No. 71596 (Feb. 21, 2014), 79 FR 11152 (Feb. 27, 2014) (``Order Approving Selection Plan''); see also Securities Exchange Act Release No. 70892 (Nov. 15, 2013), 78 FR 69910 (Nov. 21, 2013) (``Notice of Selection Plan''). \4\ See Securities Exchange Act Release No. 74223 (Feb. 6, 2015), 80 FR 7654 (``Notice of Amendment No. 1''). \5\ See letter to Brent J. Fields, Secretary, Commission, from Manisha Kimmel, Managing Director, Financial Information Forum (``FIF''), dated March 13, 2015 (``FIF Letter''). \6\ See letter to Brent J. Fields, Secretary, Commission, from the SROs, dated March 27, 2015 (``SRO Response Letter''). --------------------------------------------------------------------------- II. Background and Description of the Proposal A. Background On July 11, 2012, the Commission adopted Rule 613 to require the SROs to jointly submit an NMS plan to create, implement, and maintain a consolidated audit trail (``CAT NMS Plan'').\7\ In response, the SROs engaged in a request for proposal (``RFP'') process to help them develop an NMS Plan proposal and to solicit bids (``Bids'') for the role of Plan Processor \8\ to build, operate, administer, and maintain the consolidated audit trail.\9\ The Selection Plan, which was approved by the Commission on February 21, 2014, sets forth the process by which the Participants will review, evaluate, and narrow down the Bids, and ultimately select the Plan Processor, following Commission approval of the CAT NMS Plan.\10\ Currently, the Participants have narrowed the universe of Bids received to a set of six ``Shortlisted Bidders.'' Under the Selection Plan, a Shortlisted Bidder is only eligible to revise its Bid following Commission approval of the CAT NMS Plan and approval of a majority of the Selection Committee.\11\ Additionally, the Participants are not permitted to narrow the set of [[Page 36029]] Shortlisted Bidders prior to approval of the CAT NMS Plan, but must proceed with selection of the CAT Plan Processor from among the Shortlisted Bidders in a two-round voting process.\12\ --------------------------------------------------------------------------- \7\ Securities Exchange Act Release No. 67457 (July 18, 2012), 77 FR 45722 (Aug. 1, 2012). \8\ Unless otherwise noted, capitalized terms are used as defined in Rule 613, in the Selection Plan, or in this Order. \9\ See Notice of Amendment No. 1, supra note 4, at 7655. \10\ See Order Approving Selection Plan, supra note 3. \11\ See id. at 11154. The Selection Committee is composed of one senior officer from each SRO and is charged with evaluating the Bids and selecting the Plan Processor. Id. at 11153. \12\ See id. at 11154. --------------------------------------------------------------------------- As described in more detail below, Amendment No. 1 would revise the Selection Plan to allow the SROs to accept revised Bids prior to Commission approval of the CAT NMS Plan and allow the SROs to narrow the list of Shortlisted Bids prior to Commission approval of the CAT NMS Plan. The SROs believe that providing the Shortlisted Bidders with an additional opportunity (or opportunities) to revise their Bids prior to the approval of the CAT NMS Plan is critical to the timely and considered selection of the CAT Plan Processor, and more importantly, the adherence to the other timelines for the CAT NMS Plan set forth in Rule 613(a).\13\ The SROs state that since the time the Bidders submitted their Bids, the SROs have gathered and evaluated data and information from a variety of market participants, including Bidders, broker-dealers, vendors, regulators and others, and have made progress in developing an optimal solution and formalizing the solution in the proposed CAT NMS Plan and related technical documents.\14\ Given these developments, the SROs believe that Bidders should be permitted to revise their Bids using the new information provided in the proposed CAT NMS Plan and technical documents prior to approval of the CAT NMS Plan.\15\ The SROs also state that given the passage of time since the Bids were submitted, Bidders have indicated that new technological and other beneficial solutions are now available that may further improve the Bids, and, ultimately, the proposed solutions.\16\ --------------------------------------------------------------------------- \13\ See Notice of Amendment No. 1, supra note 4, at 7655. \14\ Id. \15\ Id. \16\ Id. --------------------------------------------------------------------------- The SROs also explain that given the large amount of information they expect will be included in any revised Bids and the importance of appropriately analyzing such information, the SROs do not believe that two months will be sufficient to select the CAT Plan Processor from as many as six Shortlisted Bidders.