Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the DTC Operational Arrangements To Add Clarifying Text Relating to the Processing of Unit Investment Trust Securities Through the DTC Investor's Voluntary Redemptions and Sales Service, 30806-30808 [2018-13980]

Download as PDF 30806 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Notices 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. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule change should be approved or disapproved. to make available publicly. All submissions should refer to File Number SR–GEMX–2018–22, and should be submitted on or before July 20, 2018. requirements for Securities issued by unit investment trusts (‘‘Units’’) to be processed through DTC’s Investor’s Voluntary Redemptions and Sales Service (‘‘IVORS’’), as described below. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.12 Eduardo A. Aleman Assistant Secretary. 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. [FR Doc. 2018–13986 Filed 6–28–18; 8:45 am] 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– GEMX–2018–22 on the subject line. sradovich on DSK3GMQ082PROD with NOTICES 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: Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the DTC Operational Arrangements To Add Clarifying Text Relating to the Processing of Unit Investment Trust Securities Through the DTC Investor’s Voluntary Redemptions and Sales Service 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–GEMX–2018–22. 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 (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 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 the Exchange. 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 VerDate Sep<11>2014 17:58 Jun 28, 2018 Jkt 244001 BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–83511; File No. SR–DTC– 2018–005] June 25, 2018. 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 June 20, 2018, The Depository Trust Company (‘‘DTC’’) 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. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule Change The proposed rule change 3 consists of proposed modifications to the DTC Operational Arrangements (Necessary for Securities to Become and Remain Eligible for DTC Services) (‘‘OA’’) 4 to provide enhanced transparency within DTC’s Procedures 5 relating to 12 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 Each capitalized term not otherwise defined herein has its respective meaning as set forth in the Rules, By-Laws and Organization Certificate of The Depository Trust Company (‘‘Rules’’), available at https://www.dtcc.com/∼/media/Files/Downloads/ legal/rules/dtc_rules.pdf. 4 Available at https://www.dtcc.com/∼/media/ Files/Downloads/legal/issue-eligibility/eligibility/ operational-arrangements.pdf. 5 Pursuant to the Rules, the term ‘‘Procedures’’ means the Procedures, service guides, and 1 15 PO 00000 Frm 00124 Fmt 4703 Sfmt 4703 (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The proposed rule change consists of proposed modifications to the OA to provide enhanced transparency within the DTC Procedures relating to DTC’s requirements for Units to be processed through IVORS, as discussed below. Background A unit investment trust is an investment company that buys and holds a generally fixed portfolio of stocks, bonds or other securities for a fixed period of time. Units are sold by a sponsor, which is the issuer of the Units, to investors who receive a share of principal and dividends, or interest. When Units mature, an investor may redeem matured Units with the transfer agent for the Units, or sell Units to the sponsor for a cash payment (such redemptions and sales jointly referred to herein as ‘‘Redemptions’’).6 The sponsor may also allow a holder of maturing Units to ‘‘rollover’’ the Units by redeeming the maturing Units for a comparable issue of Units (‘‘Rollover’’). Units that meet DTC’s eligibility requirements 7 may be Deposited for book-entry services at DTC and be held by Participants on behalf of investors. Redemptions and Rollovers of Units held at DTC must be processed through IVORS.8 IVORS allows a Participant to regulations of DTC adopted pursuant to Rule 27, as amended from time to time. See Rule 1, Section 1, supra note 3, at 13. 6 See Securities Exchange Act Release No. 39852 (April 10, 1998), 63 FR 19545 (April 20, 1998) (‘‘1998 Release’’). 7 See OA, supra note 4 at 1–3 (setting forth requirements for Securities to be made eligible for DTC book-entry services). 