Federal Register / Vol. 86, No. 136 / Tuesday, July 20, 2021 / Notices 38381 

22 15 U.S.C. 78s(b)(3)(A)(iii). 

23 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6) requires a self-regulatory organization to give 

the Commission written notice of its intent to file 

the proposed rule change at least five business days 

prior to the date of filing of the proposed rule 

change, or such shorter time as designated by the 

Commission. The Exchange has satisfied this 

requirement. 

24 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)(4). 

5Capitalized terms not defined herein are defined 

in the Rules, By-Laws, and Organization Certificate 

of DTC (‘‘Rules’’), available at www.dtcc.com/∼/ 

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

and the Guide. 

6Pursuant to the Rules, the term ‘‘Procedures’’ 

means the Procedures, service guides, and 

regulations of DTC adopted pursuant to Rule 27, as 

amended from time to time. See Rule 1, Section 1, 

supra note 5. Pursuant to Rule 27, each Participant 

and DTC is bound by the Procedures and any 

amendment thereto in the same manner as it is 

Continued 

burden on competition. The term 

‘‘electronic order book’’ makes clear that 

specific order book being described. 

The Exchange’s proposal to amend 

Options 8, Section 28(g) to provide that 

Floor Brokers may enter limit, market, 

stop-limit or stop orders into the 

electronic order book does not impose 

an undue burden on competition. 

Currently, Options 8, Section 28(g) only 

refers to limit orders when it should 

have also noted market, stop-limit and 

stop orders. The Exchange notes that 

Floor Brokers may also utilize market, 

stop-limit and stop orders to clear 

resting Customers orders from the 

electronic order book. Today, placing 

market, stop-limit and stop orders on 

the electronic order book does not 

require exposure in open outcry. 

Options 10, Section 20 

The Exchange proposes to update a 

reference to Phx Rule 1049 within 

Options 10, Section 20, Options 

Communications, and replace ‘‘Nasdaq 

PHLX’’ throughout this rule with ‘‘Phlx’’ 

are non-substantive amendments that 

will clarify the Rulebook. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were either 

solicited or received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Because the foregoing proposed rule 

change does not: (i) Significantly affect 

the protection of investors or the public 

interest; (ii) impose any significant 

burden on competition; and (iii) become 

operative for 30 days from the date on 

which it was filed, or such shorter time 

as the Commission may designate, it has 

become effective pursuant to Section 

19(b)(3)(A)(iii) of the Act 22 and 

subparagraph (f)(6) of Rule 19b–4 

thereunder.23

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or disapproved. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views, and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

Phlx–2021–41 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–Phlx–2021–41. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549 on official 

business days between the hours of 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. 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–Phlx–2021–41 and should 

be submitted on or before August 10, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.24

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–15339 Filed 7–19–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92410; File No. SR–DTC– 

2021–012] 

Self-Regulatory Organizations; The 

Depository Trust Company; Notice of 

Filing and Immediate Effectiveness of 

Proposed Rule Change Consisting of 

Modifications to the Text of the Rules 

and the Procedures, of the Service 

Guide for the DTC Canadian-Link 

Service and the DTC Operational 

Arrangements Relating to the 

Elimination of the Canadian Dollar 

Settlement Feature of the CanadianLink Service 

July 14, 2021. 

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 July 12, 

2021, The Depository Trust Company 

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

Exchange Commission (‘‘Commission’’) 

the proposed rule change as described 

in Items I, II and III below, which Items 

have been prepared by the clearing 

agency. DTC filed the proposed rule 

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

of the Act 3 and Rule 19b–4(f)(4) 

thereunder.4 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 of DTC5

consists of modifications to the text of 

the Rules and the Procedures,6


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bound by the Rules. See Rule 27 at 97, supra note 

5. 

7Available at http://www.dtcc.com/∼/media/ 

Files/Downloads/legal/service-guides/Canadian_

Dollar_Settlement.pdf. 

8Available at http://www.dtcc.com/∼/media/ 

Files/Downloads/legal/issue-eligibility/eligibility/ 

operational-arrangements.pdf. 

9Supra note 5. 

10See Securities Exchange Act Release No. 52784 

(November 16, 2005), 70 FR 70902 (November 23, 

2005) (SR–DTC–2005–08). 

11Supra note 5. 

12The Canadian-Link Service also provides for 

Cross-Border USD Securities Transactions between 

Participants and CDS Participants. See Rule 30, 

Section 1(a)(2), supra note 5. See also Securities 

Exchange Act Release No. 55239 (February 5, 2007), 

72 FR 6797 (February 13, 2007) (SR–DTC–2006–15). 

13 DTC may determine the Securities that are 

eligible for the Canadian-Link Service. Some 

Securities may be eligible for all purposes of the 

Canadian-Link Service, and some Securities may be 

eligible only for limited purposes (e.g., clearance 

and settlement through the facilities of CDS but 

only custody and asset servicing through the 

facilities of DTC). See Rule 30, Section 4, supra note 

5. 

14Pursuant to Section 1(h)(15) of Rule 30, the 

term ‘‘Canadian-Link CAD Money Settlement’’ is 

defined as the money settlement of Canadian-Link 

Transactions in CAD Funds between the DTC and 

Canadian-Link Participants. Rule 30, supra note 5. 

DTC notes that in a list of defined terms at the 

beginning of Rule 30, the definition of CanadianLink CAD Money Settlement is specified to appear 

in Section 1(a)(15); however, the definition actually 

appears in Section 1(h)(15) of Rule 30 and not 

Section 1(a)(15) of Rule 30. Id. 

15The term ‘‘Collateral Monitor’’ of a Participant, 

as used with respect to its obligations to the 

Corporation, means, on any Business Day, the 

record maintained by the Corporation for the 

Participant which records, in the manner specified 

in Procedures, the algebraic sum of (i) the Net 

Credit or Debit Balance of the Participant and (ii) 

the aggregate Collateral Value of the Collateral of 

the Participant. Rule 1, Section 1 at 3, supra note 

5. 

16See CDS’s website at https://www.cds.ca/ 

about/post-trade-modernization for information 

published by CDS regarding CDS PTM. 

including Rule 30, of the service guide 

(‘‘Guide’’) 7 for the DTC Canadian-Link 

Service (‘‘Canadian-Link Service’’) and 

the DTC Operational Arrangements 

(Necessary for Securities to Become and 

Remain Eligible for DTC Services) 

(‘‘OA’’) 8 relating to the elimination of 

the Canadian dollar (‘‘CAD’’) settlement 

feature of the Canadian-Link Service, as 

described below. 

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, the 

clearing agency included statements 

concerning the purpose of and basis for 

the proposed rule change and discussed 

any comments it received on the 

proposed rule change. The text of these 

statements may be examined at the 

places specified in Item IV below. The 

clearing agency has prepared 

summaries, set forth in sections A, B, 

and C below, of the most significant 

aspects of such statements. 

