Self-Regulatory Organizations; National Securities Clearing Corporation; Order Approving Proposed Rule Change To Remove From the DTCC Limit Monitoring Tool the 50% Early Warning Limit Alert and Make Technical Revisions to the Rules, 37229-37231 [2016-13613]

Download as PDF Federal Register / Vol. 81, No. 111 / Thursday, June 9, 2016 / Notices [sic] Bulletin of the special characteristics and risks associated with trading the Shares. Trading in Shares of the Fund will be halted if the circuit breaker parameters in NYSE Arca Equities Rule 7.12 have been reached or because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable, and trading in the Shares will be subject to NYSE Arca Equities Rule 8.600(d)(2)(D), which sets forth circumstances under which Shares of the Fund may be halted. The intra-day, closing and settlement prices of the portfolio securities are also readily available from the national securities exchanges trading such securities, automated quotation systems, published or other public sources, or on-line information services such as Bloomberg or Reuters. In addition, as noted above, investors will have ready access to information regarding the Fund’s holdings, the IIV, the Disclosed Portfolio, and quotation and last sale information for the Shares. The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that it will facilitate the listing and trading of an additional type of activelymanaged exchange-traded product that will enhance competition among market participants, to the benefit of investors and the marketplace. As noted above, the Exchange has in place surveillance procedures relating to trading in the Shares and may obtain information via ISG from other exchanges that are members of ISG or with which the Exchange has entered into a CSSA. In addition, as noted above, investors will have ready access to information regarding the Fund’s holdings, the IIV, the Disclosed Portfolio, and quotation and last sale information for the Shares. sradovich on DSK3TPTVN1PROD with NOTICES B. Self-Regulatory Organization’s Statement on Burden on Competition The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Act. The Exchange notes that the proposed rule change will facilitate the listing and trading of an actively-managed exchange-traded product that will principally hold nonU.S. equity securities and that will enhance competition among market participants, to the benefit of investors and the marketplace. VerDate Sep<11>2014 15:50 Jun 08, 2016 Jkt 238001 C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the self-regulatory organization consents, the Commission will: (A) By order approve or disapprove the proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. 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 (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– NYSEArca–2016–79 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–NYSEArca–2016–79. 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 (https://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 Frm 00053 Fmt 4703 Sfmt 4703 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 such filing also will be available for inspection and copying at the principal offices of the Exchange. 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– NYSEArca–2016–79, and should be submitted on or before June 30, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.29 Brent J. Fields, Secretary. [FR Doc. 2016–13615 Filed 6–8–16; 8:45 am] BILLING CODE 8011–01–P IV. Solicitation of Comments PO 00000 37229 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–77990; File No. SR–NSCC– 2016–001] Self-Regulatory Organizations; National Securities Clearing Corporation; Order Approving Proposed Rule Change To Remove From the DTCC Limit Monitoring Tool the 50% Early Warning Limit Alert and Make Technical Revisions to the Rules June 3, 2016. On April 18, 2016, National Securities Clearing Corporation (‘‘NSCC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) proposed rule change SR–NSCC–2016–001 pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 to amend NSCC’s Rules and Procedures (‘‘Rules’’) 3 in order to (i) remove from the DTCC Limit Monitoring tool the alert that is sent to Members when trading activity in any of their Risk Entities reaches 50% of the pre-set trading limits for that Risk Entity and (ii) to make related technical changes and corrections to the Rules, as more fully described below. The proposed rule change was published for comment 29 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Available at https://dtcc.com/∼/media/Files/ Downloads/legal/rules/nscc_rules.pdf. Terms not defined herein are defined in the Rules. 