Federal Register / Vol. 77, No. 81 / Thursday, April 26, 2012 / Notices 25007 

1See Securities Exchange Act Release No. 64976 

(July 27, 2011), 76 FR 46960 (Aug. 3, 2011) (‘‘Rule 

13h–1 Adopting Release’’). The effective date of 

Rule 13h–1 was October 3, 2011. 

2See 15 U.S.C. 78m and 17 CFR 240.13h–1(g), 

respectively. 

3The effective date for Rule 13h–1 remains 

October 3, 2011. The compliance date for the 

requirement on large traders to identify to the 

Commission pursuant to Rule 13h–1(b) was 

December 1, 2011. 

4The term ‘‘Unidentified Large Trader’’ means 

each person who has not complied with the 

identification requirements of paragraphs (b)(1) and 

(b)(2) of Rule 13h–1 that a registered broker-dealer 

knows or has reason to know is a large trader. See 

17 CFR 240.13h–1(a)(9). For purposes of 

determining whether a registered broker-dealer has 

reason to know that a person is a large trader, a 

registered broker-dealer need take into account only 

transactions in NMS securities effected by or 

through such broker-dealer. See id. 

5See 17 CFR 240.13h–1(d)(2)(xii). 

6See 17 CFR 240.13h–1(d)(2)(xiii). 

7The reporting activity level is 100 shares. See 17 

CFR 240.13h–1(a)(8). Accordingly, in response to a 

Commission request for EBS information, brokerdealers are required to report information for each 

account in which any large trader’s or Unidentified 

Large Trader’s activity amounts to at least 100 

shares in the aggregate. 

In response to a Commission request for 

transaction records, in addition to reporting 

information for any identified large trader (i.e., a 

person for whom the broker-dealer has received an 

LTID number), the broker-dealer also should report 

records for each Unidentified Large Trader, as 

applicable, including any unique identifying 

number that the broker-dealer has assigned to such 

person. 

8See 17 CFR 240.13h–1(e). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.37

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2012–10027 Filed 4–25–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66839] 

Order Temporarily Exempting BrokerDealers From the Recordkeeping, 

Reporting, and Monitoring 

Requirements of Rule 13h–1 Under the 

Securities Exchange Act of 1934 and 

Granting an Exemption for Certain 

Securities Transactions 

April 20, 2012. 

I. Introduction 

On July 27, 2011, the Securities and 

Exchange Commission (‘‘Commission’’) 

adopted Rule 13h–1 under the 

Securities Exchange Act of 1934 

(‘‘Exchange Act’’) concerning large 

trader reporting to assist the 

Commission in both identifying, and 

obtaining trading information on, 

market participants that conduct a 

substantial amount of trading activity, 

as measured by volume or market value, 

in U.S. securities (such persons are 

referred to as ‘‘large traders’’).1

Pursuant to Exchange Act Section 

13(h)(6) and Rule 13h–1(g) thereunder,2

the Commission, by order, may exempt 

from the provisions of Rule 13h–1, upon 

specified terms and conditions or for 

stated periods, any person or class of 

persons or any transaction or class of 

transactions from the provisions of Rule 

13h–1 to the extent that such exemption 

is consistent with the purposes of the 

Exchange Act. 

Currently, the compliance date for the 

broker-dealer recordkeeping and 

reporting requirements of Rule 13h–1(d) 

and (e), respectively, as well as the 

requirement under Rule 13h–1(f) for 

broker-dealers to monitor their 

customers’ accounts for activity that 

may trigger the large trader 

identification requirements of Rule 13h– 

1, is April 30, 2012. As discussed below, 

the Commission is temporarily 

exempting registered broker-dealers 

from the requirements of new Rule 

13h–1 by extending the April 30, 2012 

compliance date to provide them with 

additional time to comply with the 

recordkeeping, reporting, and 

monitoring requirements of the Rule. 

Specifically, and as discussed more 

fully below, the Commission is 

extending the April 30, 2012 

compliance date for registered brokerdealers to May 1, 2013, except for 

certain broker-dealers that: (1) Are large 

traders or (2) have large trader 

customers that are either broker-dealers 

or that trade through a ‘‘sponsored 

access’’ arrangement, for which the 

Commission is extending the 

compliance date to November 30, 2012.3

The extension of the compliance date 

will allow broker-dealers additional 

time to develop, test, and implement 

enhancements to their recordkeeping 

and reporting systems as required under 

Rule 13h–1 and, for those broker-dealer 

requirements for which the compliance 

date has been extended to May 1, 2013, 

for the Commission to consider requests 

for relief from certain provisions of the 

Rule. 

