Joint Industry Plan; Notice of Filing of Amendment to the National Market System Plan Governing the Consolidated Audit Trail, 58012-58017 [2023-18188]

Download as PDF 58012 Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices 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 such proposed rule change, or (B) institute proceedings to determine whether the proposed rule change should be disapproved. 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– FICC–2023–012 on the subject line. lotter on DSK11XQN23PROD with NOTICES1 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–FICC–2023–012. 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 VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 inspection and copying at the principal office of FICC and on DTCC’s website (dtcc.com/legal/sec-rule-filings). Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to File Number SR–FICC–2023–012 and should be submitted on or before September 14, 2023. Commission (‘‘SEC’’ or ‘‘Commission’’) pursuant to section 11A(a)(3) of the Securities Exchange Act of 1934 (‘‘Exchange Act’’),2 and Rule 608 thereunder,3 a proposed amendment to the CAT NMS Plan to modify the current linkage timeline (‘‘Current Linkage Timeline’’) for the consolidated audit trail (‘‘CAT’’), as contained in Appendix A, attached hereto (‘‘Revised Linkage Timeline’’). The Commission is publishing this notice to solicit comments from interested persons on the amendment.4 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.45 Sherry R. Haywood, Assistant Secretary. II. Description of the Plan [FR Doc. 2023–18187 Filed 8–23–23; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–98165; File No. 4–698] Joint Industry Plan; Notice of Filing of Amendment to the National Market System Plan Governing the Consolidated Audit Trail August 18, 2023. I. Introduction On August 2, 2023, the Operating Committee for Consolidated Audit Trail, LLC (‘‘CAT LLC’’), on behalf of the following parties to the National Market System Plan Governing the Consolidated Audit Trail (the ‘‘CAT NMS Plan’’ or ‘‘Plan’’):1 BOX Exchange LLC, Cboe BYX Exchange, Inc., Cboe BZX Exchange, Inc., Cboe EDGA Exchange, Inc., Cboe EDGX Exchange, Inc., Cboe C2 Exchange, Inc., Cboe Exchange, Inc., Financial Industry Regulatory Authority, Inc., Investors Exchange LLC, Long-Term Stock Exchange, Inc., MEMX LLC, Miami International Securities Exchange LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq BX, Inc., Nasdaq GEMX, LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq PHLX LLC, The NASDAQ Stock Market LLC, New York Stock Exchange LLC, NYSE American LLC, NYSE Arca, Inc., NYSE Chicago, Inc. and NYSE National, Inc. (collectively, the ‘‘Participants’’ or ‘‘SROs’’) filed with the Securities and Exchange 45 17 CFR 200.30–3(a)(12). CAT NMS Plan is a national market system plan approved by the Commission pursuant to section 11A of the Exchange Act and the rules and regulations thereunder. See Securities Exchange Act Release No. 79318 (Nov. 15, 2016), 81 FR 84696 (Nov. 23, 2016) (‘‘Order Approving CAT NMS Plan’’). 1 The PO 00000 Frm 00090 Fmt 4703 Sfmt 4703 Set forth in this Section II is the statement of the purpose and summary of the amendment, along with information required by Rule 608(a)(4) and (5) under the Exchange Act,5 as prepared and submitted by the Participants to the Commission and reproduced below verbatim.6 A. Description of the Proposed Amendments to the CAT NMS Plan 1. Current Linkage Timeline The CAT NMS Plan requires that all CAT Data reported to the Central Repository must be processed and assembled to create the complete lifecycle of each Reportable Event.7 The Plan Processor uses a daisy chain approach to link and create the order lifecycles. In the daisy chain approach, a series of unique order identifiers, assigned to all order events handled by CAT Reporters, are linked together by the Central Repository and assigned a single CAT-generated CAT Order ID that is associated with each individual order event and used to create the complete lifecycle of an order.8 Under the Current Linkage Timeline, the CAT provides a final CAT Order ID at T+5 at 8 a.m. ET pursuant to the following timeline: T+1 @8 a.m.: Initial submissions due T+1 @12 p.m.: Initial data validation, communication of errors to CAT Reporters; unlinked data available to regulators T+1 @9 p.m.: Interim CAT Order ID available 9 T+3 @8 a.m.: Resubmission of corrected data 2 15 U.S.C 78k–1(a)(3). CFR 242.608. 4 17 CFR 242.608. 5 See 17 CFR 242.608(a)(4) and (a)(5). 6 See supra note 4. Unless otherwise defined herein, capitalized terms used herein are defined as set forth in the CAT NMS Plan. 7 Section 3 of Appendix D of the CAT NMS Plan at D–7. 8 Section 3 of Appendix D of the CAT NMS Plan at D–8. 9 See supra nn.5–6. 3 17 E:\FR\FM\24AUN1.SGM 24AUN1 Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices T+4 @8 a.m.: Final lifecycle assembly begins, reprocessing of late submissions and corrections T+5 @8 a.m.: Corrected data available to Participant regulatory staff and the SEC 2. Revised Linkage Timeline With the Revised Linkage Timeline, the Participants propose to clarify that the Plan does not require assignment of interim CAT Order IDs and to provide a final CAT Order ID by T+3 at 8 a.m. ET, as opposed to T+5 at 8 a.m. ET. With this proposal, the linkage timeline would be revised to operate as follows: T+1 @8 a.m.: Initial submissions due T+1 @12 p.m.: Initial data validation, communication of errors to CAT Reporters; unlinked data available to regulators T+2 @8 a.m.: Final lifecycle assembly begins, reprocessing of late submissions and corrections submitted prior to T+2 at 8am T+3 @8 a.m.: Corrected data available to Participant regulatory staff and the SEC, resubmission of corrected data Weekend: Late submissions and corrections submitted after T+2 at 8 a.m. through T+4 at 8 a.m. would be processed over the weekend using the late-to-lifecycle approach discussed below 10 lotter on DSK11XQN23PROD with NOTICES1 3. Effect of Revised Linkage Timeline on CAT Data Processing and Availability The Revised Linkage Timeline would continue to provide regulators with timely access to CAT Data. The following compares the processing and availability of the CAT Data under the Current Linkage Timeline versus the Revised Linkage Timeline in detail.11 a. No Changes to Submission Deadlines for CAT Reporters The Revised Linkage Timeline will not change the reporting deadlines for CAT Reporters. The deadlines for initial data submissions and for error corrections will remain the same. The CAT NMS Plan requires CAT Reporters to submit the required CAT Data to the CAT by 8:00 a.m. on T+1. The Revised Linkage Timeline does not change this reporting deadline. For example, Section 6.3(b)(ii) of the CAT NMS Plan states that ‘‘[e]ach Participant shall report Participant Data to the Central Repository by 8:00 a.m. Eastern Time on the Trading Day following the 10 This change would not impact how late submissions and corrections received outside of the current T+5 processing window are addressed. 11 The Revised Linkage Timeline only addresses the processing timeline for Reportable Events; it does not propose any changes with regard to the Customer and account information in the CAT. VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 day the Participant records such Participant Data.’’ Similarly, Section 6.3(b)(ii) of the CAT NMS Plan states that: Consistent with Appendix D, Reporting and Linkage Requirements, each Participant shall, through its Compliance Rule, require its Industry Members to report: (A) Recorded Industry Member Data to the Central Repository by 8:00 a.m. Eastern Time on the Trading Day following the day the Industry Member records such Recorded Industry Member Data; and (B) Received Industry Member Data to the Central Repository by 8:00 a.m. Eastern Time on the Trading Day following the day the Industry Member receives such Received Industry Member Data. The CAT NMS Plan also requires Participants and Industry Members to submit corrected Participant Data and Industry Member Data, respectively, to the Central Repository by 8:00 a.m. Eastern Time on T+3.12 The Revised Linkage Timeline also does not change this reporting deadline. b. Earlier Access to Final CAT Order ID Under the Revised Linkage Timeline, regulators would have access to the Final CAT Order ID and the finalized data set two full days earlier than under the Current Linkage Timeline. Regulators would have access to the final CAT Order ID on T+3 at 8 a.m., rather than on T+5 at 8 a.m. Unlike the interim CAT Order ID, the final CAT Order ID includes the CCID and FDID enrichments (that is, the order and transaction data has been enriched by the Firm Designated ID 13 and CCIDs 14). In connection with the earlier provision of the final CAT Order ID, no interim CAT Order ID would be provided. The interim CAT Order ID currently is available at T+1 at 9 p.m.15 Accordingly, regulators would have access to the final CAT Order ID 35 hours (or approximately one day and a half) later than they currently receive the interim CAT Order ID but, with the accelerated final CAT Order ID, regulators would have access to the CCID and FDID enrichments as well. As discussed below, the proposed elimination of the interim CAT Order ID would save 100% of the costs related to the creation of the interim CAT Order ID. 12 See Section 6.1 of Appendix D of the CAT NMS Plan at D–18. 13 Section 1.1 of the CAT NMS Plan. 14 The CCID (also referred to as the ‘‘CAT Customer-ID’’) means ‘‘with respect to a customer, a code that uniquely and consistently identifies such customer for purposes of providing data to the central repository.’’ 15 See supra nn.5–6. PO 00000 Frm 00091 Fmt 4703 Sfmt 4703 58013 c. Reduction in Daily Linkage Processing Volume The Revised Linkage Timeline would reduce the daily linkage processing job from the processing of four days of data volume to two days of volume. Under the Current Linkage Timeline, in addition to the processing necessary for creating the interim CAT Order ID by T+1 at 9 a.m., the current linkage processing for the final CAT Order ID covers data from four days, that is, data from T+1 at 8 a.m. through T+4 at 8 a.m. With the Revised Linkage Timeline, the linkage processing for the final CAT Order ID covers data from two days, that is, data from T+1 at 8 a.m. through T+2 at 8 a.m. As discussed below, the proposed reduction in daily linkage processing volume would save approximately 40% in computational costs related to linkage in comparison to the existing processes. d. Efficient Handling of Lates/Repairs The Revised Linkage Timeline would streamline the processing for feedback to CAT Reporters. CAT Reporters currently receive feedback for any data submission reported prior to 8 a.m. on T+4. With the Revised Linkage Timeline, CAT Reporters would receive feedback for any data submitted prior to T+2 at 8 a.m. Accordingly, under the Revised Linkage Timeline, CAT Reporters would no longer receive feedback on data reported after T+2 at 8 a.m. through T+4 at 8 a.m., as they do under the current processing. Without a linkage error generated, the CAT Reporter would not know they had a linkage error and would attempt no further corrections. The error not generated under this proposal would also not be counted in the compliance error rate. For example, if an Industry Member submits a MEOR on T+2 at noon with an incorrect routed OrderID, the Industry Member would not receive unlinked feedback and the error would not be included in the Industry Member’s compliance rate. The record would, however, be included as a late submission in the compliance rate calculation. Limiting feedback to data submitted prior to T+2 at 8 a.m. would capture 99.75% of all submissions to CAT for a given trade date based on an analysis of data from a recent six-month period by the Plan Processor. The significant cost savings realized by this proposal far outweighs the less than 0.25% of data that would potentially not generate a linkage error, but would otherwise be fully available in CAT and subject to late to the lifecycle processing. E:\FR\FM\24AUN1.SGM 24AUN1 58014 Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices The remaining late events received after T+2 at 8 a.m. through T+4 at 8 a.m. would be processed over the weekend using late-to-lifecycle processing, which provides substantial efficiency gains over the current processes. Under this approach, late records may be associated with more than one CAT Order ID. Specifically, a late record that is a missing link between disjoined segments of an order lifecycle and is not associated with a lifecycle in the processing prior to T+3 at 8 a.m. would be associated with both lifecycles and will include the date of the correction. This means that the entire lifecycle would be available through the linking of the disjoined segments, each with their own CAT Order ID. The CAT LLC Operating Committee plans to consider a Change Order that would enhance the current late-to-lifecycle process to present data to users in a manner similar to how it would be presented if the data were submitted on time. 4. Cost Savings of the Revised Linkage Timeline CAT LLC estimates that the Revised Linkage Timeline would result in annual savings of $9.8 million versus the Current Linkage Timeline. The Revised Linkage Timeline addresses two primary cost drivers, each responsible for approximately half of the $9.8 million in savings: (1) the proposed elimination of the interim CAT Order ID would provide 100% of savings versus the status quo of providing the interim CAT Order ID by T+1 at 9 p.m.; and (2) reducing the daily linkage processing job from the processing of four days of volume to two days of volume would provide approximately 40% of savings versus the status quo.16 CAT LLC believes that the substantial savings of approximately $9.8 million annually are readily justified given the minimal impact on regulatory access to CAT Data. 5. Proposed Revisions to CAT NMS Plan lotter on DSK11XQN23PROD with NOTICES1 a. Clarification: No Interim CAT Order ID Available Prior to T+3 at 8 a.m. To implement the Revised Linkage Timeline, CAT LLC proposes to amend the CAT NMS Plan to clarify that there is no requirement to provide an interim CAT Order ID.17 Accordingly, CAT LLC proposes to remove any references to 16 CAT LLC notes that the estimated savings do not include incremental cost of the larger late-tolifecycle processing or the build costs associated with the revised processing. CAT LLC does not anticipate that such costs would be significant. 17 CAT LLC notes that, at the discretion of the Operating Committee, the Plan Processor could be directed to provide an interim CAT Order ID prior to T+3 in the event of a market event. VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 lifecycle linkages in the data processing timeline described in the CAT NMS Plan.18 Specifically, CAT LLC proposes to delete the phrase ‘‘lifecycle linkages’’ from the following bullet in Section 6.1 of Appendix D of the CAT NMS Plan: ‘‘Noon Eastern Time T+1 (transaction date + one day)¥Initial data validation, lifecycle linkages and communication of errors to CAT Reporters.’’ Similarly, CAT LLC proposes to delete the phrase ‘‘Life Cycle Linkage’’ from the second box in Figure A in Section 6.1 of Appendix D of the CAT NMS Plan. The box currently states the following: ‘‘12:00 p.m. ET T+1 Initial Validation, Life Cycle Linkage, Communication of Errors.’’ With the change, this box would state ‘‘12:00 p.m. ET T+1 Initial Validation, Communication of Errors.’’ b. Commencement of Final Lifecycle Assembly CAT LLC also proposes to amend the CAT NMS Plan to require CAT LLC to commence final lifecycle assembly by T+2 at 8 a.m. Accordingly, CAT LLC proposes to add the following bullet to the data processing timeline in Section 6.1 of Appendix D of the CAT NMS Plan: • 8:00 a.m. Eastern Time T+2: (transaction date + two days)¥Final lifecycle assembly begins; deadline for late submissions and corrections to be included in final CAT Order ID Similarly, CAT LLC proposes to add a new third box to Figure A in Section 6.1 of Appendix D of the CAT NMS Plan. The box would state the following: ‘‘Final Lifecycle Assembly Begins; Deadline for Late Submissions and Corrections to be included in Final CAT Order ID.’’ c. Final CAT Order ID Available at T+3 at 8 a.m. CAT LLC also proposes to amend the CAT NMS Plan to require CAT LLC to make the final CAT Order ID available and to make data ready for regulatory by T+3 at 8 a.m. Specifically, CAT LLC proposes to revise the following bullet in the data processing timeline in Section 6.1 of Appendix D of the CAT NMS Plan to indicate that the final lifecycle identifier must be available by T+3 at 8 a.m.: ‘‘8:00 a.m. Eastern Time T+3 (transaction date + three days)¥Resubmission of corrected data.’’ CAT LLC proposes to add the phrase ‘‘and final CAT Order ID available and data ready for regulators’’ to this bullet. 18 The Commission interprets the phrase ‘‘lifecycle linkages’’ to require the assignment of an interim CAT Order ID. See July 2022 Order at 42251 and supra nn.5–6. PO 00000 Frm 00092 Fmt 4703 Sfmt 4703 Similarly, CAT LLC proposes to add the phrase ‘‘and Final CAT Order ID Available and Data Ready for Regulators’’ to the third box in Figure A in Section 6.1 of Appendix D of the CAT NMS Plan. The box currently states the following: ‘‘8:00AM ET T+3 Resubmission of Errors Due.’’ With this change, this box would state ‘‘8:00AM ET T+3 Resubmission of Errors Due and Final CAT Order ID Available and Data Ready for Regulators.’’ In addition, CAT LLC proposes to amend the CAT NMS Plan to remove the references to making corrected data available to Participant regulatory staff and the SEC by T+5 at 8 a.m. As discussed above, data would be ready for regulators on T+3 at 8 a.m. Specifically, CAT LLC proposes to delete the following bullet from Section 6.1 of Appendix D of the CAT NMS Plan: ‘‘8:00 a.m. Eastern Time T+5 (transaction date + five days)¥Corrected data available to Participant regulatory staff and the SEC.’’ In addition, CAT LLC proposes to delete the fifth box in Figure A in Section 6.1 of Appendix D of the CAT NMS Plan. This box currently states ‘‘T+5 Data Ready for Regulators.’’ In light of the change from a T+5 conclusion in the Current Linkage Timeline to the T+3 conclusion in the Revised Linkage Timeline, CAT LLC proposes to amend Section 6.2 of Appendix D of the CAT NMS Plan to replace the references to ‘‘T+5’’ with references to ‘‘T+3’’ in the following statements: • ‘‘Between 12:00 p.m. Eastern Time on T+1 and T+5, access to all iterations of processed data must be available to Participants’ regulatory staff and the SEC.’’ • ‘‘If any data remains un-linked after T+5, it must be available and included with all linked data with an indication that the data was not linked.’’ • ‘‘If corrections are received after T+5, Participants’ regulatory staff and the SEC must be notified and informed as to how re-processing will be completed.’’ Similarly, for the same reason, CAT LLC proposes to replace the reference to a ‘‘five-day’’ process with a reference to a ‘‘three-day’’ process in the following sentence in Section 6.2 of Appendix D of the CAT NMS Plan: ‘‘The Plan Processor must provide reports and notifications to Participant regulatory staff and the SEC regularly during the [five-day] three-day process, indicating the completeness of the data and errors.’’ E:\FR\FM\24AUN1.SGM 24AUN1 lotter on DSK11XQN23PROD with NOTICES1 Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices 58015 d. Late to the Lifecycle Processing for Corrections Submitted From T+2 at 8 a.m. through T+4 at 8 a.m. CAT LLC proposes to amend the CAT NMS Plan to require late submission and corrections submitted to the CAT after T+2 at 8 a.m. through T+4 at 8 a.m. to be processed over the weekend. The weekend processing would rely on the late-to-lifecycle processing, which provides substantial efficiency gains over the current processes. CAT LLC proposes to describe this process by adding the following bullet to Section 6.1 of Appendix D of the CAT NMS Plan: • Over Weekend—Late submissions and corrections submitted after T+2 at 8:00 a.m. ET through T+4 at 8:00 a.m. ET for order events that occurred within the past 18 months would be processed over the weekend by 5:00 p.m. ET the next business day. Late to the lifecycle processing for data older than 18 months would be processed on a schedule as set forth by the Operating Committee. Similarly, CAT LLC proposes to add the following description to the Figure A in Section 6.1 of the CAT NMS Plan: ‘‘Late submissions and corrections submitted after T+2 at 8 a.m. ET through T+4 at 8 a.m. ET for order events that occurred within the past 18 months would be processed over the weekend by 5 p.m. ET the next business day. Late to the lifecycle processing for data older than 18 months would be processed on a schedule as set forth by the Operating Committee.’’ In addition, CAT LLC proposes to revise the CAT NMS Plan to remove references to the requirement to reprocess error corrections on T+4. Under the Revised Linkage Timeline, as described above, late submissions and corrections submitted prior to T+2 at 8 a.m. would be used to assemble the final CAT Order ID on T+3, and late submissions and corrections submitted after T+2 at 8 a.m. through T+4 at 8 a.m. would be processed over the weekend using the late-to-lifecycle approach. Accordingly, the requirement to reprocess error corrections on T+4 would be no longer be applicable. E. Analysis of Impact on Competition IV. Solicitation of Comments CAT LLC does not believe that the proposed amendment would result in any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Exchange Act. Indeed, CAT LLC believes that the proposed amendments will have a positive impact on competition, efficiency and capital formation. The proposed amendments will provide substantial savings in CAT costs while providing minimal impact on the regulatory use of CAT Data. Such substantial savings would inure to the benefit of all participants in the markets for NMS Securities and OTC Equity Securities, including Participants, Industry Members, and most importantly, the investors. Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed amendment is consistent with the Act. Comments may be submitted by any of the following methods: B. Governing or Constituent Documents Not applicable. J. Method of Determination and Imposition, and Amount of, Fees and Charges C. Implementation of Amendment The Participants propose to implement the proposal upon approval of the proposed amendment to the CAT NMS Plan. D. Development and Implementation Phases Not applicable. VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 F. Written Understanding or Agreements Relating to Interpretation of, or Participation in, Plan Not applicable. G. Approval by Plan Sponsors in Accordance With Plan Section 12.3 of the CAT NMS Plan states that, subject to certain exceptions, the CAT NMS Plan may be amended from time to time only by a written amendment, authorized by the affirmative vote of not less than twothirds of all of the Participants, that has been approved by the SEC pursuant to Rule 608 of Regulation NMS under the Exchange Act or has otherwise become effective under Rule 608 of Regulation NMS under the Exchange Act. In addition, the proposed amendment was discussed during Operating Committee meetings. The Participants, by a vote of the Operating Committee taken on August 1, 2023, have authorized the filing of this proposed amendment with the SEC in accordance with the Plan. H. Description of Operation of Facility Contemplated by the Proposed Amendment Not applicable. I. Terms and Conditions of Access Not applicable. Not applicable. K. Method and Frequency of Processor Evaluation Not applicable. 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 4– 698 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 4–698. 