\17\ However, the SROs believe that if the existing Shortlisted Bidders were able to revise their Bids, including the option to reflect any new technology or other relevant developments, the SROs could further narrow the list of Shortlisted Bidders to better facilitate the ultimate selection of the CAT Plan Processor within the time limits imposed by Rule 613 in an appropriately thoughtful and deliberative manner.\18\ --------------------------------------------------------------------------- \17\ Id. \18\ Id. --------------------------------------------------------------------------- B. Description of the Proposal The SROs propose to amend the Selection Plan to permit the Shortlisted Bidders to revise their Bids one or more times prior to Commission approval of the CAT NMS Plan if the Selection Committee determines, by majority vote, subject to the applicable recusal provisions, that such revisions are necessary and appropriate.\19\ Amendment No. 1 would not affect section VI.(D) of the Selection Plan, which states that, following approval of the CAT NMS Plan by the Commission, Shortlisted Bidders for the role of Plan Processor may be permitted to revise their Bids only upon approval by a majority of the Selection Committee, subject to certain recusal provisions in the Selection Plan.\20\ --------------------------------------------------------------------------- \19\ Id. at 7655, 57. \20\ See Order Approving Selection Plan, supra note 3, at 11154. --------------------------------------------------------------------------- In Amendment No. 1, the Participants also propose to provide the Selection Committee discretion to narrow the set of Shortlisted Bids prior to Commission approval of the CAT NMS Plan. Specifically, Amendment No. 1 would authorize an additional round of voting \21\ to narrow the number of Shortlisted Bids, currently six, down to as few as three Bids. This round of voting, which could occur either before or after any revisions to Shortlisted Bids are accepted, would commence upon at least a two-thirds vote of the Selection Committee, and would proceed in a manner similar to the initial round of voting for determining the Shortlisted Bids.\22\ Proposed Amendment No. 1 includes a recusal provision providing that no SRO shall vote in the process narrowing the set of Shortlisted Bidders if a Bid submitted by or including the SRO or an Affiliate of the SRO is a Shortlisted Bid.\23\ --------------------------------------------------------------------------- \21\ This additional narrowing round would occur prior to the two-round voting process for selection of the CAT Plan Processor under Section VI.(E) of the Selection Plan. See id. \22\ See Notice of Amendment No. 1, supra note 4, at 7655, 57. In voting to narrow the list of of Shortlisted Bids, the voting representative from each SRO would choose a first, second, and third choice of Shortlisted Bid, with each choice receiving a weight of, respectively, three points, two points, and one point. The three Bids receiving the highest cumulative number of points would constitute the new set of Shortlisted Bids. The Amendment also provides for a tie-breaking process, which could result in more than three Shortlisted Bids continuing in the process for selection of the CAT Plan Processor. \23\ See id. The SROs have also submitted, and the Commission is currently considering, a second proposed amendment to the Selection Plan extending this recusal requirement to all selection voting rounds. See Securities Exchange Act Release No. 75193 (June 17, 2015). --------------------------------------------------------------------------- III. Summary of Comment Letter and Response As noted above, the Commission received one comment letter from FIF. FIF, on behalf of its Consolidated Audit Trail Working Group, supports Amendment No. 1 but offers two recommendations.\24\ First, FIF recommends, in the interest of efficiency, that the Participants narrow the list of Bidders before any revision of Bids takes place. FIF believes that in view of the substantial efforts already undertaken by the Participants, there should be sufficient information for the Participants to take action and narrow the list of Bidders. FIF argues that it is unnecessary to require all six of the current Shortlisted Bidders to revise their Bids. Further, FIF argues that narrowing the list of Bidders prior to permitting the revision of Bids would reduce the amount of effort the SROs would need to expend in reviewing the revised Bids. --------------------------------------------------------------------------- \24\ See FIF Letter, supra note 5. --------------------------------------------------------------------------- Second, FIF recommends that once the Participants further narrow the list of Shortlisted Bidders, each of the remaining Bidders should receive detailed information on Order Audit Trail System (``OATS''), electronic blue sheets (``EBS''), and Large Trader so that Bidders can consider all of the required functionality to retire these systems in preparing their revised Bids. FIF notes that the retirement of these systems is critical to managing the cost of CAT's implementation, and additional information concerning the functionality required to retire these systems would aid in revising Bids. FIF believes that understanding the precise functional requirements for retiring OATS is critical and imperative for a level playing field among Bidders. The SROs considered FIF's recommendations, but declined to propose modifications to the Amendment.