64374 Federal Register / Vol. 83, No. 240 / Friday, December 14, 2018 / Notices 

1Notice of the United States Postal Service of 

Filing Changes in Rates Not of General 

Applicability for Inbound Parcel Post (at UPU 

Rates), and Application for Non-Public Treatment, 

December 10, 2018, at 1–2 (Notice). 

2Notice at 4–5. See Docket No. CP2014–52, Order 

Accepting Price Changes for Inbound Air Parcel 

Post (at UPU Rates), June 26, 2014, at 6 (Order No. 

2102); Docket No. CP2015–24, Order Accepting 

Changes in Rates for Inbound Parcel Post (at UPU 

Rates), December 29, 2014, at 4 (Order No. 2310). 

3Notice at 5. See Docket Nos. MC2017–58 and 

CP2017–86, Order Acknowledging Changes in Rates 

for Inbound Parcel Post (at UPU Rates), December 

30, 2016, at 5 (Order No. 3716). 

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)(2) and (f)(4). 

5. How often the collection is required 

or requested: One time or as needed. 

6. Who will be required or asked to 

respond: Thirty-Eight Agreement States 

who have signed Section 274(b) 

Agreements with the NRC and one 

additional State expected to have a 

Section 274(b) Agreement in fiscal year 

2019. 

7. The estimated number of annual 

responses: 351. 

8. The estimated number of annual 

respondents: 39. 

9. An estimate of the total number of 

hours needed annually to comply with 

the information collection requirement 

or request: 2,808. 

10. Abstract: The Agreement States 

will be asked on a one-time or asneeded basis to respond to a specific 

incident, to gather information on 

licensing and inspection practices or 

other technical information. The results 

of such information requests, which are 

authorized under Section 274(b) of the 

Atomic Energy Act, will be utilized on 

part by the NRC in preparing responses 

to Congressional inquiries. 

Dated at Rockville, Maryland, this 11th day 

of December 2018. 

For the Nuclear Regulatory Commission. 

David C. Cullison, 

NRC Clearance Officer, Office of the Chief 

Information Officer. 

[FR Doc. 2018–27164 Filed 12–13–18; 8:45 am] 

BILLING CODE 7590–01–P 

POSTAL REGULATORY COMMISSION 

[Docket No. CP2019–43; Order No. 4919] 

Inbound Parcel Post (at UPU Rates) 

AGENCY: Postal Regulatory Commission. 

ACTION: Notice. 

SUMMARY: The Commission is 

acknowledging a recent filing by the 

Postal Service of its intention to change 

prices not of general applicability to be 

effective January 1, 2019. This notice 

informs the public of the filing, invites 

public comment, and takes other 

administrative steps. 

DATES: Comments are due: December 

18, 2018. 

ADDRESSES: Submit comments 

electronically via the Commission’s 

Filing Online system at http://

www.prc.gov. Those who cannot submit 

comments electronically should contact 

the person identified in the FOR FURTHER

INFORMATION CONTACT section by 

telephone for advice on filing 

alternatives. 

FOR FURTHER INFORMATION CONTACT: 

David A. Trissell, General Counsel, at 

202–789–6820. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. Introduction 

II. Contents of Filing 

III. Commission Action 

IV. Ordering Paragraphs 

I. Introduction 

On December 10, 2018, the Postal 

Service filed notice announcing its 

intention to change prices not of general 

applicability for Inbound Parcel Post (at 

Universal Postal Union (UPU) Rates) 

effective January 1, 2019.1

II. Contents of Filing 

To accompany its Notice, the Postal 

Service filed: A redacted copy of the 

UPU International Bureau (IB) Circular 

that contains the new prices; a copy of 

the certification required under 39 CFR 

3015.5(c)(2); redacted Postal Service 

data used to justify any bonus 

payments; a copy of the Postal Service’s 

submission to the UPU in support of an 

inflation-linked adjustment; and a 

redacted copy of Governors’ Decision 

18–2. Notice at 2–3; see id. Attachments 

2–6. The Postal Service also filed 

redacted financial workpapers. Notice at 

3. 

Additionally, the Postal Service filed 

an unredacted copy of Governors’ 

Decision 18–2, an unredacted copy of 

the new prices, and related financial 

information under seal. See id. The 

Postal Service filed an application for 

non-public treatment of materials filed 

under seal. Notice, Attachment 1. 

The Postal Service states that it has 

provided supporting documentation as 

required by Order Nos. 2102 and 2310.2

In addition, the Postal Service states 

that it provided citations and copies of 

relevant UPU IB Circulars and updates 

to inflation-linked adjustments as 

required by Order No. 3716.3

III. Commission Action 

The Commission establishes Docket 

No. CP2019–43 for consideration of 

matters raised by the Notice. 

The Commission invites comments on 

whether the Postal Service’s filing is 

consistent with 39 U.S.C. 3632, 3633, 

and 39 CFR part 3015. Comments are 

due no later than December 18, 2018. 

The public portions of the filing can be 

accessed via the Commission’s website 

(http://www.prc.gov). 

The Commission appoints Katalin K. 

Clendenin to serve as Public 

Representative in this docket. 

IV. Ordering Paragraphs 

It is ordered: 

1. The Commission establishes Docket 

No. CP2019–43 for consideration of the 

matters raised by the Postal Service’s 

Notice. 

2. Pursuant to 39 U.S.C. 505, Katalin 

K. Clendenin is appointed to serve as an 

officer of the Commission to represent 

the interests of the general public in this 

proceeding (Public Representative). 

3. Comments are due no later than 

December 18, 2018. 