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 amendment that are filed with the Commission, and all written communications relating to the proposed amendment 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 a.m. and 3 p.m. Copies of the filing also will be available for inspection and copying at the Participants’ offices. Do not include personal identifiable information in submissions; you should submit only information that you wish to make available publicly. We may redact in part or withhold entirely from publication submitted material that is obscene or subject to copyright protection. All submissions should refer to file number 4–698 and should be submitted on or before September 14, 2023. L. Dispute Resolution Not applicable. PO 00000 Frm 00093 Fmt 4703 Sfmt 4703 E:\FR\FM\24AUN1.SGM 24AUN1 58016 6.1 Data Processing CAT order events must be processed within established timeframes to ensure data can be made available to Participants’ regulatory staff and the SEC in a timely manner. The processing timelines start on the day the order event is received by the Central Repository for processing. Most events must be reported to the CAT by 8:00 a.m. Eastern Time the Trading Day after the order event occurred (referred to as transaction date). The processing timeframes below are presented in this context. All events submitted after T+1 (either reported late or submitted later because not all of the information was available) must be processed within these timeframes based on the date they were received. The Participants require the following timeframes (Figure A) for the identification, communication and correction of errors from the time an order event is received by the processor: • Noon Eastern Time T+1 (transaction date + one day) ¥ Initial data validation[, lifecycle linkages] and communication of errors to CAT Reporters; • 8:00 a.m. Eastern Time T+2: (transaction date + two days) ¥ Final lifecycle assembly begins; deadline for late submissions and corrections to be included in final CAT Order ID • 8:00 a.m. Eastern Time T+3 (transaction date + three days) ¥ Resubmission of corrected data; and final CAT Order ID available and data ready for regulators; and • [8:00 a.m. Eastern Time T+5 (transaction date + five days) ¥ Corrected data available to Participant regulatory staff and the SEC.] • Over Weekend—Late submissions and corrections submitted after T+2 at 8:00 a.m. ET through T+4 at 8:00 a.m. ET for order events that occurred within the past 18 months would be processed over the weekend by 5:00 p.m. ET the next business day. Late to the lifecycle processing for data older than 18 months would be processed on a schedule as set forth by the Operating Committee. Late submissions or re-submissions (after 8:00 a.m.) may be considered to be processed that day if it falls within a given time period after the cutoff. This threshold will be determined by the Plan Processor and approved by the Operating Committee. In the event that a significant portion of the data has not been received as monitored by the Plan Processor, the Plan Processor may decide to halt processing pending submission of that data. {changes to second box in chart: 12:00 p.m. ET T+1 Initial Validation, [Life Cycle Linkage,] Communication of Errors} {insert new third box: 8:00AM ET T+2 Final Lifecycle Assembly Begins; Deadline for Late Submissions and Corrections to be included in Final CAT Order ID} {changes to third box in chart: 8:00AM ET T+3 Resubmission of Errors Due and Final CAT Order ID Available and Data Ready for Regulators} {Delete fourth box in chart: [T+4 Reprocessing of Error Corrections]} {Delete fifth box in chart: [T+5 Data Ready for Regulators]} Late submissions and corrections submitted after T+2 at 8:00AM ET through T+4 at 8:00AM ET for order events that occurred within the past 18 months would be processed over the weekend by 5:00PM ET the next business day. Late to the lifecycle processing for data older than 18 months would be processed on a schedule as set forth by the Operating Committee. 6.2 Data Availability Requirements Prior to 12:00 p.m. Eastern Time on T+1, raw unprocessed data that has been ingested by the Plan Processor must be available to Participants’ regulatory staff and the SEC. Between 12:00 p.m. Eastern Time on T+1 and [T+5] T+3, access to all iterations of processed data must be available to Participants’ regulatory staff and the SEC. The Plan Processor must provide reports and notifications to Participant regulatory staff and the SEC regularly during the [fiveday] three-day process, indicating the completeness of the data and errors. Notice of major errors or missing data must be reported as early in the process as possible. If any data remains un-linked after [T+5] T+3, it must be available and included with all linked data with an indication that the data was not linked. If corrections are received after [T+5] T+3, Participants’ regulatory staff and the SEC must be notified and informed as to how reprocessing will be completed. The Operating Committee will be involved with decisions on how to re-process the data; however, this does not relieve the Plan Processor of notifying the Participants’ regulatory staff and the SEC. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.19 Sherry R. Haywood, Assistant Secretary. Appendix A Proposed Revisions to CAT NMS Plan Additions italicized; deletions [bracketed] lotter on DSK11XQN23PROD with NOTICES1 * * 19 17 * * * CFR 200.30–3(a)(85). VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 PO 00000 Frm 00094 Fmt 4703 Sfmt 4703 E:\FR\FM\24AUN1.SGM 24AUN1 EN24AU23.000</GPH> Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices Federal Register / Vol. 88, No. 163 / Thursday, August 24, 2023 / Notices * * * * * [FR Doc. 2023–18188 Filed 8–23–23; 8:45 am] lotter on DSK11XQN23PROD with NOTICES1 BILLING CODE 8011–01–P VerDate Sep<11>2014 17:08 Aug 23, 2023 Jkt 259001 Sanctions Policy and Implementation, Bureau of Economic and Business Affairs, Department of State, Washington, DC 20520, tel.: (202) 647 7677, email: MullinaxJD@state.gov. DEPARTMENT OF STATE [Public Notice: 12145] Notice of Department of State Sanctions Actions The Department of State is publishing the names of one or more persons that have been placed on the Department of Treasury’s List of Specially Designated Nationals and Blocked Persons (SDN List) administered by the Office of Foreign Assets Control (OFAC) based on the Department of State’s determination that one or more applicable legal criteria were satisfied. All property and interests in property subject to U.S. jurisdiction of these persons are blocked, and U.S. persons are generally prohibited from engaging in transactions with them. DATES: See SUPPLEMENTARY INFORMATION section for applicable date(s). FOR FURTHER INFORMATION CONTACT: Jim Mullinax, Director, Office of Economic SUMMARY: PO 00000 Frm 00095 Fmt 4703 Sfmt 4703 SUPPLEMENTARY INFORMATION: Electronic Availability The SDN List and additional information concerning sanctions programs are available on OFAC’s website, https://ofac.treasury.gov/ sanctions-programs-and-countryinformation/russian-harmful-foreignactivities-sanctions. Notice of Department of State Actions On April 12, 2023, the Department of State determined that the property and interests in property subject to U.S. jurisdiction of the following persons are blocked under the relevant sanctions authority listed below. BILLING CODE 4710–AE–P E:\FR\FM\24AUN1.SGM 24AUN1 EN24AU23.001</GPH> CAT PII data must be processed within established timeframes to ensure data can be made available to Participants’ regulatory staff and the SEC in a timely manner. Industry Members submitting new or modified Customer information must provide it to the Central Repository no later than 8:00 a.m. Eastern Time on T+1. The Central Repository must validate the data and generate error reports no later than 5:00 p.m. Eastern Time on T+1. The Central Repository must process the resubmitted data no later than 5:00 p.m. Eastern Time on T+4. Corrected data must be resubmitted no later than 5:00 p.m. Eastern Time on T+3. The Central Repository must process the resubmitted data no later than 5:00 p.m. Eastern Time on T+4. Corrected data must be available to regulators no later than 8:00 a.m. Eastern Time on T+5. Customer information that includes PII data must be available to regulators immediately upon receipt of initial data and corrected data, pursuant to security policies for retrieving PII. 58017