(A) Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

1. Purpose 

The proposed rule change consists of 

modifications to the text of the Rules 

and the Procedures, including Rule 30,9

the Guide and the OA relating to the 

elimination of the CAD settlement 

feature of the Canadian-Link Service, as 

described below. 

Background 

In 2006, DTC established a 

‘‘northbound’’ Canadian-Link Service 

that supports transactions settled in 

CAD.10 Rule 30 11 describes the 

operation of the Canadian-Link Service, 

that permits DTC Participants using the 

Canadian Link Service (‘‘Canadian-Link 

Participants’’) to (A) settle Delivery 

Versus Payment (‘‘DVP’’) Securities 

transactions with participants (‘‘CDS 

Participants’’) of The Canadian 

Depository for Securities Limited 

(‘‘CDS’’) and other Canadian-Link 

Participants in CAD and (B) transfer 

CAD to or receive CAD from CDS 

Participants and other Canadian-Link 

Participants without any corresponding 

delivery or receipt of Securities.12

The Canadian-Link Service provides 

Participants with a single depository 

interface for CAD transactions. The link 

facilitates Participants’ ability to 

maintain U.S. and Canadian Security 

positions in their DTC accounts for 

Securities listed in both Canada and the 

United States (i.e., dually listed). This 

eliminates the need for Participants to 

maintain separate positions in an 

eligible 13 Security in CDS for CAD 

settlements and in DTC for USD 

settlements. It also eliminates the need 

for Participants to reposition Securities 

inventory between DTC and CDS in 

preparation for corporate action events 

and or transaction processing for dually 

listed issues. 

Transactions between Canadian-Link 

Participants and CDS Participants are 

processed through an omnibus account 

maintained by DTC at CDS (‘‘DTC 

Omnibus Account’’) in accordance with 

the rules and procedures of CDS. 

Canadian-Link Participants are able (i) 

to deliver Securities to or receive 

Securities from CDS Participants against 

payment (i.e., DVP) in CAD and (ii) to 

transfer funds to or receive funds from 

CDS Participants in CAD without any 

corresponding delivery or receipt of 

Securities. Transactions between 

Canadian-Link Participants and other 

Canadian-Link Participants are 

processed through accounts at DTC in 

accordance with the Rules. 

For both transactions (i) between 

Canadian-Link Participants and CDS 

Participants processed through the DTC 

Omnibus Account and (ii) between 

Canadian-Link Participants and other 

Canadian-Link Participants processed 

through accounts at DTC, there is a 

single end-of-day CAD money 

settlement between DTC and its 

Canadian-Link Participants.14 For the 

transactions between Canadian-Link 

Participants and CDS Participants 

processed through the DTC Omnibus 

Account, there is a separate end-of-day 

CAD money settlement between CDS 

and DTC. 

As with all transactions processed at 

DTC, DTC maintains risk controls with 

respect to transactions processed by 

Canadian-Link Participants, including 

the Net Debit Cap and Collateral 

Monitor.15 With respect to Collateral 

Monitor, each Canadian-Link 

Participant has a single Collateral 

Monitor with respect to transactions 

processed for such Participant through 

the Canadian-Link Service and other 

transactions processed by DTC for such 

Participant. 

Proposed Rule Change 

In recent years, activity at DTC in 

CAD has accounted for less than 0.20 

percent of DTC’s average daily valued 

settlement volume. Most of this activity 

relates to distributions such as 

principal, interest and dividend 

payments in Securities held at CDS by 

DTC on behalf of Participants. While 

Participants continue to use the 

Canadian-Link Service for custody 

purposes to position Securities 

inventory at CDS through DTC’s CDS 

account and receive related distribution 

payments, no Participants have 

effectuated a DVP of Securities through 

the Canadian-Link Service since 2018. 

DTC attributes this lack of DVP activity 

to a lack of demand among its 

Participants for the DVP aspect of the 

Canadian-Link Service. 

CDS recently communicated to CDS’s 

participants, including DTC, that it will 

be modernizing its settlement system 

through an initiative referred to as the 

Post Trade Modernization (‘‘CDS PTM’’) 

Project.16 For DTC to continue to 

maintain access to CDS’s CAD 

settlement services, it would have been 

necessary for DTC to perform systems 

development in order to be able to 

continue to use this aspect of the 

Canadian-Link service. However, the 

CDS modernization does not adversely 

impact DTC’s ability to hold Securities 


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17Pursuant 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 supra note 5. 

18See DTC Important Notice 13639–20 (July 10, 

2020). Available at https://www.dtcc.com/-/media/ 

Files/pdf/2020/7/10/13639-20.pdf. 

19Supra note 5. 

20See OA at 23–27, supra note 8. 

21Pursuant to Section 1(h)(3) of Rule 30, the term 

‘‘CAD Funds’’ are defined as funds denominated in 

Canadian dollars. See Rule 30, supra note 5. 

22See supra note 14. 

23Pursuant to Section 8(a) of Rule 30, the term 

‘‘Canadian-Link CAD Net Debit Cap’’ is defined as 

a limit established by DTC (i) on the negative CAD 

Funds balance that may, from time to time, be 

incurred by a Canadian-Link Participant in respect 

of Canadian-Link Transactions processed for such 

Participant through the Canadian-Link Service in 

CAD Funds. See Rule 30, supra note 5. 

24Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link CAD Net Settlement Credit’’ is 

defined as the net amount of CAD Funds, calculated 

by DTC by a time on a CDS Business Day set forth 

in the Procedures, payable by DTC to a CanadianLink Participant. Id. 

25Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link CAD Net Settlement Debit’’ is 

defined as the net amount of CAD Funds, calculated 

by DTC by a time on a CDS Business Day set forth 

in the Procedures, payable to DTC by a CanadianLink Participant. Id. 

26Pursuant to Rule 30, Section 1(h)(8), the term 

‘‘Canadian-Link Funds Transactions’’ is defined as 

Cross-Border CAD Funds Transactions and IntraDTC CAD Funds Transactions, referred to 

individually or collectively as the context may 

require. Id. 

27Pursuant to Rule 30, Section 8(a), the term 

‘‘Canadian-Link Net Debit Cap’’ is defined as the 

Canadian-Link CAD Net Debit Cap and CanadianLink USD Net Debit Cap referred to, individually 

or collectively as the context may require. This 

section provides that the Canadian-Link Net Debit 

Cap of each Canadian-Link Participant shall be 

determined by a formula (taking into account the 

volume of Canadian-Link Transactions of each 

Canadian-Link Participant) that shall be fixed by 

DTC and set forth in the Procedures. Id. 

28Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link Net Settlement Credit’’ is defined 

as the Canadian-Link CAD Net Settlement Credit 

and Canadian-Link USD Net Settlement Credit 

referred to, individually or collectively as the 

context may require. Id. 

29Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link Net Settlement Debit’’ is defined as 

the Canadian-Link CAD Net Settlement Debit and 

Canadian-Link USD Net Settlement Debit referred 

to, individually or collectively as the context may 

require. Id. 

