83 FR 12978 - Self-Regulatory Organizations; The Depository Trust Company; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To Amend the Loss Allocation Rules and Make Other Changes

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 58 (March 26, 2018)

Page Range		12978-12980
FR Document		2018-06020
Federal Register, Volume 83 Issue 58 (Monday, March 26, 2018)
[Federal Register Volume 83, Number 58 (Monday, March 26, 2018)]
[Notices]
[Pages 12978-12980]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-06020]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82914; File No. SR-DTC-2017-022]


Self-Regulatory Organizations; The Depository Trust Company; 
Order Instituting Proceedings To Determine Whether To Approve or 
Disapprove a Proposed Rule Change To Amend the Loss Allocation Rules 
and Make Other Changes

March 20, 2018.

I. Introduction

    On December 18, 2017, The Depository Trust Company (``DTC'') filed 
with the Securities and Exchange Commission (``Commission''), pursuant 
to Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') 
\1\ and Rule 19b-4 thereunder,\2\ proposed rule change SR-DTC-2017-022 
to amend the loss allocation rules and make other changes (``Proposed 
Rule Change'').\3\ The Proposed Rule Change was published for comment 
in the Federal Register on January 8, 2018.\4\ The Commission did not 
receive any comments on the Proposed Rule Change. On February 8, 2018, 
pursuant to Section 19(b)(2)(A)(ii)(I) of the Act,\5\ the Commission 
designated a longer period within which to approve, disapprove, or 
institute proceedings to determine whether to approve or disapprove the 
Proposed Rule Change.\6\ This order institutes proceedings, pursuant to 
Section 19(b)(2)(B) of the Act,\7\ to determine whether to approve or 
disapprove the Proposed Rule Change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ On December 18, 2017, DTC filed this proposal as an advance 
notice (SR-DTC-2017-804) with the Commission pursuant to Section 
806(e)(1) of the Payment, Clearing, and Settlement Supervision Act 
of 2010 (``Clearing Supervision Act'') and Rule 19b-4(n)(1)(i) of 
the Act (``Advance Notice''). On January 24, 2018, the Commission 
extended the review period of the Advance Notice for an additional 
60 days pursuant to Section 806(e)(1)(H) of the Clearing Supervision 
Act. See 12 U.S.C. 5465(e)(1); 17 CFR 240.19b-4(n)(1)(i); 12 U.S.C. 
5465(e)(1)(H); and Securities Exchange Act Release No. 82582 
(January 24, 2018), 83 FR 4297 (January 30, 2018) (SR-DTC-2017-804).
    \4\ Securities Exchange Act Release No. 82426 (January 2, 2018), 
83 FR 913 (January 8, 2018) (SR-DTC-2017-022) (``Notice'').
    \5\ 15 U.S.C. 78s(b)(2)(A)(ii)(I).
    \6\ Securities Exchange Act Release No. 82670 (February 8, 
2018), 83 FR 6626 (February 14, 2018) (SR-DTC-2017-022; SR-FICC-
2017-022; SR-NSCC-2017-018).
    \7\ 15 U.S.C. 78s(b)(2)(B).
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II. Summary of the Proposed Rule Change \8\
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    \8\ The Commission notes that the Summary of the Proposed Rule 
Change section does not describe the Proposed Rule Change in its 
entirety. Other changes include, but are not limited to, the 
clarification of defined terms, various aspects of the settlement 
charges, and detailed procedures of the loss allocation. The 
complete Proposed Rule Change can be found in the Notice. See 
Notice, supra note 4. In addition, the text of the Proposed Rule 
Change is available at http://www.dtcc.com/legal/rules-and-procedures.aspx.
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    As described in the Notice,\9\ DTC proposes to revise Rule 4 
(Participants Fund and Participants Investment) to primarily change (i) 
the application of the Participants Fund in a Participant Default and 
for settlement,\10\ (ii) the loss allocation process,\11\ (iii) the 
loss allocation governance for Non-Default Events,\12\ and (iv) the 
retention time for the Actual Participants Fund Deposit of former 
participants.\13\ Furthermore, the Proposed Rule change would revise 
Rule 1 (Definitions; Governing Law) to add cross-references to terms 
that would be defined in proposed Rule 4.\14\
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    \9\ The description of the Proposed Rule Change herein is based 
on the statements prepared by DTC in the Notice. See Notice, supra 
note 4. Each capitalized term not otherwise defined herein has its 
respective meaning either (i) as set forth in the Rules, By-Laws and 
Organization Certificate of DTC, available at http://www.dtcc.com/legal/rules-and-procedures.aspx, or (ii) as set forth in the Notice.
    \10\ See Notice, supra note 4, at 914-15.
    \11\ See id. at 915-18.
    \12\ See id. at 918.
    \13\ See id. at 918-19.
    \14\ See id. at 919.
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A. Application of the Participants Fund in a Participant Default and 
for Settlement