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 88, Number 163 (Thursday, August 24, 2023)]
[Notices]
[Pages 58012-58017]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-18188]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-98165; File No. 4-698]


Joint Industry Plan; Notice of Filing of Amendment to the 
National Market System Plan Governing the Consolidated Audit Trail

August 18, 2023.

I. Introduction

    On August 2, 2023, the Operating Committee for Consolidated Audit 
Trail, LLC (``CAT LLC''), on behalf of the following parties to the 
National Market System Plan Governing the Consolidated Audit Trail (the 
``CAT NMS Plan'' or ``Plan''):\1\ BOX Exchange LLC, Cboe BYX Exchange, 
Inc., Cboe BZX Exchange, Inc., Cboe EDGA Exchange, Inc., Cboe EDGX 
Exchange, Inc., Cboe C2 Exchange, Inc., Cboe Exchange, Inc., Financial 
Industry Regulatory Authority, Inc., Investors Exchange LLC, Long-Term 
Stock Exchange, Inc., MEMX LLC, Miami International Securities Exchange 
LLC, MIAX Emerald, LLC, MIAX PEARL, LLC, Nasdaq BX, Inc., Nasdaq GEMX, 
LLC, Nasdaq ISE, LLC, Nasdaq MRX, LLC, Nasdaq PHLX LLC, The NASDAQ 
Stock Market LLC, New York Stock Exchange LLC, NYSE American LLC, NYSE 
Arca, Inc., NYSE Chicago, Inc. and NYSE National, Inc. (collectively, 
the ``Participants'' or ``SROs'') filed with the Securities and 
Exchange Commission (``SEC'' or ``Commission'') pursuant to section 
11A(a)(3) of the Securities Exchange Act of 1934 (``Exchange Act''),\2\ 
and Rule 608 thereunder,\3\ a proposed amendment to the CAT NMS Plan to 
modify the current linkage timeline (``Current Linkage Timeline'') for 
the consolidated audit trail (``CAT''), as contained in Appendix A, 
attached hereto (``Revised Linkage Timeline''). The Commission is 
publishing this notice to solicit comments from interested persons on 
the amendment.\4\
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    \1\ The CAT NMS Plan is a national market system plan approved 
by the Commission pursuant to section 11A of the Exchange Act and 
the rules and regulations thereunder. See Securities Exchange Act 
Release No. 79318 (Nov. 15, 2016), 81 FR 84696 (Nov. 23, 2016) 
(``Order Approving CAT NMS Plan'').
    \2\ 15 U.S.C 78k-1(a)(3).
    \3\ 17 CFR 242.608.
    \4\ 17 CFR 242.608.
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II. Description of the Plan

    Set forth in this Section II is the statement of the purpose and 
summary of the amendment, along with information required by Rule 
608(a)(4) and (5) under the Exchange Act,\5\ as prepared and submitted 
by the Participants to the Commission and reproduced below verbatim.\6\
---------------------------------------------------------------------------

    \5\ See 17 CFR 242.608(a)(4) and (a)(5).
    \6\ See supra note 4. Unless otherwise defined herein, 
capitalized terms used herein are defined as set forth in the CAT 
NMS Plan.
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A. Description of the Proposed Amendments to the CAT NMS Plan

1. Current Linkage Timeline
    The CAT NMS Plan requires that all CAT Data reported to the Central 
Repository must be processed and assembled to create the complete 
lifecycle of each Reportable Event.\7\ The Plan Processor uses a daisy 
chain approach to link and create the order lifecycles. In the daisy 
chain approach, a series of unique order identifiers, assigned to all 
order events handled by CAT Reporters, are linked together by the 
Central Repository and assigned a single CAT-generated CAT Order ID 
that is associated with each individual order event and used to create 
the complete lifecycle of an order.\8\ Under the Current Linkage 
Timeline, the CAT provides a final CAT Order ID at T+5 at 8 a.m. ET 
pursuant to the following timeline:
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    \7\ Section 3 of Appendix D of the CAT NMS Plan at D-7.
    \8\ Section 3 of Appendix D of the CAT NMS Plan at D-8.

T+1 @8 a.m.: Initial submissions due
T+1 @12 p.m.: Initial data validation, communication of errors to CAT 
Reporters; unlinked data available to regulators
T+1 @9 p.m.: Interim CAT Order ID available \9\
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    \9\ See supra nn.5-6.
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T+3 @8 a.m.: Resubmission of corrected data

[[Page 58013]]

T+4 @8 a.m.: Final lifecycle assembly begins, reprocessing of late 
submissions and corrections
T+5 @8 a.m.: Corrected data available to Participant regulatory staff 
and the SEC
2. Revised Linkage Timeline
    With the Revised Linkage Timeline, the Participants propose to 
clarify that the Plan does not require assignment of interim CAT Order 
IDs and to provide a final CAT Order ID by T+3 at 8 a.m. ET, as opposed 
to T+5 at 8 a.m. ET. With this proposal, the linkage timeline would be 
revised to operate as follows:

T+1 @8 a.m.: Initial submissions due
T+1 @12 p.m.: Initial data validation, communication of errors to CAT 
Reporters; unlinked data available to regulators
T+2 @8 a.m.: Final lifecycle assembly begins, reprocessing of late 
submissions and corrections submitted prior to T+2 at 8am
T+3 @8 a.m.: Corrected data available to Participant regulatory staff 
and the SEC, resubmission of corrected data
Weekend: Late submissions and corrections submitted after T+2 at 8 a.m. 
through T+4 at 8 a.m. would be processed over the weekend using the 
late-to-lifecycle approach discussed below \10\
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    \10\ This change would not impact how late submissions and 
corrections received outside of the current T+5 processing window 
are addressed.

3. Effect of Revised Linkage Timeline on CAT Data Processing and 
Availability
    The Revised Linkage Timeline would continue to provide regulators 
with timely access to CAT Data. The following compares the processing 
and availability of the CAT Data under the Current Linkage Timeline 
versus the Revised Linkage Timeline in detail.\11\
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    \11\ The Revised Linkage Timeline only addresses the processing 
timeline for Reportable Events; it does not propose any changes with 
regard to the Customer and account information in the CAT.
---------------------------------------------------------------------------

a. No Changes to Submission Deadlines for CAT Reporters
    The Revised Linkage Timeline will not change the reporting 
deadlines for CAT Reporters. The deadlines for initial data submissions 
and for error corrections will remain the same.
    The CAT NMS Plan requires CAT Reporters to submit the required CAT 
Data to the CAT by 8:00 a.m. on T+1. The Revised Linkage Timeline does 
not change this reporting deadline. For example, Section 6.3(b)(ii) of 
the CAT NMS Plan states that ``[e]ach Participant shall report 
Participant Data to the Central Repository by 8:00 a.m. Eastern Time on 
the Trading Day following the day the Participant records such 
Participant Data.'' Similarly, Section 6.3(b)(ii) of the CAT NMS Plan 
states that:

    Consistent with Appendix D, Reporting and Linkage Requirements, 
each Participant shall, through its Compliance Rule, require its 
Industry Members to report: (A) Recorded Industry Member Data to the 
Central Repository by 8:00 a.m. Eastern Time on the Trading Day 
following the day the Industry Member records such Recorded Industry 
Member Data; and (B) Received Industry Member Data to the Central 
Repository by 8:00 a.m. Eastern Time on the Trading Day following 
the day the Industry Member receives such Received Industry Member 
Data.

