Federal Register / Vol. 85, No. 235 / Monday, December 7, 2020 / Notices 78897 

29 15 U.S.C. 78s(b)(3)(A). 

30 17 CFR 240.19b–4(f). 

31 17 CFR 200.30–3(a)(12). 

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). 

5Each capitalized term not otherwise defined 

herein has its respective meaning as set forth the 

Rules, By-Laws and Organization Certificate of DTC 

Continued 

using a balanced formula, to assess a fee 

that is reflective of the Member’s use of 

NSCC’s guaranteed services, so that 

NSCC can defray some of its costs and 

expenses in providing those services. 

More specifically, NSCC believes the 

proposed rule change to modify the 

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

Clearance Activity Fee would be 

appropriate because it would allow 

NSCC to assess a fee that is better 

aligned with NSCC’s increased costs 

and expenses while generating a low net 

income operating margin. 

NSCC does not believe the proposed 

change to describe its current rebate 

practice would have any impact, or 

impose any burden, on competition 

among its Members. As described above, 

this proposed rule change, as modified 

by Amendment No. 1, would replace 

outdated information currently in the 

Fee Structure with an updated 

description of NSCC’s current rebate 

practice. As described in the proposed 

language, under its current practice, 

rebates are allocated to eligible Members 

on a pro-rata basis based on such 

Members’ gross fees paid to NSCC 

within the applicable rebate period. 

Therefore, the current practice is 

applied equally to all eligible Members. 

The proposed change to provide 

Members with transparency into this 

practice would not cause any increase 

or decrease in the rebates Members may 

receive. Therefore, this proposed rule 

change, as modified by Amendment No. 

1, would not have any impact, or 

impose any burden, on competition. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change, as Modified by Amendment No. 

1, Received From Members, 

Participants, or Others 

Written comments relating to this 

proposed rule change, as modified by 

Amendment No. 1, 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, as Modified by 

Amendment No. 1, and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 19(b)(3)(A) 

of the Act 29 and paragraph (f) of Rule 

19b–4 thereunder.30 At any time within 

60 days of the filing of the proposed rule 

change, as modified by Amendment No. 

1, 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, as modified by Amendment No. 

1, 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–2020–018 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–2020–018. 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, as modified by Amendment No. 

1, that are filed with the Commission, 

and all written communications relating 

to the proposed rule change, as 

modified by Amendment No. 1, 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– 

2020–018 and should be submitted on 

or before December 28, 2020. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.31

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2020–26785 Filed 12–4–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90546; File No. SR–DTC– 

2020–014] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing and Immediate Effectiveness of 

a Proposed Rule Change, as Modified 

by Amendment No. 1, To Amend the 

Guide to the DTC Fee Schedule 

December 1, 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 November 

16, 2020, The Depository Trust 

Company (‘‘DTC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change. On November 30, 2020, DTC 

filed Amendment No. 1 to the proposed 

rule change, which revised a portion of 

the rule text and corresponding 

description in the notice relating to 

DTC’s current policy regarding the 

issuance of rebates to Participants. DTC 

filed the proposed rule change, as 

modified by Amendment No. 1, 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(2) thereunder.4

The proposed rule change, as modified 

by Amendment No. 1, is described in 

Items I, II, and III below, which Items 

have been prepared primarily by DTC. 

The Commission is publishing this 

notice to solicit comments on the 

proposed rule change, as modified by 

Amendment No. 1, from interested 

persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change, as Modified by 

Amendment No. 1 

The proposed rule change, as 

modified by Amendment No. 1,5


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(the ‘‘Rules’’), available at http://www.dtcc.com/ 

legal/rules-and-procedures.aspx. 

6Available at http://www.dtcc.com/∼/media/ 

Files/Downloads/legal/fee-guides/dtcfeeguide.pdf. 

7Pursuant to Rule 2, Section 1, each Participant 

shall pay to DTC the compensation due it for 

services rendered to the Participant based on DTC’s 

fee schedules. See Rule 2, supra note 5. 

8Pursuant to Rule 5, Section 1, an Eligible 

Security shall only be a Security accepted by the 

Corporation, in its sole discretion, as an Eligible 

Security. The Corporation shall accept a Security as 

an Eligible Security only (a) upon a determination 

by the Corporation that it has the operational 

capability and can obtain information regarding the 

Security necessary to permit it to provide its 

services to Participants and Pledgees when such 

Security is Deposited and (b) upon such inquiry, or 

based upon such criteria, as the Corporation may, 

in its sole discretion, determine from time to time. 

See Rule 5, supra note 5. See also, DTC Operational 

Arrangements Necessary for Securities to Become 

and Remain Eligible for DTC Services (‘‘OA’’), 

available at http://www.dtcc.com/∼/media/Files/ 

Downloads/legal/issue-eligibility/eligibility/ 

operational-arrangements.pdf. 

9Pursuant to Rule 1, the term ‘‘Security 

Entitlement’’ has the meaning given to the term 

‘‘security entitlement’’ in Section 8–102 of the New 

York Uniform Commercial Code. The interest of a 

Participant or Pledgee in a Security credited to its 

Account is a Security Entitlement. See Rule 1, 

supra note 5. 

10See also DTC Disclosure Framework for 

Covered Clearing Agencies and Financial Market 

Infrastructures, available at https://www.dtcc.com/ 

-/media/Files/Downloads/legal/policy-andcompliance/DTC_Disclosure_Framework.pdf, at 5. 