In addition, the Commission is 

exempting certain transactions from the 

definition of the term ‘‘transaction’’ 

provided in Rule 13h–1(a)(6), but for the 

sole purpose of determining whether a 

person is a large trader. 

II. Broker-Dealer Recordkeeping and 

Reporting 

A. Introduction 

Recordkeeping. In addition to 

requiring large traders to register with 

the Commission by filing and 

periodically updating Form 13H, Rule 

13h–1 requires certain broker-dealers to, 

among other things, maintain specified 

records of transactions that they effect, 

directly or indirectly, for large traders, 

and to report to the Commission, upon 

request of the Commission, such records 

in electronic format. Specifically, Rule 

13h–1(d) requires broker-dealers to 

maintain records of the information 

specified in Rule 13h–1(d) for all 

transactions effected directly or 

indirectly by or through: 

(i) An account such broker-dealer 

carries for a large trader or an 

Unidentified Large Trader,4 or 

(ii) If the broker-dealer is a large 

trader, any proprietary or other account 

over which such broker-dealer exercises 

investment discretion. 

(iii) Additionally, where a non-brokerdealer carries an account for a large 

trader or an Unidentified Large Trader, 

the broker-dealer effecting transactions 

directly or indirectly for such large 

trader or Unidentified Large Trader 

shall maintain records of all of the 

information required under the Rule for 

those transactions. 

The information required to be 

maintained for large trader accounts 

includes the standard information 

currently captured pursuant to Rule 

17a–25 and the Electronic Blue Sheets 

(‘‘EBS’’) system, plus two new fields 

that are unique to Rule 13h–1: (1) The 

time that the transaction was executed 

(‘‘execution time’’) 5 and (2) the large 

trader identification (‘‘LTID’’) number(s) 

associated with the account.6

Reporting. Rule 13h–1(e) requires 

every registered broker-dealer who is 

itself a large trader or carries an account 

for a large trader or an Unidentified 

Large Trader to report electronically to 

the Commission, at the Commission’s 

request, the required transaction 

information on such persons whose 

activity is equal to or greater than the 

reporting activity level.7 In addition, the 

Rule provides that where a non-brokerdealer carries an account for a large 

trader or an Unidentified Large Trader, 

the broker-dealer effecting such 

transactions directly or indirectly for a 

large trader must electronically report 

such information, at the Commission’s 

request. 

Broker-dealers are required to report 

information to the Commission upon 

request of the Commission.8 Information 

must be reported to the Commission no 

later than the day and time specified in 

the Commission’s request for 

transaction information, which shall be 

no earlier than the open of business of 


tkelley on DSK3SPTVN1PROD with NOTICES
25008 Federal Register / Vol. 77, No. 81 / Thursday, April 26, 2012 / Notices 

9See 17 CFR 240.13h–1(e). See also 17 CFR 

240.13h–1(d)(5) (requiring that the records required 

to be kept pursuant to the provisions of Rule 13h– 

1 must be available for reporting on the morning 

after the day the transactions were effected 

(including Saturdays and holidays)). 

10See Letter from Manisha Kimmel, Executive 

Director, Financial Information Forum, to Robert 

Cook, Director, and David Shillman, Associate 

Director, Division of Trading and Markets, 

Commission, dated January 25, 2012 (‘‘FIF Letter’’), 

available at: http://www.sec.gov/comments/s7-10- 

10/s71010.shtml. 

11See Letter from Ann L. Vlcek, Managing 

Director and Associate General Counsel, SIFMA, to 

David S. Shillman, Associate Director, Division, 

Commission, dated March 29, 2012, available at: 

http://www.sec.gov/comments/s7-10-10/ 

s71010.shtml. 

12See FIF Letter, supra note 10, at 5. 

13 In other words, executions in average price 

processing accounts would be reported with the 

execution time for each trade but would not include 

the applicable LTID number(s) associated with the 

transaction, and allocations out of average price 

processing accounts would be reported with the 

applicable LTID number(s) but not the execution 

times of the constituent trades. 

14See FIF Letter, supra note 10, at 2. 