4. The Secretary shall arrange for 

publication of this order in the Federal 

Register. 

By the Commission. 

Stacy L. Ruble, 

Secretary. 

[FR Doc. 2018–27163 Filed 12–13–18; 8:45 am] 

BILLING CODE 7710–FW–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–84770; File No. SR–NSCC– 

2018–011] 

Self-Regulatory Organizations; 

National Securities Clearing 

Corporation; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend Certain Fees 

and Make Other Changes 

December 10, 2018. 

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 November 

26, 2018, 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) of the Act 3 and 

Rules 19b–4(f)(2) and (f)(4) thereunder.4

The Commission is publishing this 

notice to solicit comments on the 


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5Capitalized terms not defined herein are defined 

in the Rules, available at http://www.dtcc.com/∼/ 

media/Files/Downloads/legal/rules/nscc_rules.pdf. 

6NSCC is also proposing changes to fees for 

NSCC’s Mutual Fund Services and Insurance and 

Retirement Processing Services in a separate 

proposal. In addition, NSCC’s affiliates, The 

Depository Trust Company (‘‘DTC’’) and Fixed 

Income Clearing Corporation, are proposing 

changes to their respective fees. 

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 would 

amend Addendum A (Fee Structure) of 

the NSCC Rules & Procedures 

(‘‘Rules’’) 5 with respect to certain fees 

as well as make other changes, 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 purpose of this proposed rule 

change is to amend Addendum A (Fee 

Structure) of the Rules with respect to 

certain fees and make other changes in 

order to (i) reduce complexity and 

increase transparency, (ii) better align 

fees with the costs of services provided 

by NSCC, and (iii) encourage Member 

practices that promote efficient market 

behavior. The proposed rule change 

would also make technical and 

conforming changes. Taken collectively, 

the proposed rule changes would reduce 

NSCC’s revenue by approximately 4%. 

In order to accomplish these 

objectives, NSCC is proposing to (i) 

remove fees with little or no activity, (ii) 

group fees for related or similar services 

under one fee, (iii) modify certain fees, 

and (iv) remove fees that relate to 

settlement of certain transaction 

activity. 

(i) Background 

NSCC provides clearance and 

settlement services for trades executed 

by its Members in the U.S. equity, 

corporate and municipal bond, and unit 

investment trust markets. 

Members are assessed fees in 

accordance with Addendum A (Fee 

Structure). The current Fee Structure 

covers a multitude of fees that are 

assessed on Members based upon their 

activities and the services utilized. The 

number of fees and the methods by 

which they are calculated make the 

current Fee Structure unnecessarily 

complex. In addition, certain fees in the 

current Fee Structure have over time 

become misaligned with the costs of 

services provided by NSCC. 

NSCC has undertaken a strategic 

review of its pricing structure, and 

developed a revenue and pricing 

strategy with the goals of reducing 

pricing complexity, aligning pricing 

with costs of providing the services, and 

encouraging Member practices that 

promote efficient market behavior.6

A. Pricing Overly Complex 

The number of fees and the methods 

by which they are calculated make the 

current Fee Structure difficult for 

Members to understand and reconcile. 

In fact, Members and market 

participants have often indicated to 

NSCC that the current Fee Structure is 

too complex and difficult to understand. 

In order to streamline the Fee 

Structure, the proposal would include 

changes to standardize fees and remove 

fees that have little activity or no 

activity. The proposed changes would 

also eliminate fees that relate to delivery 

of certain securities outside of NSCC. In 

addition, in order to reduce the 

complexity of pricing, the proposed 

changes would group fees for similar 

services into one fee. By simplifying and 

updating the Fee Structure, these 

proposed changes would improve the 

transparency of the Rules. 

B. Pricing Misalignment With Costs of 

Services 

Certain fees in the current Fee 

Structure have over time become 

misaligned with NSCC’s costs of 

providing the services. As such, the 

revenue from these fees no longer cover 

the costs of such services. NSCC 

believes it is reasonable and appropriate 

to assess Members fees that are 

commensurate with the costs of services 

provided to Members. Accordingly, the 

proposed changes would adjust certain 

fees so that revenue for NSCC would 

better align with the costs of the 

services. 

C. Promote Efficient Market Behavior 

The proposed changes would adjust 

certain fees in order to encourage 

Member practices that promote efficient 

market behavior. 

(ii) Proposed Fee Changes 

Based upon feedback from Members 

and market participants as well as a 

review of current fees conducted by 

NSCC as described above, NSCC is 

proposing to modify the Fee Structure to 

(i) reduce complexity and increase 

transparency, (ii) better align fees with 

the costs of services provided by NSCC, 

and (iii) encourage Member practices 

that promote efficient market behavior. 

In that respect, the proposed Fee 

Structure would consolidate 28 fees, 

modify 2 existing fees and eliminate 8 

fees, each as further described below. 