1 15 E:\FR\FM\09JNN1.SGM 09JNN1 37230 Federal Register / Vol. 81, No. 111 / Thursday, June 9, 2016 / Notices in the Federal Register on May 2, 2016.4 The Commission did not receive any comment letters on the proposed rule change. For the reasons discussed below, the Commission is granting approval of the proposed rule change. sradovich on DSK3TPTVN1PROD with NOTICES I. Description of the Proposed Rule Change The following is a description of the proposed rule change, as provided by NSCC: Reasons for Adopting the Proposed Rule Change. NSCC provides its Members with a risk management tool called DTCC Limit Monitoring, for which certain types of Members are required to register.5 DTCC Limit Monitoring enables Members that use the tool to monitor post-trade activity and to be notified when pre-set trading limits are reached. To use the tool, Members must (1) define one or more ‘‘Risk Entities,’’ which may include (i) the trading activity of a single trading desk within the firm; (ii) for Members that clear trades for other firms, i.e., their correspondents, the trading activity of a correspondent firm; (iii) for Members acting as a Special Representative or a QSR, as such terms are defined in the Rules,6 the trading activity of a firm with which it has a clearing relationship; (iv) the trading activity of a single clearing number within the Member’s NSCC account structure; or (v) all trading activity of the Member submitted to NSCC for clearing; and (2) set a trading limit, at a net notional value, for each Risk Entity. DTCC Limit Monitoring then sets early warning limits at 50%, 75%, and 90% of those trading limits.7 Members receive alerts when trading activity for their Risk Entities reaches each of these early warning limits, as well as the preset trading limits. Since the implementation of DTCC Limit Monitoring in 2014, NSCC has periodically met with a working group of its Members to discuss the functioning of the tool and to confirm it provides Members with effective posttrade surveillance as intended. In response to Member feedback provided during these discussions, NSCC has proposed to remove the 50% early 4 See Securities Exchange Act Release No. 77709 (April 26, 2016), 81 FR 26274 (May 2, 2016) (SR– NSCC–2016–001). 5 Rule 54 (DTCC Limit Monitoring) and Procedure XVII (DTCC Limit Monitoring), supra note 3; see Securities Exchange Act Release No. 71637 (February 28, 2014), 79 FR 12708 (March 6, 2014) (SR–NSCC–2013–12). 6 Rule 7 (Comparison and Trade Recording Operation) and Procedure IV (Special Representative Service), supra note 3. 7 Rule 54 (DTCC Limit Monitoring) and Procedure XVII (DTCC Limit Monitoring, supra note 3. VerDate Sep<11>2014 15:50 Jun 08, 2016 Jkt 238001 warning alert for the reasons described below. Additionally, NSCC has proposed to make technical revisions to Procedure XVII (DTCC Limit Monitoring Procedure) primarily to revise the verb tense and add clarity regarding use of the tool. Issues the Proposed Rule Change Is Intended to Address. The proposed rule change will address concerns that (1) the 50% early warning alert is set too low and, thus, may not provide Members with useful information for purposes of effective post-trade monitoring; (2) the frequency of the 50% early warning alert could have a negative impact on Member responsiveness to more critical alerts; and (3) the verb tense and certain other language in the Rule may be unclear and/or technically inaccurate. Manner in which the Proposed Rule Change Will Operate to Resolve the Issues. The proposed rule change will remove the 50% early warning alert from DTCC Limit Monitoring. DTCC Limit Monitoring will retain the 75% and 90% early warning alerts, which continue to provide Members with valuable notice of changes in their posttrade activity for purposes of effective risk management. Additionally, the proposed rule change will make certain technical changes that will clarify the Rule, primarily by updating the verb tense from future tense to present tense to reflect the present applicability of the Rule and by making certain other technical clarifications to language used in the Rule. Manner in which the Proposed Rule Change Will Affect Various Persons. Members that use DTCC Limit Monitoring will no longer receive the 50% early warning alert, but they will continue to receive alerts when their trading activity in each Risk Entity reaches 75% and 90% of their pre-set trading limits. No other changes are proposed with respect to the functioning of DTCC Limit Monitoring. The proposed technical changes are not anticipated to have any effect on Members that use DTCC Limit Monitoring. Significant Problems Known to the Self-Regulatory Organization that Persons Affected Are Likely to Have in Complying with the Proposed Rule Change. Members that use DTCC Limit Monitoring will not have to take any action as a result of the proposed rule change, and NSCC is not aware of any problems that Members will have in continuing to comply with the Rules 8 8 Id. PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 that address DTCC Limit Monitoring after the implementation of the proposed rule change. As stated above, the proposed technical changes are not anticipated to have any effect on Members that use DTCC Limit Monitoring. Description of the Proposed Rule Change. In order to implement this proposed rule change, NSCC will amend Section 4 of Procedure XVII (DTCC Limit Monitoring Procedure) of the Rules to remove reference to the 50% early warning alert and to make certain technical clarifications to language used in the Rule, primarily by updating the verb tense used therein. No other changes to the Rules are contemplated by this proposed rule change. II. Discussion and Commission Findings Section 19(b)(2)(C) of the Act 9 directs the Commission to approve a proposed rule change of a self-regulatory organization if it finds that such proposed rule change is consistent with the requirements of the Act and rules