    DTC proposes to revise Rule 4, Section 4 (Application of 
Participants Fund Deposits of Non-Defaulting Participants) to address 
the situation where the application of the Actual Participants Fund 
Deposit of a Participant that has failed to settle is insufficient to 
complete settlement among non-defaulting Participants on any Business 
Day.\15\ In such a situation, proposed Section 4 would state that the 
Participants Fund shall constitute a liquidity resource which may be 
applied by DTC in such amounts as DTC shall determine, in its sole 
discretion, to fund settlement among non-defaulting Participants.\16\
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    \15\ Id. at 915.
    \16\ Id. at 919.

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[[Page 12979]]

B. Loss Allocation Process

    DTC proposes to revise Rule 4, Section 5 (Loss Allocation 
Waterfall) to address the loss allocation of losses and liabilities 
relating to or arising out of a Default Loss Event or a Declared Non-
Default Loss Event.\17\ DTC proposes four key changes to its loss 
allocation process.
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    \17\ Id. at 920-21.
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    First, DTC proposes to replace the current discretionary 
application of an unspecified amount of retained earnings and undivided 
profits with a mandatory, defined Corporate Contribution.\18\ The 
proposed Corporate Contribution would be defined as an amount equal to 
50 percent of DTC's General Business Risk Capital Requirement as of the 
end of the calendar quarter immediately preceding the Event Period.\19\ 
DTC's General Business Risk Capital Requirement is, at a minimum, equal 
to the regulatory capital that DTC is required to maintain in 
compliance with Rule 17Ad-22(e)(15) under the Act.\20\
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    \18\ Id. at 916.
    \19\ Id.
    \20\ Id.; 17 CFR 240.17Ad-22(e)(15).
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    Second, DTC proposes to introduce an Event Period to address the 
allocation of losses and liabilities (i) relating to or arising out of 
a Participant Default, where DTC has ceased to act for such 
Participant, and/or (ii) otherwise incident to the business of DTC, as 
determined in proposed Rule 4.\21\ DTC proposes to group together 
Default Loss Events and Declared Non-Default Loss Events occurring in a 
period of 10 Business Days for purposes of allocating losses to 
Participants.\22\
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    \21\ Notice, supra note 4, at 916.
    \22\ Id.
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    Third, DTC proposes to introduce a loss allocation ``round,'' which 
would mean ``a series of loss allocations relating to an Event Period, 
the aggregate amount of which is limited by the sum of the Loss 
Allocation Caps of affected Participants.'' \23\ DTC would notify 
Participants subject to a loss allocation of the amounts being 
allocated to them.\24\ Participants would be required to pay the 
requisite amount no later than the second Business Day following the 
issuance of such notice.\25\
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    \23\ Id. at 917.
    \24\ Id.
    \25\ Id.
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    Fourth, the Proposed Rule Change would continue to provide 
Participants the opportunity to limit their loss allocation exposure by 
offering a termination option, but the associated withdrawal process 
would be modified.\26\ As proposed, if a Participant provides notice of 
its election to terminate its business with DTC as provided, in 
general, its maximum payment obligation with respect to any loss 
allocation round would be the amount of its Aggregate Requirement 
Deposit and Investment, as fixed on the first day of the Event Period, 
plus 100 percent of the amount thereof.\27\ Participants would have 
five Business Days from the issuance of the first Loss Allocation 
Notice in any round to decide whether to terminate its participation 
with DTC, and thereby benefit from its Loss Allocation Cap.\28\
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    \26\ Id. at 917-18.
    \27\ Id. at 917.
    \28\ Id. at 918.
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C. Loss Allocation Governance for Non-Default Events

