88100 Federal Register / Vol. 89, No. 215 / Wednesday, November 6, 2024 / Notices 

19 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Capitalized terms not defined herein are defined 

in the Rules, available at www.dtcc.com/legal/rulesand-procedures.aspx. 

4See Securities Exchange Act Release No. 101131 

(Sept. 23, 2024), 89 FR 79324 (Sept. 27, 2024) (File 

No. SR–NSCC–2024–008) (‘‘Notice of Filing’’). 

5See NSCC Rule 11 (describing the CNS System) 

and Procedure VII (describing the CNS Accounting 

Operation), supra note 3. To be CNS-eligible, a 

security must be eligible for book-entry transfer on 

the books of DTC and must be capable of being 

processed in the CNS system. 

6 DTC also filed a proposed rule change with the 

Commission in connection with decommissioning 

the ID Net Service. See Securities Exchange Act 

Release No. 101132 (Sept. 23, 2024), 89 FR 79320 

(Sept. 27, 2024) (File No. SR–DTC–2024–010). 

7See DTC Settlement Service Guide, available at 

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

service-guides/Settlement.pdf. 

8The Matching Utility must be (i) a clearing 

agency registered with the Commission, (ii) an 

entity that has obtained an exemption from such 

registration from the Commission, or (iii) a 

‘‘qualified vendor’’ for trade confirmation/ 

affirmation services as defined by the rules of a selfregulatory organization. See DTC Settlement 

Service Guide, supra note 7, at 40. TCC ITP 

Matching (US) LLC (‘‘ITP’’), an NSCC and DTC 

affiliate, is currently the only Matching Utility that 

submits Affirmed Transactions to DTC. See Notice 

of Filing, supra note 4, at 79325 n.6. 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number SR– 

BX–2024–044 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090. 

All submissions should refer to file 

number SR–BX–2024–044. 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 (https://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 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. Do not include personal 

identifiable information in submissions; 

you should submit only information 

that you wish to make available 

publicly. We may redact in part or 

withhold entirely from publication 

submitted material that is obscene or 

subject to copyright protection. All 

submissions should refer to file number 

SR–BX–2024–044 and should be 

submitted on or before November 27, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.19

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–25733 Filed 11–5–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–101487; File No. SR– 

NSCC–2024–008] 

Self-Regulatory Organizations; 

National Securities Clearing 

Corporation; Order Approving of 

Proposed Rule Change To 

Decommission the ID Net Service 

October 31, 2024. 

I. Introduction 

On September 12, 2024, National 

Securities Clearing Corporation 

(‘‘NSCC’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

proposed rule change SR–NSCC–2024– 

008 (‘‘Proposed Rule Change’’) pursuant 

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

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 to amend the NSCC 

Rules & Procedures (‘‘Rules’’) to 

decommission the ID Net service (‘‘ID 

Net Service’’ or ‘‘ID Net’’).3 The 

Proposed Rule Change was published 

for comment in the Federal Register on 

September 27, 2024.4 The Commission 

has received no comments on the 

Proposed Rule Change. For the reasons 

discussed below, the Commission is 

approving the Proposed Rule Change. 

II. Background 

NSCC provides central counterparty 

services, including clearing, settlement, 

risk management, and a guarantee of 

completion, for virtually all broker-tobroker trades involving equity 

securities, corporate and municipal debt 

securities, and certain other securities. 

Within NSCC’s Continuous Net 

Settlement system (‘‘CNS’’), which is 

NSCC’s system for accounting and 

settling CNS-eligible securities,5 all 

eligible compared and recorded 

transactions for a particular settlement 

date are netted by issue into one net 

long (buy), net short (sell) or flat 

position for each Member, and those 

positions are further netted with 

positions of the same issue that remain 

open after their originally scheduled 

settlement date. As central counterparty, 

NSCC becomes the contra-party for 

settlement purposes, assuming the 

obligation of its Members that are 

receiving securities to receive and pay 

for those securities and the obligation of 

Members that are delivering securities 

to make the delivery. CNS netting thus 

reduces the number of securities 

movements required to settle 

transactions. 