and regulations thereunder applicable to such organization. The Commission believes the proposal is consistent with Section 17A(b)(3)(F) of the Act,10 as described in detail below. Section 17A(b)(3)(F) of the Act requires, among other things, that the rules of a clearing agency be designed to promote the prompt and accurate clearance and settlement of securities transactions and to protect investors and the public interest.11 As described above, the 50% early warning alert may not provide Members with information that is useful for purposes of post-trade monitoring, but, rather, may distract Members from such information. By removing the 50% alert, a distraction is removed, thus increasing the effectiveness of the DTCC Limit Monitoring tool for Members to monitor their post-trade activity. Therefore, the proposed rule change will enhance Members’ ability to manage risks from their trades, facilitating the protection of investors and the public interest from such risks. As the proposed rule change pertains to technical changes to the Rules, the Commission finds the technical changes also consistent with Section 17A(b)(3)(F) of the Act 12 because technical updates to the Rules to make them more clear, consistent, and current for Members that rely on the Rules supports the prompt and accurate 9 15 U.S.C. 78s(b)(2)(C). U.S.C. 78q–1(b)(3)(F). 11 Id. 12 Id. 10 15 E:\FR\FM\09JNN1.SGM 09JNN1 Federal Register / Vol. 81, No. 111 / Thursday, June 9, 2016 / Notices clearance and settlement of securities transactions. III. Conclusion On the basis of the foregoing, the Commission finds that the proposal is consistent with the requirements of the Act and in particular with the requirements of Section 17A of the Act 13 and the rules and regulations thereunder. It is therefore ordered, pursuant to Section 19(b)(2) of the Act, that proposed rule change SR–NSCC–2016– 001 be, and hereby is, approved.14 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.15 Brent J. Fields, Secretary. [FR Doc. 2016–13613 Filed 6–8–16; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street, NE., Washington, DC 20549–2736. sradovich on DSK3TPTVN1PROD with NOTICES Extension: Notice of Exempt Preliminary Roll-Up Communication, SEC File No. 270–396, OMB Control No. 3235–0452. Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. Exchange Act Rule 14a–6(n) (17 CFR 240.14a–6(n)) requires any person that engages in a proxy solicitation subject to Exchange Act Rule 14a–2(b)(4) [(17 CFR 240.14a–2(b)(4))] to file a Notice of Exempt Preliminary Roll-Up Communication (‘‘Notice’’) [(17 CFR 240.14a–104)] with the Commission. The Notice provides information regarding ownership interest and any potential conflicts of interest to be included in statements submitted by or on behalf of a person engaging in the 13 15 U.S.C. 78q–1. approving the proposed rule change, the Commission considered the proposal’s impact on efficiency, competition, and capital formation. 15 U.S.C. 78c(f). 15 17 CFR 200.30–3(a)(12). 14 In VerDate Sep<11>2014 15:50 Jun 08, 2016 Jkt 238001 solicitation. The Notice takes approximately 0.25 hours per response and is filed by approximately 4 respondents for a total of one annual burden hour (0.25 hours per response × 4 response). Written comments are invited on: (a) Whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency’s estimate of the burden imposed by the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. Please direct your written comments to Pamela Dyson, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington, DC 20549 or send an email to: PRA_ Mailbox@sec.gov. Dated: June 3, 2016. Brent J. Fields, Secretary. [FR Doc. 2016–13617 Filed 6–8–16; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE., Washington, DC 20549–2736. Extension: Form S–8; SEC File No. 270–66, OMB Control No. 3235–0066. Notice is hereby given that, pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 37231 Management and Budget for extension and approval. Form S–8 (17 CFR 239.16b) under the Securities Act of 1933 (15 U.S.C. 77a et seq.) is the primary registration statement used by eligible registrants to register securities to be issued in connection with an employee benefit plan. We estimate that Form S–8 takes approximately 24 hours per response to prepare and is filed by approximately 2,140 respondents. In addition, we estimate that 50% of the preparation time (12 hours) is completed in-house by the filer for a total annual reporting burden of 25,680 (12 hours per response × 2,140 responses). Written comments are invited on: (a) Whether this proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency’s estimate of the burden imposed by the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. Please direct your written comments to Pamela Dyson, Director/Chief Information Officer, Securities and Exchange Commission, c/o Remi PavlikSimon, 100 F Street NE., Washington, DC 20549 or send an email to: PRA_ Mailbox@sec.gov. Dated: June 3, 2016. Brent J. Fields, Secretary. [FR Doc. 2016–13616 Filed 6–8–16; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request Copies Available From: Securities and Exchange Commission, Office of FOIA Services, 100 F Street NE., Washington, DC 20549–2736. Extension: Rule 155; SEC File No. 270–492, OMB Control No. 3235–0549. E:\FR\FM\09JNN1.SGM 09JNN1

