Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving a Proposed Rule Change To Amend FINRA Rule 6750 Regarding the Publication of Aggregated Transaction Information on U.S. Treasury Securities, 49626-49628 [2022-17225]

Download as PDF 49626 Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices become operative immediately upon filing. The Exchange has indicated that there is a continued need to extend the temporary relief because the Exchange does not believe the COVID–19 related health concerns necessitating this relief will meaningfully subside by July 31, 2022.18 Importantly, extending the temporary relief provided in SR– NASDAQ–2020–076 immediately upon filing and without a 30-day operative delay will allow the Exchange to continue critical adjudicatory and review processes in a reasonable and fair manner and meet its critical investor protection goals, while also following best practices with respect to the health and safety of hearing participants.19 The Commission also notes that this proposal extends without change the temporary relief previously provided by SR–NASDAQ–2020–076.20 As proposed, the temporary changes would be in place through October 31, 2022 and the amended rules will revert back to their original state at the conclusion of the temporary relief period and, if applicable, any extension thereof.21 For these reasons, the Commission believes that waiver of the 30-day operative delay for this proposal is consistent with the protection of investors and the public interest. Accordingly, the Commission hereby waives the 30-day operative delay and designates the proposal operative upon filing.22 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 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 should be approved or disapproved. IV. Solicitation of Comments Interested persons are invited to submit written data, views, and 18 See supra Item II. 87 FR 43335, at 43337–38 (noting the same in granting FINRA’s request to waive the 30-day operative delay so that SR–FINRA–2022–018 would become operative immediately upon filing). 20 See supra note 9. 21 See supra note 4. As noted above, the Exchange states that if it requires temporary relief from the rule requirements identified in this proposal beyond October 31, 2022, it may submit a separate rule filing to extend the effectiveness of the temporary relief under these rules. 22 For purposes only of waiving the 30-day operative delay, the Commission has considered the proposed rule change’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). lotter on DSK11XQN23PROD with NOTICES1 19 See VerDate Sep<11>2014 17:49 Aug 10, 2022 Jkt 256001 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: [FR Doc. 2022–17223 Filed 8–10–22; 8:45 am] Electronic Comments BILLING CODE 8011–01–P • 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– NASDAQ–2022–044 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–NASDAQ–2022–044. 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 to make available publicly. All submissions should refer to File Number SR–NASDAQ–2022–044 and should be submitted on or before September 1, 2022. PO 00000 Frm 00049 Fmt 4703 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.23 J. Matthew DeLesDernier, Deputy Secretary. Sfmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–95438; File No. SR–FINRA– 2022–017] Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving a Proposed Rule Change To Amend FINRA Rule 6750 Regarding the Publication of Aggregated Transaction Information on U.S. Treasury Securities August 5, 2022. I. Introduction On June 23, 2022, the Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) 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 a proposed rule change to amend FINRA Rule 6750 to provide that FINRA may publish or distribute aggregated transaction information and statistics on U.S. Treasury Securities on a more frequent basis. The proposed rule change was published for comment in the Federal Register on July 1, 2022.3 The Commission received one comment letter on the proposed rule change.4 This order approves the proposed rule change. II. Description of the Proposal On March 10, 2020 FINRA began posting on its website weekly, aggregate data on the trading volume of U.S. Treasury Securities 5 reported to the 23 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 See Securities Exchange Act Release No. 95165 (June 27, 2022), 87 FR 39573 (July 1, 2022) (‘‘Notice’’). 