11See Rule 9(A), Rule 9(B), Rule 9(C) and Rule 

9(D), supra note 5, and Settlement Service Guide 

(‘‘Settlement Guide’’), available at http://

www.dtcc.com/∼/media/Files/Downloads/legal/ 

service-guides/Settlement.pdf, at 17–30. 

12See Fee Guide, supra note 6, at 19–21. 

13 DTC has provided confidential info to the 

Commission in connection with this proposed rule 

change to support the proposed fee changes. 

14Pursuant to Rule 1, the term Delivery, as used 

with respect to a Security held in the form of a 

Security Entitlement on the books of DTC, means 

debiting the Security from an Account of the 

Deliverer and crediting the Security to an Account 

of the Receiver. A Delivery may be a Delivery 

Versus Payment or a Free Delivery, or both 

collectively, as the context may require. See Rule 

1, supra note 5. 

15See Rule 9(B), supra note 5. 

16Pursuant to Rule 1, the term ‘‘Deliverer’’, as 

used with respect to a Delivery of a Security, means 

the Person which Delivers the Security. See Rule 1, 

supra note 5. 

17Pursuant to Rule 1, the term ‘‘Receiver’’, as 

used with respect to a Delivery of a Security, means 

the Person which receives the Security. See id. 

18Pursuant to Rule 1, the term ‘‘Delivery Versus 

Payment’’ means a Delivery against a settlement 

debit to the Account of the Receiver, as provided 

in Rule 9(A) and Rule 9(B) and as specified in the 

Procedures. See Rule 1, supra note 5. 

19Pursuant to Rule 1, the term ‘‘Free Delivery’’ 

means a Delivery free of any payment by the 

Receiver through the facilities of the Corporation, 

as provided in Rule 9(B) and as specified in the 

Procedures. See id. 

20See Fee Guide, supra note 6, at 19. On the night 

before settlement day (‘‘S–1’’) DTC commences 

‘‘night cycle’’ processing. During the night cycle, 

DTC operates a process (‘‘Night Batch Process’’) that 

utilizes a settlement processing algorithm capable 

of evaluating each Participant’s transaction 

obligations, available positions, transaction 

priorities and risk management controls. 

Specifically, at approximately 8:30 p.m. on S–1, 

DTC subjects all transactions eligible for processing 

to the Night Batch Process. The Night Batch Process 

runs ‘‘off-line’’ (i.e., is not visible to Participants), 

allowing DTC to run multiple processing scenarios 

until the optimal processing scenario is identified. 

Once the optimal scenario is identified, the results 

are incorporated back into DTC’s core processing 

environment on a transaction-by-transaction basis 

prior to the start of daytime processing. 

Transactions that have satisfied DTC’s risk controls 

will be staged for settlement. However, as was the 

consists of amendments to the Guide to 

the DTC Fee Schedule 6 (‘‘Fee Guide’’) 

to (i) revise and/or consolidate certain 

Fees charged to Participants for certain 

settlement services,7 (ii) modify the 

existing Participants Fund Maintenance 

Fee (‘‘Maintenance Fee’’) and (iii) 

include a description of DTC’s current 

policy regarding the issuance of rebates 

to Participants, as described below. 

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change, as Modified by 

Amendment No. 1 

In its filing with the Commission, the 

clearing agency included statements 

concerning the purpose of and basis for 

the proposed rule change, as modified 

by Amendment No. 1, and discussed 

any comments it received on the 

proposed rule change, as modified by 

Amendment No. 1. 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, as Modified by 

Amendment No. 1 

1. Purpose 

The proposed rule change, as 

modified by Amendment No. 1, would 

amend the Fee Guide to (i) revise and/ 

or consolidate certain Fees charged to 

Participants for certain settlement 

services, (ii) modify the Maintenance 

Fee and (iii) include a description of 

DTC’s policy regarding the issuance of 

rebates to Participants, as described 

below. 

Overview 

DTC is a central securities depository, 

and as such, provides a central location 

in which Eligible Securities 8 may be 

immobilized, or through which 

Securities may be dematerialized, and 

interests, in the form of Security 

Entitlements,9 in those Securities 

reflected in Accounts maintained for 

Participants.10 DTC also provides for 

end-of-day net funds settlement relating 

to these Deliveries.11

DTC operates a ‘‘low cost’’ pricing 

model and has in place procedures to 

control costs and to regularly review 

pricing levels against costs of operation. 

It reviews pricing levels against its costs 

of operation typically during the annual 

budget process. The budget is approved 

annually by the Board. DTC’s fees are 

cost-based plus a markup, as approved 

by the Board or management (pursuant 

to authority delegated by the Board), as 

applicable. This markup of ‘‘low 

margin’’ is applied to recover 

development costs and operating 

expenses, and to accumulate capital 

sufficient to meet regulatory and 

economic requirements. 

After evaluation of DTC’s short- and 

long-term financial position in 

consideration of expected Participant 

activity, revenues, cost of funding, 

market volatility, and the financial 

markets more broadly, DTC has 

determined that it would be able to 

reduce the overall amount it collects 

from Participants through fees relating 

to its settlement services and still cover 

its costs and maintain the appropriate 

low margin above costs. In this regard, 

the proposed rule change, as modified 

by Amendment No. 1, would amend the 

Settlement Services section 12 of the Fee 

Guide to reduce and/or consolidate fees, 

as described below. 

In addition, DTC proposes to (i) 

amend the Maintenance Fee 13 and (ii) 

add a description of DTC’s current 

policy regarding the issuance of fee 

rebates to Participants. 

