82 FR 37256 - Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Establish the Effective Date of the Settlement Cycle Rule Changes

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 82, Issue 152 (August 9, 2017)

[Federal Register Volume 82, Number 152 (Wednesday, August 9, 2017)]
[Notices]
[Pages 37256-37257]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-16740]



[[Page 37256]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81306; File No. SR-NSCC-2017-014]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of Proposed 
Rule Change To Establish the Effective Date of the Settlement Cycle 
Rule Changes

August 3, 2017.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on July 31, 2017, 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 the clearing agency. NSCC filed the 
proposed rule change pursuant to Section 19(b)(3)(A) of the Act \3\ and 
Rule 19b-4(f)(4) thereunder.\4\ The Commission is publishing this 
notice to solicit comments on the proposed rule change from interested 
persons.
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    \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)(4).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    NSCC is filing this proposed rule change to (i) establish September 
5, 2017 as the effective date (``Effective Date'') of the settlement 
cycle rule changes (``T2 Changes'') submitted pursuant to rule filing 
SR-NSCC-2016-007 (``Prior Rule Filing''),\5\ (ii) incorporate the T2 
Changes into NSCC's Rules & Procedures (``Rules'') \6\ as of the 
Effective Date, and (iii) amend the legend (``Legend'') on the cover 
page of the Rules in order to include the Effective Date and self-
eliminating language for the Legend, and remove the Legend's current 
reference to NSCC making a subsequent rule filing with the Commission 
as this proposal is that subsequent rule filing.
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    \5\ See Securities Exchange Act Release No. 79356 (November 18, 
2016), 81 FR 85299 (November 25, 2016) (SR-NSCC-2016-007).
    \6\ Capitalized terms not defined herein are defined in the 
Rules, available at http://www.dtcc.com/~/media/Files/Downloads/
legal/rules/nscc_rules.pdf.
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

    In its filing with the Commission, the clearing agency 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. The clearing agency 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
    On January 4, 2017, the Commission issued an order approving the 
Prior Rule Filing,\7\ which was filed by NSCC pursuant to Section 
19(b)(2) of the Act.\8\
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    \7\ See Securities Exchange Act Release No. 79734 (January 4, 
2017), 82 FR 3030 (January 10, 2017) (SR-NSCC-2016-007).
    \8\ 15 U.S.C. 78s(b)(2).
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    The purpose of the Prior Rule Filing was to amend the Rules to 
ensure that the Rules are consistent with the anticipated industry-wide 
move to a shorter standard settlement cycle from the third business day 
after the trade date (``T+3'') to the second business day after the 
trade date (``T+2''). Although approved by the Commission, the Prior 
Rule Filing stated that the T2 Changes would not become effective and 
would not be implemented until an effective date is established by a 
subsequent proposed rule change to be submitted by NSCC under Rule 19b-
4 of the Act.\9\
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    \9\ 17 CFR 240.19b-4.
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    NSCC is filing this proposed rule change to (i) establish the 
Effective Date for the T2 Changes, which is also the compliance date 
for the Commission's amendment to Rule 15c6-1(a) under the Act,\10\ 
(ii) incorporate the T2 Changes into the Rules as of the Effective 
Date, and (iii) amend the Legend on the cover page of the Rules in 
order to include the Effective Date and self-eliminating language for 
the Legend, and remove the Legend's current reference to NSCC making a 
subsequent rule filing with the Commission as this proposal is that 
subsequent rule filing.
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    \10\ The Commission adopted an amendment to the Settlement Cycle 
Rule (Rule 15c6-1(a)) under the Act to shorten the standard 
settlement cycle for most broker-dealer transactions from T+3 to 
T+2. See Amendment to Securities Transaction Settlement Cycle, 
Exchange Act Release No. 80295 (March 22, 2017), 82 FR 15564 (March 
29, 2017).
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2. Statutory Basis
    Section 17A(b)(3)(F) of the Act requires, in part, that the Rules 
be designed to promote the prompt and accurate clearance and settlement 
of securities transactions.\11\ The proposed rule change would 
establish the Effective Date for the T2 Changes and provide NSCC 
members (``Members'') with an understanding of when the T2 Changes will 
begin to affect them. Knowing when the T2 Changes will begin to affect 
Members would enable them to timely fulfill their obligations to NSCC, 
which would in turn ensure that securities transactions would be 
promptly and accurately cleared and settled within the industry 
standard settlement cycle and, by extension, facilitate the prompt and 
accurate clearance and settlement of securities transactions submitted 
to NSCC for clearing and settlement. Therefore, NSCC believes that the 
proposed rule change would promote the prompt and accurate clearance 
and settlement of securities transactions, consistent with Section 
17A(b)(3)(F) of the Act cited above.
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    \11\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Clearing Agency's Statement on Burden on Competition

    NSCC does not believe that the proposed rule change to (i) 
establish the Effective Date for the T2 Changes, (ii) incorporate the 
T2 Changes into the Rules as of the Effective Date, and (iii) amend the 
Legend on the cover page of the Rules in order to include the Effective 
Date and self-eliminating language for the Legend, and remove the 
Legend's current reference to NSCC making a subsequent rule filing with 
the Commission would have any impact, or impose any burden, on 
competition because the proposed rule change is intended to provide 
additional clarity in the Rules regarding when the T2 Changes would 
become effective for Members. As such, the proposed rule change would 
not impact a particular category of Members nor would it impact 
particular types of Members' businesses.

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change 
Received From Members, Participants, or Others

    NSCC has not received or solicited any written comments relating to 
this proposal. 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) of the Act \12\ and paragraph (f) of Rule 19b-4 
thereunder.\13\ At any time within 60 days of the filing of the 
proposed rule

[[Page 37257]]

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.
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    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f).
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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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NSCC-2017-014 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.

All submissions should refer to File Number SR-NSCC-2017-014. 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 20549-1090 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-2017-014 and 
should be submitted on or before August 30, 2017.


    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
Eduardo A. Aleman,
Assistant Secretary.
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    \14\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2017-16740 Filed 8-8-17; 8:45 am]
 BILLING CODE 8011-01-P