NSCC is proposing to consolidate the 

following fee groupings— 

• Bond Correction Fee for supplemental 

input on T+1 

Bond Correction Fee for supplemental 

input on T+2 

Bond Correction Fee for supplemental 

input after T+2 

Trade Rejection Fee 

• Obligation Warehouse Fee to close an 

obligation and send to Continuous 

Net Settlement (‘‘CNS’’) 

Clearance Activity Fee—the 

component that is calculated based 

on the number of sides processed 

monthly by NSCC 

Clearance Activity Fee—‘‘value into 

the net’’ component 

Fee for Flip Trades 

• Obligation Warehouse Fee to 

withhold an obligation from being 

closed and send to the CNS 

Obligation Warehouse Fee for each 

obligation closed due to 

Reconfirmation and Pricing Service 

(‘‘RECAPS’’) (charged per RECAPS 

cycle) 

Clearance Activity Fee—‘‘value out of 

the net’’ component 

Fee for Foreign Securities 

Transactions (Netted) 

• Fee for Index Creation and 

Redemption Units instruction 

submitted for regular way (T+2) 

settlement 

Fee for Index Creation and 

Redemption Units instruction 

submitted for shortened settlement 

• Fee for Failure to Deliver to CNS 

(Short-In CNS) per item short in 

CNS for 31 to 60 days at close of 

business 

Fee for Failure to Deliver to CNS 

(Short-In CNS) per item short in 

CNS for 61 to 90 days at close of 

business 


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7NSCC calculates the blended average by 

dividing the portion of 2017 revenue attributed to 

the relevant fee groups by the applicable 2017 

volume numbers. The blended average is then used 

by NSCC as the resulting consolidated fee, with 

adjustments in some instances to achieve a round 

number. NSCC believes using this blended average 

approach would minimize impact to Members. For 

example, assume NSCC is grouping Fee A and Fee 

B into one fee using the blended average approach. 

If the 2017 revenue from these two fees was 

$400,000 and these fees were collectively assessed 

2,000 times during 2017, the resulting consolidated 

fee based on a blended average would be $200 

($400,000/2,000). 

8 In addition to the Obligation Warehouse Fee to 

close an obligation and send it to CNS, NSCC is also 

proposing to group (i) the component of the 

Clearance Activity Fee that is calculated based on 

the number of sides processed monthly by the CNS 

($0.021593 per side for zero to 35,000 monthly 

sides, $0.001197 per side for 35,001 to 42,000,000 

monthly sides, and $0.000628 per side for over 

42,000,000 monthly sides) from Section II.A. and 

(ii) the Fee for Flip Trades ($.00060 per side) from 

Section II.D., into the ‘‘value into the net’’ 

component of the Clearance Activity Fee. 

9See supra note 7. 

10See supra note 8. 

Fee for Failure to Deliver to CNS 

(Short-In CNS) per item short in 

CNS for more than 90 days at close 

of business 

• Fee for CNS Stock Dividend Payment 

(Long) 

Fee for CNS Cash Dividend and 

Interest Payment (Long) 

Fee for CNS Stock Dividend Payment 

(Short) 

Fee for CNS Cash and Interest 

Payment (Short) 

• Automated Customer Account 

Transfer Service (‘‘ACATS’’) fee for 

Standard Transfer Initiation Form 

ACATS fee for Non-Standard Transfer 

Initiation Form 

ACATS fee for Recording Asset 

Delivers 

ACATS fee for Corrections—asset 

additions, deletions, or changes 

ACATS fee for Insurance Registrations 

ACATS fee for adjustment of 

customer account number 

ACATS fee for Account Transfer 

Rejects 

NSCC is proposing to modify the 

following fees— 

• Trade recording fee for each side of 

foreign security trades entered for 

settlement, but not compared by 

NSCC 

• Fee in connection with New York 

State Transfer Taxes 

NSCC is proposing to eliminate the 

following fees— 

• Bond Correction Fee for Trades 

Deleted on T+1 

• Bond Correction Fee for Trades 

Deleted on T+2 

• Bond Correction Fee for Trades 

Deleted after T+2 

• Obligation Warehouse Fee for each 

obligation closed due to Pair Off 

(charged per obligation side) 

• Fee for day deliveries to CNS to cover 

short value positions 

• Fee for research on invalid CNS 

dividend or interest claim 

• Monthly Participant Fees for trade 

input, either (a) as a Service Bureau 

or (b) by an affiliated Service 

Bureau 

• Special Service Fees for DTC 

Sponsored Accounts—available to 

each CNS participant who is not 

also a participant of DTC 

The foregoing proposed fee changes 

would address pricing complexity, 

pricing misalignment with costs of 

services, and encourage member 

practices that promote efficient market 

behavior, as further described in the 

discussion below. 

A. Fee Changes To Address Pricing 

Complexity Section I of Addendum A 

(Trade Comparison and Recording 

Service Fees) 

In Section I.B.2.a., NSCC is proposing 

to group three Bond Correction Fees 

currently assessed to the submitter for 

all supplemental input on T+1 ($0.60), 

T+2 ($0.90), and after T+2 ($1.50), along 

with the Trade Rejection Fee ($.50 per 

bond reject) from Section I.B.3., into one 

single fee. Based on a blended average 7

of the four fees using 2017 volume 

numbers, NSCC is proposing a fee of 

$0.95 to the submitter that would apply 

to all bond correction supplemental 

input after T. NSCC would accomplish 

this by deleting the four fees and 

revising the lead-in sentence to remove 

the exception language and add in $0.95 

as the fee applicable to the submitter. 

In Section I.B.2.b., NSCC is proposing 

to remove three Bond Correction Fees 

currently assessed to both sides for 

trades deleted on T+1 ($0.60), T+2 

($0.90), and after T+2 ($1.50). These fees 

currently have little or no activity, and 

NSCC is proposing to delete them. 

In Section I.C.2., NSCC is proposing 

to change the trade recording fee 

charged for a foreign security trade 

entered for settlement, but not 

compared by NSCC, from $0.75 to $0.85 

per side. NSCC is proposing this change 

in order to standardize the trade 

recording fees so that they would be the 

same for bonds as well as foreign 

security trades. NSCC believes having a 

standard trade recording fee regardless 

of the types of securities would help to 

reduce complexity of pricing and 

streamline the Fee Structure. 

