7900 Federal Register / Vol. 86, No. 20 / Tuesday, February 2, 2021 / Notices 

27Applicants are not requesting and the 

Commission is not providing any relief for 

transaction fees received in connection with any 

Co-Investment Transaction. 

described in Section III.A.1.b. of the 

application. 

(e) Other Conditions. The acquisition 

of Follow-On Investments as permitted 

by this Condition will be considered a 

Co-Investment Transaction for all 

purposes and subject to the other 

Conditions set forth in the application. 

10. Board Reporting, Compliance and 

Annual Re-Approval 

(a) Each Adviser to a Regulated Fund 

will present to the Board of each 

Regulated Fund, on a quarterly basis, 

and at such other times as the Board 

may request, (i) a record of all 

investments in Potential Co-Investment 

Transactions made by any of the other 

Regulated Funds or any Affiliated 

Funds during the preceding quarter that 

fell within the Regulated Fund’s thencurrent Objectives and Strategies and 

Board-Established Criteria that were not 

made available to the Regulated Fund, 

and an explanation of why such 

investment opportunities were not made 

available to the Regulated Fund; (ii) a 

record of all Follow-On Investments in 

and Dispositions of investments in any 

issuer in which the Regulated Fund 

holds any investments by any Affiliated 

Fund or other Regulated Fund during 

the prior quarter; and (iii) all 

information concerning Potential CoInvestment Transactions and CoInvestment Transactions, including 

investments made by other Regulated 

Funds or any Affiliated Funds that the 

Regulated Fund considered but declined 

to participate in, so that the 

Independent Trustees, may determine 

whether all Potential Co-Investment 

Transactions and Co-Investment 

Transactions during the preceding 

quarter, including those investments 

that the Regulated Fund considered but 

declined to participate in, comply with 

the Conditions. 

(b) All information presented to the 

Regulated Fund’s Board pursuant to this 

Condition will be kept for the life of the 

Regulated Fund and at least two years 

thereafter, and will be subject to 

examination by the Commission and its 

staff. 

(c) Each Regulated Fund’s chief 

compliance officer, as defined in rule 

38a–1(a)(4), will prepare an annual 

report for its Board each year that 

evaluates (and documents the basis of 

that evaluation) the Regulated Fund’s 

compliance with the terms and 

Conditions of the application and the 

procedures established to achieve such 

compliance. 

(d) The Independent Trustees will 

consider at least annually whether 

continued participation in new and 

existing Co-Investment Transactions is 

in the Regulated Fund’s best interests. 

11. Record Keeping. Each Regulated 

Fund will maintain the records required 

by section 57(f)(3) of the Act as if each 

of the Regulated Funds were a BDC and 

each of the investments permitted under 

these Conditions were approved by the 

Required Majority under section 57(f). 

12. Trustee Independence. No 

Independent Trustee of a Regulated 

Fund will also be a director, general 

partner, managing member or principal, 

or otherwise be an ‘‘affiliated person’’ 

(as defined in the Act) of any Affiliated 

Fund. 

13. Expenses. The expenses, if any, 

associated with acquiring, holding or 

disposing of any securities acquired in 

a Co-Investment Transaction (including, 

without limitation, the expenses of the 

distribution of any such securities 

registered for sale under the Securities 

Act) will, to the extent not payable by 

the Advisers under their respective 

advisory agreements with the Regulated 

Funds and the Affiliated Funds, be 

shared by the Regulated Funds and any 

participating Affiliated Funds in 

proportion to the relative amounts of the 

securities held or being acquired or 

disposed of, as the case may be. 