4 See Letter from Stephen John Berger, Managing Director, Global Head of Government & Regulatory Policy, Citadel Securities, to Vanessa Countryman, Secretary, Commission (July 21, 2022) (‘‘Citadel Letter’’). Comment letters are available at: https:// www.sec.gov/comments/sr-finra-2022-017/ srfinra2022017.htm. 5 ‘‘U.S. Treasury Security’’ means a security, other than a savings bond, issued by the U.S. Department of the Treasury (‘‘Treasury Department’’) to fund the operations of the federal government or to retire such outstanding securities. The term also includes separate principal and interest components of a U.S. Treasury Security that have been separated 1 15 E:\FR\FM\11AUN1.SGM 11AUN1 Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices lotter on DSK11XQN23PROD with NOTICES1 Trade Reporting And Compliance Engine (TRACE).6 FINRA is proposing to amend paragraph (b) of Supplementary Material .01 to FINRA Rule 6750 to delete the word ‘‘weekly’’ so as to permit more frequent publication of aggregated U.S. Treasury Security transaction information and statistics, such as on a daily basis.7 FINRA states that the more frequent aggregated U.S. Treasury Security data would continue to not identify individual market participants or transactions, and that FINRA would continue to not publish aggregated transaction information and statistics by individual U.S. Treasury Security (except for the category of on-the-run U.S. Treasury Securities because there is only one on-the-run security at a time for each subtype and maturity).8 FINRA also states that the aggregate U.S. Treasury Security data would continue to be provided at no charge (unless FINRA first submits an appropriate rule filing establishing a fee for this data).9 FINRA states that the proposed rule change will become effective on the date of Commission approval.10 pursuant to the Separate Trading of Registered Interest and Principal of Securities (STRIPS) program operated by the Treasury Department. See FINRA Rule 6710(p). 6 See, e.g., Supplementary Material .01(b) to FINRA Rule 6750; FINRA Press Release, FINRA Launches New Data on Treasury Securities Trading Volume, available at https://www.finra.org/mediacenter/newsreleases/2020/finra-launches-new-datatreasury-securities-trading-volume. 7 On July 10, 2017, FINRA members began reporting information on transactions in U.S. Treasury Securities to TRACE. Information reported to TRACE regarding individual transactions in U.S. Treasury Securities is used for regulatory and other official sector purposes and is not published or disseminated. Pursuant to FINRA Rule 6750 (Dissemination of Transaction Information) FINRA may, at its discretion, publish or distribute weekly aggregated transaction information and statistics on U.S. Treasury Securities at no charge (unless FINRA submits a rule filing imposing a fee for such data). FINRA states it has received favorable feedback on the weekly aggregated trading volume data for U.S. Treasury Securities that is currently made available on its website and that, in consultation with the Treasury Department, it now believes it would be appropriate to increase the frequency by which this aggregated data is made available. See Notice, supra note 3, 87 FR at 39573. 8 See Notice, supra note 3, 87 FR at 39573–74. See also Rule 6750.01(b) (providing that aggregated transaction information and statistics on U.S. Treasury Securities will not be published or distributed by individual security (except for aggregated data that includes on-the-run U.S. Treasury Securities that may have had only one onthe-run security during the aggregated period) and will not identify individual market participants or transactions). 9 See Notice, supra note 3, 87 FR at 39574; Supplementary Material .01(b) to FINRA Rule 6750. 10 See id. VerDate Sep<11>2014 17:49 Aug 10, 2022 Jkt 256001 III. Discussion and Commission Findings After careful consideration, the Commission finds that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association.11 In particular, the Commission finds that the proposed rule change is consistent with Section 15A(b)(6) of the Act,12 which requires, among other things, that FINRA rules be designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, and, in general, to protect investors and the public interest. The Commission received one comment letter in response to the proposal.13 This commenter states that dissemination of more frequent aggregated transaction information will facilitate a better and more timely understanding of overall trading activity in U.S. Treasury securities and will improve the efficiency of the U.S. Treasury market.14 The commenter further states that FINRA’s proposal is another positive incremental step in enhancing transparency in the U.S. Treasury market.15 The Commission believes that the proposal will benefit investors and market participants by providing them with timelier insights into activity in the U.S. Treasury Securities markets while maintaining the confidentiality of individual market participants and transactions. The proposal would enable FINRA, in its discretion, to publish or distribute at no charge (unless FINRA submits a rule filing imposing a fee for such data) aggregated transaction information and statistics on TRACEEligible Securities 16 that are U.S. Treasury Securities on a more frequent basis than the weekly cadence provided under the current rule. FINRA represents it has received favorable 11 In approving this proposal, the Commission has considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 12 15 U.S.C. 78o–3(b)(6). 