    DTC proposes to clarify the governance around Non-Default Loss 
Event that would trigger loss allocation to Participants. Specifically, 
DTC proposes to require its Board of Directors to determine that there 
is a non-default loss that (i) may present a significant and 
substantial loss or liability, so as to materially impair the ability 
to DTC to provide clearance and settlement services in an orderly 
manner, and (ii) will potentially generate losses to be mutualized 
among the Participants in order to ensure that DTC may continue to 
offer clearance and settlement services in an orderly manner.\29\
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    \29\ Id. at 918.
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D. Retention Time for the Actual Participants Fund Deposit of a Former 
Participant

    DTC proposes to reduce its retention time for the Actual 
Participants Fund Deposit of a Former Participant in certain situations 
from four years to two years.\30\ Currently Rule 4 provides that, in 
general, after three months from when a Person has ceased to be 
Participant, DTC shall return to such Person the amount of the Actual 
Participants Fund Deposit of the former Participant of such payment 
provided that DTC receives such indemnities and guarantees as DTC deems 
satisfactory with respect to the matured and contingent obligations of 
the former Participant to DTC.\31\ Otherwise, within four years after a 
Person has ceased to be a Participant, DTC shall return to such Person 
the amount of the Actual Participants Fund Deposit of the former 
Participant.\32\ DTC proposes to reduce the four year retention period 
to two years, and preserve all other requirements relating to the 
return of the Actual Participants Fund Deposit.\33\
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    \30\ Id. at 918-19.
    \31\ Id. at 918.
    \32\ Id.
    \33\ Id.
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III. Proceedings To Determine Whether To Approve or Disapprove the 
Proposed Rule Change and Grounds for Disapproval Under Consideration

    The Commission is instituting proceedings pursuant to Section 
19(b)(2)(B) of the Act \34\ to determine whether the Proposed Rule 
Change should be approved or disapproved. Institution of proceedings is 
appropriate at this time in view of the legal and policy issues raised 
by the Proposed Rule Change. Institution of proceedings does not 
indicate that the Commission has reached any conclusions with respect 
to any of the issues involved. Rather, the Commission seeks and 
encourages interested persons to comment on the Proposed Rule Change, 
and provide the Commission with arguments to support the Commission's 
analysis as to whether to approve or disapprove the Proposed Rule 
Change.
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    \34\ 15 U.S.C. 78s(b)(2)(B).
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    Pursuant to Section 19(b)(2)(B) of the Act,\35\ the Commission is 
providing notice of the grounds for disapproval under consideration. 
The Commission is instituting proceedings to allow for additional 
analysis of, and input from commenters with respect to, the Proposed 
Rule Change's consistency with Section 17A of the Act,\36\ and the 
rules thereunder, including the following provisions:
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    \35\ Id.
    \36\ 15 U.S.C. 78q-1.
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     Section 17A(b)(3)(F) of the Act,\37\ which requires, among 
other things, that the rules of a clearing agency, such as DTC, must be 
designed to promote the prompt and accurate clearance and settlement of 
securities transactions, to assure the safeguarding of securities and 
funds which are in the custody or control of the clearing agency or for 
which it is responsible, and to protect investors and the public 
interest;
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    \37\ 15 U.S.C. 78q-1(b)(3)(F).
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     Rule 17Ad-22(e)(7)(i) under the Act,\38\ which requires a 
covered clearing agency, such as DTC, to establish, implement, maintain 
and enforce written policies and procedures reasonably designed to, 
among other things, effectively measure, monitor, and manage the 
liquidity risk that arises in or is borne by the covered clearing 
agency, including measuring, monitoring, and managing its settlement 
and funding flows on an ongoing and timely basis, and its use of 
intraday