The ID Net Service is a joint service 

offering of NSCC and its affiliate, The 

Depository Trust Company (‘‘DTC’’), 

available on a voluntary basis to broker/ 

dealers that are participants of both 

NSCC and DTC and banks that are 

participants of DTC.6 ID Net allows 

broker/dealer users to net their affirmed 

institutional transactions (‘‘Affirmed 

Transactions’’) with their CNS 

transactions. 

An institutional transaction is one 

between a broker/dealer and its 

institutional customer. Such 

institutional customers are not 

Participants of DTC. Unlike exchange 

trades and most prime broker trades, 

most institutional delivery transactions 

do not currently flow through CNS but 

instead settle at DTC on a trade-for-trade 

basis.7 DTC may accept Affirmed 

Transactions submitted by a utility that 

provides a matching service (‘‘Matching 

Utility’’).8 The counterparties on an 

Affirmed Transaction submitted by a 

Matching Utility to DTC are a (i) DTC 

Participant, acting as clearing broker to 

the Affirmed Transaction and a (ii) DTC 

Participant bank, acting as the custodian 

for an institutional customer. The 

Affirmed Transaction is processed on a 

trade-for-trade basis at DTC unless it is 

designated for ID Net processing by the 

Matching Utility and meets certain 

eligibility requirements. In order for an 

Affirmed Transaction to be eligible for 

processing in ID Net, (i) both 

counterparties to the Affirmed 

Transaction must be a Member of NSCC 

and a Participant of DTC, or a bank that 

is a Participant of DTC, that has 

subscribed to ID Net and (ii) the 


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Federal Register / Vol. 89, No. 215 / Wednesday, November 6, 2024 / Notices 88101 

9See DTC Settlement Service Guide, supra note 

7, at 40–41. 

10See Notice of Filing, supra note 4, at 79325. 

11 Id. 

12NSCC states that this complexity includes (i) 

special eligibility checks versus the ID Net 

eligibility criteria and (ii) leveraging of the omnibus 

accounts to simultaneously allow (a) a bank to 

process ID Net-eligible transactions on a trade-fortrade basis and (b) the broker/dealer side of an ID 

Net-eligible transaction to settle via CNS. Notice of 

Filing, supra note 4, at 79325 n.9. 

13 In 2021, NSCC adopted a proposed rule change 

to remove transactions processed through the ID 

Net Service from the calculation of Members’ 

Required Deposits to the Clearing Fund. See 

Securities Exchange Act Release No. 93070 (Sep. 

20, 2021), 86 FR 53125 (Sep. 24, 2021) (SR–NSCC– 

2021–011). 

14NSCC states that active users of the ID Net 

service constitute less than 10% of NSCC’s fullservice Members. NSCC believes that ID Net usage 

has been limited since its implementation in 2008 

because, in part, the service needs both parties to 

an ID Net transaction to be subscribers of ID Net, 

which is not always the case. See Notice of Filing, 

supra note 4, at 79325 n.10. 

15See NSCC Rule 65, Section 5(c), supra note 3. 

16See supra note 13. 

17See Notice of Filing, supra note 4, at 79326; see 

also NSCC Important Notice regarding 

decommission of the ID Net Service, available at 

https://www.dtcc.com/-/media/Files/pdf/2023/8/8/ 

a9327.pdf. 

18 15 U.S.C. 78s(b)(2)(C). 

transaction must be (a) in a security 

eligible for processing through CNS and 

(b) affirmed within established 

timeframes set forth in the DTC 

Settlement Service Guide.9

If an Affirmed Transaction is 

designated for ID Net and meets the 

eligibility criteria, then DTC will direct 

the transaction to ID Net, which 

facilitates the netting of a broker/ 

dealer’s side of an Affirmed Transaction 

with that broker/dealer’s CNS activity, 

via omnibus accounts that are 

maintained by NSCC at DTC and 

designated for ID Net activity. If a bank 

is a counterparty to the ID Net-eligible 

Affirmed Transaction, then it will either 

receive or deliver the subject shares 

versus payment, on a trade-for-trade 

basis, via the ID Net omnibus accounts. 