13 See Citadel Letter, supra note 4 at 1. 14 See Citadel Letter, supra note 4 at 1. 15 See Citadel Letter, supra note 4 at 1. 16 ‘‘TRACE-Eligible Security’’ means a debt security that is United States (‘‘U.S.’’) dollardenominated and is: (1) issued by a U.S. or foreign private issuer, and, if a ‘‘restricted security’’ as defined in Securities Act Rule 144(a)(3), sold pursuant to Securities Act Rule 144A; (2) issued or guaranteed by an Agency as defined in FINRA Rule 6710(k) or a Government-Sponsored Enterprise as defined in FINRA Rule 6710(n); or (3) a U.S. Treasury Security as defined in FINRA Rule 6710(p). ‘‘TRACE-Eligible Security’’ does not include a debt security that is issued by a foreign sovereign or a Money Market Instrument as defined in FINRA Rule 6710(o). See FINRA Rule 6710(a). PO 00000 Frm 00050 Fmt 4703 Sfmt 4703 49627 feedback on the weekly aggregated trading volume data for U.S. Treasury Securities that is currently made available on its website and, in that, in consultation with the Treasury Department, FINRA now believes it would be appropriate to increase the frequency within which this aggregated data is made available.17 The Commission believes that the more frequent availability of such aggregated transaction information on U.S. Treasury Securities would provide greater overall transparency into the market for U.S. Treasury Securities. The Commission also believes that the proposal is reasonably designed to preserve the confidentiality of individual market participants and transactions, as aggregated transaction information and statistics on U.S. Treasury Securities would not be published or distributed by individual security (except for aggregated data that includes on-the-run U.S. Treasury Securities that may have had only one on-the-run security during the aggregated period), and would not identify individual market participants or transactions.18 In addition, FINRA represents that the proposed rule change would not impose any additional requirements on firms, because any aggregate statistics that are published or distributed by FINRA pursuant to this rule change would be derived from trade reports already required to be submitted to TRACE.19 Pursuant to Section 19(b)(5) of the Act,20 the Commission consulted with and considered the views of the Treasury Department in determining to approve the proposed rule change. The Treasury Department indicated its support for the proposal.21 Pursuant to Section 19(b)(6) of the Act,22 the 17 See Notice, supra note 3, 87 FR at 39573. Notice, supra note 3, 87 FR at 39573–74; Supplementary Material .01(b) to FINRA Rule 6750. 19 See Notice, supra note 3, 87 FR at 39574. 20 See 15 U.S.C. 78s(b)(5) (providing that the Commission ‘‘shall consult with and consider the views of the Secretary of the Treasury prior to approving a proposed rule filed by a registered securities association that primarily concerns conduct related to transactions in government securities, except where the Commission determines that an emergency exists requiring expeditious or summary action and publishes its reasons therefor’’). 21 See Email from U.S. Treasury Department staff to Justin Pica, Division of Trading and Markets, Commission (August 4, 2022). See also Quarterly Refunding Statement of U.S. Treasury Department Assistant Secretary for Financial Markets Josh Frost (August 3, 2022) (stating that ‘‘Treasury supports [FINRA’s] recent proposed rule change to publish the aggregated U.S. Treasury Security transaction information and statistics on a more frequent basis’’) available at https://home.treasury.gov/news/ press-releases/jy0908. 22 15 U.S.C. 78s(b)(6). 18 See E:\FR\FM\11AUN1.SGM 11AUN1 49628 Federal Register / Vol. 87, No. 154 / Thursday, August 11, 2022 / Notices Commission has considered the sufficiency and appropriateness of existing laws and rules applicable to government securities brokers, government securities dealers, and their associated persons in approving the proposal. The proposal will benefit investors and market participants by promoting greater transparency into the U.S. Treasury Securities market while also maintaining the confidentiality of individual market participants and transactions. IV. Conclusion It is therefore ordered, pursuant to Section 19(b)(2) of the Act,23 that the proposed rule change (SR–FINRA– 2022–017) is approved. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.24 J. Matthew DeLesDernier, Deputy Secretary. [FR Doc. 2022–17225 Filed 8–10–22; 8:45 am] BILLING CODE 8011–01–P 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 consists of amendments to NSCC’s Rules & Procedures (‘‘Rules’’) in order to enhance NSCC’s Automated Customer Account Transfer Service (‘‘ACATS’’), as described in greater detail below.5 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 SECURITIES AND EXCHANGE COMMISSION 1. Purpose [Release No. 34–95437; File No. SR–NSCC– 2022–011] Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Enhance National Securities Clearing Corporation Automated Customer Account Transfer Service lotter on DSK11XQN23PROD with NOTICES1 August 5, 2022. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on July 26, 2022, National Securities Clearing Corporation (‘‘NSCC’’ or ‘‘Corporation’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II and III below, which Items have been prepared by the clearing agency. NSCC filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f)(4) thereunder.4 The Commission is publishing this notice to solicit 23 15 U.S.C. 78s(b)(2). CFR 200.30–3(a)(12). 1 15 U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(4). 24 17 VerDate Sep<11>2014 17:49 Aug 10, 2022 Jkt 256001 The proposed rule change consists of modifications to NSCC’s Rules to expand the ‘‘receiver delete’’ functionality in ACATS to additional products. (i) Background ACATS is a non-guaranteed service provided by NSCC that enables Members to effect transfers of customer accounts among themselves. ACATS complements Financial Industry Regulatory Authority (‘‘FINRA’’) Rule 11870 (‘‘FINRA Rule 11870’’) regarding customer account transfers, which requires FINRA members to use automated clearing agency customer account transfer services and to effect customer account transfers within specified time frames.6 ACATS automates and standardizes procedures for the transfer of assets in a customer account, allowing Members to efficiently and automatically enter, review, and generate instructions to settle customer account transfers. The 5 Terms not defined herein are defined in the Rules, available at https://dtcc.com/∼/media/Files/ Downloads/legal/rules/nscc_rules.pdf. 6 See FINRA Rule 11870, available at https:// www.finra.org/rules-guidance/rulebooks/finrarules/11870. NSCC also permits Qualified Securities Depositories (i.e., The Depository Trust Company (‘‘DTC’’)) to utilize ACATS on behalf of their participants (e.g., DTC member banks) on a voluntary basis. See Section 1 of Rule 50, id. PO 00000 Frm 00051 Fmt 4703 Sfmt 4703 timing and procedures with respect to customer account transfers are intended to be consistent with the timing and processes set forth in FINRA Rule 11870. Pursuant to NSCC Rule 50, an NSCC Member to whom a customer’s account will be transferred (the ‘‘Receiving Member’’) initiates the transfer by submitting a transfer initiation request to NSCC, which contains the customer detail information that the NSCC Member who currently has the account (the ‘‘Delivering Member’’) requires to transfer the account.7 The Delivering Member must either reject the customer account transfer request or submit detailed customer account asset data to NSCC. NSCC then provides a report detailing the customer account asset data to the Receiving Member,8 who has one Business Day after receipt of the report to review the account and: (i) accept all assets; (ii) reject (or ‘‘delete’’) one or more assets, to the extent such a rejection is permitted by the Receiving Member’s Designated Examining Authority (‘‘DEA’’) (i.e., FINRA),9 and allow the transfer of the remaining assets; (iii) request the Delivering Member to make adjustments to the customer account asset list; or (iv) reject the account, to extent such a rejection is permitted by NSCC or the Receiving Member’s DEA.10 Once a customer account has been accepted by the Receiving Member, ACATS facilitates the settlements associated with the account transfer at the appropriate asset settling location (e.g., through the Continuous Net Settlement system (‘‘CNS’’) for CNS-eligible securities, DTC for securities otherwise eligible for DTC settlement services, Fund/SERV for eligible mutual fund products, the Insurance Processing Service (‘‘IPS’’) for annuities, or The Options Clearing Corporation for listed options).11 FINRA Rule 11870 acknowledges that some customer assets may not be transferred within the specified time frames to the extent that those assets are not readily transferable (a ‘‘nontransferable asset’’). For purposes 7 See Section 2 of Rule 50, supra note 5. Section 7 of Rule 50, supra note 5. 9 As discussed in further detail below, NSCC Rule 50 currently limits the type of assets that a Receiving Member may delete from the customer account asset data list in ACATS to MF/I&RS Products. NSCC proposes to expand this functionality to other assets that may be deemed ‘‘nontransferable assets’’ under FINRA Rule 11870. 10 See Section 8 of Rule 50, supra note 5. Pursuant to FINRA Rule 11870(d)(8), a Receiving Member may reject a transfer of account assets in whole if the account is not in compliance with the Receiving Member’s credit policies or minimum asset requirements. See supra note 6. 11 See Section 14 of Rule 50, supra note 5. 8 See E:\FR\FM\11AUN1.SGM 11AUN1