30Pursuant to Rule 30, Section 6(c), the term 

‘‘Canadian-Link Participants Fund Cash’’ is defined 

as that portion of the cash in the Participants Fund 

equal to the aggregate amount of the Canadian-Link 

Required Participants Fund Deposits of all 

Canadian-Link Participants. Id. 

31Pursuant to Rule 30, Section 6(a), the term 

‘‘Canadian-Link Required Participant Fund 

Deposit’’ is defined as an amount each CanadianLink Participant shall be required to deposit to the 

Participants Fund (as described in Section 1 of Rule 

4) an amount of USD Funds in addition to the 

amount of USD Funds specified in Section 1(a)(i) 

of Rule 4. The Canadian-Link Required Participants 

Fund Deposit shall be in cash. The Canadian-Link 

Required Participants Fund Deposit of each 

Canadian-Link Participant shall be determined by a 

formula (considering the volume of transactions of 

each Canadian-Link Participant) that shall be fixed 

by the DTC and set forth in the Procedures. DTC 

may, from time to time, change the formula for 

determining the Canadian-Link Required 

Participants Fund Deposits of Canadian-Link 

Participants; provided, however, that notice of such 

change shall be given to each Canadian-Link 

Participant at least ten Business Days in advance of 

the effective date thereof. Id. 

32Pursuant to Rule 30, Section 8(a), a ‘‘CanadianLink USD Net Debit Cap’’ is to be established by 

DTC on the negative USD Funds balance that may, 

from time to time, be incurred by a Canadian-Link 

Participant in respect to Canadian-Link 

Transactions processed for such Participant through 

the Canadian-Link Service in USD Funds. Id. 

33Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link USD Net Settlement Credit’’ is 

defined as the net amount of USD Funds calculated 

by DTC by a time on a CDS Business Day set forth 

in the Procedures and payable by DTC to a 

Canadian-Link Participant. Id. 

34Pursuant to Rule 30, Section 12(b), the term 

‘‘Canadian-Link USD Net Settlement Debit’’ is 

defined as the net amount of USD Funds calculated 

by DTC by a time on a CDS Business Day set forth 

in the Procedures and payable to DTC by a 

Canadian-Link Participant. Id. 

35Pursuant to Rule 30, Section 13(a), ‘‘CDS 

Payment Exchange’’ is defined as on each CDS 

Business Day, during a period of time set forth in 

the Rules and Procedures of CDS, when CDS is 

required to pay to DTC the amount of its DTC 

Omnibus Account CAD Net Settlement Credit, id, 

or DTC is required to pay to CDS the amount of its 

Continued 

at CDS on behalf of Participants, receive 

distributions on behalf of Participants 

and facilitate Free Deliveries 17 through 

the link. 

Rule 30, Section 2 provides: 

The Corporation has entered into various 

agreements with CDS, and as a participant of 

CDS has undertaken to abide by the rules, 

procedures and user guides of CDS (the 

‘‘Rules and Procedures of CDS’’). Such 

agreements and the Rules and Procedures of 

CDS, as the same may be amended or 

supplemented from time to time, are 

collectively referred to as the ‘‘CDS 

Documents’’. Notwithstanding anything else 

contained in this Rule 30 or otherwise in the 

Rules and Procedures of the Corporation, the 

Corporation shall offer the Canadian-Link 

Service only for so long as the Corporation 

continues to be a participant of CDS and 

there have been no changes in the CDS 

Documents, or actions taken by CDS, which 

would, in the judgment of the Corporation, 

prevent or impair the ability of the 

Corporation to offer the Canadian-Link 

Service or make it impractical or onerous for 

the Corporation to do so. 

DTC has determined that it would no 

longer be able to access CDS’s CAD 

settlement service without making 

necessary system changes consistent 

with CDS PTM. In DTC’s judgement, it 

would be impractical for DTC to incur 

the costs to undertake such changes, 

including incurring development costs, 

due to the lack of demand by its 

Participants to use the valued aspect of 

the Canadian Link Service. 

In this regard, because there is no 

Participant demand for valued CAD 

Securities transaction and CAD Funds 

transfer aspect of the Canadian-Link 

Service, it is DTC’s judgement that it 

would be impractical for DTC to 

continue to process valued CAD 

Securities and CAD Funds transfer 

transactions and, in accordance with its 

discretion set forth in Rule 30 as 

described above, DTC has discontinued 

processing of CAD Securities and CAD 

Funds transactions through the 

Canadian-Link Service.18 DTC proposes 

to amend the Rules to clarify its Rules 

in this regard and reflect the elimination 

of the function of processing of CAD 

Securities and CAD Funds transactions 

pursuant to the provisions of Rule 30, 

Section 2.19 However, because the CDS 

PTM changes are not expected to 

materially impact DTC’s ability to 

perform custody and process Free 

Deliveries at CDS, DTC would continue 

to maintain its membership, including 

its Securities account, at CDS, to hold 

Securities on behalf of DTC Participants 

at CDS and offer the functionality 

allowing Participants the ability to 

process Free Deliveries through the 

Canadian-Link Service. In addition, 

DTC would continue to pass 

distributions paid on Securities held in 

its DTC account to the applicable 

Participants in CAD or USD.20

In this regard, DTC proposes to 

update the text of its Rules to reflect the 

discontinuance of processing valued 

CAD Securities transactions and CAD 

Funds transfers through the CanadianLink Service. 

Proposed Rule Changes 

Proposed Changes to Rulebook 

Pursuant to the proposed rule change, 

DTC will delete text in Rule 30 relating 

to the processing of CAD transactions in 

the Canadian-Link Service, including as 

follows. 

Defined Terms 

Defined terms relating to the 

description of the processing of CAD 

transactions in Rule 30 would be 

deleted, including CAD Funds,21

Canadian-Link CAD Money 

Settlement,22 Canadian-Link CAD Net 

Debit Cap,23 Canadian-Link CAD Net 

Settlement Credit,24 Canadian-Link 

CAD Settlement Debit,25 Canadian-Link 

Funds Transactions,26 Canadian-Link 

Net Debit Cap,27 Canadian-Link Net 

Settlement Credit,28 Canadian-Link Net 

Settlement Debit,29 Canadian-Link 

Participants Fund Cash,30 CanadianLink Required Participants Fund 

Deposit,31 Canadian-Link USD Net Debit 

Cap,32 Canadian-Link USD Net 

Settlement Credit,33 Canadian-Link USD 

Net Settlement Debit,34 CDS Payment 

Exchange,35 Canadian-Link Securities 


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DTC Omnibus Account CAD Net Settlement Debit, 

as specified in the CDS Settlement Recap. All such 

payments to or by DTC are made to or by a 

Canadian bank acting on behalf of DTC. Id. 

36Pursuant to Rule 30, Section 1(h)(7), 

‘‘Canadian-Link Securities Transactions’’ is defined, 

individually or collectively as the context may 

require, Cross-Border CAD Securities Transactions, 

Cross-Border USD Securities Transactions and 

Intra-DTC CAD Securities Transactions. Id. 