\25\ With regard to FIF's suggestion that the SROs narrow the list of Bidders before allowing any revisions to the Bids, the SROs state that one of the main purposes of the Amendment is to provide greater flexibility to the SROs to narrow the list of Bidders.\26\ The SROs, however, note that they recognize the value of a streamlined process for all [[Page 36030]] parties and intend to consider this factor, among others, in determining when to narrow the list of Shortlisted Bidders.\27\ --------------------------------------------------------------------------- \25\ See SRO Response Letter, supra note 6, at 3. \26\ Id. at 2. \27\ Id. --------------------------------------------------------------------------- The SROs concur with FIF in the significance of retiring overlapping and redundant systems, but do not see this as linked to the proposed amendment to the Selection Plan. The SROs reiterate their commitment to the retirement of systems as provided in the CAT NMS Plan,\28\ noting that the Plan describes the major data attributes that will be required to retire such systems. Going forward, as additional technical specifications are developed in accordance with milestones included in the CAT NMS Plan, the SROs will provide this information to Bidders. --------------------------------------------------------------------------- \28\ Rule 613(a)(viii) requires ``a plan to eliminate existing audit trail rules and systems (or components thereof) that will be rendered duplicative by the consolidated audit trail, including identification of such audit trail rules and systems (or components thereof); to the extent that any existing audit trail rules or systems provide information that is not rendered duplicative by the consolidated audit trail, an analysis of whether collection of such information continues to be appropriate and, if so, whether such information could instead be incorporated into the consolidated audit trail; the steps the plan sponsors propose to take to seek Commission approval for the elimination of such audit trail rules and systems (or components thereof); and a timetable for such elimination, including a description of how the plan sponsors propose to phase in the consolidated audit trail and phase out such existing audit trail rules and systems (or components thereof)[.]'' 17 CFR 242.613(a)(viii). --------------------------------------------------------------------------- IV. Discussion After careful review of Amendment No. 1, the comment received, and the SROs' response, the Commission finds that Amendment No. 1 is necessary or appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, and to remove impediments to, and perfect the mechanisms of, a national market system. The Commission believes Amendment No. 1 would provide the SROs with additional flexibility with respect to the process of reviewing Shortlisted Bids and selecting the CAT Plan Processor. Such additional flexibility is aimed at allowing the SROs to be more efficient in selecting the CAT Plan Processor, which is particularly important given additional deadlines contained in Rule 613(a)(3).\29\ The Commission believes that the SROs' explanation that they prefer to retain flexibility in the process to select the Plan Processor, without any additional conditions or restrictions, in response to FIF's suggestion that they narrow the list of Bidders before allowing Bidders to revise their Bids, is reasonable. Permitting the SROs to accept revised Bids prior to Commission approval of the CAT NMS Plan, and to narrow the number of Shortlisted Bids prior to Commission approval of the CAT NMS Plan,\30\ will allow the SROs to position themselves to avoid any delays in selecting the CAT Plan Processor,\31\ thus removing any impediments to meeting the additional deadlines set forth in Rule 613(a)(3).