Agencies

[Federal Register Volume 87, Number 154 (Thursday, August 11, 2022)]
[Notices]
[Pages 49626-49628]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17225]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-95438; File No. SR-FINRA-2022-017]


Self-Regulatory Organizations; Financial Industry Regulatory 
Authority, Inc.; Order Approving a Proposed Rule Change To Amend FINRA 
Rule 6750 Regarding the Publication of Aggregated Transaction 
Information on U.S. Treasury Securities

August 5, 2022.

I. Introduction

    On June 23, 2022, the Financial Industry Regulatory Authority, Inc. 
(``FINRA'') 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\ a 
proposed rule change to amend FINRA Rule 6750 to provide that FINRA may 
publish or distribute aggregated transaction information and statistics 
on U.S. Treasury Securities on a more frequent basis. The proposed rule 
change was published for comment in the Federal Register on July 1, 
2022.\3\ The Commission received one comment letter on the proposed 
rule change.\4\ This order approves the proposed rule change.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 95165 (June 27, 
2022), 87 FR 39573 (July 1, 2022) (``Notice'').
    \4\ See Letter from Stephen John Berger, Managing Director, 
Global Head of Government & Regulatory Policy, Citadel Securities, 
to Vanessa Countryman, Secretary, Commission (July 21, 2022) 
(``Citadel Letter''). Comment letters are available at: https://www.sec.gov/comments/sr-finra-2022-017/srfinra2022017.htm.
---------------------------------------------------------------------------

II. Description of the Proposal

    On March 10, 2020 FINRA began posting on its website weekly, 
aggregate data on the trading volume of U.S. Treasury Securities \5\ 
reported to the

[[Page 49627]]

Trade Reporting And Compliance Engine (TRACE).\6\ FINRA is proposing to 
amend paragraph (b) of Supplementary Material .01 to FINRA Rule 6750 to 
delete the word ``weekly'' so as to permit more frequent publication of 
aggregated U.S. Treasury Security transaction information and 
statistics, such as on a daily basis.\7\
---------------------------------------------------------------------------

    \5\ ``U.S. Treasury Security'' means a security, other than a 
savings bond, issued by the U.S. Department of the Treasury 
(``Treasury Department'') to fund the operations of the federal 
government or to retire such outstanding securities. The term also 
includes separate principal and interest components of a U.S. 
Treasury Security that have been separated pursuant to the Separate 
Trading of Registered Interest and Principal of Securities (STRIPS) 
program operated by the Treasury Department. See FINRA Rule 6710(p).
    \6\ See, e.g., Supplementary Material .01(b) to FINRA Rule 6750; 
FINRA Press Release, FINRA Launches New Data on Treasury Securities 
Trading Volume, available at https://www.finra.org/media-center/newsreleases/2020/finra-launches-new-data-treasury-securities-trading-volume.
    \7\ On July 10, 2017, FINRA members began reporting information 
on transactions in U.S. Treasury Securities to TRACE. Information 
reported to TRACE regarding individual transactions in U.S. Treasury 
Securities is used for regulatory and other official sector purposes 
and is not published or disseminated. Pursuant to FINRA Rule 6750 
(Dissemination of Transaction Information) FINRA may, at its 
discretion, publish or distribute weekly aggregated transaction 
information and statistics on U.S. Treasury Securities at no charge 
(unless FINRA submits a rule filing imposing a fee for such data). 
FINRA states it has received favorable feedback on the weekly 
aggregated trading volume data for U.S. Treasury Securities that is 
currently made available on its website and that, in consultation 
with the Treasury Department, it now believes it would be 
appropriate to increase the frequency by which this aggregated data 
is made available. See Notice, supra note 3, 87 FR at 39573.
---------------------------------------------------------------------------