15This includes the large trader broker-dealer 

itself, if self-clearing. 

16See FIF Letter, supra note 10, at 2 and 22. FIF 

defines a ‘‘sponsored access’’ arrangement by 

reference to the Commission’s Market Access 

release (Securities Exchange Act Release No. 63241 

(November 3, 2010), 75 FR 69792 (November 15, 

2010) (S7–03–10)), generally as an arrangement 

where a broker-dealer permits a customer to enter 

orders into a trading center without using the 

broker-dealer’s trading system (i.e., using the 

customer’s own technology or that of a third party 

provider). FIF indicates that compliance is easier 

for sponsored access customers because those 

arrangements typically are distinct from all other 

business lines of the broker-dealer, with 

infrastructure that processes this order flow that is 

separate from the platforms that handle other client 

and proprietary flows. See id. at 5. 

17See, e.g., FINRA Regulatory Notice 11–56 

(December 2011) (concerning proposed 

enhancements to EBS submissions). As reflected in 

that Regulatory Notice, the ISG’s proposed 

enhancements currently have an effective date of 

August 31, 2012. Commission staff are currently 

working with the ISG on the changes to the EBS 

record layout and expects to be able to coordinate 

the implementation dates as requested. 

18Commission staff have published written 

responses to a series of ‘‘Frequently Asked 

Questions’’ that staff have received since the 

Commission’s adoption of Rule 13h–1 and Form 

13H. See Responses to Frequently Asked Questions 

Concerning Large Trader Reporting, available at: 

http://www.sec.gov/divisions/marketreg/mrfaq.htm. 

19 In connection with any potential relief that the 

Commission may grant on or before the new May 

1, 2013 date, the Commission would consider the 

appropriateness of an implementation period as 

well as a systems testing schedule beyond May 1, 

2013. 

20 In its request, FIF asked the Commission for 

‘‘relief for broker dealers involved in Large Trader 

transactions that do not have a direct relationship 

with the Large Trader. Only the self-clearing and 

clearing broker dealers with a direct relationship 

with the Large Trader would perform Large Trader 

Reporting.’’ See FIF Letter, supra note 10, at 2. In 

Appendix C of its letter, FIF provides an example 

of the entities for whom it recommends imposing 

a recordkeeping and reporting obligation. See id. at 

25. Specifically, FIF recommends that the reporting 

the day following the request, unless in 

unusual circumstances same day 

submission of information is requested.9

B. Request for Extension of Compliance 

Date and Other Relief From BrokerDealer Recordkeeping and Reporting 

Requirements 

The Financial Information Forum 

(‘‘FIF’’), representing a variety of brokerdealers and other market participants, 

has requested that the Commission 

extend the compliance date to 

November 30, 2012 for the broker-dealer 

recordkeeping and reporting provisions 

of Rule 13h–1, and provide certain 

substantive relief with respect to those 

provisions.10 The Securities Industry 

and Financial Markets Association 

(‘‘SIFMA’’) also has approached 

Commission staff with an outline for 

relief similar to that requested by FIF, 

including a phased implementation 

approach.11

FIF and SIFMA believe that brokerdealers need additional time to perform 

the business analysis, development, and 

testing required to implement the Rule’s 

recordkeeping and reporting 

requirements. FIF and SIFMA also 

believe that relief from certain of the 

substantive requirements of the Rule is 

warranted in order to reduce the 

implementation costs for some brokerdealers.12 Among other things, FIF has 

requested relief from the reporting 

requirements for non-self clearing 

broker-dealers, such that only clearing 

broker-dealers (including large traders 

that are themselves self-clearing brokerdealers) would report large trader 

transaction data to the Commission 

through the EBS infrastructure. Further, 

for large trader customers other than 

those using ‘‘sponsored access’’ 

arrangements, FIF has requested relief 

from providing LTID numbers on 

executions in average price processing 

accounts, and execution time on 

allocations made out of average price 

processing accounts.13 FIF also 

requested relief for broker-dealers 

effecting transactions for a large trader 

other than the large trader’s clearing 

broker.14 FIF did not request relief from 

the substantive requirements of the Rule 

for clearing brokers 15 where the large 

trader customer either (1) is a U.S. 