37Pursuant to Rule 30, Section 12(a), provides the 

definition of ‘‘CDS Settlement Recap’’ as follows: 

‘‘On each CDS Business Day, by a time set forth in 

the Rules and Procedures of CDS, CDS calculates 

and provides to the Corporation a settlement recap 

(the ‘‘CDS Settlement Recap’’) with (i) the net 

amount of CAD Funds payable by CDS to the 

Corporation (a ‘‘DTC Omnibus Account CAD Net 

Settlement Credit’’) or by the Corporation to CDS 

(a ‘‘DTC Omnibus Account CAD Net Settlement 

Debit’’), (ii) the net amount of USD Funds payable 

by CDS to the Corporation (a ‘‘DTC Omnibus 

Account USD Net Settlement Credit’’) or by the 

Corporation to CDS (a ‘‘DTC Omnibus Account USD 

Net Settlement Debit’’) and (iii) other information 

in respect of the Cross-Border Transactions 

processed by CDS for the Corporation on such CDS 

Business Day.’’ Id. 

38Pursuant to Rule 30, Section 12(a), ‘‘CDS 

Settlement Recap Time’’ is defined as time when 

CDS provides the CDS Settlement Recap to DTC. Id. 

39Pursuant to Rule 30, Section 16(b), provides the 

definition of ‘‘Collateral Monitor Conversion Rate’’ 

as follows: ‘‘If any computation has to be made 

requiring the conversion of an amount of CAD 

Funds into an amount of USD Funds for the 

purpose of calculating the Collateral Monitor of a 

Canadian-Link Participant pursuant to Section 9 of 

this Rule 30, the conversion rate for such purpose 

shall be a rate determined by a formula (taking into 

account exchange rate fluctuations) that shall be 

fixed by the Corporation and set forth in the 

Procedures (the ‘‘Collateral Monitor Conversion 

Rate’’).’’ Id. 

40Pursuant to Rule 30, Section 1(a)(4), the term 

‘‘Cross-Border CAD Funds Transactions’’ is defined 

as the transfer of Canadian dollars between 

Participants of DTC and participants of CDS. Id. 

41Pursuant to Rule 30, Section 1(a)(1), the term 

‘‘Cross-Border CAD Securities Transactions’’ is 

defined as the settlement of valued transactions (A) 

in Securities that are Eligible Securities (as 

described in Section 1 of Rule 5) and in Securities 

that are not Eligible Securities (B) in Canadian 

dollars (C) between Participants of the Corporation 

and participants of CDS (‘‘Cross-Border CAD 

Securities Transactions’’). Id. 

42Pursuant to Rule 30, Section 7(b), the term 

‘‘Cross-Border Net Additions’’ is defined as any 

Cross-Border Securities credited to the DTC 

Omnibus Account. Id. 

43Pursuant to Rule 30, Section 1(a)(2), the term 

‘‘Cross-Border USD Securities Transactions’’ is 

defined as the settlement of valued transactions in 

(A) Securities that are not Eligible Securities (B) in 

US dollars (C) between Participants of DTC and 

participants of CDS. Id. 

44Pursuant to Rule 30, Section 8(a), the term 

‘‘DTC Omnibus Account CAD Net Debit Cap’’ is 

defined as a limit established by CDS on the 

negative CAD Funds balance that may, from time 

to time, be incurred in the DTC Omnibus Account 

in respect of Cross-Border Transactions processed 

for DTC through the facilities of CDS in CAD Funds. 

Id. 

45See supra note 37. 

46 Id. 

47Pursuant to Rule 30, Section 8(a), the terms 

‘‘DTC Omnibus Account CAD Net Debit Cap’’ and 

‘‘DTC Omnibus Account USD Net Debit Cap’’ are 

referred to, individually or collectively as the 

context may require, as the ‘‘DTC Omnibus Account 

Net Debit Cap.’’ See Rule 30, supra note 5. 

48Pursuant to Rule 30, Section 12(a), the term 

‘‘DTC Omnibus Account Net Settlement Credit’’ 

means the DTC Omnibus Account CAD Net 

Settlement Credit and DTC Omnibus Account USD 

Net Settlement Credit, individually or collectively 

as the context may require. Id. 

49Pursuant to Rule 30, Section 12(a), the term 

‘‘DTC Omnibus Account Net Settlement Debit’’ 

means the DTC Omnibus Account CAD Net 

Settlement Debit and DTC Omnibus Account USD 

Net Settlement Debit, individually or collectively as 

the context may require. Id. 

50Pursuant to Rule 30, Section 8(a), the term 

‘‘DTC Omnibus Account USD Net Debit Cap’’ is 

defined pursuant to the Rules and Procedures of 

CDS, as a limit established by CDS (i) on the 

negative USD Funds balance that may, from time 

to time, be incurred in the DTC Omnibus Account 

in respect of Cross-Border Transactions processed 

for the Corporation through the facilities of CDS in 

USD Funds. Id. 

51See supra note 37. 

52 Id. 

53Pursuant to Rule 30, Section 13(a), the term 

‘‘DTC Canadian Settlement Bank’’ is defined as a 

Canadian bank acting on behalf of DTC for 

payments relating to CDS paying to DTC the 

amount of the DTC Omnibus Account CAD Net 

Settlement Credit, or DTC paying to CDS the 

amount of its DTC Omnibus Account CAD Net 

Settlement Debit, as specified in the CDS 

Settlement Recap. See Rule 30, supra note 5. 

54Pursuant to Rule 30, Section 13(b), the term 

‘‘DTC Settlement Payment Deadline’’ is defined as 

on each CDS Business Day, by a time set forth in 

the Procedures of the Corporation, each CanadianLink Participant with a Canadian-Link CAD Net 

Settlement Debit shall pay to the Corporation the 

amount of its Canadian-Link CAD Net Settlement 

Debit, as specified in the DTC Settlement Recap. 

See Rule 30, supra note 5. The time when such 

payment must be made is referred to as the ‘‘DTC 

Settlement Payment Deadline.’’ Id. 

55Pursuant to Rule 30, Section 12(b), the term 

‘‘DTC Settlement Recap’’ is defined as described in 

the following: ‘‘On each CDS Business Day, by a 

time set forth in the Procedures of the Corporation, 

the Corporation shall calculate and provide to each 

Canadian-Link Participant a settlement recap (a 

‘‘DTC Settlement Recap’’) with (i) the net amount 

of CAD Funds payable by the Corporation to such 

Canadian-Link Participant (a ‘‘Canadian-Link CAD 

Net Settlement Credit’’) or by such Canadian-Link 

Participant to the Corporation (a ‘‘Canadian-Link 

CAD Net Settlement Debit’’), (ii) the net amount of 

USD Funds payable by the Corporation to such 

Canadian-Link Participant (a ‘‘Canadian-Link USD 

Net Settlement Credit’’) or by such Canadian-Link 

Participant to the Corporation (a ‘‘Canadian-Link 

USD Net Settlement Debit’’) and (iii) other 

information in respect of the Canadian-Link 

Transactions of such Canadian-Link Participant 

processed through the Canadian-Link Service on 

such CDS Business Day, including both CrossBorder Transactions with CDS Participants 

processed for such Participant through the DTC 

Omnibus Account and Intra-DTC Transactions with 

other Canadian-Link Participants processed for 

such Participant through Accounts with the 

Corporation.’’ Id. 