    The CAT NMS Plan also requires Participants and Industry Members to 
submit corrected Participant Data and Industry Member Data, 
respectively, to the Central Repository by 8:00 a.m. Eastern Time on 
T+3.\12\ The Revised Linkage Timeline also does not change this 
reporting deadline.
---------------------------------------------------------------------------

    \12\ See Section 6.1 of Appendix D of the CAT NMS Plan at D-18.
---------------------------------------------------------------------------

b. Earlier Access to Final CAT Order ID
    Under the Revised Linkage Timeline, regulators would have access to 
the Final CAT Order ID and the finalized data set two full days earlier 
than under the Current Linkage Timeline. Regulators would have access 
to the final CAT Order ID on T+3 at 8 a.m., rather than on T+5 at 8 
a.m. Unlike the interim CAT Order ID, the final CAT Order ID includes 
the CCID and FDID enrichments (that is, the order and transaction data 
has been enriched by the Firm Designated ID \13\ and CCIDs \14\).
---------------------------------------------------------------------------

    \13\ Section 1.1 of the CAT NMS Plan.
    \14\ The CCID (also referred to as the ``CAT Customer-ID'') 
means ``with respect to a customer, a code that uniquely and 
consistently identifies such customer for purposes of providing data 
to the central repository.''
---------------------------------------------------------------------------

    In connection with the earlier provision of the final CAT Order ID, 
no interim CAT Order ID would be provided. The interim CAT Order ID 
currently is available at T+1 at 9 p.m.\15\ Accordingly, regulators 
would have access to the final CAT Order ID 35 hours (or approximately 
one day and a half) later than they currently receive the interim CAT 
Order ID but, with the accelerated final CAT Order ID, regulators would 
have access to the CCID and FDID enrichments as well. As discussed 
below, the proposed elimination of the interim CAT Order ID would save 
100% of the costs related to the creation of the interim CAT Order ID.
---------------------------------------------------------------------------

    \15\ See supra nn.5-6.
---------------------------------------------------------------------------

c. Reduction in Daily Linkage Processing Volume
    The Revised Linkage Timeline would reduce the daily linkage 
processing job from the processing of four days of data volume to two 
days of volume. Under the Current Linkage Timeline, in addition to the 
processing necessary for creating the interim CAT Order ID by T+1 at 9 
a.m., the current linkage processing for the final CAT Order ID covers 
data from four days, that is, data from T+1 at 8 a.m. through T+4 at 8 
a.m. With the Revised Linkage Timeline, the linkage processing for the 
final CAT Order ID covers data from two days, that is, data from T+1 at 
8 a.m. through T+2 at 8 a.m. As discussed below, the proposed reduction 
in daily linkage processing volume would save approximately 40% in 
computational costs related to linkage in comparison to the existing 
processes.
d. Efficient Handling of Lates/Repairs
    The Revised Linkage Timeline would streamline the processing for 
feedback to CAT Reporters. CAT Reporters currently receive feedback for 
any data submission reported prior to 8 a.m. on T+4. With the Revised 
Linkage Timeline, CAT Reporters would receive feedback for any data 
submitted prior to T+2 at 8 a.m. Accordingly, under the Revised Linkage 
Timeline, CAT Reporters would no longer receive feedback on data 
reported after T+2 at 8 a.m. through T+4 at 8 a.m., as they do under 
the current processing. Without a linkage error generated, the CAT 
Reporter would not know they had a linkage error and would attempt no 
further corrections. The error not generated under this proposal would 
also not be counted in the compliance error rate. For example, if an 
Industry Member submits a MEOR on T+2 at noon with an incorrect routed 
OrderID, the Industry Member would not receive unlinked feedback and 
the error would not be included in the Industry Member's compliance 
rate. The record would, however, be included as a late submission in 
the compliance rate calculation.
    Limiting feedback to data submitted prior to T+2 at 8 a.m. would 
capture 99.75% of all submissions to CAT for a given trade date based 
on an analysis of data from a recent six-month period by the Plan 
Processor. The significant cost savings realized by this proposal far 
outweighs the less than 0.25% of data that would potentially not 
generate a linkage error, but would otherwise be fully available in CAT 
and subject to late to the lifecycle processing.

[[Page 58014]]

    The remaining late events received after T+2 at 8 a.m. through T+4 
at 8 a.m. would be processed over the weekend using late-to-lifecycle 
processing, which provides substantial efficiency gains over the 
current processes. Under this approach, late records may be associated 
with more than one CAT Order ID. Specifically, a late record that is a 
missing link between disjoined segments of an order lifecycle and is 
not associated with a lifecycle in the processing prior to T+3 at 8 
a.m. would be associated with both lifecycles and will include the date 
of the correction. This means that the entire lifecycle would be 
available through the linking of the disjoined segments, each with 
their own CAT Order ID. The CAT LLC Operating Committee plans to 
consider a Change Order that would enhance the current late-to-
lifecycle process to present data to users in a manner similar to how 
it would be presented if the data were submitted on time.
4. Cost Savings of the Revised Linkage Timeline
    CAT LLC estimates that the Revised Linkage Timeline would result in 
annual savings of $9.8 million versus the Current Linkage Timeline. The 
Revised Linkage Timeline addresses two primary cost drivers, each 
responsible for approximately half of the $9.8 million in savings: (1) 
the proposed elimination of the interim CAT Order ID would provide 100% 
of savings versus the status quo of providing the interim CAT Order ID 
by T+1 at 9 p.m.; and (2) reducing the daily linkage processing job 
from the processing of four days of volume to two days of volume would 
provide approximately 40% of savings versus the status quo.\16\
---------------------------------------------------------------------------

    \16\ CAT LLC notes that the estimated savings do not include 
incremental cost of the larger late-to-lifecycle processing or the 
build costs associated with the revised processing. CAT LLC does not 
anticipate that such costs would be significant.
---------------------------------------------------------------------------

    CAT LLC believes that the substantial savings of approximately $9.8 
million annually are readily justified given the minimal impact on 
regulatory access to CAT Data.
5. Proposed Revisions to CAT NMS Plan
a. Clarification: No Interim CAT Order ID Available Prior to T+3 at 8 
a.m.
    To implement the Revised Linkage Timeline, CAT LLC proposes to 
amend the CAT NMS Plan to clarify that there is no requirement to 
provide an interim CAT Order ID.\17\ Accordingly, CAT LLC proposes to 
remove any references to lifecycle linkages in the data processing 
timeline described in the CAT NMS Plan.\18\ Specifically, CAT LLC 
proposes to delete the phrase ``lifecycle linkages'' from the following 
bullet in Section 6.1 of Appendix D of the CAT NMS Plan: ``Noon Eastern 
Time T+1 (transaction date + one day)-Initial data validation, 
lifecycle linkages and communication of errors to CAT Reporters.'' 
Similarly, CAT LLC proposes to delete the phrase ``Life Cycle Linkage'' 
from the second box in Figure A in Section 6.1 of Appendix D of the CAT 
NMS Plan. The box currently states the following: ``12:00 p.m. ET T+1 
Initial Validation, Life Cycle Linkage, Communication of Errors.'' With 
the change, this box would state ``12:00 p.m. ET T+1 Initial 
Validation, Communication of Errors.''
---------------------------------------------------------------------------