In Section I.D., NSCC is proposing to 

group the $0.35 Obligation Warehouse 

Fee to close an obligation and send it to 

CNS, along with other fees, into the 

‘‘value into the net’’ component of the 

Clearance Activity Fee in Section II.A., 

given that these fees all relate to 

activities going into the netting 

process.8 Similarly, NSCC is proposing 

to group two Obligation Warehouse 

Fees, (i) the $0.05 fee to withhold an 

obligation from being closed and send to 

the CNS and (ii) the $0.35 fee for each 

obligation closed due to RECAPS 

(charged per RECAPS cycle), along with 

the Fee for Foreign Securities 

Transactions (Netted) ($.50 per item) 

from Section II.I., into the ‘‘value out of 

the net’’ component of the Clearance 

Activity Fee in Section II.A., given that 

these fees all relate to activities exiting 

the netting process. NSCC is also 

proposing to eliminate the Obligation 

Warehouse Fee for each obligation 

closed due to Pair Off that is charged 

per obligation side. This fee currently 

has little or no activity, and NSCC is 

proposing to delete it. 

In Section I.E., NSCC is proposing to 

group the two fees for Index Creation 

and Redemption Units instructions into 

one fee based on a blended average 9 of 

the two fees using 2017 volume 

numbers. Specifically, NSCC is 

grouping the $30 fee assessed on each 

side of each Index Creation and 

Redemption Units instruction submitted 

for regular way (T+2) settlement and the 

$50 fee assessed on each side of each 

Index Creation and Redemption Units 

instruction submitted for shortened 

settlement into a single $35 fee assessed 

on each side of each Index Creation and 

Redemption Units instruction 

submitted. 

Section II of Addendum A (Trade 

Clearance Fees) 

In Section II.A., NSCC is proposing to 

group the component of the Clearance 

Activity Fee that is calculated based on 

the number of sides processed monthly 

by CNS, along with other fees as 

discussed above, into the ‘‘value into 

the net’’ component of the Clearance 

Activity Fee.10 After the proposed 

consolidation, the ‘‘value into the net’’ 

component of the Clearance Activity 

Fee would increase from $0.331940430 

to $0.47 per million of processed value. 

As discussed above, NSCC is 

proposing to group the two Obligation 

Warehouse Fees from Section I.D.5 and 

9 with the ‘‘value out of the net’’ 

component of the Clearance Activity 

Fee in Section II.A., along with the Fee 

for Foreign Securities Transactions 

(Netted) ($.50 per item) from Section 

II.I. After the proposed consolidation, 


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11Based on discussion with clients, NSCC 

believes that imposing a $3.00 fee per day for each 

item short in CNS for more than 30 days is an 

appropriate amount that would serve as an effective 

deterrent to Members having CNS fails for more 

than 30 days (i.e., Members would be incentivized 

to deliver securities to CNS within 30 days of the 

settlement date so that they would not be assessed 

this daily fee). 

12See supra note 8. 

13See supra note 7. 

14 Id. 

15This service is provided under Rule 14 

(Transfer Taxes) to facilitate Members’ compliance 

with the NYS stock transfer tax, which is imposed 

on the sale or transfer of certain securities within 

New York. See supra note 5. In 2017, this service 

was utilized by approximately 14 Members, all of 

whom were either large or medium-size firms. On 

average, each Member submitted approximately 20 

forms per month. 

16See Securities Exchange Act Release No. 28085 

(June 1, 1990), 55 FR 23495 (June 8, 1990) (SR– 

NSCC–89–18). 

17See supra note 11. 

the ‘‘value out of the net’’ component of 

the Clearance Activity Fee would 

decrease from $2.36844405 to $2.12 per 

million of settling value. 

NSCC is proposing to eliminate the 

fee for day deliveries to CNS to cover 

short valued positions ($.40 per 

delivery) from Section II.B. This 

proposed change would simplify the 

Fee Structure by removing fees that 

relate to delivery of certain securities 

outside of NSCC. 

In renumbered Section II.B., NSCC is 

proposing to group the three Fees for 

Failure to Deliver to CNS (Short-In CNS) 

($.50 per item short in CNS for 31 to 60 

days at close of business; $.75 per item 

short in CNS for 61 to 90 days at close 

of business; and $1.00 per item short in 

CNS for more than 90 days at close of 

business) into a single fee, and increase 

it to $3.00 11 for each item short in CNS 

for more than 30 days at close of 

business. NSCC is proposing these 

changes not only in order to reduce 

pricing complexity but also to 

encourage Member practices that 

promote efficient market behavior, i.e., 

disincentivize Members to have CNS 

fails for more than 30 days. NSCC 

believes encouraging Members to 

address CNS fails that are more than 30 

days would promote efficient market 

behavior because securities would be 

delivered to CNS on a more timely 

basis. 

As discussed above, NSCC is 

proposing to group (i) the Fee for Flip 

Trades ($.00060 per side) from Section 

II.D., along with other fees, into the 

‘‘value into the net’’ component of the 

Clearance Activity Fee 12 and (ii) the Fee 

for Foreign Securities Transactions 

(Netted) ($.50 per item) from Section 

II.I., along with two Obligation 

Warehouse Fees, (x) the $0.05 fee to 

withhold an obligation from being 

closed and send to the CNS and (y) the 

$0.35 fee for each obligation closed due 

to RECAPS (charged per RECAPS cycle), 

into the ‘‘value out of the net’’ 

component of the Clearance Activity 

Fee. 