56Pursuant to Rule 30, Section 12(b), the term 

‘‘DTC Settlement Recap Time’’ means the time 

when DTC provides the DTC Settlement Recap to 

Canadian-Link Participants. Id. 

57Pursuant to Rule 30, Section 1(h)(5), the term 

‘‘Funds’’ is defined as CAD Funds and USD Funds, 

individually or collectively as the context may 

require. Id. 

58Pursuant to Rule 30, Section 1(a)(5), the term 

‘‘Intra-DTC CAD Funds Transactions’’ is defined as 

the transfer of Canadian dollars between 

Participants of DTC and other Participants of DTC. 

Id. 

59Pursuant to Rule 30, Section 1(a)(3), the term 

‘‘Intra-DTC CAD Securities Transactions’’ is defined 

as the settlement of valued transactions (A) in 

Securities that are Eligible Securities (B) in 

Canadian dollars (C) between Participants of DTC 

and other Participants of DTC. Id. 

60Pursuant to Rule 30, Section 13(d), the term 

‘‘Participant Canadian Settlement Bank’’ is defined 

as a Canadian Bank acting on behalf of a Canadian 

bank to which all payments of CAD Funds to or by 

a Canadian-Link Participant shall be made. Id. 

61Pursuant to Rule 30, Section 16 (c), ‘‘Payment 

Default Conversion Rate’’ is defined as follows: ‘‘If 

any computation has to be made requiring the 

conversion of an amount of CAD Funds into an 

amount of USD Funds for the purpose of calculating 

the Gross Settlement Debit of a Canadian-Link 

Participant pursuant to Section 15 of this Rule 30, 

the conversion rate for such purpose shall be a rate 

determined by a formula (taking into account all 

factors incident to the default of such Participant 

in the payment of its Canadian-Link CAD Net 

Settlement Debit) that shall be fixed by the 

Corporation and set forth in the Procedures (the 

‘‘Payment Default Conversion Rate’’).’’ Id. 

Transactions,36 CDS Settlement 

Recap,37 CDS Settlement Recap Time,38

Collateral Monitor Conversion Rate,39

Cross-Border CAD Funds 

Transactions,40 Cross-Border CAD 

Securities Transactions,41 Cross-Border 

Net Additions,42 Cross-Border USD 

Securities Transactions,43 DTC 

Omnibus Account CAD Net Debit Cap,44

DTC Omnibus Account CAD Net 

Settlement Credit,45 DTC Omnibus 

Account CAD Net Settlement Debit,46

DTC Omnibus Account Net Debit Cap,47

DTC Omnibus Account Net Settlement 

Credit,48 DTC Omnibus Account Net 

Settlement Debit,49 DTC Omnibus 

Account USD Net Debit Cap,50 DTC 

Omnibus Account USD Net Settlement 

Credit,51 DTC Omnibus Account USD 

Net Settlement Debit,52 DTC Canadian 

Settlement Bank,53 DTC Settlement 

Payment Deadline,54 DTC Settlement 

Recap,55 DTC Settlement Recap Time,56

Funds,57 Intra-DTC CAD Funds 

Transactions,58 Intra-DTC CAD 

Securities Transactions,59 Participant 

Canadian Settlement Bank,60 Payment 

Default Conversion Rate,61 Payment 


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62Pursuant to Rule 30, Section 16(a), the term 

‘‘Payment Default Exchange Rate’’ is defined as the 

exchange rate determined by a formula (taking into 

account all factors incident to the default of such 

Participant in the payment of its Canadian-Link 

CAD Net Settlement Debit) that shall be fixed by 

DTC and set forth in the Procedures. The exchange 

rate relates to any amount of USD Funds has to be 

exchanged for an amount of CAD Funds to pay (or 

re-fund) a DTC Omnibus Account CAD Net 

Settlement Debit to CDS in accordance with Section 

13 of this Rule 30 because a Canadian-Link 

Participant failed to pay DTC the amount of its 

Canadian-Link CAD Net Settlement Debit. Id. 

63Pursuant to Rule 30, Section 1(h)(4), the term 

‘‘USD Funds’’ is defined as funds denominated in 

US dollars. Id. 

64Pursuant 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. 

65Pursuant to Rule 1, the term ‘‘Receiver,’’ as 

used with respect to a Delivery of a Security, means 

the Person which receives the Security. Id. 

Default Exchange Rate 62 and USD 

Funds.63

Cross references to sections of Rule 30 

for certain defined terms would be 

revised to reflect renumbering of the 

respective referenced sections, as more 

fully described below. The referenced 

section for the term (A) ‘‘Canadian-Link 

Participants’’ would be revised from 

Section 1(h)(1) to Section 1(e)(1), (B) 

‘‘Canadian-Link Securities’’ from 

Section 1(h)(14) to Section 1(e)(8), (C) 

‘‘Canadian-Link Transactions’’ from 

Section 1(h)(11) to Section 1(e)(5), ‘‘CDS 

Business Day’’ from Section 11(a) to 

Section 7(a), (D) ‘‘CDS Participants’’ 

from Section 1(h)(2) to Section 1(e)(2), 

(E) ‘‘Cross-Border Securities’’ from 

Section 1(h)(12) to Section 1(e)(6), (F) 

‘‘Cross-Border Transactions’’ from 

Section 1(h)(9) to Section 1(e)(3), (G) 

‘‘DTC Business Day’’ from Section 11(a) 

to Section 7(a), (I) ‘‘Intra-DTC 

Securities’’ from Section 1(h)(13) to 

Section 1(e)(7), and ‘‘Intra-DTC 

Transactions’’ from Section 1(h)(10) to 

Section 1(e)(4). 

Section 1—Overview of Canadian Link 

Service 

Section 1 of Rule 30 describes the 

scope of services offered by DTC 

relating to the Canadian-Link Service. 

Pursuant to the proposed rule change, 

Section 1 of Rule 30 would be revised 

to remove references to the processing 

of CAD Securities and CAD Funds 

transactions through the Canadian-Link 

service and provide only for processing 

of Free Deliveries through the link. 

These changes include: 

(i) Consolidate subsection (a) of 

Section 1 by eliminating references to 

DTC processing of (1) Cross-Border CAD 

Securities Transactions, (2) CrossBorder USD Securities Transactions, (3) 

Intra-DTC CAD Securities Transactions, 

(4) Cross-Border CAD Funds 

Transactions and (5) Intra-DTC CAD 

Funds Transactions, and instead refer to 

processing of Free Deliveries only. 