14. Transaction Fees.27 Any 

transaction fee (including break-up, 

structuring, monitoring or commitment 

fees but excluding brokerage or 

underwriting compensation permitted 

by section 17(e) or 57(k)) received in 

connection with any Co-Investment 

Transaction will be distributed to the 

participants on a pro rata basis based on 

the amounts they invested or 

committed, as the case may be, in such 

Co-Investment Transaction. If any 

transaction fee is to be held by an 

Adviser pending consummation of the 

transaction, the fee will be deposited 

into an account maintained by an 

Adviser at a bank or banks having the 

qualifications prescribed in section 

26(a)(1), and the account will earn a 

competitive rate of interest that will also 

be divided pro rata among the 

participants. None of the Adviser, the 

Affiliated Funds, the other Regulated 

Funds or any affiliated person of the 

Affiliated Funds or the Regulated Funds 

will receive any additional 

compensation or remuneration of any 

kind as a result of or in connection with 

a Co-Investment Transaction other than 

(i) in the case of the Regulated Funds 

and the Affiliated Funds, the pro rata 

transaction fees described above and 

fees or other compensation described in 

Condition 2(c)(iii)(B)(z), (ii) brokerage or 

underwriting compensation permitted 

by section 17(e) or 57(k) or (iii) in the 

case of the Adviser, investment advisory 

compensation paid in accordance with 

investment advisory agreements 

between the applicable Regulated 

Fund(s) or Affiliated Fund(s) and its 

Adviser. 

15. Independence. If the Holders own 

in the aggregate more than 25 percent of 

the Shares of a Regulated Fund, then the 

Holders will vote such Shares in the 

same percentages as the Regulated 

Fund’s other shareholders (not 

including the Holders) when voting on 

(1) the election of directors; (2) the 

removal of one or more directors; or (3) 

any other matter under either the Act or 

applicable State law affecting the 

Board’s composition, size or manner of 

election. 

For the Commission, by the Division of 

Investment Management, under delegated 

authority. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–02179 Filed 2–1–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. SIPA–183; File No. SIPC–2021– 

01] 

Securities Investor Protection 

Corporation; Determination 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Notice. 

SUMMARY: Pursuant to Section 3(e)(2) of 

the Securities Investor Protection Act of 

1970 (‘‘SIPA’’), notice is hereby given 

that the Board of Directors of SIPC (the 

‘‘Board’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

on January 5, 2021, notification that the 

Board has determined, beginning 

January 1, 2022, and for the five year 

period immediately thereafter, that the 

standard maximum cash advance 

amount available to satisfy customer 

claims for cash in a SIPA liquidation 

proceeding will remain at $250,000. The 

Commission is publishing this notice to 

solicit comments on Board’s 

determination from interested parties. 

DATES: Comments are to be received on 

or before February 17, 2021. 

ADDRESSES: Interested persons are 

invited to submit written data, views, 

and arguments concerning the foregoing 

by any of the following methods: 


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Federal Register / Vol. 86, No. 20 / Tuesday, February 2, 2021 / Notices 7901 

1For convenience, references herein to provisions 

of SIPA shall be to the United States Code, and 

shall omit ‘‘15 U.S.C.’’ 

2SIPA § 78fff–3(e)(1) provides that approval by 

the Commission be obtained ‘‘as provided under 

section 78ccc(e)(2)’’ of SIPA. SIPA § 78ccc(e)(2) 

establishes procedures governing proposed changes 

to SIPC’s rules. 

3Pursuant to SIPA § 78fff–3(e), the $40,000 

amount was determined as follows: $250,000 

multiplied by 1.1675 [the ratio of 108.763 (the 

annual value of the Price Index published by the 

Department of Commerce for calendar year 2019), 

to 94.094 (the published annual value of the index 

for 2009)], which equals $291,875. Pursuant to SIPA 

§ 78fff–3(e)(2), this amount is to be rounded down 

to the nearest multiple of $10,000, i.e., $290,000. 

However, because the determination is to be made 

for the calendar year 2021, the annual value of the 

Price Index to be used is for the ‘‘calendar year 

preceding the year in which such determination is 

made,’’ namely, the year 2020. The 2020 annual 

value will not be available until sometime in 2021. 

Nevertheless, through the month of November 2020, 

the index increased by approximately 0.9%. 

Consequently, the index value would have to either 

increase in December 2020 by approximately 1.9% 

or decrease by approximately 1.5% for the result to 

be different from $290,000, which is extremely 

unlikely. 

Electronic Comments 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/submitcomments.htm); or 

• Send an email to rule-comments@

sec.gov. Please include File Number 

SIPC–2021–01 on the subject line. 

Paper Comments 

• Send paper comments to Secretary, 

Securities and Exchange Commission, 

100 F Street NE, Washington, DC 

20549–1090. 