Agencies

[Federal Register Volume 81, Number 111 (Thursday, June 9, 2016)]
[Notices]
[Pages 37229-37231]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-13613]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-77990; File No. SR-NSCC-2016-001]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Order Approving Proposed Rule Change To Remove From the 
DTCC Limit Monitoring Tool the 50% Early Warning Limit Alert and Make 
Technical Revisions to the Rules

June 3, 2016.
    On April 18, 2016, National Securities Clearing Corporation 
(``NSCC'') filed with the Securities and Exchange Commission 
(``Commission'') proposed rule change SR-NSCC-2016-001 pursuant to 
Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \1\ 
and Rule 19b-4 thereunder,\2\ to amend NSCC's Rules and Procedures 
(``Rules'') \3\ in order to (i) remove from the DTCC Limit Monitoring 
tool the alert that is sent to Members when trading activity in any of 
their Risk Entities reaches 50% of the pre-set trading limits for that 
Risk Entity and (ii) to make related technical changes and corrections 
to the Rules, as more fully described below. The proposed rule change 
was published for comment

[[Page 37230]]

in the Federal Register on May 2, 2016.\4\ The Commission did not 
receive any comment letters on the proposed rule change. For the 
reasons discussed below, the Commission is granting approval of the 
proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Available at https://dtcc.com/~/media/Files/Downloads/legal/
rules/nscc_rules.pdf. Terms not defined herein are defined in the 
Rules.
    \4\ See Securities Exchange Act Release No. 77709 (April 26, 
2016), 81 FR 26274 (May 2, 2016) (SR-NSCC-2016-001).
---------------------------------------------------------------------------

I. Description of the Proposed Rule Change

    The following is a description of the proposed rule change, as 
provided by NSCC:
    Reasons for Adopting the Proposed Rule Change. NSCC provides its 
Members with a risk management tool called DTCC Limit Monitoring, for 
which certain types of Members are required to register.\5\ DTCC Limit 
Monitoring enables Members that use the tool to monitor post-trade 
activity and to be notified when pre-set trading limits are reached. To 
use the tool, Members must (1) define one or more ``Risk Entities,'' 
which may include (i) the trading activity of a single trading desk 
within the firm; (ii) for Members that clear trades for other firms, 
i.e., their correspondents, the trading activity of a correspondent 
firm; (iii) for Members acting as a Special Representative or a QSR, as 
such terms are defined in the Rules,\6\ the trading activity of a firm 
with which it has a clearing relationship; (iv) the trading activity of 
a single clearing number within the Member's NSCC account structure; or 
(v) all trading activity of the Member submitted to NSCC for clearing; 
and (2) set a trading limit, at a net notional value, for each Risk 
Entity. DTCC Limit Monitoring then sets early warning limits at 50%, 
75%, and 90% of those trading limits.\7\ Members receive alerts when 
trading activity for their Risk Entities reaches each of these early 
warning limits, as well as the pre-set trading limits.
---------------------------------------------------------------------------

    \5\ Rule 54 (DTCC Limit Monitoring) and Procedure XVII (DTCC 
Limit Monitoring), supra note 3; see Securities Exchange Act Release 
No. 71637 (February 28, 2014), 79 FR 12708 (March 6, 2014) (SR-NSCC-
2013-12).
    \6\ Rule 7 (Comparison and Trade Recording Operation) and 
Procedure IV (Special Representative Service), supra note 3.
    \7\ Rule 54 (DTCC Limit Monitoring) and Procedure XVII (DTCC 
Limit Monitoring, supra note 3.
---------------------------------------------------------------------------