    \17\ CAT LLC notes that, at the discretion of the Operating 
Committee, the Plan Processor could be directed to provide an 
interim CAT Order ID prior to T+3 in the event of a market event.
    \18\ The Commission interprets the phrase ``lifecycle linkages'' 
to require the assignment of an interim CAT Order ID. See July 2022 
Order at 42251 and supra nn.5-6.
---------------------------------------------------------------------------

b. Commencement of Final Lifecycle Assembly
    CAT LLC also proposes to amend the CAT NMS Plan to require CAT LLC 
to commence final lifecycle assembly by T+2 at 8 a.m. Accordingly, CAT 
LLC proposes to add the following bullet to the data processing 
timeline in Section 6.1 of Appendix D of the CAT NMS Plan:

 8:00 a.m. Eastern Time T+2: (transaction date + two days)-
Final lifecycle assembly begins; deadline for late submissions and 
corrections to be included in final CAT Order ID

Similarly, CAT LLC proposes to add a new third box to Figure A in 
Section 6.1 of Appendix D of the CAT NMS Plan. The box would state the 
following: ``Final Lifecycle Assembly Begins; Deadline for Late 
Submissions and Corrections to be included in Final CAT Order ID.''
c. Final CAT Order ID Available at T+3 at 8 a.m.
    CAT LLC also proposes to amend the CAT NMS Plan to require CAT LLC 
to make the final CAT Order ID available and to make data ready for 
regulatory by T+3 at 8 a.m. Specifically, CAT LLC proposes to revise 
the following bullet in the data processing timeline in Section 6.1 of 
Appendix D of the CAT NMS Plan to indicate that the final lifecycle 
identifier must be available by T+3 at 8 a.m.: ``8:00 a.m. Eastern Time 
T+3 (transaction date + three days)-Resubmission of corrected data.'' 
CAT LLC proposes to add the phrase ``and final CAT Order ID available 
and data ready for regulators'' to this bullet. Similarly, CAT LLC 
proposes to add the phrase ``and Final CAT Order ID Available and Data 
Ready for Regulators'' to the third box in Figure A in Section 6.1 of 
Appendix D of the CAT NMS Plan. The box currently states the following: 
``8:00AM ET T+3 Resubmission of Errors Due.'' With this change, this 
box would state ``8:00AM ET T+3 Resubmission of Errors Due and Final 
CAT Order ID Available and Data Ready for Regulators.''
    In addition, CAT LLC proposes to amend the CAT NMS Plan to remove 
the references to making corrected data available to Participant 
regulatory staff and the SEC by T+5 at 8 a.m. As discussed above, data 
would be ready for regulators on T+3 at 8 a.m. Specifically, CAT LLC 
proposes to delete the following bullet from Section 6.1 of Appendix D 
of the CAT NMS Plan: ``8:00 a.m. Eastern Time T+5 (transaction date + 
five days)-Corrected data available to Participant regulatory staff and 
the SEC.'' In addition, CAT LLC proposes to delete the fifth box in 
Figure A in Section 6.1 of Appendix D of the CAT NMS Plan. This box 
currently states ``T+5 Data Ready for Regulators.''
    In light of the change from a T+5 conclusion in the Current Linkage 
Timeline to the T+3 conclusion in the Revised Linkage Timeline, CAT LLC 
proposes to amend Section 6.2 of Appendix D of the CAT NMS Plan to 
replace the references to ``T+5'' with references to ``T+3'' in the 
following statements:
     ``Between 12:00 p.m. Eastern Time on T+1 and T+5, access 
to all iterations of processed data must be available to Participants' 
regulatory staff and the SEC.''
     ``If any data remains un-linked after T+5, it must be 
available and included with all linked data with an indication that the 
data was not linked.''
     ``If corrections are received after T+5, Participants' 
regulatory staff and the SEC must be notified and informed as to how 
re-processing will be completed.''
    Similarly, for the same reason, CAT LLC proposes to replace the 
reference to a ``five-day'' process with a reference to a ``three-day'' 
process in the following sentence in Section 6.2 of Appendix D of the 
CAT NMS Plan: ``The Plan Processor must provide reports and 
notifications to Participant regulatory staff and the SEC regularly 
during the [five-day] three-day process, indicating the completeness of 
the data and errors.''

[[Page 58015]]

d. Late to the Lifecycle Processing for Corrections Submitted From T+2 
at 8 a.m. through T+4 at 8 a.m.
    CAT LLC proposes to amend the CAT NMS Plan to require late 
submission and corrections submitted to the CAT after T+2 at 8 a.m. 
through T+4 at 8 a.m. to be processed over the weekend. The weekend 
processing would rely on the late-to-lifecycle processing, which 
provides substantial efficiency gains over the current processes. CAT 
LLC proposes to describe this process by adding the following bullet to 
Section 6.1 of Appendix D of the CAT NMS Plan:
     Over Weekend--Late submissions and corrections submitted 
after T+2 at 8:00 a.m. ET through T+4 at 8:00 a.m. ET for order events 
that occurred within the past 18 months would be processed over the 
weekend by 5:00 p.m. ET the next business day. Late to the lifecycle 
processing for data older than 18 months would be processed on a 
schedule as set forth by the Operating Committee.
    Similarly, CAT LLC proposes to add the following description to the 
Figure A in Section 6.1 of the CAT NMS Plan: ``Late submissions and 
corrections submitted after T+2 at 8 a.m. ET through T+4 at 8 a.m. ET 
for order events that occurred within the past 18 months would be 
processed over the weekend by 5 p.m. ET the next business day. Late to 
the lifecycle processing for data older than 18 months would be 
processed on a schedule as set forth by the Operating Committee.''
    In addition, CAT LLC proposes to revise the CAT NMS Plan to remove 
references to the requirement to reprocess error corrections on T+4. 
Under the Revised Linkage Timeline, as described above, late 
submissions and corrections submitted prior to T+2 at 8 a.m. would be 
used to assemble the final CAT Order ID on T+3, and late submissions 
and corrections submitted after T+2 at 8 a.m. through T+4 at 8 a.m. 
would be processed over the weekend using the late-to-lifecycle 
approach. Accordingly, the requirement to reprocess error corrections 
on T+4 would be no longer be applicable.

B. Governing or Constituent Documents

    Not applicable.

C. Implementation of Amendment

    The Participants propose to implement the proposal upon approval of 
the proposed amendment to the CAT NMS Plan.

D. Development and Implementation Phases

    Not applicable.

E. Analysis of Impact on Competition

    CAT LLC does not believe that the proposed amendment would result 
in any burden on competition that is not necessary or appropriate in 
furtherance of the purposes of the Exchange Act. Indeed, CAT LLC 
believes that the proposed amendments will have a positive impact on 
competition, efficiency and capital formation. The proposed amendments 
will provide substantial savings in CAT costs while providing minimal 
impact on the regulatory use of CAT Data. Such substantial savings 
would inure to the benefit of all participants in the markets for NMS 
Securities and OTC Equity Securities, including Participants, Industry 
Members, and most importantly, the investors.

