Self-Regulatory Organizations; National Securities Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the Clearing Agency Risk Management Framework, 86183-86185 [2023-27162]
Download as PDF
Federal Register / Vol. 88, No. 237 / Tuesday, December 12, 2023 / Notices
The proposed fee changes are not
unfairly discriminatory among issuers of
operating company equity securities
because the same fee schedule will
apply to all such issuers. Further, the
Exchange operates in a competitive
environment and its fees are constrained
by competition in the marketplace.
Other venues currently list all of the
categories of securities covered by the
proposed fees and if a company believes
that the Exchange’s fees are
unreasonable it can decide either not to
list its securities or to list them on an
alternative venue.
For the foregoing reasons, the
Exchange believes that the proposal is
consistent with the Act.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. The
proposed rule change is designed to
ensure that the fees charged by the
Exchange accurately reflect the services
provided and benefits realized by listed
companies. The market for listing
services is extremely competitive. Each
listing exchange has a different fee
schedule that applies to issuers seeking
to list securities on its exchange. Issuers
have the option to list their securities on
these alternative venues based on the
fees charged and the value provided by
each listing. Because issuers have a
choice to list their securities on a
different national securities exchange,
the Exchange does not believe that the
proposed fee changes impose a burden
on competition.
Intramarket Competition
The proposed amended fees will be
charged to all listed issuers on the same
basis. The Exchange does not believe
that the proposed amended fees will
have any meaningful effect on the
competition among issuers listed on the
Exchange.
ddrumheller on DSK120RN23PROD with NOTICES1
Intermarket Competition
The Exchange operates in a highly
competitive market in which issuers can
readily choose to list new securities on
other exchanges and transfer listings to
other exchanges if they deem fee levels
at those other venues to be more
favorable. Because competitors are free
to modify their own fees, and because
issuers may change their chosen listing
venue, the Exchange does not believe its
proposed fee change can impose any
burden on intermarket competition.
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C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change is effective
upon filing pursuant to section
19(b)(3)(A) 8 of the Act and
subparagraph (f)(2) of Rule 19b–4 9
thereunder, because it establishes a due,
fee, or other charge imposed by the
Exchange.
At any time within 60 days of the
filing of such 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
under section 19(b)(2)(B) 10 of the Act to
determine whether the proposed rule
change should be approved or
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–
NYSE–2023–49 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–NYSE–2023–49. 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/
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(2).
10 15 U.S.C. 78s(b)(2)(B).
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
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. 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–NYSE–2023–49 and should be
submitted on or before January 2, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.11
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–27157 Filed 12–11–23; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–99098; File No. SR–NSCC–
2023–012]
Self-Regulatory Organizations;
National Securities Clearing
Corporation; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Amend the Clearing
Agency Risk Management Framework
December 6, 2023.
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 December
1, 2023, National Securities Clearing
Corporation (‘‘NSCC’’) 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
8 15
11 17
9 17
1 15
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CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
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Federal Register / Vol. 88, No. 237 / Tuesday, December 12, 2023 / Notices
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 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 of National
Securities Clearing Corporation
(‘‘NSCC’’) is provided hereto [sic] as
Exhibit 5 and amends the Clearing
Agency Risk Management Framework
(‘‘Risk Management Framework’’, or
‘‘Framework’’) of NSCC and its
affiliates, The Depository Trust
Company (‘‘DTC’’) and Fixed Income
Clearing Corporation (‘‘FICC,’’ and
together with NSCC and DTC, the
‘‘Clearing Agencies’’).5 The proposed
rule change would amend the Risk
Management Framework to clarify and
revise the descriptions of certain matters
within the Framework, as further
described below. The proposed changes
would update and clarify the Risk
Management Framework but do not
reflect changes to how the Clearing
Agencies comply with the applicable
requirements of Rule 17Ad–22(e), as
described in greater detail below.