Fee Revisions and Consolidations for 

Certain Settlement Services 

Fee Reduction for Deliver Orders and 

Consolidation of Reclaim Fees With the 

Deliver Order Fees 

A Participant may submit an 

instruction (‘‘Deliver Order’’) to DTC to 

make a Delivery 14 of Eligible Securities 

via book-entry to another Participant’s 

account.15 DTC reduces the 

Deliverer’s 16 position and increases the 

Receiver’s 17 position without the need 

to move physical certificates. Deliveries 

can be made Delivery Versus Payment 18

or as a Free Delivery,19 depending on 

the applicable Participant’s delivery 

instructions provided in the Deliver 

Order. 

A Participant is charged a fee, named 

in the Fee Guide as ‘‘Day Deliver Order 

(excluding stock loans),’’ (‘‘Day Deliver 

Order Fee’’) of 45 cents for a Deliver 

Order, except the charge is 17 cents for 

Deliver Orders submitted by the 

Participant for processing in the night 

cycle.20 The latter fee, named the ‘‘Night 


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case prior to this change, if a transaction cannot 

satisfy DTC’s control functions initially, then it will 

recycle throughout the day, continuously 

attempting to satisfy the controls until 

approximately 3:10 p.m. for valued transactions and 

until 6:35 p.m. for free transactions. See Settlement 

Guide, supra note 11 at 5 and 68. 

21See id. 

22See Securities Exchange Act Release No. 84768 

(December 10, 2018), 83 FR 64401 (December 14, 

2018) (File No. SR–DTC–2018–011). 

23See Fee Guide, supra note 6, at 19. 

Deliver Order’’ fee 21 (‘‘Night Deliver 

Order Fee’’), is lower than the former 

because it is designed to encourage 

earlier submission of transactions by 

Participants, which results in more 

efficient settlement processing by 

increasing the volume of transactions 

processed in the night-cycle, which, in 

turn, enhances intraday settlement 

processing.22

The Receiver of the Delivery is 

charged 11 cents, regardless of time, per 

receive. This fee is named in the Fee 

Guide as ‘‘Receive, regardless of time 

(excluding reclaims and stock loans and 

returns)’’ 23 (‘‘Receive Fee’’). The 

Participant may reclaim a Delivery that 

it receives, meaning it enters an 

instruction for the Delivered Security to 

be returned to the original Deliverer. 

The Deliverer and Receiver of a reclaim 

are each charged 26 cents, referred to in 

the Fee Guide under the name 

‘‘Reclaims’’ (‘‘Reclaim Fee’’). 

Pursuant to the proposed rule change, 

as modified by Amendment No. 1, DTC 

would reduce the Day Deliver Order Fee 

from 45 cents to 40 cents. The proposed 

fee reflects an amount that would 

facilitate DTC’s ability, as discussed 

above, to reduce the overall fees DTC 

collects from Participants relating to its 

settlement services and still cover its 

costs and maintain the appropriate low 

margin above costs. 

In addition, DTC would eliminate the 

Reclaim Fee and consolidate charges for 

reclaims into the Day Deliver Order Fee, 

Night Deliver Order Fee and Receive 

Fee, as applicable for the given reclaim 

activity. The fees as consolidated would 

replace the Reclaim Fee of 26 cents that, 

as mentioned above, is currently 

charged to the Deliverer and Receiver of 

a reclaim. As such, a Participant 

submitting reclaim instructions would 

incur the proposed Day Deliver Order 

Fee of 40 cents, except during the night 

cycle where it would incur the Night 

Deliver Order Fee of 17 cents. All 

receives relating to reclaims would 

cause the Receiver to be charged a 

Receive Fee of 11 cents per reclaim 

received. The proposed consolidation of 

the Reclaim Fee with the other fees 

relating to Deliver Orders and receives 

as described above, would promote 

consistency and transparency within the 

Fee Guide by causing Deliveries and 

receives to be charged for at one fee 

amount for each Delivery and one fee 

amount for each receive, regardless of 

whether the related Delivery was 

instructed as an original Deliver Order 

or as a reclaim. 

In light of the consolidation of the 

Reclaim Fee into the Day Deliver Order 

Fee, Night Deliver Order Fee and 

Receive Fee, as applicable for the given 

reclaim activity, the Fee Guide would be 

revised such that the three latter fees 

would be renamed to reflect the 

inclusion of reclaims and the Reclaim 

Fee would be removed. 

As a result of the above described 

proposed changes, the Fee Guide entries 

for the Day Deliver Order Fee, Night 

Deliver Order Fee and Receive Fee 

would be revised and the Reclaim Fee 

would be deleted, as follows (Bold, 

italicized text indicates additions, Bold, 

strikethrough text indicates deletions): 


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24See Settlement Guide, supra note 11, at 15–17. 

25See id. at 17. 

26See Fee Guide, supra note 6, at 19. 

27 Id. 

28 Id. 

29 Id. 

30Securities Exchange Act Release No. 78530 

(August 10, 2016), 81 FR 54639 (August 16, 2016) 

(SR–DTC–2016–006). 

For clarity regarding the changes 

relating to the consolidation of the 

Reclaim Fee into other fees as described 

above, the following chart compares the 

charges Participants incur for a given 

reclaim pursuant to the current Fee 

Guide and the charge that would be 

incurred pursuant to the proposed rule 

change, as modified by Amendment No. 

1. 

Reclaim Current fee name Current fee 

amount 

Proposed fee under which reclaim 

would be charged (proposed) 

Proposed fee 

amount 

Daytime Reclaim Delivery Instruction ... Reclaims ............... 26 cents ................ Day deliver order (including reclaims; 

excluding stock loans).