[[Page 12980]]

liquidity by, at a minimum, maintaining sufficient liquid resources to 
effect same-day and, where appropriate, intraday and multiday 
settlement of payment obligations with a high degree of confidence 
under a wide range of foreseeable stress scenarios that includes, but 
is not limited to, the default of the participant family that would 
generate the largest aggregate payment obligation for the covered 
clearing agency in extreme but plausible market conditions;
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    \38\ 17 CFR 240.17Ad-22(e)(1).
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     Rule 17Ad-22(e)(13) under the Act, which requires, in 
general, a covered clearing agency, such as DTC, to establish, 
implement, maintain and enforce written policies and procedures 
reasonably designed to ensure the covered clearing agency has the 
authority and operational capacity to take timely action to contain 
losses and liquidity demands and continue to meet its obligations.
     Rule 17Ad-22(e)(23)(i) under the Act,\39\ which requires a 
covered clearing agency, such as DTC, to establish, implement, maintain 
and enforce written policies and procedures reasonably designed to 
publicly disclose all relevant rules and material procedures, including 
key aspects of its default rules and procedures.
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    \39\ 17 CFR 240.17Ad-22(e)(23)(i).
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IV. Procedure: Request for Written Comments

    The Commission requests that interested persons provide written 
submissions of their views, data, and arguments with respect to the 
issues identified above, as well as any other concerns they may have 
with the Proposed Rule Change. In particular, the Commission invites 
the written views of interested persons concerning whether the Proposed 
Rule Change is consistent with Section 17A(b)(3)(F) of the Act,\40\ 
Rule 17Ad-22(e)(7)(i) under the Act,\41\ Rule 17Ad-22(e)(13) under the 
Act,\42\ Rule 17Ad-22(e)(23)(i) under the Act,\43\ or any other 
provision of the Act, or the rules and regulations thereunder. Although 
there do not appear to be any issues relevant to approval or 
disapproval that would be facilitated by an oral presentation of views, 
data, and arguments, the Commission will consider, pursuant to Rule 
19b-4(g) under the Act,\44\ any request for an opportunity to make an 
oral presentation.\45\
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    \40\ 15 U.S.C. 78q-1(b)(3)(F).
    \41\ 17 CFR 240.17Ad-22(e)(7)(i).
    \42\ 17 CFR 240.17Ad-22(e)(13).
    \43\ 17 CFR 240.17Ad-22(e)(23)(i).
    \44\ 17 CFR 240.19b-4(g).
    \45\ Section 19(b)(2) of the Act grants to the Commission 
flexibility to determine what type of proceeding--either oral or 
notice and opportunity for written comments--is appropriate for 
consideration of a particular proposal by a self-regulatory 
organization. See Securities Act Amendments of 1975, Senate Comm. on 
Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st 
Sess. 30 (1975).
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    Interested persons are invited to submit written data, views, and 
arguments regarding whether the Proposed Rule Change should be approved 
or disapproved by April 16, 2018. Any person who wishes to file a 
rebuttal to any other person's submission must file that rebuttal by 
April 30, 2018.
    The Commission asks that commenters address the sufficiency of 
DTC's statements in support of the Proposed Rule Change, which are set 
forth in the Notice,\46\ in addition to any other comments they may 
wish to submit about the Proposed Rule Change.
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    \46\ See Notice, supra note 4.
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    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-DTC-2017-022 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-DTC-2017-022. 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 website (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 website 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 DTC and on The Depository Trust 
& Clearing Corporation's website (http://dtcc.com/legal/sec-rule-filings.aspx). All comments received will be posted without change. 
Persons submitting comments are cautioned that we do not redact or edit 
personal identifying information from comment submissions. You should 
submit only information that you wish to make available publicly. All 
submissions should refer to File Number SR-DTC-2017-022 and should be 
submitted on or before April 16, 2018. Rebuttal comments should be 
submitted by April 30, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\47\
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    \47\ 17 CFR 200.30-3(a)(57).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-06020 Filed 3-23-18; 8:45 am]
 BILLING CODE 8011-01-P
12978 Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Notices