II. Clearing Agency’s Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Change
In its filing with the Commission, the
clearing agency included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
clearing agency has prepared
summaries, set forth in sections A, B,
and C below, of the most significant
aspects of such statements.
(A) Clearing Agency’s Statement of the
Purpose of, and Statutory Basis for, the
Proposed Rule Change
1. Purpose
The Clearing Agencies adopted the
Risk Management Framework 6 to
3 15
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(4).
5 See Securities Exchange Act Release Nos. 81635
(September 15, 2017), 82 FR 44224 (September 21,
2017) (SR–DTC–2017–013; SR–FICC–2017–016;
SR–NSCC–2017–012) (‘‘Initial Filing’’) and
Securities Exchange Act Release Nos. 89271 (July
09, 2020), 85 FR 42933 (July 15, 2020) (SR–NSCC–
2020–012); Securities Exchange Act Release No.
89269 (July 09, 2020), 85 FR 42954 (July 15, 2020)
(SR–DTC–2020–009); and Securities Exchange Act
Release No. 89270 (July 09, 2020), 85 FR 42927
(July 15, 2020) (SR–FICC–2020–007) (together with
the Initial Filing, the ‘‘Framework Filings’’).
6 Supra note 5.
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4 17
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provide an outline for how each of the
Clearing Agencies (i) maintains a wellfounded, clear, transparent and
enforceable legal basis for each aspect of
its activities; (ii) comprehensively
manages legal, credit, liquidity,
operational, general business,
investment, custody, and other risks
that arise in or are borne by it; (iii)
identifies, monitors, and manages risks
related to links it establishes with one
or more clearing agencies, financial
market utilities, or trading markets; (iv)
meets the requirements of its
participants and the markets it serves
efficiently and effectively; (v) uses, or at
a minimum accommodates, relevant
internationally accepted communication
procedures and standards in order to
facilitate efficient payment, clearing and
settlement; and (vi) publicly discloses
certain information, including market
data. In this way, the Risk Management
Framework currently supports the
Clearing Agencies’ compliance with
Rules 17Ad–22(e)(1), (3), (20), (21), (22)
and (23) of the Standards,7 as described
in the Framework Filings. In addition to
setting forth the way each of the
Clearing Agencies addresses these
requirements, the Risk Management
Framework also contains a section titled
‘‘Framework Ownership and Change
Management’’ that, among other
matters, describes the Framework
ownership and the required governance
process for review and approval of
changes to the Framework. In
connection with the annual review and
approval of the Framework by the Board
of Directors of NSCC, DTC and FICC
(each a ‘‘Board’’ and collectively, the
‘‘Boards’’), the Clearing Agencies are
proposing to make certain revisions to
the Framework.
The proposed changes would clarify
and enhance the descriptions in the
Risk Management Framework, for
example, (i) clarify the cadence of
publication of disclosure frameworks;
(ii) clarify the description of the
Clearing Agencies recovery and winddown processes and procedures; and
(iii) make other non-substantive
clarifying and clean-up changes to the
Framework. Each of these categories of
changes are discussed in further detail
below.
i. Proposed Amendment To Clarify the
Cadence of Publication of Disclosure
Frameworks
Section 4.1 of the Framework
describes certain tools provided to
Clearing Agency participants to assist
participants in understanding the
7 17 CFR 240.17Ad–22(e)(1), (3), (20), (21), (22)
and (23).
