81 FR 15599 - Order Granting a Temporary Exemption Pursuant to Section 36 of the Securities Exchange Act of 1934 From Compliance With Rules 13n-1 to 13n-12 Under the Securities Exchange Act of 1934

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 81, Issue 56 (March 23, 2016)

[Federal Register Volume 81, Number 56 (Wednesday, March 23, 2016)]
[Notices]
[Pages 15599-15600]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-06546]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77400]


Order Granting a Temporary Exemption Pursuant to Section 36 of 
the Securities Exchange Act of 1934 From Compliance With Rules 13n-1 to 
13n-12 Under the Securities Exchange Act of 1934

March 18, 2016.

I. Introduction

    On June 15, 2011, the Securities and Exchange Commission 
(``Commission'') issued an exemptive order that provided guidance and 
certain exemptions with respect to the requirements under Title VII of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 
(``Dodd-Frank Act'') that had an effective date of July 16, 2011 (i.e., 
the effective date of Title VII).\1\ With respect

[[Page 15600]]

to Commission regulation of security-based swap data repositories 
(``SDR''), the DFA Effective Date Order provided exemptions from 
Exchange Act Sections 13(n)(5)(D)(i), 13(n)(5)(F), 13(n)(5)(G), 
13(n)(5)(H), 13(n)(7)(A), 13(n)(7)(B), and 13(n)(7)(C), each of which 
will expire on the earlier of (1) the date the Commission grants 
registration to an SDR and (2) the earliest compliance date set forth 
in any of the final rules regarding the registration of SDRs.\2\ The 
DFA Effective Date Order also provided an exemption from Exchange Act 
Section 29(b) with respect to provisions of the Exchange Act amended or 
added by subtitle B of the Dodd-Frank Act for which compliance is 
triggered by registration or by adoption of final rules by the 
Commission, or for which the Commission has provided an exception or 
exemptive relief, until such date as the Commission specifies.\3\ 
Absent other Commission action, these exemptions relevant to SDRs 
(``SDR Relief'') will expire as of March 18, 2016, as further explained 
below.
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    \1\ See Temporary Exemptions and Other Temporary Relief, 
Together With Information on Compliance Dates for New Provisions of 
the Exchange Act Applicable to Security-Based Swaps, Exchange Act 
Release No. 64678 (June 15, 2011), 76 FR 36287 (June 22, 2011) (the 
``DFA Effective Date Order'').
    \2\ See DFA Effective Date Order, 76 FR at 36306.
    \3\ See DFA Effective Date Order, 76 FR at 36305-36306.
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    In February 2015, the Commission adopted Rules 13n-11 to 13n-112 
under the Exchange Act to govern SDRs (the ``SDR Rules''). The SDR 
Rules became effective on May 18, 2015.\4\ The SDR Rules Release states 
that SDRs must be in compliance with the SDR Rules by March 18, 2016, 
which is 365 days after publication of the SDR Rules in the Federal 
Register (the ``SDR Rules Compliance Date'').\5\ The SDR Rules Release 
also notes that (1) absent an exemption, any SDR must be registered 
with the Commission and in compliance with the federal securities laws 
and the rules and regulations thereunder (including the applicable 
Dodd-Frank Act provisions and all of the SDR Rules) by the SDR Rules 
Compliance Date, and (2) all exemptions that the Commission provided in 
the DFA Effective Date Order will expire on the compliance date, 
including the exemptions set forth in the DFA Effective Date Order.\6\ 
The SDR Rules govern the SDR registration process, duties, and core 
principles. The 12 core SDR Rules establish a framework for SDRs to 
register with the Commission by filing a new Form SDR, and require an 
SDR to update its Form SDR when any information becomes inaccurate. The 
SDR Rules also provide a process for the Commission to cancel or revoke 
the registration of an SDR.
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    \4\ See Exchange Act Release No. 74246 (Feb. 11, 2015), 80 FR 
14438 (Mar. 19, 2015) (``SDR Rules Release'').
    \5\ See SDR Rules Release, 80 FR at 14456.
    \6\ See id.
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    In addition to the requirements set forth in the SDR Rules, there 
are a number of regulatory requirements applicable to SDRs once 
registered under Regulation SBSR, which was adopted by the Commission 
at the same time as the SDR Rules.\7\ Regulation SBSR provides for the 
reporting of security-based swap information to registered SDRs, and 
the public dissemination of security-based swap transaction, volume, 
and pricing information by registered SDRs. Rule 907 of Regulation SBSR 
requires a registered SDR to establish and maintain written policies 
and procedures for carrying out its duties under Regulation SBSR.\8\
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    \7\ See Exchange Act Release No. 74244 (Feb. 11, 2015), 80 FR 
14563 (Mar. 19, 2015).
    \8\ See 17 CFR 242.907.
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II. Discussion

    The Commission is using its authority under Section 36 of the 
Exchange Act to grant a temporary exemption from compliance with the 
SDR Rules until June 30, 2016 and to extend the SDR Relief so that it 
will expire on the earlier of (1) the date the Commission grants 
registration to an SDR and (2) June 30, 2016. The temporary exemption 
is designed to help facilitate the potential submission of any SDR 
applications.
    Subject to certain exceptions, Section 36 of the Exchange Act \9\ 
authorizes the Commission, by rule, regulation, or order, to exempt, 
either conditionally or unconditionally, any person, security, or 
transaction, or any class or classes of persons, securities, or 
transactions, from any provision or provisions of the Exchange Act or 
any rule or regulation thereunder, to the extent that such exemption is 
necessary or appropriate in the public interest, and is consistent with 
the protection of investors. The Commission finds that it is necessary 
and appropriate in the public interest, and consistent with the 
protection of investors to grant a temporary exemption from compliance 
with the SDR Rules until June 30, 2016. The SDR Rules implement 
mandates under Title VII of the Dodd-Frank Act and govern the SDR 
registration process, duties and core principles.
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    \9\ 15 U.S.C. 78mm.
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    The Commission notes that the SDR Rules Compliance Date is less 
than one month away. The Commission believes that granting the 
temporary exemption along with an extension of the SDR Relief will give 
additional time to potential SDR registrants to thoroughly develop and 
prepare a complete application for registration. Notices of completed 
Forms SDR will be published to afford interested persons an opportunity 
to submit written comments concerning such application.\10\ Given the 
SDR Rules Compliance Date, the temporary exemption should also provide 
staff sufficient time to analyze adequately any application materials 
that may be submitted.
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    \10\ In the SDR Rules Release, the Commission stated that if a 
person files an amendment to its application for registration after 
the Commission has already published notice of the filing of its 
Form SDR and the Commission finds that the amendment renders the 
prior filing materially incomplete, then the 90-day period pursuant 
to Rule 13n-11(c) will reset from the time that the Commission deems 
the amended application to be complete for the Commission's review.
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II. Conclusion

    Accordingly, the Commission hereby grants, pursuant to Section 36 
of the Exchange Act, a temporary exemption from compliance with the SDR 
Rules until June 30, 2016, and an extension of the SDR Relief such that 
it will expire on the earlier of (1) the date the Commission grants 
registration to an SDR and (2) June 30, 2016.

    By the Commission.
Brent J. Fields,
Secretary.
[FR Doc. 2016-06546 Filed 3-22-16; 8:45 am]
 BILLING CODE 8011-01-P