    Since the implementation of DTCC Limit Monitoring in 2014, NSCC has 
periodically met with a working group of its Members to discuss the 
functioning of the tool and to confirm it provides Members with 
effective post-trade surveillance as intended. In response to Member 
feedback provided during these discussions, NSCC has proposed to remove 
the 50% early warning alert for the reasons described below.
    Additionally, NSCC has proposed to make technical revisions to 
Procedure XVII (DTCC Limit Monitoring Procedure) primarily to revise 
the verb tense and add clarity regarding use of the tool.
    Issues the Proposed Rule Change Is Intended to Address. The 
proposed rule change will address concerns that (1) the 50% early 
warning alert is set too low and, thus, may not provide Members with 
useful information for purposes of effective post-trade monitoring; (2) 
the frequency of the 50% early warning alert could have a negative 
impact on Member responsiveness to more critical alerts; and (3) the 
verb tense and certain other language in the Rule may be unclear and/or 
technically inaccurate.
    Manner in which the Proposed Rule Change Will Operate to Resolve 
the Issues. The proposed rule change will remove the 50% early warning 
alert from DTCC Limit Monitoring. DTCC Limit Monitoring will retain the 
75% and 90% early warning alerts, which continue to provide Members 
with valuable notice of changes in their post-trade activity for 
purposes of effective risk management.
    Additionally, the proposed rule change will make certain technical 
changes that will clarify the Rule, primarily by updating the verb 
tense from future tense to present tense to reflect the present 
applicability of the Rule and by making certain other technical 
clarifications to language used in the Rule.
    Manner in which the Proposed Rule Change Will Affect Various 
Persons. Members that use DTCC Limit Monitoring will no longer receive 
the 50% early warning alert, but they will continue to receive alerts 
when their trading activity in each Risk Entity reaches 75% and 90% of 
their pre-set trading limits. No other changes are proposed with 
respect to the functioning of DTCC Limit Monitoring.
    The proposed technical changes are not anticipated to have any 
effect on Members that use DTCC Limit Monitoring.
    Significant Problems Known to the Self-Regulatory Organization that 
Persons Affected Are Likely to Have in Complying with the Proposed Rule 
Change. Members that use DTCC Limit Monitoring will not have to take 
any action as a result of the proposed rule change, and NSCC is not 
aware of any problems that Members will have in continuing to comply 
with the Rules \8\ that address DTCC Limit Monitoring after the 
implementation of the proposed rule change.
---------------------------------------------------------------------------

    \8\ Id.
---------------------------------------------------------------------------

    As stated above, the proposed technical changes are not anticipated 
to have any effect on Members that use DTCC Limit Monitoring.
    Description of the Proposed Rule Change. In order to implement this 
proposed rule change, NSCC will amend Section 4 of Procedure XVII (DTCC 
Limit Monitoring Procedure) of the Rules to remove reference to the 50% 
early warning alert and to make certain technical clarifications to 
language used in the Rule, primarily by updating the verb tense used 
therein. No other changes to the Rules are contemplated by this 
proposed rule change.

II. Discussion and Commission Findings

    Section 19(b)(2)(C) of the Act \9\ directs the Commission to 
approve a proposed rule change of a self-regulatory organization if it 
finds that such proposed rule change is consistent with the 
requirements of the Act and rules and regulations thereunder applicable 
to such organization. The Commission believes the proposal is 
consistent with Section 17A(b)(3)(F) of the Act,\10\ as described in 
detail below.
---------------------------------------------------------------------------

    \9\ 15 U.S.C. 78s(b)(2)(C).
    \10\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    Section 17A(b)(3)(F) of the Act requires, among other things, that 
the rules of a clearing agency be designed to promote the prompt and 
accurate clearance and settlement of securities transactions and to 
protect investors and the public interest.\11\ As described above, the 
50% early warning alert may not provide Members with information that 
is useful for purposes of post-trade monitoring, but, rather, may 
distract Members from such information. By removing the 50% alert, a 
distraction is removed, thus increasing the effectiveness of the DTCC 
Limit Monitoring tool for Members to monitor their post-trade activity. 
Therefore, the proposed rule change will enhance Members' ability to 
manage risks from their trades, facilitating the protection of 
investors and the public interest from such risks.
---------------------------------------------------------------------------

    \11\ Id.
---------------------------------------------------------------------------

    As the proposed rule change pertains to technical changes to the 
Rules, the Commission finds the technical changes also consistent with 
Section 17A(b)(3)(F) of the Act \12\ because technical updates to the 
Rules to make them more clear, consistent, and current for Members that 
rely on the Rules supports the prompt and accurate

[[Page 37231]]

clearance and settlement of securities transactions.
---------------------------------------------------------------------------

    \12\ Id.
---------------------------------------------------------------------------

III. Conclusion

    On the basis of the foregoing, the Commission finds that the 
proposal is consistent with the requirements of the Act and in 
particular with the requirements of Section 17A of the Act \13\ and the 
rules and regulations thereunder.
---------------------------------------------------------------------------

    \13\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------

    It is therefore ordered, pursuant to Section 19(b)(2) of the Act, 
that proposed rule change SR-NSCC-2016-001 be, and hereby is, 
approved.\14\
---------------------------------------------------------------------------

    \14\ In approving the proposed rule change, the Commission 
considered the proposal's impact on efficiency, competition, and 
capital formation. 15 U.S.C. 78c(f).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\15\
---------------------------------------------------------------------------

    \15\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2016-13613 Filed 6-8-16; 8:45 am]
 BILLING CODE 8011-01-P
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