    FINRA states that the more frequent aggregated U.S. Treasury 
Security data would continue to not identify individual market 
participants or transactions, and that FINRA would continue to not 
publish aggregated transaction information and statistics by individual 
U.S. Treasury Security (except for the category of on-the-run U.S. 
Treasury Securities because there is only one on-the-run security at a 
time for each subtype and maturity).\8\ FINRA also states that the 
aggregate U.S. Treasury Security data would continue to be provided at 
no charge (unless FINRA first submits an appropriate rule filing 
establishing a fee for this data).\9\ FINRA states that the proposed 
rule change will become effective on the date of Commission 
approval.\10\
---------------------------------------------------------------------------

    \8\ See Notice, supra note 3, 87 FR at 39573-74. See also Rule 
6750.01(b) (providing that aggregated transaction information and 
statistics on U.S. Treasury Securities will not be published or 
distributed by individual security (except for aggregated data that 
includes on-the-run U.S. Treasury Securities that may have had only 
one on-the-run security during the aggregated period) and will not 
identify individual market participants or transactions).
    \9\ See Notice, supra note 3, 87 FR at 39574; Supplementary 
Material .01(b) to FINRA Rule 6750.
    \10\ See id.
---------------------------------------------------------------------------

III. Discussion and Commission Findings

    After careful consideration, the Commission finds that the proposed 
rule change is consistent with the requirements of the Act and the 
rules and regulations thereunder applicable to a national securities 
association.\11\ In particular, the Commission finds that the proposed 
rule change is consistent with Section 15A(b)(6) of the Act,\12\ which 
requires, among other things, that FINRA rules be designed to prevent 
fraudulent and manipulative acts and practices, to promote just and 
equitable principles of trade, and, in general, to protect investors 
and the public interest.
---------------------------------------------------------------------------

    \11\ In approving this proposal, the Commission has considered 
the proposed rule's impact on efficiency, competition, and capital 
formation. See 15 U.S.C. 78c(f).
    \12\ 15 U.S.C. 78o-3(b)(6).
---------------------------------------------------------------------------

    The Commission received one comment letter in response to the 
proposal.\13\ This commenter states that dissemination of more frequent 
aggregated transaction information will facilitate a better and more 
timely understanding of overall trading activity in U.S. Treasury 
securities and will improve the efficiency of the U.S. Treasury 
market.\14\ The commenter further states that FINRA's proposal is 
another positive incremental step in enhancing transparency in the U.S. 
Treasury market.\15\
---------------------------------------------------------------------------

    \13\ See Citadel Letter, supra note 4 at 1.
    \14\ See Citadel Letter, supra note 4 at 1.
    \15\ See Citadel Letter, supra note 4 at 1.
---------------------------------------------------------------------------

    The Commission believes that the proposal will benefit investors 
and market participants by providing them with timelier insights into 
activity in the U.S. Treasury Securities markets while maintaining the 
confidentiality of individual market participants and transactions. The 
proposal would enable FINRA, in its discretion, to publish or 
distribute at no charge (unless FINRA submits a rule filing imposing a 
fee for such data) aggregated transaction information and statistics on 
TRACE-Eligible Securities \16\ that are U.S. Treasury Securities on a 
more frequent basis than the weekly cadence provided under the current 
rule. FINRA represents it has received favorable feedback on the weekly 
aggregated trading volume data for U.S. Treasury Securities that is 
currently made available on its website and, in that, in consultation 
with the Treasury Department, FINRA now believes it would be 
appropriate to increase the frequency within which this aggregated data 
is made available.\17\ The Commission believes that the more frequent 
availability of such aggregated transaction information on U.S. 
Treasury Securities would provide greater overall transparency into the 
market for U.S. Treasury Securities.
---------------------------------------------------------------------------