registered broker-dealer or (2) has a 

‘‘sponsored access’’ arrangement.16

Finally, FIF and SIFMA requested that 

the Commission coordinate the Rule’s 

implementation dates with those for a 

series of separate changes to the EBS 

record layout that have been proposed 

by the Intermarket Surveillance 

Group,17 and that Commission staff 

provide guidance on a range of 

suggested ‘‘Frequently Asked 

Questions’’ relating to the Rule.18

C. Extension of Compliance Date for the 

Broker-Dealer Requirements 

The Commission believes that it is 

appropriate and consistent with the 

purposes of the Exchange Act to provide 

a temporary exemption from the brokerdealer recordkeeping, reporting, and 

monitoring requirements of Rule 13h–1 

by extending the Rule’s compliance date 

on a limited basis. FIF raised a variety 

of implementation concerns relating to 

the application of the Rule to brokerdealers other than the large trader’s 

clearing broker, and in cases where the 

large trader customer is neither a U.S.- 

registered broker-dealer nor a sponsored 

access customer. An extension of the 

compliance date should provide the 

Commission an opportunity to work 

with market participants to more fully 

examine the implementation issues 

raised by FIF, assess the appropriateness 

of any exemptive relief, and allow 

broker-dealers time to develop, test, and 

implement the necessary systems 

changes once the examination of 

implementation issues is complete. 

However, the Commission believes a 

more modest extension of the 

compliance date is appropriate for those 

aspects of the Rule for which 

substantive relief was not requested— 

namely compliance by the large trader’s 

clearing broker (including the large 

trader itself if it is a self-clearing brokerdealer) where the large trader customer 

either (1) is a U.S. registered brokerdealer or (2) has a ‘‘sponsored access’’ 

arrangement. The Commission believes 

that temporarily exempting registered 

broker-dealers from the recordkeeping, 

reporting, and monitoring requirements 

of Rule 13h–1 for the stated periods 

should facilitate the orderly and 

meaningful implementation of the 

requirements for those broker-dealers 

that need more time to comply with the 

new rule. 

Recordkeeping and Reporting 

Requirements for Broker-Dealers. 

Accordingly, the Commission is 

providing a temporary exemption to 

extend the compliance date to May 1, 

2013, for the broker-dealer 

recordkeeping, reporting, and 

monitoring requirements of Rule 13h–1, 

except as described below.19

The Commission is providing a 

temporary exemption to extend the 

compliance date to November 30, 2012, 

for the broker-dealer recordkeeping and 

reporting requirements of Rule 13h–1 

with respect to a clearing broker-dealer 

for a large trader 20 where the large 

trader: 


tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 81 / Thursday, April 26, 2012 / Notices 25009 

of execution time should rest with the clearing 

broker for the originating broker, and any prime 

broker would be relieved from being required to 

report execution times. The term ‘‘a clearing brokerdealer for a large trader’’ refers to self-clearing and 

clearing broker-dealers that have a direct 

relationship with the large trader (including the 

large trader broker-dealer itself, if self-clearing). 

21The reportable activity would include 

proprietary trading by a large trader broker-dealer 

where the large trader is trading for its own 

account. 

22A ‘‘sponsored access arrangement’’ in this 

context refers to an arrangement in which a brokerdealer permits a large trader customer to enter 

orders directly to a trading center where such 

orders are not processed through the broker-dealer’s 

own trading system (other than any risk 

management controls established for purposes of 

compliance with Rule 15c3–5 under the Exchange 

Act) and where the orders are routed directly to a 

trading center, in some cases supported by a service 

bureau or other third party technology provider. See 

Securities Exchange Act Release No. 63241 

(November 3, 2010), 75 FR 69792 (November 15, 

2010) (S7–03–10). 

23Accordingly, large traders that are themselves 

registered broker-dealers but that are not selfclearing would not be required to connect to the 

EBS system to report their transactions as of 

November 30, 2012, and instead could rely on their 

clearing broker to perform the reporting 

responsibilities with respect to their reportable 

transactions during that interim period. 

In addition, FIF requested in its letter that the 

Commission provide guidance on whether 

execution times are required to be reported in 

connection with options exercises and assignments 

as well as exchange traded fund creations and 

redemptions (i.e., the actual transfers involving the 

authorized participant and the exchange traded 

fund sponsor, not the underlying purchases or sales 

of securities in the secondary market by an 

authorized participant in connection with the 

creation or redemption process). See FIF Letter, 

supra note 10, at 1. While the Commission 

continues to consider FIF’s broader request for 

relief, in the interim period, firms will not be 

required to provide execution times on any options 

exercises and assignments or exchange traded fund 

creations and redemptions that they report through 

EBS for large traders prior to May 1, 2013. 