\32\ --------------------------------------------------------------------------- \29\ 17 CFR 242.613(a)(3). \30\ See Notice of Amendment No. 1, supra note 4, at 7655, 57. \31\ Rule 613(a)(3)(i) requires the Participants to select the CAT Plan Processor within two months after effectiveness of the CAT NMS Plan. 17 CFR 242.613(a)(3)(i). \32\ See, e.g., Rule 613(a)(3)(iii), which requires Participants to begin providing data to the central repository within one year after effectiveness of the CAT NMS Plan. --------------------------------------------------------------------------- Regarding FIF's recommendation that, prior to any Bid revisions, the SROs provide Bidders with detailed functional requirements concerning OATS, EBS, and Large Trader to facilitate retirement of those systems, the Commission notes that the SROs' Response Letter outlines the steps taken to date by the SROs to furnish pertinent information to assist in eliminating redundant systems and contains commitments to supplement that material in the future as outlined in the CAT NMS Plan. IV. Conclusion For the reasons discussed above, the Commission finds that Amendment No. 1 is necessary or appropriate in the public interest, for the protection of investors and the maintenance of fair and orderly markets, and to remove impediments to, and perfect the mechanisms of, a national market system, or otherwise in furtherance of the purposes of the Act. It is therefore ordered, pursuant to section 11A of the Act,\33\ and the rules thereunder, that Amendment No. 1 to the Selection Plan be, and it hereby is, approved. --------------------------------------------------------------------------- \33\ 15 U.S.C. 78k-1. By the Commission. Brent J. Fields, Secretary. [FR Doc. 2015-15365 Filed 6-22-15; 8:45 am] BILLING CODE 8011-01-P
![36028 Federal Register / Vol. 80, No. 120 / Tuesday, June 23, 2015 / Notices
and obviates the need for Rule 970.1.’’ 64 For the Commission, by the Division of for the Consolidated Audit Trail
Other information or data may also be Trading and Markets, pursuant to delegated (‘‘Selection Plan’’).3 Amendment No. 1
helpful for the Commission’s authority.67 was published for comment in the
consideration of the proposed rule Brent J. Fields, Federal Register on February 11, 2015.4
change. Without sufficient supporting Secretary. The Commission received one comment
data and analysis, the Commission is [FR Doc. 2015–15340 Filed 6–22–15; 8:45 am] letter 5 and the SROs submitted a
not able to adequately assess the impact BILLING CODE 8011–01–P response to that comment letter.6 This
of NYSE MKT’s proposed rule change to order approves Amendment No. 1 to the
eliminate its quote mitigation plan and Selection Plan.
make a determination that the proposed SECURITIES AND EXCHANGE
COMMISSION II. Background and Description of the
rule change is consistent with the Act.
Given the limitations in the data Proposal
[Release No. 34–75192; File No. 4–668]
provided by NYSE MKT, as described A. Background
above, the Commission cannot find a Joint Industry Plan; Order Approving On July 11, 2012, the Commission
sufficient basis to conclude that the Amendment No. 1 to the National adopted Rule 613 to require the SROs to
proposal is consistent with the Act. The Market System Plan Governing the jointly submit an NMS plan to create,
Commission notes, however, that the Process of Selecting a Plan Processor implement, and maintain a consolidated
Penny Pilots for each of the options and Developing a Plan for the audit trail (‘‘CAT NMS Plan’’).7 In
exchanges are anticipated to be Consolidated Audit Trail by BATS response, the SROs engaged in a request
extended for an additional year, until Exchange, Inc., BATS–Y Exchange, for proposal (‘‘RFP’’) process to help
June 30, 2016. In connection with any Inc., BOX Options Exchange LLC, C2 them develop an NMS Plan proposal
future requests to extend the Penny Options Exchange, Incorporated, and to solicit bids (‘‘Bids’’) for the role
Pilots after that date, the Commission Chicago Board Options Exchange, of Plan Processor 8 to build, operate,
intends to require each exchange to Incorporated, Chicago Stock administer, and maintain the
submit detailed information to allow for Exchange, Inc., EDGA Exchange, Inc., consolidated audit trail.9 The Selection
permanent approval or disapproval by EDGX Exchange, Inc., Financial Plan, which was approved by the
the Commission. Such proposals Industry Regulatory Authority, Inc., Commission on February 21, 2014, sets
should, among other things, provide International Securities Exchange, forth the process by which the
detailed data and analysis to support the LLC, ISE Gemini, LLC, Miami Participants will review, evaluate, and
efficacy, or any proposed modification International Securities Exchange LLC, narrow down the Bids, and ultimately
or elimination, of any exchanges’ quote NASDAQ OMX BX, Inc., NASDAQ OMX select the Plan Processor, following
mitigation plan.65 PHLX LLC, The NASDAQ Stock Market Commission approval of the CAT NMS
For the foregoing reasons, the
LLC, National Stock Exchange, Inc., Plan.10 Currently, the Participants have
Commission does not believe that NYSE
New York Stock Exchange LLC, NYSE narrowed the universe of Bids received
MKT has met its burden to demonstrate
MKT LLC, and NYSE Arca, Inc. to a set of six ‘‘Shortlisted Bidders.’’