While ID Net allows broker/dealers to 

realize the benefit of netting for 

Affirmed Transactions by allowing the 

broker/dealer to net its ID Net-eligible 

Affirmed Transactions with its 

transactions in CNS, banks using ID Net 

settle ID Net transactions on a trade-fortrade basis as they would for other 

Affirmed Transactions. In this regard, 

NSCC states that ID Net’s main benefit 

is to streamline clearance and 

settlement of ID Net-eligible Affirmed 

Transactions for broker/dealers.10

III. Description of the Proposed Rule 

Change 

NSCC states that as part of NSCC’s 

and DTC’s continuous evaluations to the 

efficiency and effectiveness of the 

services they provide and in order to 

streamline and simplify their services 

and processes, NSCC and DTC have 

identified ID Net as an underused 

service that may be eliminated as part 

of modernization efforts.11 They each 

propose to decommission the ID Net 

Service due to factors including: (i) 

limited uptake and usage of the service 

since its adoption; (ii) the operational 

complexity of maintaining the service, 

which also connects with and impacts 

other core clearance and settlement 

processes; 12 and (iii) the prior 

elimination of the NSCC Clearing Fund 

offset for ID Net transactions.13

To implement the proposed change, 

NSCC would remove Rule 65 and 

Procedure XVI from the Rules and make 

other conforming changes throughout 

the Rules to reflect the decommission of 

the service. The ID Net Service is 

primarily described in NSCC Rule 65 

and Procedure XVI of the Rules, and 

these would no longer be necessary or 

relevant upon the decommission of the 

ID Net Service. As a result, Rule 65 and 

Procedure XVI would be deleted in their 

entirety and would be reserved for 

future use by NSCC. 

NSCC also proposes removing 

associated defined terms ‘‘Eligible ID 

Net Security’’ and ‘‘ID Net Subscriber’’ 

from Rule 1 and remove a reference to 

ID Net transactions from the definition 

of ‘‘Net Unsettled Position’’ in Rule 1. 

In addition, NSCC would remove 

Section 1(f) of Rule 3, concerning 

certain lists required to be maintained 

by NSCC, to reflect that NSCC would no 

longer be required to maintain a list of 

Eligible ID Net Securities and would 

make a conforming change to renumber 

existing Section 1(g) of Rule 3 to Section 

1(f). NSCC would also remove Section 

2(a)(vii) of Rule 18, which concerns 

procedures for when NSCC ceases to act 

for a Member, to reflect that 

uncompleted ID Net Service 

transactions would no longer be 

considered for purposes of determining 

excluded transactions in a cease to act 

scenario. 

Additionally, NSCC proposes 

modifying Procedure VII, concerning its 

CNS Accounting Operation, to remove 

various references to the ID Net Service 

and ID Net transactions. Specifically, 

NSCC would revise the Introduction in 

Section A to remove a reference to 

Eligible ID Net Securities being 

included in CNS Securities for purpose 

of Procedure VII. NSCC would also 

modify Section D.1., concerning the 

process for exemptions from deliveries, 

to remove a statement regarding the 

treatment of securities available in an 

agency account established at a 

Qualified Securities Depository for the 

processing of transactions through the 

ID Net Service. In addition, NSCC 

would modify Section E.4, concerning 

the allocation algorithm for CNS 

deliveries, to remove a statement 

regarding the treatment of long positions 

in a receiving ID Net Subscriber’s 

agency account established at a 

Qualified Securities Depository. NSCC 

would also delete Section H.5. of 

Procedure VII concerning the reporting 

of ID Net transactions on NSCC’s 

Miscellaneous Activity Report and make 

conforming changes to renumber 

subsequent rules in Section H. 