40 cents. 

Night Delivery Reclaim Instruction ....... Reclaims ............... 26 cents ................ Night deliver order (including reclaims) 17 cents. 

Reclaim Receive (Regardless of Time) Reclaims ............... 26 cents ................ Receive, regardless of time (including 

reclaims; excluding stock loans and 

returns).

11 cents. 

As a result of its review of pricing 

levels against costs of operation, DTC 

believes that the proposed fee changes 

would enable DTC to offset its cost and 

expense while generating a low margin. 

Fee Reduction for Deliveries and 

Receives of Securities to and From CNS 

and Consolidation of Existing Fee for 

ACATS Deliveries and Receives With 

the Reduced Fee 

Another important use of DTC bookentry transfer services is the interface of 

DTC with its affiliate National Securities 

Clearing Corporation (‘‘NSCC’’) for the 

processing of trades that are cleared and 

settled in the NSCC Continuous Net 

Settlement (‘‘CNS’’) system and are 

processed as Free Deliveries at DTC.24

DTC also processes Free Deliveries as 

instructed by NSCC to DTC relating to 

NSCC’s Automated Customer Account 

Transfer Service (‘‘ACATS’’).25

A Participant is charged 16 cents for 

the Delivery of a Security to the NSCC 

CNS account at DTC (‘‘CNS Account’’) 

on the Participant’s behalf.26 Likewise, 

the receiving Participant of a Security 

from the CNS Account is charged 16 

cents for the Delivery of the Securities 

from the CNS Account to its account.27

This fee is named in the Fee Guide as 

‘‘Delivery to/from CNS.’’ 28

Separately, a Participant is charged 12 

cents if it is Delivering or Receiving a 

Delivery from ACATS.29 This fee is 

named in the Fee Guide as ‘‘Delivery to/ 

from CNS ACAT.’’ This fee would be 

consolidated into a modified Delivery 

to/from CNS ACAT fee, as described 

below. 

Specifically, pursuant to the proposed 

rule change, as modified by Amendment 

No. 1, DTC would reduce the Delivery 

to/from CNS fee from 16 cents to 7 

cents. In addition, the Delivery to/from 

CNS ACAT fee would be consolidated 

into the proposed reduced Delivery to/ 

from CNS fee, and thus would reduce 

the charge for ACATS-related deliveries 

and receives from 12 cents to 7 cents. 

This proposed fee change reflects an 

amount that would facilitate DTC’s 

ability, as discussed above, to reduce 

the overall fees DTC collects from 

Participants relating to its settlement 

services and still cover its costs and 

maintain the appropriate low margin 

above costs. 

As a result of the above described 

proposed changes, the text of the Fee 

Guide relating to these fees would be 

revised as follows (Bold, italicized text 

indicates additions, Bold, strikethrough 

text indicates deletions): 

As a result of its review of pricing 

levels against costs of operation, DTC 

believes that these proposed fee 

amounts would enable DTC to offset its 

cost and expense while generating a low 

margin. 

Participants Fund Maintenance Fee 

The Maintenance Fee was 

implemented in 2016 in order to (i) 

diversify DTC’s revenue sources, 

mitigating its dependence on revenues 

driven by settlement volumes, and (ii) 

add a stable revenue source that would 

contribute to DTC’s operating margin by 

offsetting increasing costs and 

expenses.30 The fee is charged to all 

Participants in proportion to the 

Participant’s Actual Participants Fund 

Deposit, as described below. 

The Maintenance Fee is calculated 

monthly, in arrears, as the product of 

(A) 0.25 percent and (B) the average of 

the Participant’s Actual Participants 

Fund Deposit as of the end of each day, 

for the month, multiplied by the number 

of days in that month and divided by 

360. However, by its terms, the fee is 

waived if the monthly rate of return on 

DTC’s investment of the Participants 

Fund is less than 0.25 percent for the 

month (‘‘Waiver Provision’’). 

The Waiver Provision was included 

for the benefit of Participants. DTC 

believed that if its monthly rate of 

return on the investment of the 


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31The Depository Trust & Clearing Corporation is 

the parent company of DTC, NSCC, and FICC. 

DTCC operates on a shared services model for DTC, 

NSCC, and FICC. Most corporate functions are 

established and managed on an enterprise-wide 

basis pursuant to intercompany agreements under 

which it is generally DTCC that provides a relevant 

service to DTC, NSCC, or FICC. 

32See NSCC File No. SR–NSCC–2020–018 and 

FICC File No. SR–FICC–2020–014 available at 

https://www.dtcc.com/legal/sec-rule-filings. 

33See Fee Guide, supra note 6 at 21. 

34 DTC manages its general business risk by 

holding sufficient liquid net assets funded by equity 

to cover potential general business losses so it can 

continue operations and services as going concerns 

if those losses materialize, in compliance with the 

requirements of Rule 17Ad–22(e)(15). 17 CFR 

240.17Ad–22(e)(15). DTC maintains a Clearing 

Agency Policy on Capital Requirements which 

defines the amount of capital it must maintain for 

this purpose and sets forth the manner in which 

this amount is calculated. See Securities Exchange 

Act Release No. 89361 (July 21, 2020), 85 FR 45263 

(July 27, 2020) (SR–DTC–2020–010) (amending 

original filing). 

Participants Fund was less than 0.25 

percent, then Participants would likely 

be experiencing similarly low interest 

income on their deposits, including 

excess reserves, if applicable; in which 

case, DTC would waive the fee. 