(ii) Subsection (b) of Section 1 which 

currently states, among other things, 

that DTC provides the Canadian-Link 

Service as a Securities Intermediary for 

its Participants, and all transactions in 

Securities and transfers of funds are 

subject to the Rules and Procedures of 

the Corporation, including this Rule 30 

and the Procedures adopted pursuant to 

Rule 30, would be amended to delete 

the reference to ‘‘and transfers of 

funds.’’ This reference would be deleted 

as DTC would no longer offer the ability 

to process CAD Funds Transactions 

through the Canadian-Link Service. As 

indicated above, DTC notes that 

distributions such as principal, interest 

and dividend payments relating 

Securities held at CDS by DTC on behalf 

of Participants would continue to be 

processed through DTC’s CAD Settling 

Bank to DTC Participants, pursuant to 

the applicable provisions of the OA. 

Processing of such distributions are 

conducted through DTC’s asset 

servicing functions and are not part of 

the DVP functionality that DTC 

proposes to eliminate from its Rules and 

Procedures. 

(iii) DTC would amend Subsection (c) 

of Section 1 to change references to 

‘‘seller’’ and ‘‘purchaser’’ of Securities 

to ‘‘Deliverer’’ 64 and ‘‘Receiver,’’ 65

respectively, to harmonize the use of 

terms with DTC’s rules related to 

settlement of Securities Deliveries and 

receives generally. DTC would also 

amend the text of this subsection to 

reflect the proposal that DVP 

transactions would no longer be 

processed through the Canadian-Link 

Service. In this regard, references to 

settlement in CAD would be deleted, 

and the text would refer to the crediting 

and debiting of Securities from a 

‘‘Deliverer’’ to a ‘‘Receiver.’’ Also, 

Subsection (d) directly below 

Subsection (c), which refers to crossborder settlement of transactions in USD 

would be deleted in its entirety to 

reflect the elimination of DVP 

settlement through the service. Since 

Subsection (c), as described above, 

would be written to address the 

Deliveries and Receives of Securities, 

generally, Securities transactions 

previously covered under Subsection (d) 

would be covered under the proposed 

revisions to Subsection (c). 

(iv) Subsection (e) of Section 1 

describes the processing of CAD 

Securities Transactions between DTC 

Participants. DTC proposes to amend 

Subsection (e) of Section 1 to reflect the 

elimination of money settlement 

relating to transactions conducted 

through the Canadian-Link Service. In 

this regard, a sentence that describes the 

debiting and crediting of Securities 

between Participants and references the 

term ‘‘Intra-DTC CAD Securities 

Transaction’’ would be revised to refer 

to ‘‘intra-DTC Securities transaction’’ 

instead, to reflect that movements of 

Securities between Participants would 

continue to be permitted through the 

Canadian-Link Service, even though the 

ability to settle a Securities transaction 

in CAD would be eliminated. In 

addition, DTC would change references 

to ‘‘seller’’ and ‘‘purchaser’’ of 

Securities to ‘‘Deliverer’’ and 

‘‘Receiver,’’ respectively, to harmonize 

the use of terms with DTC’s rules 

related to settlement of Securities 

deliveries and receives generally. DTC 

would also revise Subsection (e) so that 

it would be renumbered as Subsection 

(d) to reflect the deletion of the current 

Subsection (d), described above. 

(v) DTC would delete Subsection (f) of 

Section 1 which states: ‘‘A Cross-Border 

CAD Funds Transaction between a 

Participant of the Corporation and a 

participant of CDS is processed through 

the facilities of CDS.’’ In addition, DTC 

would delete Subsection (g) of Section 

1 which states: ‘‘An Intra-DTC CAD 

Funds Transaction between a 

Participant of the Corporation and 

another Participant of Corporation is 

processed though Canadian settlement 

banks acting for the Corporation and 

such Participants.’’ Both subsections 

would be obsolete because of the 

elimination of CAD processing through 

the Canadian-Link Service. 

(vi) Subsection (h) of Section 1 would 

be amended to delete explanations of 

certain definitions described above, 

including CAD Funds, USD Funds, 

Funds, Cross-Border Securities 

Transactions, Canadian-Link Securities 

Transactions, Canadian-Link Funds 

Transactions, and Canadian-Link CAD 

Money Settlement. Also the definitions 

of Intra-DTC Transactions, Cross-Border 

Securities, Cross-Border Transactions 

and Intra-DTC Securities would be 

amended to reflect the above-described 

elimination of money settlement in the 

Canadian-Link Service so that 

transactions are not referred to as 

involving DVP settlement or payment of 

funds. In this regard, references to the 

terms ‘‘Cross-Border USD Securities 

Transactions’’ and ‘‘Cross-Border CAD 

Securities Transactions’’ as elements of 

the definition of ‘‘Cross-Border 

Transactions’’ would be replaced with 

an undefined term ‘‘Cross-border 

securities transactions’’ to reflect that 

movements of Securities between 

Canadian-Link Participants and CDS 


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66See Section 5.2.2 of CDS’s rules, available at 

https://www.cds.ca/resource/en/311. 

Participants would continue to be 

permitted through the Canadian-Link 

Service, even though the ability to settle 

a Securities transaction versus payment 

would be eliminated. Further, ‘‘IntraDTC CAD Securities Transactions’’ and 

‘‘Intra-DTC CAD Funds Transactions’’ as 

elements of the definition of ‘‘Intra-DTC 

Transactions’’ would be replaced with a 

reference ‘‘Intra-DTC securities 

transactions,’’ for the same reason as an 

identical change to current Subsection 

(e) of Section 1 (proposed to be 

renumbered as Subsection (d)), as 

described above. Also, ‘‘Cross-Border 

CAD Securities Transactions’’ and 

‘‘Cross-Border USD Securities 

Transactions’’ used as elements of the 

description of ‘‘Cross-Border Securities’’ 

would be deleted and replaced with 

Cross-Border Transactions. Also, ‘‘IntraDTC CAD Securities Transactions,’’ 

used as a descriptor relating to 

Securities underlying an element of the 

definition of ‘‘Intra-DTC Securities,’’ 

would be replaced with ‘‘Intra-DTC 

Transactions,’’ because (i) even though 

Intra-DTC CAD Securities Transactions 

would no longer be provided for under 

Rule 30, intra-DTC Securities 

transactions could still occur through 

the Canadian-Link Service, as described 

above and (ii) such transactions would 

defined as ‘‘Intra-DTC Transactions,’’ as 

described above. In addition, Subsection 

(h) would be renumbered as Subsection 

(e) to conform the numbering of this 

section with the elimination and 

renumbering of other subsections as 

described above. In this regard, the 

explanations of definitions in 

subsection (h) are currently set forth in 

an itemized list numbered from (1) to 

(15), with each item followed by a 

semicolon. As a result of the proposed 

revisions described above, in addition to 

changes to the text to reflect the 

substantive changes described above, 

item numbers (3), (4), (5), (6) (7), (8) and 

(15) would be deleted and items (9), 

(10), (11), (12), (13) and (14) would be 

renumbered respectively as (3), (4), (5), 

(6), (7) and (8). A semicolon and the 

word ‘‘and’’ would be deleted from the 

end of current (14) (to be renumbered as 

(8)) and replaced with a period because 

the deletion of (15) would make the 

newly renumbered (8) the last item of 

this list. The word ‘‘and’’ would be 

added to the end of current (13) (to be 

renumbered as 7) directly after an 

existing semicolon. 