that the proposed rule change is Under the Selection Plan, a Shortlisted
consistent with the requirements of the June 17, 2015. Bidder is only eligible to revise its Bid
Act and the rules and regulations following Commission approval of the
thereunder, including that the rules of I. Introduction
CAT NMS Plan and approval of a
an exchange be designed to promote just On December 12, 2014, BATS
majority of the Selection Committee.11
and equitable principles of trade, to Exchange, Inc., BATS–Y Exchange, Inc.,
Additionally, the Participants are not
remove impediments to and perfect the BOX Options Exchange LLC, C2 Options
permitted to narrow the set of
mechanism of a free and open market Exchange, Incorporated, Chicago Board
and a national market system, and, in Options Exchange, Incorporated, 3 The Selection Plan is an NMS Plan approved by
general, to protect investors and the Chicago Stock Exchange, Inc., EDGA the Commission pursuant to Section 11A of the Act
public interest.66 Exchange, Inc., EDGX Exchange, Inc., and Rule 608 thereunder. See Securities Exchange
Financial Industry Regulatory Act Release No. 71596 (Feb. 21, 2014), 79 FR 11152
IV. Conclusion Authority, Inc., International Securities
(Feb. 27, 2014) (‘‘Order Approving Selection Plan’’);
see also Securities Exchange Act Release No. 70892
For the reasons set forth above, the Exchange, LLC, ISE Gemini, LLC, Miami (Nov. 15, 2013), 78 FR 69910 (Nov. 21, 2013)
Commission does not believe that NYSE International Securities Exchange LLC, (‘‘Notice of Selection Plan’’).
MKT has met its burden to demonstrate NASDAQ OMX BX, Inc., NASDAQ 4 See Securities Exchange Act Release No. 74223
(Feb. 6, 2015), 80 FR 7654 (‘‘Notice of Amendment
that the proposed rule change is OMX PHLX LLC, The NASDAQ Stock No. 1’’).
consistent with the requirements of the Market LLC, National Stock Exchange, 5 See letter to Brent J. Fields, Secretary,
Act and the rules and regulations Inc., New York Stock Exchange LLC, Commission, from Manisha Kimmel, Managing
thereunder applicable to a national NYSE MKT LLC, and NYSE Arca, Inc. Director, Financial Information Forum (‘‘FIF’’),
dated March 13, 2015 (‘‘FIF Letter’’).
securities exchange, and in particular, (collectively, ‘‘SROs’’ or ‘‘Participants’’) 6 See letter to Brent J. Fields, Secretary,
section 6(b)(5) of the Act. filed with the Securities and Exchange Commission, from the SROs, dated March 27, 2015
It is therefore ordered, pursuant to Commission (‘‘Commission’’ or ‘‘SEC’’) (‘‘SRO Response Letter’’).
section 19(b)(2) of the Act, that the pursuant to section 11A of the 7 Securities Exchange Act Release No. 67457 (July
proposed rule change (SR–NYSEMKT– Securities Exchange Act of 1934 18, 2012), 77 FR 45722 (Aug. 1, 2012).