transparent and (2) specify clear and For the Commission, by the Division of This order institutes proceedings,
direct lines of responsibility.70 Trading and Markets, pursuant to delegated pursuant to Section 19(b)(2)(B) of the
authority.74 Act,7 to determine whether to approve
As described above, NSCC proposes a Eduardo A. Aleman,
number of changes that would provide or disapprove the Proposed Rule
Assistant Secretary. Change.
clarity and transparency. NSCC
[FR Doc. 2018–06030 Filed 3–23–18; 8:45 am]
proposes to revise By-Laws provisions II. Summary of the Proposed Rule
BILLING CODE 8011–01–P
that were outdated or incorrect. Change 8
Specifically, the proposed changes to As described in the Notice,9 DTC
the titles and offices (and their related SECURITIES AND EXCHANGE proposes to revise Rule 4 (Participants
powers and duties) would provide COMMISSION Fund and Participants Investment) to
clarity and transparency because they primarily change (i) the application of
would clearly set forth NSCC’s current [Release No. 34–82914; File No. SR–DTC–
2017–022] the Participants Fund in a Participant
organizational structure, including the Default and for settlement,10 (ii) the loss
lines of responsibility of various officers Self-Regulatory Organizations; The allocation process,11 (iii) the loss
and the Board. The proposed changes Depository Trust Company; Order allocation governance for Non-Default
relating to compensation-setting would Instituting Proceedings To Determine Events,12 and (iv) the retention time for
also give clarity and transparency by (1) Whether To Approve or Disapprove a the Actual Participants Fund Deposit of
accurately reflecting the process that is Proposed Rule Change To Amend the former participants.13 Furthermore, the
followed pursuant to the Compensation Loss Allocation Rules and Make Other Proposed Rule change would revise
Committee Charter, and (2) clarifying Changes Rule 1 (Definitions; Governing Law) to
that the Non-Executive Chairman of the add cross-references to terms that would
March 20, 2018. be defined in proposed Rule 4.14
Board does not receive compensation.
Finally, the proposed technical changes I. Introduction A. Application of the Participants Fund
and corrections would raise the clarity On December 18, 2017, The in a Participant Default and for
and transparency of the By-Laws by Depository Trust Company (‘‘DTC’’) Settlement
removing grammatical and filed with the Securities and Exchange DTC proposes to revise Rule 4,
typographical errors. Additionally, Commission (‘‘Commission’’), pursuant Section 4 (Application of Participants
NSCC also proposes changes to its Rules to Section 19(b)(1) of the Securities Fund Deposits of Non-Defaulting
to provide clarity and transparency. Exchange Act of 1934 (‘‘Act’’) 1 and Rule Participants) to address the situation
Specifically, the proposed changes 19b–4 thereunder,2 proposed rule where the application of the Actual
would create clarity and transparency change SR–DTC–2017–022 to amend the Participants Fund Deposit of a
by integrating the By-Laws and the loss allocation rules and make other Participant that has failed to settle is
Certificate of Incorporation into one changes (‘‘Proposed Rule Change’’).3 insufficient to complete settlement
document, the Rules (to which all NSCC The Proposed Rule Change was among non-defaulting Participants on
members are subject and have access). published for comment in the Federal any Business Day.15 In such a situation,
Register on January 8, 2018.4 The proposed Section 4 would state that the
For these reasons, the Commission
Commission did not receive any Participants Fund shall constitute a
finds that the proposed rule change is
comments on the Proposed Rule liquidity resource which may be applied
designed to enhance clarity and Change. On February 8, 2018, pursuant
transparency in NSCC’s governance by DTC in such amounts as DTC shall
to Section 19(b)(2)(A)(ii)(I) of the Act,5 determine, in its sole discretion, to fund
arrangements, as well as to specify clear the Commission designated a longer
and direct lines of responsibility for settlement among non-defaulting
period within which to approve, Participants.16
various officer positions and the Board disapprove, or institute proceedings to
within NSCC’s organizational structure, determine whether to approve or 7 15 U.S.C. 78s(b)(2)(B).
consistent with Rule 17Ad–22(e)(2)(i) disapprove the Proposed Rule Change.6 8 The Commission notes that the Summary of the
and (v) under the Act.71 Proposed Rule Change section does not describe the
74 17 CFR 200.30–3(a)(12). Proposed Rule Change in its entirety. Other changes
III. Conclusion 1 15 U.S.C. 78s(b)(1). include, but are not limited to, the clarification of
2 17 CFR 240.19b–4. defined terms, various aspects of the settlement
On the basis of the foregoing, the 3 On December 18, 2017, DTC filed this proposal
charges, and detailed procedures of the loss
Commission finds that the proposal is allocation. The complete Proposed Rule Change can
as an advance notice (SR–DTC–2017–804) with the be found in the Notice. See Notice, supra note 4.
consistent with the requirements of the Commission pursuant to Section 806(e)(1) of the In addition, the text of the Proposed Rule Change
Act, in particular the requirements of Payment, Clearing, and Settlement Supervision Act is available at http://www.dtcc.com/legal/rules-and-
of 2010 (‘‘Clearing Supervision Act’’) and Rule 19b– procedures.aspx.
Section 17A of the Act 72 and the rules 4(n)(1)(i) of the Act (‘‘Advance Notice’’). On January 9 The description of the Proposed Rule Change
and regulations thereunder. 24, 2018, the Commission extended the review
herein is based on the statements prepared by DTC
period of the Advance Notice for an additional 60
It is therefore ordered, pursuant to days pursuant to Section 806(e)(1)(H) of the
in the Notice. See Notice, supra note 4. Each
Section 19(b)(2) of the Act, that capitalized term not otherwise defined herein has
Clearing Supervision Act. See 12 U.S.C. 5465(e)(1);
its respective meaning either (i) as set forth in the
proposed rule change SR–NSCC–2018– 17 CFR 240.19b–4(n)(1)(i); 12 U.S.C. 5465(e)(1)(H);
Rules, By-Laws and Organization Certificate of
and Securities Exchange Act Release No. 82582
001 be, and hereby is, approved.73 (January 24, 2018), 83 FR 4297 (January 30, 2018)
DTC, available at http://www.dtcc.com/legal/rules-
sradovich on DSK3GMQ082PROD with NOTICES