In renumbered Section II.G., NSCC is 

proposing to group the four fees relating 

to CNS stock dividend, cash dividend, 

and interest payments (Fee for CNS 

Stock Dividend Payment (Long)¥$12.00 

per item; Fee for CNS Cash Dividend 

and Interest Payment (Long)¥$1.40 per 

item; Fee for CNS Stock Dividend 

Payment (Short)¥$12 per item; and Fee 

for CNS Cash and Interest Payment 

(Short)¥$1.40 per item) into one fee. 

Based on a blended average 13 of the 

four fees using 2017 volume numbers, 

NSCC is proposing a fee of $1.85 for 

each CNS stock dividend, cash 

dividend, and interest payment, 

including both long and short. NSCC is 

also proposing to remove the fee for 

research on invalid CNS dividend or 

interest claim ($70 per claim). This fee 

currently has little or no activity, and 

NSCC is proposing to delete it. 

Section IV of Addendum A (Other 

Service Fees) 

In Section IV.F., NSCC is proposing to 

group seven fees relating to ACATS into 

one single fee. Specifically, NSCC is 

proposing to group the following 

ACATS fees: (i) The ACATS fee for 

Standard Transfer Initiation Form ($.18 

per submission), (ii) the ACATS fee for 

Non-Standard Transfer Initiation Form 

($.18 per submission), (iii) the ACATS 

fee for Recording Asset Delivers ($.05 

per asset which is reported by the 

delivering firm), (iv) the ACATS fee for 

Corrections¥asset additions, deletions, 

or changes ($.06 per asset), (v) the 

ACATS fee for Insurance Registrations 

($.25 per insurance registration 

submitted, to the receiver and the 

deliverer), (vi) the ACATS fee for 

adjustment of customer account number 

($.12 per adjustment), and (vii) the 

ACATS fee for Account Transfer Rejects 

($1.20 per full account reject per side 

where both parties are required by their 

designated examining authority or other 

regulatory body to use an automated 

customer account transfer service), into 

a new proposed fee for account 

transfers. Based on a blended average 14

of the seven fees using 2017 volume 

numbers, NSCC is proposing an ACATS 

fee for Account Transfers of $0.50 per 

transfer initiation. 

Section V of Addendum A (PassThrough and Other Fees) 

NSCC is proposing to eliminate the 

Monthly Participant Fees for trade 

input, either (a) as a Service Bureau or 

(b) by an affiliated Service Bureau 

($250.00 per month) from Section V.A.2. 

NSCC is also proposing to eliminate the 

Special Service Fees for DTC Sponsored 

Accounts (available to each CNS 

participant who is not also a participant 

of DTC) that is currently in Section 

V.B.1. Both of these fees currently have 

little or no activity, and NSCC is 

proposing to delete them. 

B. Fee Changes to Address Pricing 

Misalignment With Costs of Service 

In Section III.B., NSCC is proposing to 

adjust the fee assessed for services in 

connection with New York State 

(‘‘NYS’’) stock transfer taxes from $1.00 

per form to $175.00 per month.15 NSCC 

has not increased this fee since 1990 16

even though the costs of providing this 

service have increased. In addition, 

NSCC believes changing the way this fee 

is charged from ‘‘per form’’ to ‘‘per 

month’’ would simplify the fee 

reconciliation process for Members 

because they would no longer need to 

ensure the number of forms they 

submitted is consistent with fees 

charged. NSCC believes assessing 

Members a $175 monthly fee for this 

service is appropriate because doing so 

would not only allow NSCC to cover the 

increased costs of providing this service 

but also simplify the fee reconciliation 

process for Members that use this 

service. 

C. Fee Changes To Promote Efficient 

Market Behavior 

As discussed above, in renumbered 

Section II.B., NSCC is proposing to 

group the current three fees for failure 

to deliver to CNS ($.50 per item short 

in CNS for 31 to 60 days at close of 

business; $.75 per item short in CNS for 

61 to 90 days at close of business; and 

$1.00 per item short in CNS for more 

than 90 days at close of business) into 

one single fee of $3.00 17 per item short 

in CNS for more than 30 days at close 

of business. In addition to reduce 

pricing complexity, these changes are 

being proposed in order to encourage 

Member practices that promote efficient 

market behavior (i.e., encourage 

Members to address CNS fails that are 

more than 30 days). NSCC believes 

encouraging Members to address CNS 

fails that are more than 30 days would 

promote efficient market behavior 

because securities would be delivered to 

CNS on a more timely basis. 


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18See Securities Exchange Act Release 83397 

(June 8, 2018), 83 FR 27802 (June 14, 2018) (SR– 

NSCC–2018–002). 

19 15 U.S.C. 78q–1(b)(3)(D). 

20 15 U.S.C. 78q–1(b)(3)(F). 

21 17 CFR 240.17Ad–22(e)(23)(ii). 

22 15 U.S.C. 78q–1(b)(3)(D). 23 15 U.S.C. 78q–1(b)(3)(F). 

D. Technical and Conforming Changes 

NSCC is proposing a number of 

technical and conforming changes. 

Specifically, due to the grouping and/or 

removal of certain fees as described 

above, NSCC is proposing to renumber 

or re-letter, as applicable, current Fee 

Structure Sections I.D.6 to 8 and 11; 

II.A.(c), C., E. to H., and J.; IV.F.; V.A.3 

to 4; and V.B.2 to 7. 