8 Unless otherwise noted, capitalized terms are
2014–86) be, and hereby is, (‘‘Act’’),1 and Rule 608 thereunder,2 an used as defined in Rule 613, in the Selection Plan,
mstockstill on DSK4VPTVN1PROD with NOTICES
disapproved. amendment (‘‘Amendment No. 1’’) to or in this Order.
the National Market System (‘‘NMS’’) 9 See Notice of Amendment No. 1, supra note 4,
64 See Notice, supra note 3, at 63010. Plan Governing the Process of Selecting at 7655.
65 Inreviewing the quote mitigation plans in this 10 See Order Approving Selection Plan, supra
manner, the Commission would be able to consider
a Plan Processor and Developing a Plan
note 3.
the market-wide impact of any proposed 11 See id. at 11154. The Selection Committee is
67 17 CFR 200.30–3(a)(12).
modification to or elimination of an exchange’s composed of one senior officer from each SRO and
quote mitigation practices. 1 15 U.S.C. 78k–1. is charged with evaluating the Bids and selecting
66 15 U.S.C. 78f(b)(5). 2 17 CFR 242.608. the Plan Processor. Id. at 11153.
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![36030 Federal Register / Vol. 80, No. 120 / Tuesday, June 23, 2015 / Notices
parties and intend to consider this reasonable. Permitting the SROs to SECURITIES AND EXCHANGE
factor, among others, in determining accept revised Bids prior to Commission COMMISSION
when to narrow the list of Shortlisted approval of the CAT NMS Plan, and to
Bidders.27 [Extension: Form N–5; OMB Control No.
narrow the number of Shortlisted Bids
The SROs concur with FIF in the 3235–0169, SEC File No. 270–172]
prior to Commission approval of the
significance of retiring overlapping and CAT NMS Plan,30 will allow the SROs Submission for OMB Review;
redundant systems, but do not see this to position themselves to avoid any Comment Request
as linked to the proposed amendment to delays in selecting the CAT Plan
the Selection Plan. The SROs reiterate Upon Written Request, Copy Available
Processor,31 thus removing any
their commitment to the retirement of From: Securities and Exchange
impediments to meeting the additional
systems as provided in the CAT NMS Commission, Office of FOIA Services,
Plan,28 noting that the Plan describes deadlines set forth in Rule 613(a)(3).32
100 F Street NE., Washington, DC
the major data attributes that will be Regarding FIF’s recommendation that, 20549–2736.
required to retire such systems. Going prior to any Bid revisions, the SROs Notice is hereby given that, pursuant
forward, as additional technical provide Bidders with detailed to the Paperwork Reduction Act of 1995
specifications are developed in functional requirements concerning (44 U.S.C. 3501 et seq.), the Securities
accordance with milestones included in OATS, EBS, and Large Trader to and Exchange Commission (the
the CAT NMS Plan, the SROs will facilitate retirement of those systems, ‘‘Commission’’) has submitted to the
provide this information to Bidders. the Commission notes that the SROs’ Office of Management and Budget
IV. Discussion Response Letter outlines the steps taken (‘‘OMB’’) a request for extension of the
to date by the SROs to furnish pertinent previously approved collection of
After careful review of Amendment
information to assist in eliminating information discussed below.