and-procedures.aspx, or (ii) as set forth in the
(SR–DTC–2017–804).
4 Securities Exchange Act Release No. 82426
Notice.
70 17 CFR 240.17Ad–22(e)(2)(i) and (v). 10 See Notice, supra note 4, at 914–15.
71 Id. (January 2, 2018), 83 FR 913 (January 8, 2018) (SR– 11 See id. at 915–18.
DTC–2017–022) (‘‘Notice’’).
72 15 U.S.C. 78q–1. 12 See id. at 918.
5 15 U.S.C. 78s(b)(2)(A)(ii)(I).
73 In 13 See id. at 918–19.
approving the proposed rule change, the 6 Securities Exchange Act Release No. 82670
Commission considered the proposals’ impact on 14 See id. at 919.
(February 8, 2018), 83 FR 6626 (February 14, 2018)
efficiency, competition, and capital formation. 15 15 Id. at 915.
(SR–DTC–2017–022; SR–FICC–2017–022; SR–
U.S.C. 78c(f). NSCC–2017–018). 16 Id. at 919.

VerDate Sep<11>2014 16:38 Mar 23, 2018 Jkt 244001 PO 00000 Frm 00041 Fmt 4703 Sfmt 4703 E:\FR\FM\26MRN1.SGM 26MRN1
12980 Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Notices

liquidity by, at a minimum, maintaining Interested persons are invited to office of DTC and on The Depository
sufficient liquid resources to effect submit written data, views, and Trust & Clearing Corporation’s website
same-day and, where appropriate, arguments regarding whether the (http://dtcc.com/legal/sec-rule-
intraday and multiday settlement of Proposed Rule Change should be filings.aspx). All comments received
payment obligations with a high degree approved or disapproved by April 16, will be posted without change. Persons
of confidence under a wide range of 2018. Any person who wishes to file a submitting comments are cautioned that
foreseeable stress scenarios that rebuttal to any other person’s we do not redact or edit personal
includes, but is not limited to, the submission must file that rebuttal by identifying information from comment
default of the participant family that April 30, 2018. submissions. You should submit only
would generate the largest aggregate The Commission asks that information that you wish to make
payment obligation for the covered commenters address the sufficiency of available publicly. All submissions
clearing agency in extreme but plausible DTC’s statements in support of the should refer to File Number SR–DTC–
market conditions; Proposed Rule Change, which are set 2017–022 and should be submitted on
• Rule 17Ad–22(e)(13) under the Act, forth in the Notice,46 in addition to any or before April 16, 2018. Rebuttal
which requires, in general, a covered other comments they may wish to comments should be submitted by April
clearing agency, such as DTC, to submit about the Proposed Rule Change. 30, 2018.
establish, implement, maintain and Comments may be submitted by any For the Commission, by the Division of
enforce written policies and procedures of the following methods: Trading and Markets, pursuant to delegated
reasonably designed to ensure the authority.47
covered clearing agency has the Electronic Comments
Eduardo A. Aleman,
authority and operational capacity to • Use the Commission’s internet
Assistant Secretary.
take timely action to contain losses and comment form (http://www.sec.gov/
liquidity demands and continue to meet [FR Doc. 2018–06020 Filed 3–23–18; 8:45 am]
rules/sro.shtml); or
its obligations. • Send an email to rule-comments@ BILLING CODE 8011–01–P
• Rule 17Ad–22(e)(23)(i) under the sec.gov. Please include File Number SR–
Act,39 which requires a covered clearing DTC–2017–022 on the subject line.
