[Federal Register Volume 85, Number 49 (Thursday, March 12, 2020)]
[Notices]
[Pages 14511-14512]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-05029]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-88343; File No. SR-NSCC-2020-006]


Self-Regulatory Organizations; National Securities Clearing 
Corporation; Notice of Filing and Immediate Effectiveness of a Proposed 
Rule Change To Establish Implementation Date of National Securities 
Clearing Corporation's Enhancements to the Haircut-Based Volatility 
Charge Applicable to Municipal Bonds

March 6, 2020.
    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 March 3, 2020, 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 Section 19(b)(3)(A) \3\ of the Act and 
subparagraph (f)(4) \4\ of Rule 19b-4 thereunder. The Commission is 
publishing this notice to solicit comments on the proposed rule change 
from interested persons.
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    \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).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    The proposed rule change consists of amendments to the NSCC Rules & 
Procedures (the ``Rules'') \5\ in order to establish the implementation 
date \6\ of rule changes (``Approved Rule Change'') submitted pursuant 
to rule filing SR-NSCC-2019-004 (``Rule Filing'') \7\ and advance 
notice SR-NSCC-2019-801 (``Advance Notice'').\8\ Pursuant to the 
proposed rule change, the Rules would be amended to state that the 
Approved Rule Change will be implemented by March 27, 2020, as 
discussed below.
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    \5\ Capitalized terms not defined herein are defined in the 
Rules, available at http://dtcc.com/~/media/Files/Downloads/legal/
rules/nscc_rules.pdf.
    \6\ The implementation date was previously set for February 28, 
2020 pursuant to rule filing NSCC-2020-004. See Securities Exchange 
Act Release No. 88260 (February 21, 2020), 85 FR 11425 (February 27, 
2020) (SR-NSCC-2020-004).
    \7\ See Securities Exchange Act Release No. 87858 (December 26, 
2019), 85 FR 149 (January 2, 2020) (SR-NSCC-2019-004).
    \8\ See Securities Exchange Act Release No. 87911 (January 8, 
2020), 85 FR 2197 (January 14, 2020) (File No. SR-NSCC-2019-801).
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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
    On February 13, 2020, the Commission issued an order approving the 
Rule Filing,\9\ which was filed by NSCC pursuant to Section 19(b)(2) of 
Act'').\10\ The Commission also issued a notice of no objection to the 
Advance Notice,\11\ which was filed with the Commission pursuant to 
Section 806(e)(1) of Title VIII of the Dodd-Frank Wall Street Reform 
and Consumer Protection Act entitled the Payment, Clearing, and 
Settlement Supervision

[[Page 14512]]

Act of 2010 \12\ and Rule 19b-4(n)(1)(i) of the Act.\13\
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    \9\ See Securities Exchange Act Release No. 88191 (February 13, 
2020), 85 FR 9843 (February 20, 2020) (SR-NSCC-2019-004).
    \10\ 15 U.S.C. 78s(b)(2).
    \11\ See Securities Exchange Act Release No. 88162 (February 11, 
2020), 85 FR 8798 (February 18, 2020) (SR-NSCC-2019-801).
    \12\ 12 U.S.C. 5465(e)(1).
    \13\ 17 CFR 240.19b-4(n)(1)(i).
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    The purpose of the Approved Rule Change is to amend the Rules to 
enhance the methodology NSCC uses for calculating the haircut-based 
margin charge applicable to municipal bonds.
    NSCC is filing this proposed rule change to establish that the 
Approved Rule Change submitted pursuant to the Rule Filing and the 
Advance Notice will be implemented by March 27, 2020. Specifically, 
NSCC would add a legend to Procedure XV (Clearing Fund Formula and 
Other Matters) of the Rules (``Procedure XV'') \14\ to state that the 
rule changes submitted pursuant to the Rule Filing and the Advance 
Notice have been approved and not objected to, respectively, but are 
not yet implemented. The legend would provide that these rule changes 
would be implemented by March 27, 2020 and include the file numbers of 
the Rule Filing and the Advance Notice. The legend would also state 
that when the rule changes are implemented, NSCC will announce the 
implementation by important notice and the legend would automatically 
be removed from Procedure XV.
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    \14\ Procedure XV, supra note 5.
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2. Statutory Basis
    Section 17A(b)(3)(F) of the Act requires, in part, that the Rules 
be designed to (i) promote the prompt and accurate clearance and 
settlement of securities transactions and (ii) remove impediments to 
and perfect the mechanism of a national system for the prompt and 
accurate clearance and settlement of securities transactions, and, in 
general, to protect investors and the public interest.\15\ The proposed 
rule change would establish that the Approved Rule Change would be 
implemented by March 27, 2020 and provide Members with an understanding 
of when the Approved Rule Change will begin to affect them. Knowing 
when the rule changes will begin to affect Members would enable them to 
timely fulfill their obligations to NSCC, which would in turn ensure 
NSCC's processes work as intended. Therefore, NSCC believes that the 
proposed rule change would promote the prompt and accurate clearance 
and settlement of securities transactions as well as remove impediments 
to and perfect the mechanism of a national system for the prompt and 
accurate clearance and settlement of securities transactions, 
consistent with Section 17A(b)(3)(F) of the Act cited above.
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    \15\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Clearing Agency's Statement on Burden on Competition

    NSCC does not believe that the proposed rule change to establish an 
implementation date for the Approved Rule Change would have any impact, 
or impose any burden, on competition because the proposed rule change 
is intended to provide additional clarity in the Rules with respect to 
when these rule changes would be implemented. As such, the proposed 
rule change would not affect the rights or obligations of the Members 
or NSCC other than establishing when the rule changes described above 
would begin to impact the Members.

(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. NSCC will notify the Commission of any written comments 
received by NSCC.

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) \16\ of the Act and paragraph (f) \17\ 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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    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-NSCC-2020-006 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-2020-006. 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 (http://www.sec.gov/rules/sro.shtml). 
Copies of the submission, all subsequent amendments, all written 
statements with respect to the proposed rule change that are filed with 
the Commission, and all written communications relating to the proposed 
rule change between the Commission and any person, other than those 
that may be withheld from the public in accordance with the provisions 
of 5 U.S.C. 552, will be available for website viewing and printing in 
the Commission's Public Reference Room, 100 F Street NE, Washington, DC 
20549 on official business days between the hours of 10:00 a.m. and 
3:00 p.m. Copies of the filing also will be available for inspection 
and copying at the principal office of NSCC and on DTCC's website 
(http://dtcc.com/legal/sec-rule-filings.aspx). All comments received 
will be posted without change. Persons submitting comments are 
cautioned that we do not redact or edit personal identifying 
information from comment submissions. You should submit only 
information that you wish to make available publicly. All submissions 
should refer to File Number SR-NSCC-2020-006 and should be submitted on 
or before April 2, 2020.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
J. Matthew DeLesDernier,
Assistant Secretary.


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    \18\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2020-05029 Filed 3-11-20; 8:45 am]
 BILLING CODE 8011-01-P