All comments should refer to File 

Number SIPC–2021–01. This file 

numbers 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/other.shtml). 

Copies of the submission, all 

subsequent amendments, all written 

statements with respect to this Notice 

that are filed with the Commission, and 

all written communications relating to 

the Notice between the Commission and 

any person, other than those that may be 

withheld from the public in accordance 

with the provisions of 5 U.S.C. 552, will 

be available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549, on official 

business days between the hours of 10 

a.m. and 3 p.m. 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. 

FOR FURTHER INFORMATION CONTACT: 

Michael A. Macchiaroli, Associate 

Director, at (202) 551–5525; Thomas K. 

McGowan, Associate Director, at (202) 

551–5521; Randall W. Roy, Deputy 

Associate Director, at (202) 551–5522; 

Raymond A. Lombardo, at (202) 551– 

5755; Timothy C. Fox, Branch Chief, at 

(202) 551–5687; or A.J. Jacob, Special 

Counsel, at (202) 551–5583; Office of 

Financial Responsibility, Division of 

Trading and Markets, Securities and 

Exchange Commission, 100 F Street NE, 

Washington, DC 20549–7010. 

SUPPLEMENTARY INFORMATION: 

I. SIPC’S Statement of the Purpose of 

and Statutory Basis of the 

Determination of the Board of Directors 

of SIPC Not To Adjust the Standard 

Maximum Cash Advance Amount for 

Inflation 

In its filing with the Commission, 

SIPC included statements concerning 

the purpose of and statutory basis of the 

SIPC Board’s determination. The text of 

these statements may be examined at 

the places specified above, and appear 

in the text, below. 

* * * * * 

‘‘Pursuant to section 9(e)(1) of the 

Securities Investor Protection Act 

(‘‘SIPA’’), 15 U.S.C. 78fff–3(e)(1),1 the 

Board of Directors (‘‘Board’’) of the 

Securities Investor Protection 

Corporation (‘‘SIPC’’) must determine, 

‘‘[n]ot later than January 1, 2011, and 

every five years thereafter, and subject 

to the approval of the Commission,’’ 

whether to adjust for inflation the 

standard maximum cash advance 

amount that SIPC can advance to satisfy 

customer claims for cash under SIPA 

§ 78fff–3(a)(1). The Board considered 

the issue at its Meeting on September 9, 

2020, and again at its Meeting on 

November 12, 2020. Among other 

things, and as more fully set forth 

below, the Board considered the criteria 

set forth in SIPA § 78fff–3(e)(5), and the 

views of the staffs of the Commission, 

the FDIC, and FINRA. 

The Board has determined that the 

maximum cash advance amount should 

remain at the current level of $250,000 

per customer. Pursuant to SIPA § 78fff– 

3(e)(4), and subject to the approval of 

the Commission as provided under 

SIPA §§ 78ccc(e)(2) and 78fff–3(e)(1),2

the Board’s determination will become 

effective January 1, 2022. Further, 

pursuant to SIPA § 78fff–3(e)(3)(A), the 

Commission ‘‘shall publish in the 

Federal Register the standard maximum 

cash advance amount’’ not later than 

April 5, 2021. 

Consideration of the Statutory Criteria 

A. Amount of Potential Adjustment 

Were the Board to have determined 

that the maximum cash advance amount 

should be adjusted, the formula for 

calculation of such adjustment would 

entail multiplying $250,000 by: 

[t]he ratio of the annual value of the 

Personal Consumption Expenditures 

Chain-Type Price Index (or any 

successor index thereto), published by 

the Department of Commerce, for the 

calendar year preceding the year in 

which such determination is made, to 

the published annual value of such 

index for the calendar year preceding 

the year 2010. 

SIPA § 78fff–3(e)(1)(B). 

A present-day application of the 

formula would increase the limit by 

$40,000, to a total of $290,000.3

B. Inflation Adjustment Considerations 

SIPA § 78fff–3(e)(5) provides that in 

deciding whether to adjust the 

maximum cash advance amount, the 

Board shall consider the following 

criteria: 

(A) The overall state of the fund and 

the economic conditions affecting 

members of SIPC; 

(B) the potential problems affecting 

members of SIPC; and 

(C) such other factors as the Board of 

Directors of SIPC may determine 

appropriate. 