No. 1, the comment received, and the
SROs’ response, the Commission finds redundant systems and contains Form N–5 (17 CFR 239.24 and 274.5)
that Amendment No. 1 is necessary or commitments to supplement that is the form used by small business
appropriate in the public interest, for material in the future as outlined in the investment companies (‘‘SBICs’’) to
the protection of investors and the CAT NMS Plan. register their securities under the
maintenance of fair and orderly markets, Securities Act of 1933 (15 U.S.C. 77a et
IV. Conclusion seq.) (‘‘Securities Act’’) and the
and to remove impediments to, and
perfect the mechanisms of, a national For the reasons discussed above, the Investment Company Act of 1940 (15
market system. The Commission Commission finds that Amendment No. U.S.C. 80a–1 et seq.) (‘‘Investment
believes Amendment No. 1 would 1 is necessary or appropriate in the Company Act’’). Form N–5 is the
provide the SROs with additional registration statement form adopted by
public interest, for the protection of
flexibility with respect to the process of the Commission for use by an SBIC that
investors and the maintenance of fair
reviewing Shortlisted Bids and selecting has been licensed as such under the
and orderly markets, and to remove
the CAT Plan Processor. Such Small Business Investment Act of 1958
impediments to, and perfect the or which has received the preliminary
additional flexibility is aimed at mechanisms of, a national market
allowing the SROs to be more efficient approval of the Small Business
system, or otherwise in furtherance of Administration (‘‘SBA’’) and has been
in selecting the CAT Plan Processor, the purposes of the Act.
which is particularly important given notified by the SBA that the company
additional deadlines contained in Rule It is therefore ordered, pursuant to may submit a license application Form
613(a)(3).29 The Commission believes section 11A of the Act,33 and the rules N–5 is an integrated registration form
that the SROs’ explanation that they thereunder, that Amendment No. 1 to and may be used as the registration
prefer to retain flexibility in the process the Selection Plan be, and it hereby is, statement under both the Securities Act
to select the Plan Processor, without any approved. and the Investment Company Act. The
additional conditions or restrictions, in purpose of Form N–5 is to meet the
By the Commission.
response to FIF’s suggestion that they filing and disclosure requirements of
Brent J. Fields, both the Securities Act and Investment
narrow the list of Bidders before
allowing Bidders to revise their Bids, is Secretary. Company Act, and to provide investors
[FR Doc. 2015–15365 Filed 6–22–15; 8:45 am] with information sufficient to evaluate
27 Id. BILLING CODE 8011–01–P an investment in an SBIC. The
28 Rule 613(a)(viii) requires ‘‘a plan to eliminate information that is required to be filed
existing audit trail rules and systems (or with the Commission permits
components thereof) that will be rendered verification of compliance with
duplicative by the consolidated audit trail,
including identification of such audit trail rules and securities law requirements and assures
systems (or components thereof); to the extent that the public availability and
any existing audit trail rules or systems provide dissemination of the information.
information that is not rendered duplicative by the The Commission has received one
consolidated audit trail, an analysis of whether
collection of such information continues to be filing on Form N–5 in the last three
appropriate and, if so, whether such information
30 See Notice of Amendment No. 1, supra note 4,
years, and we therefore estimate that
could instead be incorporated into the consolidated at 7655, 57. SBICs will file about 0.333 filings on
audit trail; the steps the plan sponsors propose to 31 Rule 613(a)(3)(i) requires the Participants to
mstockstill on DSK4VPTVN1PROD with NOTICES
Form N–5 per year. The currently
take to seek Commission approval for the select the CAT Plan Processor within two months
elimination of such audit trail rules and systems (or approved burden of Form N–5 is 352
after effectiveness of the CAT NMS Plan. 17 CFR
components thereof); and a timetable for such 242.613(a)(3)(i).
hours per response. Therefore, the
elimination, including a description of how the 32 See, e.g., Rule 613(a)(3)(iii), which requires number of currently approved aggregate
plan sponsors propose to phase in the consolidated burden hours, when calculated using
audit trail and phase out such existing audit trail Participants to begin providing data to the central
rules and systems (or components thereof)[.]’’ 17 repository within one year after effectiveness of the the current estimate for number of
CFR 242.613(a)(viii). CAT NMS Plan. filings is about 117 hours per year. The
29 17 CFR 242.613(a)(3). 33 15 U.S.C. 78k–1. currently approved cost burden of Form
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Document Created: 2018-02-22 11:15:30
Document Modified: 2018-02-22 11:15:30
| 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 36028 |
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