8 See OA, supra note 4 at 43–44. E:\FR\FM\29JNN1.SGM 29JNN1 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Notices sradovich on DSK3GMQ082PROD with NOTICES surrender Units for value via bookentry, which Units are processed in accordance with standing instructions (‘‘Standing Instructions’’) provided by the sponsor or transfer agent for the Units through DTC’s Participant Terminal System (‘‘PTS’’),9 an electronic interface that allows Participants to submit instructions to DTC and make inquiries in DTC’s system. The transfer agent and the sponsor must each maintain a DTC Participant Account in order to facilitate the settlement of Redemptions.10 In this regard, and as approved in the 1998 Release, in order to be eligible for processing through IVORS, (i) Units must be DTC-eligible and held in DTC’s FAST program,11 (ii) the transfer agent, which is the Fast Agent for the Units, must be a DTC Participant and (iii) the sponsor, or the sponsor’s clearing agent, i.e., a Participant that acts on the sponsor’s behalf with respect to the settlement of transactions in Units issued by the sponsor, must be a DTC Participant (‘‘IVORS Eligibility Requirements’’).12 As indicated above, the OA currently states the requirement that IVORS must be used for the processing of Redemptions and Rollovers for Units held at DTC. The applicable OA text does not include references to requirements relating to IVORS processing that were approved in the 1998 and 2004 Releases, in particular: (i) The use of Standing Instructions by a sponsor and/or FAST Agent 13 and (ii) the IVORS Eligibility Requirements.14 Pursuant to this rule filing, in order to provide enhanced transparency within the OA to users of DTC services with regard to the use of IVORS for the processing of Redemptions and Rollovers, DTC proposes to amend the OA to include text stating these requirements. In addition, currently existing text in the OA relating to the processing of Units uses the term ‘‘UIT’’ interchangeably to describe both a unit investment trust and Units. In order to further enhance the transparency of the text of the Subject Section, as defined below, to more clearly distinguish between unit investment trusts and the 9 See 1998 Release, supra note 6, and Securities Exchange Act Release No. 50279 (August 27, 2004), 69 FR 54169 (‘‘2004 Release’’). 10 See id. 11 DTC’s FAST program allows a transfer agent which is approved by DTC to be a ‘‘FAST Agent’’ to act as custodian for DTC and increase or decrease the amounts of a balance certificate representing Securities eligible for DTC book-entry services. See OA, supra note 4 at 15. 12 See 1998 Release, supra note 6. 13 See supra note 9. 14 See supra note 12. VerDate Sep<11>2014 17:58 Jun 28, 2018 Jkt 244001 securities issued by them, DTC would revise the applicable OA text to define Securities issued by unit investment trusts as ‘‘Units.’’ The text would continue to refer to unit investment trusts as UITs. Proposed Changes to the OA Pursuant to the proposed rule change, DTC would amend the OA to revise Section VI.C.1.a. (Use of DTC’s Investor’s Voluntary Redemptions and Sales to sponsor) (‘‘Subject Section’’), relating to Redemption and Rollover processing through IVORS, to add text stating (i) the IVORS Eligibility Requirements and (ii) a provision relating to the processing of Redemptions and Rollovers in accordance with Standing Instructions provided by the sponsor or FAST Agent for the Units, as described above. Specifically, the proposed rule change would add the following within the existing text of that section as it relates to the description of Redemption and Rollover activities: ‘‘IVORS will only be available for these activities if (1) the subject Unit is DTC-eligible, (2) the subject Unit is held through the FAST program, (3) the FAST Agent for the Unit is a Participant of DTC, and (4) the Unit’s lead sponsor or its clearing agent is a Participant. Redemptions and rollovers are processed in accordance with standing instructions provided by the FAST Agent and/or sponsor of the Unit through PTS.’’ In addition, DTC would revise the text of the Subject Section to define Securities issued by unit investment trusts (i.e., Units, as defined above) as ‘‘Units,’’ as described above. Effective Date The proposed rule change would become effective upon filing with the Commission. 2. Statutory Basis Section 17A(b)(3)(F) of the Securities Exchange Act of 1934 (‘‘Act’’) 15 requires that the rules of the clearing agency be designed, inter alia, to promote the prompt and accurate clearance and settlement of securities transactions. DTC believes that the proposed rule change is consistent with this provision of the Act because by adding text within the Procedures set forth in the OA regarding DTC’s requirements for the processing of Redemptions and Rollovers of Units through IVORS and more clearly distinguishing in the text of the Subject Section between unit investment trusts and Units, the proposed rule change would provide enhanced transparency for Participants with respect to the Procedures relating to such processing, including better facilitating Participants’ understanding of the requirements relating to the processing of Units held by them at DTC. Therefore, by providing Participants with enhanced transparency with regard to the Procedures relating to the processing of Redemptions and Rollovers of Units through IVORS, and therefore facilitating Participants ability to understand the requirements relating to the processing of Units held by them at DTC, DTC believes that the proposed rule change would promote the prompt and accurate clearance and settlement of securities transactions consistent with the Act. (B) Clearing Agency’s Statement on Burden on Competition DTC does not believe that the proposed rule change would have any impact on competition. The proposed rule change would merely provide enhanced transparency with respect to existing Procedures relating to the processing of Redemptions and Rollovers through IVORS by adding text to the OA that is consistent with requirements previously approved by the Commission.16 Therefore, the proposed rule change would not affect the rights or obligations of Participants, and as such, would not impact competition. (C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others Written comments relating to this proposed rule change have not been solicited or received. DTC will notify the Commission of any written comments received by DTC. 