Additionally, NSCC is proposing to 

update the format of (i) the $.40 Listed 

Equity System Correction Fees to $0.40 

in Section I.B.1., (ii) the Fails to Deliver 

to CNS (Short-In CNS) $.25 fee per item 

short in CNS for 1 to 30 days at close 

of business to $0.25 in re-lettered 

Section II.B., (iii) the $.40 per item fee 

for security orders generated to $0.40 in 

re-lettered Section II.C., (iv) the $.75 per 

item fee for Clearing Interface 

Exemption or Inclusion Instruction to 

NSCC to $0.75 in re-lettered Section 

II.E., (v) the $.06 ACATS fee for 

Recording Asset Receives to $0.06 in 

Section IV.F.2., and (vi) the $.12 ACATS 

fee for Non-CNS Receive/Deliver Orders 

issued to $0.12 in re-numbered Section 

IV.F.3. 

NSCC is also proposing to delete the 

word ‘‘withhold’’ and replace it with 

‘‘reversal’’ in the parenthetical portion 

within the lead-in sentence of Section 

I.B.2.a. This change is being proposed in 

order to conform with the recent 

revisions to simplify, clarify, and 

improve the description of the rules 

regarding submission and processing of 

syndicate takedown trades and 

syndicate takedown reversals in 

Procedure II, Section D.2(A)(2)(g) of the 

Rules.18

(iii) Expected Member Impact 

In general, NSCC anticipates that the 

proposal would result in fee reductions 

for approximately 127 Members (41%) 

and fee increases for approximately 35 

Members (11%). Of the 35 Members that 

may have their fees increased, 20 would 

have an increase of less than $1,000 per 

year, 7 would have an increase between 

$1,000 to $10,000 per year, 3 would 

have an increase of $27,000 to $40,000 

per year, and 5 would have an increase 

of $100,000 to $200,000 per year. These 

estimates are calculated based on 2017 

volume numbers. 

(iv) Member Outreach 

Beginning in June 2018, NSCC has 

conducted ongoing outreach to 

Members in order to provide them with 

notice of the proposed changes to the 

affected fees. As of the date of this 

filing, no written comments relating to 

the proposed changes have been 

received in response to this outreach. 

The Commission will be notified of any 

written comments received. 

(v) Implementation Timeframe 

NSCC would implement this proposal 

on January 1, 2019. As proposed, a 

legend would be added to the Fee 

Structure stating there are changes that 

became effective upon filing with the 

Commission but have not yet been 

implemented. The proposed legend also 

would include a date on which such 

changes would be implemented and the 

file number of this proposal, and state 

that, once this proposal is implemented, 

the legend would automatically be 

removed from the Fee Structure. 

2. Statutory Basis 

NSCC believes this proposal is 

consistent with the requirements of the 

Act, and the rules and regulations 

thereunder applicable to a registered 

clearing agency. Specifically, NSCC 

believes this proposal is consistent with 

Sections 17A(b)(3)(D) 19 and 

17A(b)(3)(F) 20 of the Act and Rule 

17Ad–22(e)(23)(ii),21 as promulgated 

under the Act, for the reasons described 

below. 

Section 17A(b)(3)(D) of the Act 

requires that the Rules provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among its 

participants.22 NSCC believes the 

proposed rule changes to the Fee 

Structure, described in detail in Item 

II(A)(1)(ii)(A) above (entitled ‘‘Fee 

Changes to Address Pricing 

Complexity’’), to reduce the complexity 

of the Fee Structure would provide for 

the equitable allocation of reasonable 

fees. NSCC believes the proposed 

changes to address pricing complexity 

are equitable because they would apply 

uniformly to all Members that use the 

applicable services. NSCC believes these 

proposed changes are reasonable 

because they are designed to reduce 

complexity and increase transparency of 

the Fee Structure with minimal client 

impact. Therefore, NSCC believes the 

proposed rule changes described in 

detail in Item II(A)(1)(ii)(A) above to 

reduce the complexity of the Fee 

Structure are consistent with Section 

17A(b)(3)(D) of the Act. 

NSCC believes the proposed rule 

changes to the Fee Structure, described 

in detail in Item II(A)(1)(ii)(B) above 

(entitled ‘‘Fee Changes to Address 

Pricing Misalignment with Costs of 

Service’’), to better align pricing with 

costs of services would provide for the 

equitable allocation of reasonable fees. 

The proposed changes would modify 

the fee assessed for services in 

connection with NYS stock transfer 

taxes from $1.00 per form to a monthly 

fee of $175 in order to better align with 

the increased costs of providing the 

services. NSCC believes the proposed 

changes to the rate as well as the 

method of charging this fee are equitable 

because they are designed to simplify 

the fee reconciliation process for 

Members and would apply uniformly to 

all Members that utilize the services. 

NSCC believes the proposed changes are 

reasonable because they would be 

commensurate with the costs of 

resources allocated by NSCC in 

providing such services. Therefore, 

NSCC believes the proposed rule 

changes to the Fee Structure described 

in detail in Item II(A)(1)(ii)(B) above to 

better align pricing with costs of 

services are consistent with Section 

17A(b)(3)(D) of the Act. 

NSCC also believes the proposed rule 

changes to the Fee Structure, described 

in detail in Item II(A)(1)(ii)(C) above 

(entitled ‘‘Fee Changes to Promote 

Efficient Market Behavior’’), to 

encourage Member practices that 

promote efficient market behavior 

would provide for the equitable 

allocation of reasonable fees. The 

proposed change would assess Members 

a daily $3 fee per item short in CNS that 

are more than 30 days at close of 

business. NSCC believes the proposed 

changes are equitable because they 

would apply uniformly to all Members 

that have CNS fails that are more than 

30 days. NSCC believes the proposed 

changes are reasonable because they are 

designed to encourage Members to 

address CNS fails that are more than 30 

days in order to promote efficient 

market behavior. Therefore, NSCC 

believes the proposed rule changes to 

the Fee Structure described in detail in 

Item II(A)(1)(ii)(C) above to encourage 

Member practices that promote efficient 

market behavior are consistent with 

Section 17A(b)(3)(D) of the Act. 