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Clearing Agencies’ products and
services and their use. One such tool is
the publication of disclosure
frameworks to the DTCC website. The
proposed change would enhance the
description in the third bullet of Section
4.1, to add that although each of the
Clearing Agencies publish to the DTCC
website disclosure frameworks that are
updated on a biennial basis, such
frameworks are also updated more
frequently for material changes.
ii. Proposed Amendment To Clarify the
Description of Recovery and WindDown
Section 5 of the Framework describes
the Clearing Agencies identification of
scenarios that may potentially prevent
them from being able to provide critical
operations and services, and assessment
of options for recovery and orderly
wind-down, and maintenance of
appropriate plans for recovery and
orderly wind-down. The proposed
changes to Section 5 are primarily
rephrasing and grammatical choices that
clarify the Framework and conform the
language in the Framework to the
Clearing Agencies’ stand-alone Recovery
and Wind-Down Plans.
iii. Proposed Amendment To Make
Other Non-Substantive Clarifying
Changes
These proposed changes consist of
rephrasing for clarity and removal of
unnecessary language in the
Framework. These changes include: (i)
changes to Section 1 to simplify the
description of other documentation of
the Clearing Agencies that support the
activities described in the Framework
by removing statements regarding the
maintenance of those documents that
are not relevant to the operation of this
Framework and removing redundant
sentences; (ii) add ‘‘and’’ for
grammatical purposes in the second
sentence of the last paragraph of Section
3.2 as well as the words ‘‘when
required’’ as clarifying language; (3)
remove the words ‘‘Market Risk’’ from
the heading ‘‘Clearing Agency Stress
Testing Framework’’ in Section 3.3.3
and add ‘‘liquidity resources’’ to align
with other documentation of the
Clearing Agencies; (4) deletion of the
word ‘‘all’’ in various sentences in
Section 4.2.2, as unnecessary.
2. Statutory Basis
The Clearing Agencies believe that the
proposed changes are consistent with
section 17A(b)(3)(F) of the Act 8 for the
reasons described below. Section
17A(b)(3)(F) of the Act requires, in part,
8 15
E:\FR\FM\12DEN1.SGM
U.S.C. 78q–1(b)(3)(F).
12DEN1
Federal Register / Vol. 88, No. 237 / Tuesday, December 12, 2023 / Notices
that the rules of a registered clearing
agency be designed to promote the
prompt and accurate clearance and
settlement of securities transactions,
and to assure the safeguarding of
securities and funds which are in the
custody or control of the clearing agency
or for which it is responsible.9 The
proposed changes would clarify the
descriptions of certain matters within
the Framework to improve
comprehensiveness and align with other
documentation of the Clearing Agencies,
as described above. By creating clearer,
updated descriptions, the Clearing
Agencies believe that the proposed
changes would make the Risk
Management Framework more effective
in providing an overview of the
important risk management activities of
the Clearing Agencies, as described
therein.
As described in the Framework
Filings, the risk management functions
described in the Risk Management
Framework allow the Clearing Agencies
to continue to promote the prompt and
accurate clearance and settlement of
securities transactions and continue to
assure the safeguarding of securities and
funds which are in their custody or
control or for which they are
responsible notwithstanding the default
of a member of an affiliated family. The
proposed changes to improve the clarity
and accuracy of the descriptions of risk
management functions within the
Framework would assist the Clearing
Agencies in carrying out these risk
management functions. Therefore, the
Clearing Agencies believe these
proposed changes are consistent with
the requirements of section 17A(b)(3)(F)
of the Act.10
ddrumheller on DSK120RN23PROD with NOTICES1
(B) Clearing Agency’s Statement on
Burden on Competition
The Clearing Agencies do not believe
that the proposed changes to the
Framework described above would have
any impact, or impose any burden, on
competition. As described above, the
proposed rule changes would improve
the comprehensiveness of the
Framework by creating clearer, updated
descriptions, thereby making the Risk
Management Framework more effective
in providing an overview of the
important risk management activities of
the Clearing Agencies. As such, the
Clearing Agencies do not believe that
the proposed rule changes would have
any impact on competition.
(C) Clearing Agency’s Statement on
Comments on the Proposed Rule
Change Received From Members,
Participants, or Others
NSCC has not received or solicited
any written comments relating to this
proposal. If any written comments are
received, they will be publicly filed as
an Exhibit 2 to this filing, as required by
Form 19b–4 and the General
Instructions thereto.