Section 2—CDS Documents 

Section 2 of Rule 30 provides, among 

other things, that ‘‘[E]ach Canadian-Link 

Participant shall observe and comply 

with the CDS Documents applicable to 

the Canadian-Link Service as if such 

Canadian-Link Participant were a CDS 

Participant and a direct party to the CDS 

Documents. Each Canadian-Link 

Participant acknowledges that the CDS 

Documents may include grants of 

security interests in and liens on CrossBorder Securities and CAD Funds in 

which such Canadian-Link Participant 

may have an interest. . . .’’ 

Pursuant to the proposed rule change, 

DTC proposes to change ‘‘CAD Funds’’ 

in the preceding sentence to ‘‘funds.’’ 

As described herein, the term ‘‘CAD 

Funds’’ would be eliminated pursuant 

to the proposed rule change. However, 

CDS may continue to have a security 

interest in funds owed to DTC for 

dividends and interest paid on 

Securities held by DTC at CDS on behalf 

of Canadian-Link Participants.66

Section 4—Participants Eligible for 

Canadian-Link Service 

Section 4 of Rule 30 provides, among 

other things that ‘‘A Security that is an 

Eligible Security may or may not be a 

Canadian-Link Security and may or may 

not be the subject of Cross-Border CAD 

Securities Transactions, Cross-Border 

USD Securities Transactions and/or 

Intra-DTC Securities Transactions. A 

Security that is not an Eligible Security 

may be a Limited-Service CanadianLink Security, but it may not be a FullService Canadian-Link Security and 

may not be the subject of Intra-DTC 

CAD Securities Transactions.’’ 

Consistent with the proposed changes 

described above, DTC proposes to 

amend this section to eliminate 

references to CAD and USD-related 

transactions and refer to transactions 

without reference to Canadian or U.S. 

currency. In this regard, a reference to 

‘‘Intra-DTC CAD Securities 

Transactions’’ would be revised to 

‘‘Intra-DTC Transactions’’ in a sentence 

describing to the effect, among other 

things, that a Limited-Service CanadianLink Security cannot be included in an 

intra-DTC Securities transaction. 

Section 5—Canadian-Link Interface and 

DTC Omnibus Account 

Section 5(a) of Rule 10 includes a 

description of ledgers and accounts that 

CDS maintains for DTC at CDS that 

relate to Securities and funds. The funds 

accounts are denominated in Canadian 

dollars and US dollars. While the DVP 

function of the Canadian-Link Service 

would be discontinued pursuant to the 

proposed rule change, DTC would 

continue to receive dividends and 

interest on Securities held by it at CDS 

and DTC may owe fees for services to 

CDS. As a result, DTC would continue 

to maintain funds accounts for these 

purposes. While the terms ‘‘CAD 

Funds’’ and ‘‘USD Funds’’ would be 

removed from Rule 30 as described 

herein, DTC proposes to replace these 

terms as used in Section 5(a) of Rule 30 

with ‘‘Canadian Dollar funds’’ and ‘‘US 

dollar funds,’’ respectively. 

Section 5(b) provides that DTC will 

make the DTC Omnibus Account 

available for the purpose of processing 

Cross-Border Transactions between 

Canadian-Link Participants and CDS 

Participants. This section states that 

DTC will act on behalf of Canadian-Link 

Participants and in accordance with 

their instructions, but DTC maintains, at 

all times, control over the Cross-Border 

Securities and Funds in the DTC 

Omnibus Account. As described herein, 

DTC would remove the defined term for 

‘‘Funds’’. However, as described above, 

DTC would continue to receive funds 

into its account at CDS in the form of 

dividends and interest. Therefore, DTC 

would replace ‘‘Funds’’ as used in 

Section 5(b) with ‘‘funds.’’ 

Section 6—Canadian-Link Required 

Participants Fund Deposit 

Section 6 of Rule 30 provides that a 

Participant must make a deposit that is 

deemed to be included in the 

Participants Fund with respect to DVP 

volume conducted by the Participant 

through the Canadian-Link Service. The 

section also provides for the investment 

of such deposits by DTC and the 

payment of interest for those 

investments to the applicable 

Participants. The Participants Fund 

provides liquidity for DTC to complete 

settlement in the event a Participant 

fails to meet its settlement obligation. 

Section 6 would be deleted in its 

entirety pursuant to the proposed rule 

change, because Participants would no 

longer have a settlement obligation in 

the Canadian-Link Service due to the 

elimination of money settlement for 

Securities transactions conducted 

through the service. In this regard, DTC 

would no longer have a settlement 

obligation with respect to CDS. As a 

result, there would no longer be a need 

to maintain such deposits with respect 

to Canadian-Link activity. 

Section 7—Security for Canadian-Link 

Transactions 

Section 7 of Rule 30 provides DTC 

with a security interest in Securities 

settled DVP through the Canadian-Link 

Service and allows DTC to use such 

Securities to secure loans for purposes 

of completing settlement in the event a 

Participant fails to satisfy its settlement 

obligation. This Section would be 


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67 Id. 

68 Id. 

deleted in its entirety pursuant to the 

proposal, because since Participants 

would no longer be able to incur a 

settlement obligation with respect to 

activity within the Canadian-Link 

Service, it would no longer necessary 

for DTC to maintain a security interest 

in Securities that are the subject of 

Canadian-Link Transactions. 

Section 8—Canadian-Link Net Debit 

Caps of Canadian-Link Participants 

Section 8 of Rule 30 provides for a 

limit to be established by DTC (i) on the 

negative CAD Funds balance that may, 

from time to time, be incurred by a 

Canadian-Link Participant in respect of 

Canadian-Link Transactions processed 

for such Participant through the 

Canadian-Link Service in CAD Funds 

(each a ‘‘Canadian-Link CAD Net Debit 

Cap’’) and (ii) on the negative USD 

Funds balance that may, from time to 

time, be incurred by a Canadian-Link 

Participant in respect to Canadian-Link 

Transactions processed for such 

Participant through the Canadian-Link 

Service in USD Funds (each, a 

‘‘Canadian-Link USD Net Debit Cap’’). 

The Canadian-Link CAD Net Debit Cap 

and Canadian-Link USD Net Debit Cap 

are referred to, individually or 

collectively as the context may require, 

as the ‘‘Canadian-Link Net Debit Cap.’’ 