Although this approach exposed DTC to 

the risk of not receiving revenue from 

the Maintenance Fee, DTC did not 

believe that such an exposure would be 

common, significant, or long-term. 

Proposed Modification to the 

Maintenance Fee 

Due to the coronavirus global 

pandemic and overall reaction by the 

financial markets, the rate of return on 

DTC’s investment of the Participants 

Fund has fallen below 0.25 percent, 

triggering the Waiver Provision. 

However, application of the Waiver 

Provision in this instance has proven to 

be longer and more significant than 

what DTC originally contemplated 

when drafting the provision, resulting in 

a drop in DTC’s revenues. If 

unaddressed, DTC’s revenue could 

continue to deteriorate and negatively 

impact DTC’s long-term financial 

health. 

To address this issue, DTC is 

removing the Waiver Provision so that 

DTC will be able to generate revenue 

from the Maintenance Fee even if DTC’s 

monthly rate of return on the 

investment of the Participants Fund is 

less than 0.25 percent. The ability to 

generate such revenue under such 

circumstances is important in helping 

DTC offset its costs and expenses in any 

economic environment. Additionally, 

the proposed change would help 

provide consistent pricing between DTC 

and its affiliate clearing agencies, NSCC 

and Fixed Income Clearing Corporation 

(‘‘FICC’’),31 as both NSCC and FICC 

have filed proposed rule changes 

concurrently with this filing that would 

result in the same calculation of their 

respective Maintenance Fee.32

To effectuate the proposed change 

described above, the Maintenance Fee 

entry in the Settlement Services section 

of the DTC Fee Guide 33 would be 

updated to remove the Waiver 

Provision. 

Rebate Policy 

DTC is also proposing to amend the 

Fee Guide to include a description of its 

current policy regarding the issuance of 

rebates to Participants. DTC views its 

practice of providing a rebate to its 

Participants as a corporate function, and 

not related to its operation as a selfregulatory organization. A DTC rebate is 

essentially a return of the revenue that 

DTC collects through the fees it charges 

Participants for its services (as set forth 

in the Fee Guide). Rebates are not 

related to the amounts Participants 

deposit with DTC as their Participants 

Fund Deposit. The determination to 

provide a rebate is made at the 

corporation-level, based on a number of 

factors and considerations, as described 

below, and is not a separate 

determination made for each individual 

Participant. 

Following the financial recession of 

2008, DTC ceased providing such 

discounts in connection with the 

implementation of a financial strategy to 

strengthen its financial position and 

health. As a result of that strategy and 

improved financial markets, in 2019, 

DTC determined to reinstitute its 

practice of discounting Participants’ 

invoices, in the form of a rebate, based 

on its financial performance. In 

connection with this decision, DTC is 

proposing to include a description of its 

current rebate practice in the Fee Guide. 

This proposed change would not change 

DTC’s rebate practice but would provide 

Participants with transparency into this 

practice and the governance around 

rebates. 

First, the proposed language would 

describe that DTC may provide 

Participants with a rebate of excess net 

income, and would define excess net 

income as income of either DTC or 

income related to one business line of 

DTC after application of expenses, 

capitalization costs, and applicable 

regulatory requirements. The language 

would also state that a rebate is 

discretionary, and DTC is not obligated 

to provide a rebate. 

Second, the proposed language would 

state that a rebate would be approved by 

the Board. The proposed language 

would also state that, in determining if 

a rebate is appropriate, the Board would 

consider, one or more of the following, 

as appropriate: DTC’s regulatory capital 

requirements,34 anticipated expenses, 

investment needs, anticipated future 

expenses with respect to improvement 

or maintenance of DTC’s operations, 

cash balances, financial projections, and 

appropriate level of shareholders’ 

equity. 

Third, the proposed language would 

state that, if it determined to issue a 

rebate, the Board would set a rebate 

period and a rebate payment date, both 

of which are used to determine which 

Participants are eligible for a rebate. The 

proposed language would state that 

Participants that maintain their 

membership during all or a portion of 

the rebate period and on the rebate 

payment date are eligible for a rebate. 

Finally, the proposed language would 

describe how rebates are applied to the 

invoices of eligible Participants. The 

proposed language would state that 

rebates are applied to all eligible 

Participants, on a pro-rata basis, based 

on such Participants’ gross fees paid to 

DTC within the applicable rebate 

period, excluding pass-through fees and 

interest earned on Participants Fund 

Deposits. The proposed language would 

also state that rebates are applied to 

eligible Participants’ invoices on the 

rebate payment date as either a 

reduction in fees or, if fees owed are 

lower than the allocated rebate amount, 

a payment of such difference. The 

proposed language would also note that 

rebate amounts may be adjusted for 

miscellaneous charges and discounts. 

Participant Impact 

The proposed rule change, as 

modified by Amendment No. 1, is 

expected to increase DTC’s annual 

revenue by approximately $12.7 

million. 

In general, DTC anticipates that the 

proposal would result in fee decreases 

for approximately 63% of impacted 

affiliated families of Participants and fee 

increases for approximately 37% of 

impacted affiliated families of 

Participants. Of the impacted affiliated 

families of Participants that may have 

their fees decrease, 25% of impacted 

affiliated families of Participants would 

have a decrease of less than $1,000, 49% 

of impacted affiliated families of 

Participants would have a decrease of 

between $1,000 and $100,000, and 26% 

of impacted affiliated families of 

Participants would have a decrease 

greater than $100,000. 


khammond on DSKJM1Z7X2PROD with NOTICES
78902 Federal Register / Vol. 85, No. 235 / Monday, December 7, 2020 / Notices 

35 15 U.S.C. 78q–1(b)(3)(D). 