Persons submitting comments are
cautioned that, according to Section IV
(Solicitation of Comments) of the
Exhibit 1A in the General Instructions to
Form 19b–4, the Commission does not
edit personal identifying information
from comment submissions.
Commenters should submit only
information that they wish to make
available publicly, including their
name, email address, and any other
identifying information.
All prospective commenters should
follow the Commission’s instructions on
how to submit comments, available at
https://www.sec.gov/regulatory-actions/
how-to-submitcomments. General
questions regarding the rule filing
process or logistical questions regarding
this filing should be directed to the
Main Office of the Commission’s
Division of Trading and Markets at
tradingandmarkets@sec.gov or 202–
551–5777.
NSCC reserves the right not to
respond to any comments received.
III. Date of Effectiveness of the
Proposed Rule Change, and Timing for
Commission Action
The foregoing rule change has become
effective pursuant to section
19(b)(3)(A) 11 of the Act and paragraph
(f) 12 of Rule 19b–4 thereunder. 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.
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–
NSCC–2023–012 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549.
All submissions should refer to file
number SR–NSCC–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
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of NSCC
and on DTCC’s website (https://
dtcc.com/legal/sec-rule-filings.aspx). 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–NSCC–2023–012 and
should be submitted on or before
January 2, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–27162 Filed 12–11–23; 8:45 am]
BILLING CODE 8011–01–P
9 Id.
U.S.C. 78s(b)(3)(A).
12 17 CFR 240.19b–4(f).
11 15
10 Id.
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86185
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CFR 200.30–3(a)(12).
12DEN1
Agencies
[Federal Register Volume 88, Number 237 (Tuesday, December 12, 2023)]
[Notices]
[Pages 86183-86185]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-27162]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-99098; File No. SR-NSCC-2023-012]
Self-Regulatory Organizations; National Securities Clearing
Corporation; Notice of Filing and Immediate Effectiveness of Proposed
Rule Change To Amend the Clearing Agency Risk Management Framework
December 6, 2023.
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 December 1, 2023, National Securities Clearing Corporation
(``NSCC'') 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
[[Page 86184]]
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 comments on the
proposed rule change from interested persons.
---------------------------------------------------------------------------
\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).
---------------------------------------------------------------------------
I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change
The proposed rule change of National Securities Clearing
Corporation (``NSCC'') is provided hereto [sic] as Exhibit 5 and amends
the Clearing Agency Risk Management Framework (``Risk Management
Framework'', or ``Framework'') of NSCC and its affiliates, The
Depository Trust Company (``DTC'') and Fixed Income Clearing
Corporation (``FICC,'' and together with NSCC and DTC, the ``Clearing
Agencies'').\5\ The proposed rule change would amend the Risk
Management Framework to clarify and revise the descriptions of certain
matters within the Framework, as further described below. The proposed
changes would update and clarify the Risk Management Framework but do
not reflect changes to how the Clearing Agencies comply with the
applicable requirements of Rule 17Ad-22(e), as described in greater
detail below.
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release Nos. 81635 (September
15, 2017), 82 FR 44224 (September 21, 2017) (SR-DTC-2017-013; SR-
FICC-2017-016; SR-NSCC-2017-012) (``Initial Filing'') and Securities
Exchange Act Release Nos. 89271 (July 09, 2020), 85 FR 42933 (July
15, 2020) (SR-NSCC-2020-012); Securities Exchange Act Release No.
89269 (July 09, 2020), 85 FR 42954 (July 15, 2020) (SR-DTC-2020-
009); and Securities Exchange Act Release No. 89270 (July 09, 2020),
85 FR 42927 (July 15, 2020) (SR-FICC-2020-007) (together with the
Initial Filing, the ``Framework Filings'').