Finally, NSCC proposes updating 

Section I.(A)(1)(b) of Procedure XV, 

concerning NSCC’s Clearing Fund 

calculations, to remove a reference to ID 

Net transactions from the Mark-toMarket component of the Clearing Fund 

formula. 

NSCC believes that the decommission 

of the ID Net Service would have 

minimal impact on its Members, as only 

13 broker/dealers and 20 banks are 

subscribed to the ID Net Service and the 

service is not used by all of those 

broker/dealers and banks.14

Furthermore, without ID Net, Affirmed 

Transactions can simply settle trade-fortrade, directly between the 

counterparties like they already do. 

NSCC also notes that there would be 

minimal impact to risk management 

from both an NSCC and Member 

perspective given that the ID Net 

Service is a non-guaranteed service of 

NSCC15 and there is no longer a 

Clearing Fund offset for ID Net 

transactions.16

NSCC states that it has performed 

direct outreach to Members that use the 

ID Net Service and has also announced 

its plans to decommission the ID Net 

Service in an Important Notice, and that 

there have been no material objections 

or concerns raised by Members.17

IV. Discussion and Commission 

Findings 

Section 19(b)(2)(C) of the Act 18

directs the Commission to approve a 

proposed rule change of a selfregulatory organization if it finds that 

such proposed rule change is consistent 

with the requirements of the Act and 

rules and regulations thereunder 

applicable to such organization. After 

careful review of the Proposed Rule 

Change, the Commission finds that the 

Proposed Rule Change is consistent 

with the requirements of the Act and the 

rules and regulations thereunder 

applicable to NSCC. In particular, the 


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19 15 U.S.C. 78q–1(b)(3)(F). 

20 Id. 

21 Id. 

22 15 U.S.C. 78q–1. 

23 15 U.S.C. 78s(b)(2). 

24 In approving the Proposed Rule Change, the 

Commission considered its impact on efficiency, 

competition, and capital formation. 15 U.S.C. 78c(f). 25 17 CFR 200.30–3(a)(12). 

Commission finds that the Proposed 

Rule Change is consistent with Section 

17A(b)(3)(F) of the Act.19

A. Consistency With Section 

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

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

requires that the rules of a clearing 

agency, such as NSCC, be designed to, 

among other things, promote the prompt 

and accurate clearance and settlement of 

securities transactions.20 The 

Commission believes that the Proposed 

Rule Change is consistent with Section 

17A(b)(3)(F) of the Act for the reasons 

stated below. 

The Proposed Rule Change would 

modify the NSCC Rules to reflect the 

decommission of the ID Net Service. As 

discussed in Parts II and III, ID Net is 

an underused service that is 

operationally complex to maintain, and 

its main benefit is to broker/dealers’ 

streamline clearance and settlement of 

ID Net-eligible Affirmed Transactions, 

which may otherwise settle on a tradefor-trade basis. As such, ID Net’s 

decommission would have minimal 

impact on NSCC and its Members 

considering its limited usage. Affirmed 

Transactions that would have otherwise 

been directed to ID Net will settle tradefor-trade directly between 

counterparties, like most other Affirmed 

Transactions currently do. Therefore, 

these transactions will continue to settle 

promptly and accurately, as other 

Affirmed Transactions do, outside of the 

ID Net Service. For these reasons, the 

Commission finds that the Proposed 

Rule Change should continue to support 

NSCC’s ability to provide prompt and 

accurate clearance and settlement of 

securities transactions, consistent with 

Section 17A(b)(3)(F) of the Act.21

V. Conclusion 

On the basis of the foregoing, the 

Commission finds that the Proposed 

Rule Change is consistent with the 

requirements of the Act, and in 

particular, with the requirements of 

Section 17A of the Act 22 and the rules 

and regulations promulgated 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act 23 that 

proposed rule change SR–NSCC–2024– 

008, be, and hereby is, approved.24

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.25

Vanessa A. Countryman, 

Secretary. 