24See FIF Letter, supra note 10, at 5. 

25See 17 CFR 240.13h–1(a)(1)(i). 

26See 17 CFR 240.13h–1(a)(6). 

27See Rule 13h–1 Adopting Release, supra note 

1, 76 FR at 46967. 

28See Letter from Sean Davy, Managing Director, 

SIFMA, to David S. Shillman, Associate Director, 

Division, Commission, dated March 26, 2012, 

available at: http://www.sec.gov/comments/s7-10- 

10/s71010.shtml (‘‘SIFMA Capital Markets Letter’’). 

29See 17 CFR 240.13h–1(a)(6)(ii) (providing an 

exclusion for ‘‘[a]ny transaction that is part of an 

offering of securities by or on behalf of an issuer, 

or by an underwriter on behalf of an issuer, or an 

agent for an issuer, whether or not such offering is 

subject to registration under the Securities Act of 

1933 (15 U.S.C. 77a), provided, however, that this 

exemption shall not include an offering of securities 

effected through the facilities of a national 

securities exchange’’). 

30SIFMA notes that a ‘‘dribble out program’’ 

enables an issuer to offer and sell its equity 

securities through one or more registered brokerdealers in incremental registered transactions that 

are effected over a period of time. See SIFMA 

Capital Markets Letter, supra note 28, at 3. Such 

offerings involve prospectus supplements, comfort 

letters, opinions of counsel, due diligence, officer’s 

certificates, and filings with the SEC. See id. SIFMA 

states that these transactions can facilitate capital 

formation for issuers, particularly during periods of 

high volatility, by avoiding some of the risks of 

underwritten offerings. See id. 

31SIFMA notes that all of part of an offering of 

securities by an issuer may be ‘‘crossed’’ on a 

national securities exchange purely for ease of 

settlement. See id. SIFMA believes that the 

character of this type of offering makes it 

distinguishable from ordinary secondary market 

trading. See id. 

32See id. 

(1) Is a U.S.-registered broker-dealer,21

or 

(2) Trades through a sponsored access 

arrangement.22

On November 30, 2012, these clearing 

brokers should be prepared to record 

and report disaggregated trade 

information, together with the LTID 

number (or numbers, if applicable) and 

execution time, for these two categories 

of large traders, in accordance with the 

requirements of Rule 13h–1.23

As explained in FIF’s letter, the 

trading activity of these categories of 

large traders typically is processed by 

clearing brokers on infrastructure 

separate from that used for other 

customers, so that compliance with the 

Rule requires substantially less effort 

than for other types of large trader 

customers.24 Further, the Commission 

believes that limiting the recordkeeping 

and reporting responsibility to clearing 

brokers for this initial compliance 

period is reasonable as it narrows the 

universe of reporting entities to brokerdealers that currently are connected to 

the EBS system. 

Monitoring Requirements. The 

Commission also is providing a 

temporary exemption to extend the 

compliance date to May 1, 2013 for the 

requirement on registered broker-dealers 

to monitor their customers’ accounts for 

activity that may trigger the large trader 

identification requirements of Rule 13h– 

1. This extension should allow firms to 

focus their resources on the 

recordkeeping and reporting provisions 

and facilitate the orderly 

implementation of those provisions. 

III. Exemption for Certain Transactions 

Rule 13h–1(a)(1)(i) defines a large 

trader as a person who, among other 

things, ‘‘effects transactions for the 

purchase or sale of any NMS security 

* * *’’ 25 Rule 13h–1(a)(6) defines the 

term ‘‘transactions’’ as ‘‘all transactions 

in NMS securities, excluding exercises 

or assignments of option contracts,’’ 

except for certain specifically 

enumerated transactions.26 The 

exceptions from the term ‘‘transaction’’ 

were designed to exclude certain 

transactions from the identifying 

activity level calculation that are not 

effected with an intent that is commonly 

associated with the arm’s-length trading 

of securities in the secondary market 

and therefore would not fall within the 

types of transactions that are 

characterized by the exercise of 

investment discretion for purposes of 

Rule 13h–1.27 Rather, these enumerated 

categories of transactions generally are 

effected for materially different reasons 

that reflect fundamental corporate 

decision-making or capital formation 

objectives and therefore are not effected 

with an intent that is normally 

associated with secondary-market 

trading activity in NMS securities. 