F. Written Understanding or Agreements Relating to Interpretation of, 
or Participation in, Plan

    Not applicable.

G. Approval by Plan Sponsors in Accordance With Plan

    Section 12.3 of the CAT NMS Plan states that, subject to certain 
exceptions, the CAT NMS Plan may be amended from time to time only by a 
written amendment, authorized by the affirmative vote of not less than 
two-thirds of all of the Participants, that has been approved by the 
SEC pursuant to Rule 608 of Regulation NMS under the Exchange Act or 
has otherwise become effective under Rule 608 of Regulation NMS under 
the Exchange Act. In addition, the proposed amendment was discussed 
during Operating Committee meetings. The Participants, by a vote of the 
Operating Committee taken on August 1, 2023, have authorized the filing 
of this proposed amendment with the SEC in accordance with the Plan.

H. Description of Operation of Facility Contemplated by the Proposed 
Amendment

    Not applicable.

I. Terms and Conditions of Access

    Not applicable.

J. Method of Determination and Imposition, and Amount of, Fees and 
Charges

    Not applicable.

K. Method and Frequency of Processor Evaluation

    Not applicable.

L. Dispute Resolution

    Not applicable.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed 
amendment 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 4-698 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 4-698. 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 amendment that are filed with 
the Commission, and all written communications relating to the proposed 
amendment 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 a.m. and 3 
p.m. Copies of the filing also will be available for inspection and 
copying at the Participants' offices. Do not include personal 
identifiable information in submissions; you should submit only 
information that you wish to make available publicly. We may redact in 
part or withhold entirely from publication submitted material that is 
obscene or subject to copyright protection. All submissions should 
refer to file number 4-698 and should be submitted on or before 
September 14, 2023.


[[Page 58016]]


    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)(85).
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Sherry R. Haywood,
Assistant Secretary.

Appendix A

Proposed Revisions to CAT NMS Plan

    Additions italicized; deletions [bracketed]
* * * * *

6.1 Data Processing

    CAT order events must be processed within established timeframes 
to ensure data can be made available to Participants' regulatory 
staff and the SEC in a timely manner. The processing timelines start 
on the day the order event is received by the Central Repository for 
processing. Most events must be reported to the CAT by 8:00 a.m. 
Eastern Time the Trading Day after the order event occurred 
(referred to as transaction date). The processing timeframes below 
are presented in this context. All events submitted after T+1 
(either reported late or submitted later because not all of the 
information was available) must be processed within these timeframes 
based on the date they were received.
    The Participants require the following timeframes (Figure A) for 
the identification, communication and correction of errors from the 
time an order event is received by the processor:
     Noon Eastern Time T+1 (transaction date + one day) - 
Initial data validation[, lifecycle linkages] and communication of 
errors to CAT Reporters;
     8:00 a.m. Eastern Time T+2: (transaction date + two 
days) - Final lifecycle assembly begins; deadline for late 
submissions and corrections to be included in final CAT Order ID
     8:00 a.m. Eastern Time T+3 (transaction date + three 
days) - Resubmission of corrected data; and final CAT Order ID 
available and data ready for regulators; and
     [8:00 a.m. Eastern Time T+5 (transaction date + five 
days) - Corrected data available to Participant regulatory staff and 
the SEC.]
     Over Weekend--Late submissions and corrections 
submitted after T+2 at 8:00 a.m. ET through T+4 at 8:00 a.m. ET for 
order events that occurred within the past 18 months would be 
processed over the weekend by 5:00 p.m. ET the next business day. 
Late to the lifecycle processing for data older than 18 months would 
be processed on a schedule as set forth by the Operating Committee.
    Late submissions or re-submissions (after 8:00 a.m.) may be 
considered to be processed that day if it falls within a given time 
period after the cutoff. This threshold will be determined by the 
Plan Processor and approved by the Operating Committee. In the event 
that a significant portion of the data has not been received as 
monitored by the Plan Processor, the Plan Processor may decide to 
halt processing pending submission of that data.
[GRAPHIC] [TIFF OMITTED] TN24AU23.000

{changes to second box in chart: 12:00 p.m. ET T+1 Initial 
Validation, [Life Cycle Linkage,] Communication of Errors{time} 

{insert new third box: 8:00AM ET T+2 Final Lifecycle Assembly 
Begins; Deadline for Late Submissions and Corrections to be included 
in Final CAT Order ID{time} 

{changes to third box in chart: 8:00AM ET T+3 Resubmission of Errors 
Due and Final CAT Order ID Available and Data Ready for 
Regulators{time} 

{Delete fourth box in chart: [T+4 Reprocessing of Error 
Corrections]{time} 

{Delete fifth box in chart: [T+5 Data Ready for Regulators]{time} 

Late submissions and corrections submitted after T+2 at 8:00AM ET 
through T+4 at 8:00AM ET for order events that occurred within the 
past 18 months would be processed over the weekend by 5:00PM ET the 
next business day. Late to the lifecycle processing for data older 
than 18 months would be processed on a schedule as set forth by the 
Operating Committee.

6.2 Data Availability Requirements

    Prior to 12:00 p.m. Eastern Time on T+1, raw unprocessed data 
that has been ingested by the Plan Processor must be available to 
Participants' regulatory staff and the SEC.
    Between 12:00 p.m. Eastern Time on T+1 and [T+5] T+3, access to 
all iterations of processed data must be available to Participants' 
regulatory staff and the SEC.
    The Plan Processor must provide reports and notifications to 
Participant regulatory staff and the SEC regularly during the [five-
day] three-day process, indicating the completeness of the data and 
errors. Notice of major errors or missing data must be reported as 
early in the process as possible. If any data remains un-linked 
after [T+5] T+3, it must be available and included with all linked 
data with an indication that the data was not linked.
    If corrections are received after [T+5] T+3, Participants' 
regulatory staff and the SEC must be notified and informed as to how 
re-processing will be completed. The Operating Committee will be 
involved with decisions on how to re-process the data; however, this 
does not relieve the Plan Processor of notifying the Participants' 
regulatory staff and the SEC.

[[Page 58017]]

[GRAPHIC] [TIFF OMITTED] TN24AU23.001

    CAT PII data must be processed within established timeframes to 
ensure data can be made available to Participants' regulatory staff 
and the SEC in a timely manner. Industry Members submitting new or 
modified Customer information must provide it to the Central 
Repository no later than 8:00 a.m. Eastern Time on T+1. The Central 
Repository must validate the data and generate error reports no 
later than 5:00 p.m. Eastern Time on T+1. The Central Repository 
must process the resubmitted data no later than 5:00 p.m. Eastern 
Time on T+4. Corrected data must be resubmitted no later than 5:00 
p.m. Eastern Time on T+3. The Central Repository must process the 
resubmitted data no later than 5:00 p.m. Eastern Time on T+4. 
Corrected data must be available to regulators no later than 8:00 
a.m. Eastern Time on T+5.
    Customer information that includes PII data must be available to 
regulators immediately upon receipt of initial data and corrected 
data, pursuant to security policies for retrieving PII.
* * * * *

[FR Doc. 2023-18188 Filed 8-23-23; 8:45 am]
BILLING CODE 8011-01-P

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