agency, such as DTC, to establish, SECURITIES AND EXCHANGE
implement, maintain and enforce Paper Comments COMMISSION
written policies and procedures • Send paper comments in triplicate [Release No. 34–82907; File No. SR–
reasonably designed to publicly disclose to Secretary, Securities and Exchange NYSEArca–2018–08]
all relevant rules and material Commission, 100 F Street NE,
procedures, including key aspects of its Washington, DC 20549–1090. Self-Regulatory Organizations; NYSE
default rules and procedures. All submissions should refer to File Arca, Inc.; Order Approving a
Number SR–DTC–2017–022. This file Proposed Rule Change To Amend
IV. Procedure: Request for Written
number should be included on the NYSE Arca Rule 1.1(ll) To Establish
Comments
subject line if email is used. To help the How the Official Closing Price Would
The Commission requests that Commission process and review your Be Determined for an Exchange-Listed
interested persons provide written comments more efficiently, please use Security That Is a Derivative Securities
submissions of their views, data, and only one method. The Commission will Product if the Exchange Does Not
arguments with respect to the issues post all comments on the Commission’s Conduct a Closing Auction or if a
identified above, as well as any other internet website (http://www.sec.gov/ Closing Auction Trade Is Less Than a
concerns they may have with the rules/sro.shtml). Copies of the Round Lot
Proposed Rule Change. In particular, the submission, all subsequent
Commission invites the written views of amendments, all written statements March 20, 2018.
interested persons concerning whether with respect to the Proposed Rule I. Introduction
the Proposed Rule Change is consistent Change that are filed with the
with Section 17A(b)(3)(F) of the Act,40 Commission, and all written On January 19, 2018, NYSE Arca, Inc.
Rule 17Ad–22(e)(7)(i) under the Act,41 communications relating to the (‘‘Exchange’’ or ‘‘NYSE Arca’’) filed
Rule 17Ad–22(e)(13) under the Act,42 Proposed Rule Change between the with the Securities and Exchange
Rule 17Ad–22(e)(23)(i) under the Act,43 Commission and any person, other than Commission (‘‘Commission’’) pursuant
or any other provision of the Act, or the those that may be withheld from the to Section 19(b)(1) of the Securities
rules and regulations thereunder. public in accordance with the Exchange Act of 1934 (‘‘Act’’) 1 and Rule
Although there do not appear to be any provisions of 5 U.S.C. 552, will be 19b–4 thereunder,2 a proposed rule
issues relevant to approval or available for website viewing and change to amend NYSE Arca Rule 1.1(ll)
disapproval that would be facilitated by printing in the Commission’s Public to establish how the Official Closing
an oral presentation of views, data, and Reference Room, 100 F Street NE, Price 3 would be determined for an
arguments, the Commission will Washington, DC 20549 on official Exchange-listed security that is a
consider, pursuant to Rule 19b–4(g) business days between the hours of Derivative Securities Product 4 if the
under the Act,44 any request for an 10:00 a.m. and 3:00 p.m. Copies of the
opportunity to make an oral filing also will be available for
47 17 CFR 200.30–3(a)(57).
1 15 U.S.C. 78s(b)(1).
presentation.45 inspection and copying at the principal 2 17 CFR 240.19b–4.
sradovich on DSK3GMQ082PROD with NOTICES