36 17 CFR.17Ad–22(e)(23)(ii). 

37 15 U.S.C. 78q–1(b)(3)(D). 

38 Id. 

39 Id. 

40See Rule 4, Rules, supra note 5. 

41 Id. 

42See supra note 32. 

43 15 U.S.C. 78q–1(b)(3)(D). 

44 17 CFR 240.17Ad–22(e)(23)(ii). 

Participant Outreach 

DTC has conducted ongoing outreach 

to each Participant in order to provide 

them with notice of the proposed 

changes and the anticipated impact for 

the Participant. 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. 

Implementation Timeframe 

DTC would implement this proposal 

on January 1, 2021. As proposed, a 

legend would be added to the Fee 

Structure stating there are changes that 

have become 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 

DTC believes this proposal is 

consistent with the requirements of the 

Act, and the rules and regulations 

thereunder applicable to a registered 

clearing agency. Specifically, DTC 

believes the proposed changes to modify 

certain settlement service fees and the 

Maintenance Fee, as described above, 

are consistent with Section 17A(b)(3)(D) 

of the Act,35 for the reasons described 

below. DTC believes that the proposed 

change to include a description of DTC’s 

current policy regarding the issuance of 

rebates to Participants is consistent with 

Rule 17Ad–22(e)(23)(ii),36 as 

promulgated under the Act, for the 

reasons described below. 

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

requires, inter alia, that the Rules 

provide for the equitable allocation of 

reasonable dues, fees, and other charges 

among participants.37 For the reasons 

set forth below, DTC believes that each 

of the proposed rule changes, as 

modified by Amendment No. 1, 

described above would provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among 

Participants. 

DTC believes the proposed rule 

change to (i) reduce the Day Deliver 

Order Fee and consolidate the Reclaim 

Fee into the Day Deliver Order Fee, 

Night Deliver Order Fee and Receive 

Fee, as applicable, and (ii) reduce the 

Delivery to/from CNS fee and 

consolidate the CNS ACAT-related fee 

into the Delivery to/from CNS fee as 

described above, would provide for the 

equitable allocation of reasonable fees. 

Because the proposed change would not 

alter how these fees are charged to 

Participants, DTC believes that the fees 

would continue to be equitably 

allocated because they would continue 

to be charged based on volume of 

transaction activity for a given 

Participant. More specifically, as 

mentioned above, the Day Deliver Order 

Fee and the Night Deliver Order Fee are 

charged based on a Participant’s volume 

of Deliveries during the applicable 

timeframes, as described above. As 

such, and as is currently the case, 

Participants that provide a greater 

number of Delivery instructions, or 

receive a greater number of Deliveries, 

would generally be subject to a higher 

overall charge for Deliveries and/or 

Receives, as applicable, based on 

volume of related transactions. 

Conversely, Participants that make 

fewer Deliveries and or receive few 

Deliveries would generally be a smaller 

overall charge for Deliveries and 

receives based on volume. 

Similarly, DTC believes that the Day 

Deliver Order Fee, Night Deliver Order 

Fee, Receive Fee, and the Delivery to/ 

from CNS fee would continue to be 

reasonable fees under the proposed 

change described above. As described 

above, the fee amounts as proposed 

reflect an amount that would facilitate 

DTC’s ability, as discussed above, to 

reduce the overall fees DTC collects 

from Participants relating to its 

settlement services and still cover its 

costs and maintain an appropriate low 

margin above costs. For this reason, 

DTC believes that the proposed rule 

change to (i) reduce the Day Deliver 

Order Fee and consolidate the Reclaim 

Fee into the Day Deliver Order Fee, 

Night Deliver Order Fee and Receive 

Fee as applicable, and (ii) reduce the 

Delivery to/from CNS fee and 

consolidate the ACATS-related fee into 

the Delivery to/from CNS fee, as 

described above, would be reasonable 

fees charged by DTC for these services 

and is consistent with Section 

17A(b)(3)(D) of the Act.38

DTC believes that the proposed 

change to the Maintenance Fee is 

consistent with this provision of the 

Act.39

As described above, the proposal 

would modify the Maintenance Fee to 

remove the Waiver Provision. Because 

the proposed change would not alter 

how the Maintenance Fee is currently 

allocated (i.e., charged) to Participants, 

DTC believes the fee would continue to 

be equitably allocated. More 

specifically, as mentioned above, the 

Maintenance Fee is and would continue 

to be charged to all Participants in 

proportion to the Participant’s average 

monthly Actual Participants Fund 

Deposits. As such, and as is currently 

the case, Participants that make greater 

use of DTC’s services would generally 

be subject to a larger Maintenance Fee 

because such Participants would 

typically be required to maintain larger 

Participants Fund deposits pursuant to 

the Rules.40 Conversely, Participants 

that use DTC’s services less would 

generally be subject to a smaller 

Maintenance Fee because such 

Participants would typically be required 

to maintain smaller Participants Fund 

deposits pursuant to the Rules.41 The 

described change would not adjust that 

allocation. For this reason, DTC believes 

the Maintenance Fee would continue to 

be equitably allocated among 

Participants. 