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 17 and paragraph (f) of Rule 19b–4 thereunder.18 At any time within 60 days of the filing of the proposed rule 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 16 See supra note 9. U.S.C. 78s(b)(3)(A). 18 17 CFR 240.19b–4(f). 17 15 15 15 PO 00000 U.S.C. 78q–1(b)(3)(F). Frm 00125 Fmt 4703 Sfmt 4703 30807 E:\FR\FM\29JNN1.SGM 29JNN1 30808 Federal Register / Vol. 83, No. 126 / Friday, June 29, 2018 / Notices investors, or otherwise in furtherance of the purposes of the Act. 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 (https://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– DTC–2018–005 on the subject line. Paper Comments sradovich on DSK3GMQ082PROD with NOTICES • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549. All submissions should refer to File Number SR–DTC–2018–005. 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 (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 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 DTCC’s website (https://dtcc.com/legal/sec-rulefilings.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– 2018–005 and should be submitted on or before July 20, 2018. VerDate Sep<11>2014 17:58 Jun 28, 2018 Jkt 244001 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2018–13980 Filed 6–28–18; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–83507; File No. SR– NYSEAMER–2018–33] Self-Regulatory Organizations; NYSE American LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Commentary .02 to Rule 960NY in Order To Extend the Penny Pilot in Options Classes in Certain Issues Through December 31, 2018 June 25, 2018. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (the ‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that on June 21, 2018, NYSE American LLC (the ‘‘Exchange’’ or ‘‘NYSE American’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I and II below, which Items have been prepared by the self-regulatory organization. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Commentary .02 to Rule 960NY in order to extend the Penny Pilot in options classes in certain issues (‘‘Pilot Program’’) previously approved by the Securities and Exchange Commission (‘‘Commission’’) through December 31, 2018. The Pilot Program is currently scheduled to expire on June 30, 2018. The proposed rule change is available on the Exchange’s website at www.nyse.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the self-regulatory organization included 19 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 15 U.S.C. 78a. 3 17 CFR 240.19b–4. 1 15 PO 00000 Frm 00126 Fmt 4703 Sfmt 4703 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 those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange hereby proposes to amend Commentary .02 to Rule 960NY to extend the time period of the Pilot Program,4 which is currently scheduled to expire on June 30, 2018, through December 31, 2018. The Exchange also proposes that the date to replace issues in the Pilot Program that have been delisted be revised to the second trading day following July 1, 2018.5 The Exchange believes that extending the Pilot would allow for further analysis of the Pilot Program and a determination of how the Pilot Program should be structured in the future. This filing does not propose any substantive changes to the Pilot Program: All classes currently participating will remain the same and all minimum increments will remain unchanged. The Exchange believes the benefits to public customers and other market participants who will be able to express their true prices to buy and sell options have been demonstrated to outweigh the increase in quote traffic. 2. Statutory Basis The proposed rule change is consistent with Section 6(b) 6 of the Securities Exchange Act of 1934 (the ‘‘Act’’), in general, and furthers the objectives of Section 6(b)(5),7 in particular, in that it is designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to foster cooperation and coordination with 4 See Securities Exchange Act Release No. 82358 (December 19, 2017), 82 FR 61054 (December 26, 2017) (SR–NYSEAMER–2017–38). 5 The month immediately preceding a replacement class’s addition to the Pilot Program (i.e., June) would not be used for purposes of the analysis for determining the replacement class. Thus, a replacement class to be added on the second trading day following July 1, 2018 would be identified based on The Option Clearing Corporation’s trading volume data from December 1, 2017 through May 31, 2018. The Exchange will announce the replacement issues to the Exchange’s membership through a Trader Update. 6 15 U.S.C. 78f(b). 7 15 U.S.C. 78f(b)(5). E:\FR\FM\29JNN1.SGM 29JNN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 83, Number 126 (Friday, June 29, 2018)]
[Notices]
[Pages 30806-30808]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-13980]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-83511; File No. SR-DTC-2018-005]


Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Amend the DTC Operational Arrangements To Add Clarifying Text Relating 
to the Processing of Unit Investment Trust Securities Through the DTC 
Investor's Voluntary Redemptions and Sales Service

June 25, 2018.
    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 June 20, 2018, The Depository Trust Company (``DTC'') 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. The Commission is publishing this 
notice to solicit comments on the proposed rule change from interested 
persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    The proposed rule change \3\ consists of proposed modifications to 
the DTC Operational Arrangements (Necessary for Securities to Become 
and Remain Eligible for DTC Services) (``OA'') \4\ to provide enhanced 
transparency within DTC's Procedures \5\ relating to requirements for 
Securities issued by unit investment trusts (``Units'') to be processed 
through DTC's Investor's Voluntary Redemptions and Sales Service 
(``IVORS''), as described below.
---------------------------------------------------------------------------

    \3\ Each capitalized term not otherwise defined herein has its 
respective meaning as set forth in the Rules, By-Laws and 
Organization Certificate of The Depository Trust Company 
(``Rules''), available at https://www.dtcc.com/~/media/Files/
Downloads/legal/rules/dtc_rules.pdf.
    \4\ Available at https://www.dtcc.com/~/media/Files/Downloads/
legal/issue-eligibility/eligibility/operational-arrangements.pdf.
    \5\ Pursuant to the Rules, the term ``Procedures'' means the 
Procedures, service guides, and regulations of DTC adopted pursuant 
to Rule 27, as amended from time to time. See Rule 1, Section 1, 
supra note 3, at 13.
---------------------------------------------------------------------------

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
    The proposed rule change consists of proposed modifications to the 
OA to provide enhanced transparency within the DTC Procedures relating 
to DTC's requirements for Units to be processed through IVORS, as 
discussed below.
Background
    A unit investment trust is an investment company that buys and 
holds a generally fixed portfolio of stocks, bonds or other securities 
for a fixed period of time. Units are sold by a sponsor, which is the 
issuer of the Units, to investors who receive a share of principal and 
dividends, or interest. When Units mature, an investor may redeem 
matured Units with the transfer agent for the Units, or sell Units to 
the sponsor for a cash payment (such redemptions and sales jointly 
referred to herein as ``Redemptions'').\6\ The sponsor may also allow a 
holder of maturing Units to ``rollover'' the Units by redeeming the 
maturing Units for a comparable issue of Units (``Rollover'').
---------------------------------------------------------------------------

    \6\ See Securities Exchange Act Release No. 39852 (April 10, 
1998), 63 FR 19545 (April 20, 1998) (``1998 Release'').
---------------------------------------------------------------------------

    Units that meet DTC's eligibility requirements \7\ may be Deposited 
for book-entry services at DTC and be held by Participants on behalf of 
investors. Redemptions and Rollovers of Units held at DTC must be 
processed through IVORS.\8\ IVORS allows a Participant to

[[Page 30807]]

surrender Units for value via book-entry, which Units are processed in 
accordance with standing instructions (``Standing Instructions'') 
provided by the sponsor or transfer agent for the Units through DTC's 
Participant Terminal System (``PTS''),\9\ an electronic interface that 
allows Participants to submit instructions to DTC and make inquiries in 
DTC's system. The transfer agent and the sponsor must each maintain a 
DTC Participant Account in order to facilitate the settlement of 
Redemptions.\10\
---------------------------------------------------------------------------

    \7\ See OA, supra note 4 at 1-3 (setting forth requirements for 
Securities to be made eligible for DTC book-entry services).
    \8\ See OA, supra note 4 at 43-44.
    \9\ See 1998 Release, supra note 6, and Securities Exchange Act 
Release No. 50279 (August 27, 2004), 69 FR 54169 (``2004 Release'').
    \10\ See id.
---------------------------------------------------------------------------

    In this regard, and as approved in the 1998 Release, in order to be 
eligible for processing through IVORS, (i) Units must be DTC-eligible 
and held in DTC's FAST program,\11\ (ii) the transfer agent, which is 
the Fast Agent for the Units, must be a DTC Participant and (iii) the 
sponsor, or the sponsor's clearing agent, i.e., a Participant that acts 
on the sponsor's behalf with respect to the settlement of transactions 
in Units issued by the sponsor, must be a DTC Participant (``IVORS 
Eligibility Requirements'').\12\
---------------------------------------------------------------------------

    \11\ DTC's FAST program allows a transfer agent which is 
approved by DTC to be a ``FAST Agent'' to act as custodian for DTC 
and increase or decrease the amounts of a balance certificate 
representing Securities eligible for DTC book-entry services. See 
OA, supra note 4 at 15.
    \12\ See 1998 Release, supra note 6.
---------------------------------------------------------------------------

    As indicated above, the OA currently states the requirement that 
IVORS must be used for the processing of Redemptions and Rollovers for 
Units held at DTC. The applicable OA text does not include references 
to requirements relating to IVORS processing that were approved in the 
1998 and 2004 Releases, in particular: (i) The use of Standing 
Instructions by a sponsor and/or FAST Agent \13\ and (ii) the IVORS 
Eligibility Requirements.\14\ Pursuant to this rule filing, in order to 
provide enhanced transparency within the OA to users of DTC services 
with regard to the use of IVORS for the processing of Redemptions and 
Rollovers, DTC proposes to amend the OA to include text stating these 
requirements.
---------------------------------------------------------------------------