SIFMA has requested that certain 

additional types of transactions 

involving securities offerings be 

excluded from being counted towards 

the identifying activity level.28 Under 

the Rule, offerings of securities by or on 

behalf of an issuer generally are 

excluded for purposes of determining 

whether a person is a large trader, but 

that exemption expressly does not apply 

to ‘‘an offering of securities effected 

through the facilities of a national 

securities exchange.’’ 29 The 

Commission understands from SIFMA 

that, while the Rule does exclude the 

vast majority of primary offerings, 

certain offerings such as ‘‘dribble out’’ 

programs 30 or offerings ‘‘crossed’’ on a 

national securities exchange 31 occur 

with enough regularity to warrant relief 

for the reasons discussed below. In 

addition, while the Rule excludes 

offerings of securities by or on behalf of 

an issuer, it does not exclude sales of 

stock acquired as part of employee 

compensation by current or former 

selling employees of the issuer in 

connection with those offerings. SIFMA 

argues in its letter that offerings effected 

through the facilities of a national 

securities exchange, as well as sales by 

issuer employees in an initial public 

offering or registered secondary offering, 

similarly are effected for materially 

different reasons than those normally 

associated with secondary-market 

trading activity, and should be excluded 

for purposes of determining whether a 

person is a large trader.32

The Commission believes that it is 

appropriate and consistent with the 

purposes of the Exchange Act to not 

count these transactions for the purpose 

of determining whether a person meets 

the identifying activity level. 

Accordingly, the Commission hereby is 

exempting from the definition of the 

term ‘‘transaction,’’ for the sole purpose 

of determining whether a person is a 

large trader: (1) Any transaction that is 

part of an offering of securities by or on 

behalf of an issuer, or by an underwriter 

on behalf of an issuer, or an agent for 


tkelley on DSK3SPTVN1PROD with NOTICES
25010 Federal Register / Vol. 77, No. 81 / Thursday, April 26, 2012 / Notices 

33This includes the large trader broker-dealer 

itself, if self-clearing. 

34A ‘‘sponsored access arrangement’’ in this 

context refers to an arrangement in which a brokerdealer permits a large trader customer to enter 

orders directly to a trading center where such 

orders are not processed through the broker-dealer’s 

own trading system (other than any risk 

management controls established for purposes of 

compliance with Rule 15c3–5 under the Exchange 

Act) and where the orders are routed directly to a 

trading center, in some cases supported by a service 

bureau or other third party technology provider. See 

Securities Exchange Act Release No. 63241 

(November 3, 2010), 75 FR 69792 (November 15, 

2010) (S7–03–10). 

an issuer, whether or not such offering 

is subject to registration under the 

Securities Act of 1933, regardless of 

whether such transaction is effected 

through the facilities of a national 

securities exchange; and (2) sales of 

securities by a selling shareholder in 

connection with an initial public 

offering or in a registered secondary 

offering if such selling shareholder is a 

current or former employee of the issuer 

and the securities being sold were 

acquired as part of the person’s 

compensation as an employee of the 

issuer. The Commission believes that 

providing this limited exemption will 

continue to ensure that Rule 13h–1 

provides a mechanism for the 

Commission to gather data on persons 

that conduct a significant amount of 

secondary market trading in NMS 

securities, while providing limited relief 

to issuers and selling shareholders who 

would not otherwise meet the definition 

of large trader in the absence of these 

capital market transactions. Because 

such transactions typically are 

infrequent in nature and are 

distinguishable in character from the 

secondary market activity that is the 

focus of Rule 13h–1, this exemption 

should preserve the Commission’s 

ability to identify large traders while 

reducing burdens on issuers and selling 

shareholders and thereby assist in the 

promotion of capital formation. 

IV. Conclusion 

It is hereby ordered, pursuant to 

Exchange Act Section 13(h)(6) and Rule 

13h–1(g) thereunder, that broker-dealers 

subject to the recordkeeping, reporting, 

and monitoring requirements of Rule 

13h–1 are temporarily exempted from 

those requirements until May 1, 2013, 

except that clearing broker-dealers for a 

large trader that either (1) is a U.S.- 

registered broker-dealer,33 or (2) trades 

through a sponsored access 

arrangement,34 are temporarily 

exempted from the recordkeeping and 

reporting provisions of Rule 13h–1 only 

until November 30, 2012. 