---------------------------------------------------------------------------
II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change
In its filing with the Commission, the clearing agency included
statements concerning the purpose of and basis for the proposed rule
change and discussed any comments it received on the proposed rule
change. The text of these statements may be examined at the places
specified in Item IV below. The clearing agency has prepared summaries,
set forth in sections A, B, and C below, of the most significant
aspects of such statements.
(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change
1. Purpose
The Clearing Agencies adopted the Risk Management Framework \6\ to
provide an outline for how each of the Clearing Agencies (i) maintains
a well-founded, clear, transparent and enforceable legal basis for each
aspect of its activities; (ii) comprehensively manages legal, credit,
liquidity, operational, general business, investment, custody, and
other risks that arise in or are borne by it; (iii) identifies,
monitors, and manages risks related to links it establishes with one or
more clearing agencies, financial market utilities, or trading markets;
(iv) meets the requirements of its participants and the markets it
serves efficiently and effectively; (v) uses, or at a minimum
accommodates, relevant internationally accepted communication
procedures and standards in order to facilitate efficient payment,
clearing and settlement; and (vi) publicly discloses certain
information, including market data. In this way, the Risk Management
Framework currently supports the Clearing Agencies' compliance with
Rules 17Ad-22(e)(1), (3), (20), (21), (22) and (23) of the
Standards,\7\ as described in the Framework Filings. In addition to
setting forth the way each of the Clearing Agencies addresses these
requirements, the Risk Management Framework also contains a section
titled ``Framework Ownership and Change Management'' that, among other
matters, describes the Framework ownership and the required governance
process for review and approval of changes to the Framework. In
connection with the annual review and approval of the Framework by the
Board of Directors of NSCC, DTC and FICC (each a ``Board'' and
collectively, the ``Boards''), the Clearing Agencies are proposing to
make certain revisions to the Framework.
---------------------------------------------------------------------------
\6\ Supra note 5.
\7\ 17 CFR 240.17Ad-22(e)(1), (3), (20), (21), (22) and (23).
---------------------------------------------------------------------------
The proposed changes would clarify and enhance the descriptions in
the Risk Management Framework, for example, (i) clarify the cadence of
publication of disclosure frameworks; (ii) clarify the description of
the Clearing Agencies recovery and wind-down processes and procedures;
and (iii) make other non-substantive clarifying and clean-up changes to
the Framework. Each of these categories of changes are discussed in
further detail below.
i. Proposed Amendment To Clarify the Cadence of Publication of
Disclosure Frameworks
Section 4.1 of the Framework describes certain tools provided to
Clearing Agency participants to assist participants in understanding
the Clearing Agencies' products and services and their use. One such
tool is the publication of disclosure frameworks to the DTCC website.
The proposed change would enhance the description in the third bullet
of Section 4.1, to add that although each of the Clearing Agencies
publish to the DTCC website disclosure frameworks that are updated on a
biennial basis, such frameworks are also updated more frequently for
material changes.
ii. Proposed Amendment To Clarify the Description of Recovery and Wind-
Down
Section 5 of the Framework describes the Clearing Agencies
identification of scenarios that may potentially prevent them from
being able to provide critical operations and services, and assessment
of options for recovery and orderly wind-down, and maintenance of
appropriate plans for recovery and orderly wind-down. The proposed
changes to Section 5 are primarily rephrasing and grammatical choices
that clarify the Framework and conform the language in the Framework to
the Clearing Agencies' stand-alone Recovery and Wind-Down Plans.
iii. Proposed Amendment To Make Other Non-Substantive Clarifying
Changes
These proposed changes consist of rephrasing for clarity and
removal of unnecessary language in the Framework. These changes
include: (i) changes to Section 1 to simplify the description of other
documentation of the Clearing Agencies that support the activities
described in the Framework by removing statements regarding the
maintenance of those documents that are not relevant to the operation
of this Framework and removing redundant sentences; (ii) add ``and''
for grammatical purposes in the second sentence of the last paragraph
of Section 3.2 as well as the words ``when required'' as clarifying
language; (3) remove the words ``Market Risk'' from the heading
``Clearing Agency Stress Testing Framework'' in Section 3.3.3 and add
``liquidity resources'' to align with other documentation of the
Clearing Agencies; (4) deletion of the word ``all'' in various
sentences in Section 4.2.2, as unnecessary.