[FR Doc. 2024–25727 Filed 11–5–24; 8:45 am] 

BILLING CODE 8011–01–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #20705 and #20706; 

VIRGINIA Disaster Number VA–20011] 

Presidential Declaration Amendment of 

a Major Disaster for the 

Commonwealth of Virginia 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Amendment 4. 

SUMMARY: This is an amendment of the 

Presidential declaration of a major 

disaster for the Commonwealth of 

Virginia (FEMA–4831–DR), dated 

October 1, 2024. 

Incident: Tropical Storm Helene. 

DATES: Issued on October 25, 2024. 

Incident Period: September 25, 2024 

through October 3, 2024. 

Physical Loan Application Deadline 

Date: December 2, 2024. 

Economic Injury (EIDL) Loan 

Application Deadline Date: July 1, 2025. 

ADDRESSES: Visit the MySBA Loan 

Portal at https://lending.sba.gov to 

apply for a disaster assistance loan. 

FOR FURTHER INFORMATION CONTACT: 

Alan Escobar, Office of Disaster 

Recovery & Resilience, U.S. Small 

Business Administration, 409 3rd Street 

SW, Suite 6050, Washington, DC 20416, 

(202) 205–6734. 

SUPPLEMENTARY INFORMATION: The notice 

of the President’s major disaster 

declaration for the Commonwealth of 

Virginia, dated October 1, 2024, is 

hereby amended to update the incident 

period for this disaster as beginning 

September 25, 2024 and continuing 

through October 3, 2024. 

All other information in the original 

declaration remains unchanged. 

(Catalog of Federal Domestic Assistance 

Number 59008) 

Alejandro Contreras, 

Acting Deputy Associate Administrator, 

Office of Disaster Recovery & Resilience. 

[FR Doc. 2024–25744 Filed 11–5–24; 8:45 am] 

BILLING CODE 8026–09–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #20757 and #20758; 

VIRGINIA Disaster Number VA–20013] 

Presidential Declaration Amendment of 

a Major Disaster for Public Assistance 

Only for the Commonwealth of Virginia 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Amendment 1. 

SUMMARY: This is an amendment of the 

Presidential declaration of a major 

disaster for Public Assistance Only for 

the Commonwealth of Virginia (FEMA– 

4831–DR), dated October 10, 2024. 

Incident: Tropical Storm Helene. 

DATES: Issued on October 25, 2024. 

Incident Period: September 25, 2024 

through October 3, 2024. 

Physical Loan Application Deadline 

Date: December 9, 2024. 

Economic Injury (EIDL) Loan 

Application Deadline Date: July 10, 

2025. 

ADDRESSES: Visit the MySBA Loan 

Portal at https://lending.sba.gov to 

apply for a disaster assistance loan. 

FOR FURTHER INFORMATION CONTACT: 

Alan Escobar, Office of Disaster 

Recovery & Resilience, U.S. Small 

Business Administration, 409 3rd Street 

SW, Suite 6050, Washington, DC 20416, 

(202) 205–6734. 

SUPPLEMENTARY INFORMATION: The notice 

of the President’s major disaster 

declaration for Private Non-Profit 

organizations in the Commonwealth of 

Virginia, dated October 10, 2024 is 

hereby amended to update the incident 

period for this disaster as beginning 

September 25, 2024 and continuing 

through October 3, 2024. 

All other information in the original 

declaration remains unchanged. 

(Catalog of Federal Domestic Assistance 

Number 59008) 

Alejandro Contreras, 

Acting Deputy Associate Administrator, 

Office of Disaster Recovery & Resilience. 

[FR Doc. 2024–25761 Filed 11–5–24; 8:45 am] 

BILLING CODE 8026–09–P 

SMALL BUSINESS ADMINISTRATION 

[Disaster Declaration #20757 and #20758; 

VIRGINIA Disaster Number VA–20013] 

Presidential Declaration Amendment of 

a Major Disaster for Public Assistance 

Only for the Commonwealth of Virginia 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Amendment 2. 


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