    \16\ ``TRACE-Eligible Security'' means a debt security that is 
United States (``U.S.'') dollar-denominated and is: (1) issued by a 
U.S. or foreign private issuer, and, if a ``restricted security'' as 
defined in Securities Act Rule 144(a)(3), sold pursuant to 
Securities Act Rule 144A; (2) issued or guaranteed by an Agency as 
defined in FINRA Rule 6710(k) or a Government-Sponsored Enterprise 
as defined in FINRA Rule 6710(n); or (3) a U.S. Treasury Security as 
defined in FINRA Rule 6710(p). ``TRACE-Eligible Security'' does not 
include a debt security that is issued by a foreign sovereign or a 
Money Market Instrument as defined in FINRA Rule 6710(o). See FINRA 
Rule 6710(a).
    \17\ See Notice, supra note 3, 87 FR at 39573.
---------------------------------------------------------------------------

    The Commission also believes that the proposal is reasonably 
designed to preserve the confidentiality of individual market 
participants and transactions, as aggregated transaction information 
and statistics on U.S. Treasury Securities would not be published or 
distributed by individual security (except for aggregated data that 
includes on-the-run U.S. Treasury Securities that may have had only one 
on-the-run security during the aggregated period), and would not 
identify individual market participants or transactions.\18\ In 
addition, FINRA represents that the proposed rule change would not 
impose any additional requirements on firms, because any aggregate 
statistics that are published or distributed by FINRA pursuant to this 
rule change would be derived from trade reports already required to be 
submitted to TRACE.\19\
---------------------------------------------------------------------------

    \18\ See Notice, supra note 3, 87 FR at 39573-74; Supplementary 
Material .01(b) to FINRA Rule 6750.
    \19\ See Notice, supra note 3, 87 FR at 39574.
---------------------------------------------------------------------------

    Pursuant to Section 19(b)(5) of the Act,\20\ the Commission 
consulted with and considered the views of the Treasury Department in 
determining to approve the proposed rule change. The Treasury 
Department indicated its support for the proposal.\21\ Pursuant to 
Section 19(b)(6) of the Act,\22\ the

[[Page 49628]]

Commission has considered the sufficiency and appropriateness of 
existing laws and rules applicable to government securities brokers, 
government securities dealers, and their associated persons in 
approving the proposal.
---------------------------------------------------------------------------

    \20\ See 15 U.S.C. 78s(b)(5) (providing that the Commission 
``shall consult with and consider the views of the Secretary of the 
Treasury prior to approving a proposed rule filed by a registered 
securities association that primarily concerns conduct related to 
transactions in government securities, except where the Commission 
determines that an emergency exists requiring expeditious or summary 
action and publishes its reasons therefor'').
    \21\ See Email from U.S. Treasury Department staff to Justin 
Pica, Division of Trading and Markets, Commission (August 4, 2022). 
See also Quarterly Refunding Statement of U.S. Treasury Department 
Assistant Secretary for Financial Markets Josh Frost (August 3, 
2022) (stating that ``Treasury supports [FINRA's] recent proposed 
rule change to publish the aggregated U.S. Treasury Security 
transaction information and statistics on a more frequent basis'') 
available at https://home.treasury.gov/news/press-releases/jy0908.
    \22\ 15 U.S.C. 78s(b)(6).
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    The proposal will benefit investors and market participants by 
promoting greater transparency into the U.S. Treasury Securities market 
while also maintaining the confidentiality of individual market 
participants and transactions.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\23\ that the proposed rule change (SR-FINRA-2022-017) is approved.
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    \23\ 15 U.S.C. 78s(b)(2).
    \24\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\24\
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2022-17225 Filed 8-10-22; 8:45 am]
BILLING CODE 8011-01-P
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