2. Statutory Basis
The Clearing Agencies believe that the proposed changes are
consistent with section 17A(b)(3)(F) of the Act \8\ for the reasons
described below. Section 17A(b)(3)(F) of the Act requires, in part,
[[Page 86185]]
that the rules of a registered clearing agency be designed to promote
the prompt and accurate clearance and settlement of securities
transactions, and to assure the safeguarding of securities and funds
which are in the custody or control of the clearing agency or for which
it is responsible.\9\ The proposed changes would clarify the
descriptions of certain matters within the Framework to improve
comprehensiveness and align with other documentation of the Clearing
Agencies, as described above. By creating clearer, updated
descriptions, the Clearing Agencies believe that the proposed changes
would make the Risk Management Framework more effective in providing an
overview of the important risk management activities of the Clearing
Agencies, as described therein.
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\8\ 15 U.S.C. 78q-1(b)(3)(F).
\9\ Id.
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As described in the Framework Filings, the risk management
functions described in the Risk Management Framework allow the Clearing
Agencies to continue to promote the prompt and accurate clearance and
settlement of securities transactions and continue to assure the
safeguarding of securities and funds which are in their custody or
control or for which they are responsible notwithstanding the default
of a member of an affiliated family. The proposed changes to improve
the clarity and accuracy of the descriptions of risk management
functions within the Framework would assist the Clearing Agencies in
carrying out these risk management functions. Therefore, the Clearing
Agencies believe these proposed changes are consistent with the
requirements of section 17A(b)(3)(F) of the Act.\10\
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\10\ Id.
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(B) Clearing Agency's Statement on Burden on Competition
The Clearing Agencies do not believe that the proposed changes to
the Framework described above would have any impact, or impose any
burden, on competition. As described above, the proposed rule changes
would improve the comprehensiveness of the Framework by creating
clearer, updated descriptions, thereby making the Risk Management
Framework more effective in providing an overview of the important risk
management activities of the Clearing Agencies. As such, the Clearing
Agencies do not believe that the proposed rule changes would have any
impact on competition.
(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants, or Others
NSCC has not received or solicited any written comments relating to
this proposal. If any written comments are received, they will be
publicly filed as an Exhibit 2 to this filing, as required by Form 19b-
4 and the General Instructions thereto.
Persons submitting comments are cautioned that, according to
Section IV (Solicitation of Comments) of the Exhibit 1A in the General
Instructions to Form 19b-4, the Commission does not edit personal
identifying information from comment submissions. Commenters should
submit only information that they wish to make available publicly,
including their name, email address, and any other identifying
information.
All prospective commenters should follow the Commission's
instructions on how to submit comments, available at https://www.sec.gov/regulatory-actions/how-to-submitcomments. General questions
regarding the rule filing process or logistical questions regarding
this filing should be directed to the Main Office of the Commission's
Division of Trading and Markets at [email protected] or 202-
551-5777.
NSCC reserves the right not to respond to any comments received.
III. Date of Effectiveness of the Proposed Rule Change, and Timing for
Commission Action
The foregoing rule change has become effective pursuant to section
19(b)(3)(A) \11\ of the Act and paragraph (f) \12\ of Rule 19b-4
thereunder. 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.
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\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
file number SR-NSCC-2023-012 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549.
All submissions should refer to file number SR-NSCC-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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of NSCC and on DTCC's
website (https://dtcc.com/legal/sec-rule-filings.aspx). 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-NSCC-2023-012 and should be submitted on
or before January 2, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023-27162 Filed 12-11-23; 8:45 am]
BILLING CODE 8011-01-P