    \13\ See supra note 9.
    \14\ See supra note 12.
---------------------------------------------------------------------------

    In addition, currently existing text in the OA relating to the 
processing of Units uses the term ``UIT'' interchangeably to describe 
both a unit investment trust and Units. In order to further enhance the 
transparency of the text of the Subject Section, as defined below, to 
more clearly distinguish between unit investment trusts and the 
securities issued by them, DTC would revise the applicable OA text to 
define Securities issued by unit investment trusts as ``Units.'' The 
text would continue to refer to unit investment trusts as UITs.
Proposed Changes to the OA
    Pursuant to the proposed rule change, DTC would amend the OA to 
revise Section VI.C.1.a. (Use of DTC's Investor's Voluntary Redemptions 
and Sales to sponsor) (``Subject Section''), relating to Redemption and 
Rollover processing through IVORS, to add text stating (i) the IVORS 
Eligibility Requirements and (ii) a provision relating to the 
processing of Redemptions and Rollovers in accordance with Standing 
Instructions provided by the sponsor or FAST Agent for the Units, as 
described above. Specifically, the proposed rule change would add the 
following within the existing text of that section as it relates to the 
description of Redemption and Rollover activities:
    ``IVORS will only be available for these activities if (1) the 
subject Unit is DTC-eligible, (2) the subject Unit is held through the 
FAST program, (3) the FAST Agent for the Unit is a Participant of DTC, 
and (4) the Unit's lead sponsor or its clearing agent is a Participant. 
Redemptions and rollovers are processed in accordance with standing 
instructions provided by the FAST Agent and/or sponsor of the Unit 
through PTS.''
    In addition, DTC would revise the text of the Subject Section to 
define Securities issued by unit investment trusts (i.e., Units, as 
defined above) as ``Units,'' as described above.
Effective Date
    The proposed rule change would become effective upon filing with 
the Commission.
2. Statutory Basis
    Section 17A(b)(3)(F) of the Securities Exchange Act of 1934 
(``Act'') \15\ requires that the rules of the clearing agency be 
designed, inter alia, to promote the prompt and accurate clearance and 
settlement of securities transactions. DTC believes that the proposed 
rule change is consistent with this provision of the Act because by 
adding text within the Procedures set forth in the OA regarding DTC's 
requirements for the processing of Redemptions and Rollovers of Units 
through IVORS and more clearly distinguishing in the text of the 
Subject Section between unit investment trusts and Units, the proposed 
rule change would provide enhanced transparency for Participants with 
respect to the Procedures relating to such processing, including better 
facilitating Participants' understanding of the requirements relating 
to the processing of Units held by them at DTC. Therefore, by providing 
Participants with enhanced transparency with regard to the Procedures 
relating to the processing of Redemptions and Rollovers of Units 
through IVORS, and therefore facilitating Participants ability to 
understand the requirements relating to the processing of Units held by 
them at DTC, DTC believes that the proposed rule change would promote 
the prompt and accurate clearance and settlement of securities 
transactions consistent with the Act.
---------------------------------------------------------------------------

    \15\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

(B) Clearing Agency's Statement on Burden on Competition

    DTC does not believe that the proposed rule change would have any 
impact on competition. The proposed rule change would merely provide 
enhanced transparency with respect to existing Procedures relating to 
the processing of Redemptions and Rollovers through IVORS by adding 
text to the OA that is consistent with requirements previously approved 
by the Commission.\16\ Therefore, the proposed rule change would not 
affect the rights or obligations of Participants, and as such, would 
not impact competition.
---------------------------------------------------------------------------

    \16\ See supra note 9.
---------------------------------------------------------------------------

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

    Written comments relating to this proposed rule change have not 
been solicited or received. DTC will notify the Commission of any 
written comments received by DTC.

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 \17\ and paragraph (f) of Rule 19b-4 
thereunder.\18\ At any time within 60 days of the filing of the 
proposed rule 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

[[Page 30808]]

investors, or otherwise in furtherance of the purposes of the Act.
---------------------------------------------------------------------------

    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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 (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-DTC-2018-005 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE, Washington, DC 20549.

All submissions should refer to File Number SR-DTC-2018-005. 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 (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 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 DTCC's website 
(https://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-2018-005 and should be submitted on 
or before July 20, 2018.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\19\
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    \19\ 17 CFR 200.30-3(a)(12).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-13980 Filed 6-28-18; 8:45 am]
 BILLING CODE 8011-01-P

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