3 See NYSE Arca Rule 1.1(ll) for a definition of
39 17 CFR 240.17Ad–22(e)(23)(i).
40 15
proceeding—either oral or notice and opportunity Official Closing Price.
U.S.C. 78q–1(b)(3)(F).
41 17 CFR 240.17Ad–22(e)(7)(i).
for written comments—is appropriate for 4 With respect to equities traded on the Exchange,
consideration of a particular proposal by a self- the term ‘‘Derivative Securities Product’’ means a
42 17 CFR 240.17Ad–22(e)(13).
regulatory organization. See Securities Act security that meets the definition of ‘‘derivative
43 17 CFR 240.17Ad–22(e)(23)(i).
Amendments of 1975, Senate Comm. on Banking, securities product’’ in Rule 19b–4(e) under the Act.
44 17 CFR 240.19b–4(g). Housing & Urban Affairs, S. Rep. No. 75, 94th See NYSE Arca Rule 1.1(k). For purposes of Rule
45 Section 19(b)(2) of the Act grants to the Cong., 1st Sess. 30 (1975). 19b–4(e), a ‘‘derivative securities product’’ means
Commission flexibility to determine what type of 46 See Notice, supra note 4. any type of option, warrant, hybrid securities

VerDate Sep<11>2014 16:38 Mar 23, 2018 Jkt 244001 PO 00000 Frm 00043 Fmt 4703 Sfmt 4703 E:\FR\FM\26MRN1.SGM 26MRN1
Document Created: 2018-03-24 01:00:06
Document Modified: 2018-03-24 01:00:06
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Notices
FR Citation		83 FR 12978