Section 17A(b)(3)(F) of the Act 

requires, in part, that the Rules be 

designed to promote the prompt and 

accurate clearance and settlement of 

securities transactions.23 The proposed 

rule changes to promote efficient market 

behavior, as described in Item 

II(A)(1)(ii)(C) above (entitled ‘‘Fee 

Changes to Promote Efficient Market 

Behavior’’), are designed to encourage 

Members to address CNS fails that are 


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24 17 CFR 240.17Ad–22(e)(23)(ii). 

25 15 U.S.C. 78q–1(b)(3)(I). 

26 15 U.S.C. 78q–1(b)(3)(D). 

27 15 U.S.C. 78q–1(b)(3)(I). 

28 Id. 

more than 30 days. In this respect, the 

proposal would encourage Member 

practices that would reduce the number 

of CNS fails that are more than 30 days 

and thereby promote the prompt and 

accurate clearance and settlement of 

securities transactions. As such, NSCC 

believes the proposed rule changes to 

promote efficient market behavior are 

consistent with Section 17A(b)(3)(F) of 

the Act. 

The proposed rule changes to make 

technical and conforming changes, as 

described in Item II(A)(1)(ii)(D) above 

(entitled ‘‘Technical and Conforming 

Changes’’), would help ensure that the 

Rules, including the Fee Structure, 

remain accurate and clear to Members. 

Having accurate and clear Rules would 

help Members to better understand their 

rights and obligations regarding NSCC’s 

clearance and settlement services. NSCC 

believes that when Members better 

understand their rights and obligations 

regarding NSCC’s clearance and 

settlement services, they can act in 

accordance with the Rules. NSCC 

believes that better enabling Members to 

comply with the Rules would promote 

the prompt and accurate clearance and 

settlement of securities transactions by 

NSCC. As such, NSCC believes the 

proposed rule changes to make 

technical and conforming changes are 

consistent with Section 17A(b)(3)(F) of 

the Act. 

Rule 17Ad–22(e)(23)(ii) under the Act 

requires NSCC to establish, implement, 

maintain and enforce written policies 

and procedures reasonably designed to 

provide sufficient information to enable 

participants to identify and evaluate the 

risks, fees, and other material costs they 

incur by participating in the covered 

clearing agency.24 NSCC believes that 

the proposed rule changes to reduce the 

complexity of the Fee Structure, as 

described in Item II(A)(1)(ii)(A) above 

(entitled ‘‘Fee Changes to Address 

Pricing Complexity’’), and to make 

technical and conforming changes, as 

described in Item II(A)(1)(ii)(D) above 

(entitled ‘‘Technical and Conforming 

Changes’’), would help ensure that the 

Fee Structure is transparent and clear to 

Members. Having a transparent and 

clear Fee Structure would help 

Members, NSCC believes, to better 

understand NSCC’s fees and help 

provide Members with increased 

predictability and certainty regarding 

the fees they incur by participating in 

NSCC. As such, NSCC believes the 

proposed rule changes to reduce the 

complexity of the Fee Structure and to 

make technical and conforming changes 

are consistent with Rule 17Ad– 

22(e)(23)(ii) under the Act. 

(B) Clearing Agency’s Statement on 

Burden on Competition 

NSCC believes the proposed rule 

changes to modify (i) the trade recording 

fee for foreign security trades and (ii) 

the fee assessed for services in 

connection with NYS stock transfer 

taxes, may have an impact on 

competition because these changes 

would likely increase the fees of those 

Members that utilize these services 

when compared to their fees under the 

current Fee Structure. NSCC believes 

these proposed rule changes could 

burden competition by negatively 

affecting such Members’ operating costs. 

While these Members may experience 

increases in their fees when compared 

to their fees under the current Fee 

Structure, NSCC does not believe such 

change in fees would in and of itself 

mean that the burden on competition is 

significant. This is because even though 

the amount of the fee increase may seem 

significant in some instances (e.g., going 

from $1 per form to $175 per month), 

NSCC believes the increase in fees 

would similarly affect all Members that 

utilize the services, and therefore the 

burden on competition would not be 

significant. 

Regardless of whether the burden on 

competition is deemed significant, 

NSCC believes any burden on 

competition that is created by these 

proposed rule changes would be 

necessary and appropriate in 

furtherance of the purposes of the Act, 

as permitted by Section 17A(b)(3)(I) of 

the Act.25

The proposed rule changes to modify 

(i) the trade recording fee for foreign 

security trades and (ii) the fee assessed 

for services in connection with NYS 

stock transfer taxes, would be necessary 

in furtherance of the purposes of the Act 

because the Rules must provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among its 

participants.26 As described above, 

NSCC believes that the proposed rule 

changes would result in fees that are 

equitably allocated (by applying 

uniformly to all Members that use the 

applicable services) and would result in 

reasonable fees (by reducing the 

complexity of the Fee Structure with 

minimal client impact and by aligning 

with costs, respectively). As such, NSCC 

believes these proposed rule changes 

would be necessary in furtherance of the 

purposes of the Act, as permitted by 

Section 17A(b)(3)(I) of the Act.27

NSCC believes any burden on 

competition that is created by the 

proposed rule changes to modify (i) the 

trade recording fee for foreign security 

trades and (ii) the fee assessed for 

services in connection with NYS stock 

transfer taxes, would also be appropriate 

in furtherance of the purposes of the 

Act. The proposed rule changes to 

modify the trade recording fee for 

foreign security trades would provide 

NSCC with the ability to assess a 

standard trade recording fee regardless 

of the types of securities and thereby 

help to reduce complexity of pricing 

and streamline the Fee Structure. The 

proposed rule changes to modify the fee 

for the NYS stock transfer tax service 

would allow NSCC to cover increased 

costs of providing the service as well as 

simplify the fee reconciliation process 

for Members that use this service. 