Similarly, DTC believes that the 

Maintenance Fee would continue to be 

a reasonable fee under the proposed 

change described above. Although 

removal of the Waiver Provision means 

that Participants could be assessed a 

Maintenance Fee at times when they 

may not otherwise have been assessed 

the fee, the removal of the provision 

would enable DTC to collect needed 

revenue from the fee even in a difficult 

economic environment. Additionally, 

the proposed change would help 

establish consistent pricing between 

DTC and its affiliates, NSCC and FICC, 

regarding each of their respective 

Maintenance Fees, as concurrent 

proposals by NSCC and FICC would 

result in the same calculation.42 For this 

reason, DTC believes the Maintenance 

Fee would continue to be reasonable. 

Based on the forgoing, DTC believes 

the proposed rule change relating to the 

modification of certain settlement 

service fees and the Maintenance Fee, as 

described above, is consistent with 

Section 17A(b)(3)(D).43

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

requires that DTC 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.44 The proposed change 

would add to the Fee Guide a 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 85, No. 235 / Monday, December 7, 2020 / Notices 78903 

45 Id. 

46 15 U.S.C. 78q–1(b)(3)(I). 

47See Settlement Guide, supra note 11 at 5 and 

54. 

48See Securities Exchange Act Release Nos. 

72576 (July 9, 2014), 79 FR 41355 (July 15, 2014) 

(SR–DTC–2014–06); and 73804 (December 10, 

2014), 79 FR 74796 (December 16, 2014) (SR–DTC– 

2014–010). 49 15 U.S.C. 78q–1(b)(3)(I). 

description of DTC’s current rebate 

practice, which, when applicable, 

results in a reduction to the amount of 

fees a Participant owes to DTC. By 

updating the Fee Guide with a 

transparent description of DTC’s rebate 

practice, the proposed change would 

provide Participants with sufficient 

information to evaluate the fees they 

may incur by participating in DTC. 

Therefore, DTC believes the proposed 

change would be consistent with the 

requirements of Rule 17Ad– 

22(e)(23)(ii).45

(B) Clearing Agency’s Statement on 

Burden on Competition Fee Revisions 

and Consolidations for Certain 

Settlement Services 

DTC believes that the proposed rule 

change to reduce the Day Deliver Order 

Fees and the Delivery to/from CNS fee 

may promote competition among its 

Participants because the effect of the 

consolidations, as proposed, would 

result in a reduction of the applicable 

fees, as described above. 

The consolidation of fees, as 

described above, except for the 

consolidation of the Reclaim Fee into 

the Day Deliver order fee for applicable 

activity (reclaims that do not occur in 

the night cycle), may promote 

competition among Participants because 

the effect of the consolidations, as 

proposed, would result in a reduction of 

the applicable fees, as described above. 

The proposed change to consolidate 

the Reclaim Fee into the Day Deliver 

Order Fee for applicable activity 

(reclaims that do not occur in the night 

cycle) may present a competitive burden 

among Participants because this change 

could increase the fees of those 

Participants that instruct a reclaim in 

that a Reclaim that would be charged at 

the amount of 26 cents under the 

current Fee Schedule would be charged 

at 40 cents per reclaim under the 

proposal. DTC does not believe the 

proposed change in and of itself would 

mean that the burden on competition 

among Participants is significant. This is 

because even though the amount of the 

fee increase may seem significant, DTC 

believes the increase in fees would 

similarly affect all Participants that 

utilize DTC’s services and be reflective 

of each Participant’s individual activity 

at DTC, and therefore the burden on 

competition would not be significant. 

Regardless of whether the burden on 

competition is deemed significant, DTC 

believes any burden that is created by 

the proposed change would be 

necessary and appropriate in 

furtherance of the purposes of the Act, 

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

the Act.46

The burden would be necessary 

because a Reclaim is a functional 

equivalent of a Deliver Order except that 

it represents a Delivery to return 

Securities rather than representing the 

original Delivery of Securities, and 

therefore should be charged at the same 

rate as a Deliver Order. The burden 

would be appropriate because a reclaim 

is the functional equivalent of a 

Delivery and DTC believes a reclaim 

should now be priced the same as other 

Deliveries given the capability of a 

Receiver via the Receiver Authorized 

Delivery (‘‘RAD’’) functionality to return 

Deliveries prior to processing and a 

reduced need for Receivers to rely on 

reclaims to return Deliveries to its 

Account, as described below. In this 

regard, RAD enables a Receiver of 

valued deliveries of securities to manage 

which deliveries to accept, or to reject, 

prior to further processing by DTC.47

Specifically, whereas prior to a series of 

earlier rule changes, transactions below 

an established dollar value could bypass 

the RAD control, today all valued 

transactions are subject to RAD, 

whereby a Participant can prevent any 

such Deliveries to its account.48

Therefore, a Receiver is able to approve 

all Deliveries to its account through 

RAD and there is less likelihood that a 

Participant would need to rely on 

reclaims to remedy an errant instruction 

by a counterparty to make a Delivery to 

its account. 

Maintenance Fee 

DTC does not believe that the 

proposed change to the Maintenance 

Fee would have an impact on 

competition among its Participants. As 

described above, the Maintenance Fee is 

charged ratably based on Participants’ 

use of DTC’s services, as reflected in 

Participants’ Actual Participant Fund 

Deposits. Thus, the fee is designed to be 

reflective of each Participant’s 

individual activity at DTC. 

Nevertheless, if removal of the Waiver 

Position, and the resulting imposition of 

the Maintenance Fee at a time when a 

Participant would not have otherwise 

been assessed the fee, would create a 

competitive burden for a Participant, 

DTC believes such a burden would not 

be significant, given that the amount 

assessed would be the same but for 

application of the Waiver Provision. 