1. The Overall State of the SIPC Fund 

and Economic Conditions Affecting 

Members, and Potential Problems 

Affecting Members of SIPC 

The Board reviewed the projected 

growth of the SIPC Fund, including the 

target amount for the Fund of $5 billion, 

the assessment rate imposed on SIPC 

members pursuant to SIPC’s 

Assessments bylaw, as amended, and 

the potential impact of an inflation 

adjustment on the Fund, and 

determined that keeping the standard 

maximum cash advance at $250,000 did 

not adversely affect SIPC members. In 

its review, the Board also considered 

SIPC’s historical experience and 

examined: (1) SIPC advances in past and 

present liquidation proceedings; (2) 

amounts generated from assessments on 

member broker-dealers; and (3) 

projected returns on SIPC investments. 


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7902 Federal Register / Vol. 86, No. 20 / Tuesday, February 2, 2021 / Notices 

4The below compares the limits of protection for 

cash under SIPA and the FDIA: SIPA: $20,000 (Pub. 

L. No 91–598, § 6(f)(1)(A), 84 Stat. 1636, 1651 

(1970)). FDIA: $20,000 (Pub. L. 91–151, 7, 83 Stat. 

371, 375 (1969)). SIPA: $40,000 (Pub. L. 95–283, 9, 

92 Stat. 249, 265 (1978)). FDIA: $40,000 (Pub. L. 93– 

495, 102(a), 88 Stat. 1500, 1502 (1974)). SIPA: 

$100,000 (Pub. L. 96–433, 1, 94 Stat. 1855 (1980)). 

FDIA: $100,000 (Pub. L. 96–221, 308, 94 Stat. 132, 

147 (1980)). SIPA: $250,000 (Pub. L. 111–203, 

929H, 124 Stat. 1376, 1865 (2010)). FDIA: $250,000 

(temporary until 12/31/2009) Public Law 110–343, 

136, 122 Stat. 3765, 3799 (2008); (permanent) 

Public Law 111–203, 335, 124 Stat. 1376, 1540 

(2010)). 

5 17 CFR 200.30–3(f)(3). 

1 15 U.S.C. 78s(b)(1). 

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

In addition, the Board considered the 

views of the staffs of the Commission, 

the FDIC, and FINRA, as reported to the 

SIPC staff and as further reported by the 

SIPC staff to the Board. The Board 

concluded that the SIPC Fund remains 

on a steady growth path for the near 

future, barring any unforeseen 

catastrophic event, and that any 

increases in the cash limit of SIPA 

protection would not appreciably 

benefit customers. 

2. Other Appropriate Factors 

a. Potential Divergence Between FDIC 

and SIPC Protections 

The Board noted the equivalency— 

presently $250,000—between SIPA’s 

maximum cash advance amount and the 

‘‘standard maximum deposit insurance 

amount’’ that fixes the limit on bank 

deposit insurance under the Federal 

Deposit Insurance Act (‘‘FDIA’’), 12 

U.S.C. 1821 et seq. An inflation 

adjustment to the former without a 

corresponding adjustment to the latter 

would result in an unprecedented 

divergence between the maximum cash 

advance amount under SIPA and the 

standard maximum deposit insurance 

amount under FDIA. 

Increases to the limit of protection for 

cash claims under SIPA historically 

have been in lockstep with increases in 

FDIC deposit insurance.4 In 2008, and 

again, in 2010, parity with deposit 

insurance was the primary reason for 

SIPC’s request to Congress to increase 

the SIPA limit of protection for cash 

claims. In 2016, uniformity with FDIC 

deposit insurance was a primary factor 

in the Board’s determination not to 

adjust the standard maximum cash 

advance amount. 

b. Historical Claims Experience and 

Benefit to Customers 

The Board also reviewed the number 

of claims for cash exceeding the limit of 

protection in past and present 

liquidation proceedings. This data 

suggests that the benefit to customers of 

an inflation adjustment may be limited. 