Further, it is hereby ordered, pursuant 

to Exchange Act Section 13(h)(6) and 

Rule 13h–1(g) thereunder, that: (1) 

Transactions that are part of an offering 

of securities by or on behalf of an issuer, 

or by an underwriter on behalf of an 

issuer, or an agent for an issuer, whether 

or not such offering is subject to 

registration under the Securities Act of 

1933, or such transaction is effected 

through the facilities of a national 

securities exchange, and (2) sales of 

securities by a selling shareholder in 

connection with an initial public 

offering or in a registered secondary 

offering if such selling shareholder is a 

current or former employee of the issuer 

and the securities being sold were 

acquired as part of the person’s 

compensation as an employee of the 

issuer, are hereby exempt from the 

definition of the term ‘‘transaction’’ 

under Rule 13h-1(a)(6) for the sole 

purpose of determining whether a 

person is a large trader. 

By the Commission. 

Elizabeth M. Murphy, 

Secretary. 

[FR Doc. 2012–10026 Filed 4–25–12; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #13065 and #13066] 

Hawaii Disaster # HI–00026 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Notice. 

SUMMARY: This is a Notice of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the State of Hawaii (FEMA–4062–DR), 

dated 04/18/2012. 

Incident: Severe Storms, Flooding, 

and Landslides. 

Incident Period: 03/03/2012 through 

03/11/2012. 

Effective Date: 04/18/2012. 

Physical Loan Application Deadline 

Date: 06/18/2012. 

Economic Injury (EIDL) Loan 

Application Deadline Date: 01/18/2013. 

ADDRESSES: Submit completed loan 

applications to: U.S. Small Business 

Administration, Processing and 

Disbursement Center, 14925 Kingsport 

Road, Fort Worth, TX 76155. 

FOR FURTHER INFORMATION CONTACT: A. 

Escobar, Office of Disaster Assistance, 

U.S. Small Business Administration, 

409 3rd Street SW., Suite 6050, 

Washington, DC 20416. 

SUPPLEMENTARY INFORMATION: Notice is 

hereby given that as a result of the 

President’s major disaster declaration on 

04/18/2012, Private Non-Profit 

organizations that provide essential 

services of governmental nature may file 

disaster loan applications at the address 

listed above or other locally announced 

locations. 

The following areas have been 

determined to be adversely affected by 

the disaster: 

Primary Counties Kauai. 

The Interest Rates are: 

Percent 

For Physical Damage: 

Non-Profit Organizations With 

Credit Available Elsewhere ....... 3.125 

Non-Profit Organizations Without 

Credit Available Elsewhere ....... 3.000 

For Economic Injury: 

Non-Profit Organizations Without 

Credit Available Elsewhere ....... 3.000 

The number assigned to this disaster 

for physical damage is 13065B and for 

economic injury is 13066B. 

(Catalog of Federal Domestic Assistance 

Numbers 59002 and 59008) 

Joseph P. Loddo, 

Acting Associate Administrator for Disaster 

Assistance. 

[FR Doc. 2012–10112 Filed 4–25–12; 8:45 am] 

BILLING CODE 8025–01–P 

SMALL BUSINESS ADMINISTRATION 

Military Reservist Economic Injury 

Disaster Loans Interest Rate for Third 

Quarter FY 2012 

In accordance with the Code of 

Federal Regulations 13—Business Credit 

and Assistance § 123.512, the following 

interest rate is effective for Military 

Reservist Economic Injury Disaster 

Loans approved on or after April 20, 

2012. 

Military Reservist Loan Program— 

4.000% 

Dated: April 23, 2012. 

Joseph P. Loddo, 

Acting Associate Administrator for Disaster 

Assistance. 

[FR Doc. 2012–10115 Filed 4–25–12; 8:45 am] 

BILLING CODE P 

SUSQUEHANNA RIVER BASIN 

COMMISSION 

Projects Approved for Consumptive 

Uses of Water 

AGENCY: Susquehanna River Basin 

Commission. 

ACTION: Notice. 

SUMMARY: This notice lists the projects 

approved by rule by the Susquehanna 


tkelley on DSK3SPTVN1PROD with NOTICES