Having the ability to assess fees that are 

(i) standard regardless of the types of 

securities and (ii) commensurate with 

NSCC’s costs of providing the services, 

would help NSCC to (x) reduce 

complexity of pricing as well as 

streamline the Fee Structure and (y) 

continue providing dependable and 

stable clearance and settlement services 

to its Members. As such, NSCC believes 

these proposed rule changes would be 

appropriate in furtherance of the 

purposes of the Act, as permitted by 

Section 17A(b)(3)(I) of the Act.28

NSCC believes the proposed rule 

changes to promote efficient market 

behavior, as discussed above in Item 

II(A)(1)(ii)(C), may have an impact on 

competition because these changes 

would likely increase the fees of those 

Members with CNS fails that are more 

than 30 days. NSCC believes these 

proposed rule changes could burden 

competition by negatively affecting such 

Members’ operating costs. While these 

Members may experience increases in 

their fees when compared to their fees 

under the current Fee Structure, NSCC 

does not believe such change in fees 

would in and of itself mean that the 

burden on competition is significant. 

This is because even though the amount 

of the fee increase may be significant 

(with a maximum increase of $2.50 for 

each fail over 30 days), NSCC believes 

the increase in fees would similarly 

affect all Members that have CNS fails 

that are more than 30 days and therefore 

the burden on competition would not be 

significant. Regardless of whether the 

burden on competition is deemed 

significant, NSCC believes any burden 


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29 Id. 

30 15 U.S.C. 78q–1(b)(3)(D). 

31 15 U.S.C. 78q–1(b)(3)(I). 

32 Id. 

33 Id. 

34 15 U.S.C. 78s(b)(3)(A). 

35 17 CFR 240.19b–4(f). 36 17 CFR 200.30–3(a)(12). 

on competition that is created by the 

proposed rule changes to the fees 

associated with CNS fails that are more 

than 30 days would be necessary and 

appropriate in furtherance of the 

purposes of the Act, as permitted by 

Section 17A(b)(3)(I) of the Act.29

NSCC believes that the proposed rule 

changes to promote efficient market 

behavior would be necessary in 

furtherance of the purposes of the Act 

because the Rules must provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among its 

participants.30 As described above, 

NSCC believes that the proposed rule 

changes would result in fees that are 

equitably allocated (by imposing the 

fees on all Members with CNS fails 

more than 30 days) and would result in 

reasonable fees (by increasing fees to the 

extent they would serve as meaningful 

deterrents to Members having CNS fails 

that are more than 30 days). As such, 

NSCC believes the proposed rule 

changes to promote efficient market 

behavior would be necessary in 

furtherance of the purposes of the Act, 

as permitted by Section 17A(b)(3)(I) of 

the Act.31

NSCC believes any burden on 

competition that is created by the 

proposed rule changes to promote 

efficient market behavior would also be 

appropriate in furtherance of the 

purposes of the Act. NSCC believes that 

the proposed rule changes would 

encourage Members to address CNS fails 

that are more than 30 days. Reducing 

the number of CNS fails that are more 

than 30 days would, NSCC believes, 

promote the prompt and accurate 

clearance and settlement of securities 

transactions. As such, NSCC believes 

the proposed rule changes to promote 

efficient market behavior would be 

appropriate in furtherance of the 

purposes of the Act, as permitted by 

Section 17A(b)(3)(I) of the Act.32

NSCC does not believe the proposed 

rule changes to reduce the complexity of 

the Fee Structure (other than the 

proposed rule change to modify the 

trade recording fee for foreign security 

trades) and make technical and 

conforming changes, as discussed above 

in Items II(A)(1)(ii)(A) and (D), 

respectively, would impact 

competition.33 These changes would 

apply equally to all Members and would 

not affect Members’ rights and 

obligations. As such, NSCC believes 

these proposed rule changes would not 

have any impact on competition. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change Received From Members, 

Participants, or Others 

Written comments relating to this 

proposed rule change have not been 

solicited or received. 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) 

of the Act 34 and paragraph (f) of Rule 

19b–4 thereunder.35 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NSCC–2018–011 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–2018–011. 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-rulefilings.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– 

2018–011 and should be submitted on 

or before January 4, 2019. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.36

Eduardo A. Aleman, 

Deputy Secretary. 

[FR Doc. 2018–27080 Filed 12–13–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–264, OMB Control No. 

3235–0341] 

Submission for OMB Review; 

Comment Request 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736. 

Extension: 

Rule 17Ad–4(b) & (c) 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.) the Securities 

and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the existing collection of information 

provided for in the following rule: Rule 

17Ad–4(b) & (c) under the Securities 

Exchange Act of 1934 (15 U.S.C. 78a et 

seq.) (‘‘Exchange Act’’). 

Rule 17Ad–4(b) & (c) (17 CFR 

240.17Ad–4) is used to document when 

transfer agents are exempt, or no longer 

exempt, from the minimum 

performance standards and certain 


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