Moreover, DTC believes that any such 

burden would be necessary and 

appropriate in furtherance of the 

purposes of the Act, as permitted by 

Section 17A(b)(3)(I) of the Act.49

The burden would be necessary 

because it is essential that DTC offset 

some of its costs and expenses with 

stable revenue generated from the 

Maintenance Fee, regardless of the 

economic environment. As described 

above, not doing so could adversely 

affect DTC’s financial health. The 

burden would be appropriate because, 

as described above, the Maintenance 

Fee is calculated, using a balanced 

formula, to assess a fee that is reflective 

of the Participant’s use of DTC’s 

services, so that DTC can defray some of 

its costs and expenses in providing 

those services. 

Rebate Policy 

DTC does not believe the proposed 

change to describe its current rebate 

practice would have any impact, or 

impose any burden, on competition 

among its Participants. As described 

above, this proposed rule change, as 

modified by Amendment No. 1, would 

include a description of DTC’s current 

rebate practice in the Fee Guide. As 

described in the proposed language, 

under its current practice, rebates are 

allocated to eligible Participants pro-rata 

based on such Participants’ gross fees 

paid to DTC within the applicable 

rebate period. Therefore, the current 

practice is applied equally to all eligible 

Participants. The proposed change to 

provide Participants with transparency 

into this practice would not cause any 

increase or decrease in the rebates 

Participants may receive. Therefore, this 

proposed rule change, as modified by 

Amendment No. 1, would not have any 

impact, or impose any burden, on 

competition among Participants. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change, as Modified by Amendment No. 

1, Received From Members, 

Participants, or Others 

Written comments relating to this 

proposed rule change as modified by 

Amendment No. 1, have not been 

solicited or received. DTC will notify 

the Commission of any written 

comments received by DTC. 


khammond on DSKJM1Z7X2PROD with NOTICES
78904 Federal Register / Vol. 85, No. 235 / Monday, December 7, 2020 / Notices 

50 15 U.S.C. 78s(b)(3)(A). 

51 17 CFR 240.19b–4(f). 

52 17 CFR 200.30–3(a)(12). 

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). 

5Capitalized terms not defined herein are defined 

in the GSD Rules and the MBSD Rules, as 

applicable, available at http://www.dtcc.com/legal/ 

rules-and-procedures. 

III. Date of Effectiveness of the 

Proposed Rule Change, as Modified by 

Amendment No. 1, and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A) 50 of the Act and paragraph 

(f) 51 of Rule 19b–4 thereunder. At any 

time within 60 days of the filing of the 

proposed rule change, as modified by 

Amendment No. 1, 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, as modified by Amendment No. 

1, 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– 

DTC–2020–014 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–DTC–2020–014. 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, as modified by Amendment No. 

1, that are filed with the Commission, 

and all written communications relating 

to the proposed rule change, as 

modified by Amendment No. 1, 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 DTC 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–DTC– 

2020–014 and should be submitted on 

or before December 28, 2020. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.52

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2020–26787 Filed 12–4–20; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–90544; File No. SR–FICC– 

2020–014] 

Self-Regulatory Organizations; Fixed 

Income Clearing Corporation; Notice of 

Filing and Immediate Effectiveness of 

a Proposed Rule Change, as Modified 

by Amendment No. 1, To Modify the 

Clearance Maintenance Fee, Reduce 

the End of Day Position Fee of the 

Government Securities Division, and 

Describe the Current Rebate Policy 

December 1, 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 November 

16, 2020, Fixed Income Clearing 

Corporation (‘‘FICC’’) filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change. On November 30, 2020, FICC 

filed Amendment No. 1 to the proposed 

rule change, which revised a portion of 

the rule text and corresponding 

description in the notice relating to 

FICC’s current policy regarding the 

issuance of rebates to its members. FICC 

filed the proposed rule change, as 

modified by Amendment No. 1, 

pursuant to Section 19(b)(3)(A) of the 

Act 3 and Rule 19b–4(f)(2) thereunder.4

The proposed rule change, as modified 

by Amendment No. 1 is hereinafter 

referred to as the ‘‘Proposed Rule 

Change.’’ The Proposed Rule Change is 

described in Items I, II, and III below, 

which Items have been prepared 

primarily by FICC. The Commission is 

publishing this notice to solicit 

comments on the Proposed Rule Change 

from interested persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

The Proposed Rule Change consists of 

modifications to FICC’s MortgageBacked Securities Division (‘‘MBSD’’) 

Clearing Rules (‘‘MBSD Rules’’) and 

Government Securities Division 

(‘‘GSD’’) Rulebook (‘‘GSD Rules’’ and 

together with the MBSD Rules, the 

‘‘Rules’’) in order to (i) modify the 

respective Clearing Fund Maintenance 

Fee (‘‘Maintenance Fee’’) of GSD and 

MBSD, (ii) reduce the end of day 

position fee of GSD, and (iii) include a 

description of FICC’s current policy 

regarding the issuance of rebates to GSD 

Members and MBSD Clearing Members, 

as described in greater detail below.5

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 

FICC is proposing to amend the 

MBSD Rules and the GSD Rules in order 

to (i) modify the respective Maintenance 

Fee of GSD and MBSD, (ii) reduce the 

end of day position fee of GSD, and (iii) 

include a description of FICC’s current 

policy regarding the issuance of rebates 

to GSD Members and MBSD Clearing 

Members, as described in greater detail 

below. 


khammond on DSKJM1Z7X2PROD with NOTICES