Of the more than 770,000 allowed 

claims in completed or substantially 

completed liquidation proceedings as of 

year-end 2019, the unsatisfied portion of 

cash claims amounted to $25 million. 

More than half of that amount involved 

only three claims. In the seven SIPA 

proceedings initiated since 2010, when 

the cash limit was raised to $250,000, 

only one cash claim remains 

unsatisfied. 

c. Aggregate Credit Balances and Sweep 

Programs 

It also was brought to the Board’s 

attention that aggregate cash credit 

balances at member firms have not 

increased over the last five years in line 

with inflation. Instead, member firms 

have increasingly utilized sweep 

programs to move customer free credit 

balances from broker- dealers to banks. 

Conclusion 

The Board weighed all the relevant 

factors against a potential adjustment of 

$40,000, the amount determined by the 

formula set forth in SIPA § 78fff– 

3(e)(1)(B). The Board concluded that, on 

balance, in light of the intent to grow 

the SIPC Fund to reach a target of $5 

billion, the unprecedented break with 

the FDIC limit that would result, and 

the absence of evidence that an 

appreciable number of investors would 

be benefitted, an adjustment to the limit 

of protection for cash claims was not 

appropriate. Accordingly, the Board 

determined that the standard maximum 

cash advance amount should remain at 

$250,000 per customer.’’ 

* * * * * 

II. Date of Effectiveness and Timing for 

Commission Action 

Within thirty-five days of the date of 

publication of this notice of the SIPC 

Board’s determination in the Federal 

Register, or within such longer period 

(i) as the Commission may designate of 

not more than ninety days after such 

date if it finds such longer period to be 

appropriate and publishes its reasons 

for so finding or (ii) as to which SIPC 

consents, the Commission shall: 

(A) By order approve such 

determination or 

(B) Institute proceedings to determine 

whether such determination should be 

disapproved. 

III. Notice of the Determination of the 

SIPC Board Not To Adjust the Standard 

Maximum Cash Advance Amount for 

Inflation 

On January 1, 2021, pursuant to 

section 9(e)(1) of the Securities Investor 

Protection Act, 15 U.S.C. 78fff–3(e)(1), 

the Board of Directors of the Securities 

Investor Protection Corporation (the 

‘‘Board’’) determined that an inflation 

adjustment to the standard maximum 

cash advance amount would not be 

appropriate. Accordingly, the Board 

determined that the standard maximum 

cash advance amount will remain at 

$250,000 per customer, effective January 

1, 2022. 

For the Commission, by the Division 

of Trading and Markets, pursuant to 

delegated authority.5

Dated: January 27, 2021. 

J. Matthew DesLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–02128 Filed 2–1–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–91002; File No. SR– 

CboeEDGX–2021–006] 

Self-Regulatory Organizations; Cboe 

EDGX Exchange, Inc.; Notice of Filing 

and Immediate Effectiveness of a 

Proposed Rule Change To Amend the 

Fee Schedule 

January 27, 2021. 

Pursuant to Section 19(b)(1) 1 of the 

Securities Exchange Act of 1934 (the 

‘‘Act’’),2 and Rule 19b–4 thereunder,3

notice is hereby given that on January 

13, 2021, Cboe EDGX Exchange, Inc. 

(the ‘‘Exchange’’ or ‘‘EDGX’’) filed with 

the Securities and Exchange 

Commission (the ‘‘Commission’’) the 

proposed rule change as described in 

Items I and II below, which Items have 

been prepared by the self-regulatory 

organization. The Commission is 

publishing this notice to solicit 

comments on the proposed rule change 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Cboe EDGX Exchange, Inc. (the 

‘‘Exchange’’ or ‘‘EDGX’’) is filing with 

the Securities and Exchange 

Commission (‘‘Commission’’) a 

proposed rule change to amend the fee 

schedule applicable to Members and 

non-Members of the Exchange pursuant 

to EDGX Rules 15.1(a) and (c). Changes 

to the fee schedule pursuant to this 

proposal are effective upon filing. The 

text of the proposed rule change is 

provided in Exhibit 5. 

The text of the proposed rule change 

is also available on the Exchange’s 

website (http://markets.cboe.com/us/ 

options/regulation/rule_filings/edgx/), 


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