This Section subjects all transactions 

processed though the Canadian-Link 

Service to be subject to the CanadianLink Net Debit Cap. The section further 

provides that DTC shall not comply 

with any instruction from a CanadianLink Participant in respect of any 

Canadian-Link Transaction that would 

cause DTC to exceed its DTC Omnibus 

Account Net Debit Cap or cause such 

Canadian-Link Participant to exceed its 

Canadian-Link Net Debit Cap but rather 

shall pend such Canadian-Link 

Transaction (subject to the Rules) until 

such Canadian-Link Transaction may be 

processed without causing DTC to 

exceed its DTC Omnibus Account Net 

Debit Cap or causing such CanadianLink Participant to exceed its CanadianLink Net Debit Cap. 

Pursuant to the proposed rule change, 

DTC would delete Section 8 of Rule 30 

in its entirety. The maintenance of a 

Canadian-Link Net Debit Cap would no 

longer be necessary as this limit applies 

to DVP transactions, and DVP 

transactions would no longer be 

processed through the Canadian-Link 

Service. 

Section 9—Collateral Monitor of 

Canadian-Link Participants 

In addition to the Net Debit Cap,67

another tool DTC uses in managing 

credit risk is the Collateral Monitor.68

These two controls work together to 

protect the DTC settlement system in 

the event of Participant default. The 

Collateral Monitor requires net debit 

settlement obligations, as they accrue 

intraday, to be fully collateralized. 

Meanwhile, the Net Debit Cap limits the 

amount of any Participant’s net debit 

settlement obligation to the amount that 

can be satisfied with DTC liquidity 

resources. Section 9 of Rule 30 provides 

for activity conducted by a Participant 

through the Canadian-Link Service to be 

included in the Participant’s Collateral 

Monitor. For the same reason as 

described above with respect to the 

elimination of Section 8, DTC would 

delete Section 9 in its entirety, because 

the elimination of DVP activity would 

eliminate any credit risk associated with 

transactions conducted through the 

Canadian-Link Service, and therefore 

DTC would no longer require the 

inclusion of Canadian-Link activity in 

the Collateral Monitor in managing its 

credit risk. 

Section 10—Processing Canadian-Link 

Transactions 

Section 10 of Rule 30 provides for the 

process by which Securities and funds 

are credited and debited to and from 

Canadian-Link Participants’ accounts 

for activity instructed by Participants to 

be processed through the Canadian-Link 

Service. As described above, DTC would 

continue to process transfers of 

Securities through the Canadian-Link 

Service, but it would no longer process 

DVP and/or CAD Funds activity for 

transactions conducted through the 

service. Therefore, pursuant to the 

proposed rule change, DTC would 

amend Section 10 to reflect the 

elimination of processing of funds 

debits and credits as part of the 

processing of Canadian-Link 

Transactions. In this regard, DTC would 

also revise references in the text of this 

section to (a) ‘‘Canadian-Link Securities 

Transaction’’ to ‘‘Canadian-Link 

Transaction,’’ (b) ‘‘Intra-DTC CAD 

Securities Transaction’’ to ‘‘Intra-DTC 

Transaction,’’ and (c) ‘‘Cross-Border 

Securities Transaction’’ to ‘‘CrossBorder Transaction,’’ because the 

currently used terms would be deleted 

from Rule 30, as described above, and 

the elimination of the processing of 

funds debits and credits, as described 

above, would eliminate the need for the 

use of defined terms relating to 

transactions processed through the 

Canadian-Link that distinguish between 

Securities transactions from funds 

transactions. Further subsections (C) 

and (D) of Section 10(a)(1) and Item (iii) 

of Sections 10(a)(2)(A) and 10(a)(2)(B) 

would be deleted from Rule 30. Finally, 

this section would also be renumbered 

as Section 6 due to the deletion of the 

original Sections 6, 7, 8 and 9, as 

described above. 

Section 11—CDS Business Days 

Pursuant to the proposed rule change, 

Section 11 would be renumbered as 

Section 7. 

Section 12—Settlement Recaps 

Section 12 provides the process for 

the issuance of Settlement Recaps by 

DTC. Because the money settlement 

aspect of the Canadian-Link Service 

would be eliminated, there would no 

longer be a need for DTC to issue 

Settlement Recaps with respect to CAD 

activity. Therefore, DTC would 

eliminate Section 12 in its entirety 

because Settlement Recaps would no 

longer be issued by DTC, and this 

Section would become obsolete. 

Section 13—Settlement Payments 

Section 13 provides for the processing 

of settlement payments relating to DVP 

activity through the Canadian-Link 

Service. As described above, money 

settlement would be eliminated 

pursuant to the proposed rule change. 

Therefore, DTC would no longer 

provide for money settlement relating to 

transactions processed through the 

Canadian-Link. In this regard, DTC 

proposes to eliminate Section 13 in its 

entirety as it would become obsolete. 

Section 14—End of Day Sweep 

Section 14 provides for the timing of 

the movement of Securities between 

accounts used for the Canadian-Link 

Service. This section provides that such 

movements occur at the end of each 

CDS Business Day after the completion 

of money settlement. DTC would delete 

the provision requiring for the 

completion of money settlement prior to 

the ‘‘sweeping’’ of Securities in this 

regard as DTC would no longer be 

conducting money settlement for the 

Canadian-Link Service. Also, DTC 

would renumber this section as Section 

8 to reflect the renumbering and 

deletion of previous sections as 

described above. 


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69 15 U.S.C. 78q–1(b)(3)(F). 

Section 15—Failure To Make Settlement 

Payments 

Section 15 provides the process to be 

followed if a Participant fails to make 

payment with regards to Canadian-Link 

activity. As described above, DTC 

proposes to eliminate money settlement 

with respect to Canadian-Link activity. 

In this regard, DTC would delete 

Section 15 in its entirety as it would 

become obsolete due to the elimination 

of settlement payments through this 

service. 

Section 16—Currency Conversion and 

Exchange 

Section 16 provides the process for 

the conversion of USD Funds to CAD 

Funds as necessary for a Participant to 

complete settlement or satisfy its risk 

controls relating to the Canadian-Link 

Service. Since money settlement would 

no longer occur through this service, 

such conversions of currency would no 

longer occur, and this section would 

become obsolete. Therefore, pursuant to 

the proposed rule change, DTC would 

delete Section 16 in its entirety. 

Section 17—Choice of Law and 

Submission to Jurisdiction 

To conform the numbering of sections 

to reflect the deletion and renumbering 

of previous sections as described above, 

Section 17 would be renumbered as 

Section 9. 

Section 18—Canadian Link Charges 

Section 18 provides that Participants 

must pay to DTC any fees and charges 

relating to their use of the CanadianLink Service. These charges include 

charges relating to the cost to DTC for 

maintaining liquidity resources to settle 

Canadian-Link Transactions. As 

mentioned above, money settlement 

under this service would be eliminated 

and therefore it would no longer 

necessary for DTC to maintain such 

liquidity resources with respect to 

activity processed through the 

Canadian-Link Service. Therefore, text 

referring to charges relating to the cost 

of maintaining liquidity resources with 

respect to the Canadian-Link Service 

would be obsolete and would be 

deleted. As a result of these proposed 

changes, to conform the numbering of 

the subsections to reflect the deletion of 

subsection (ii), the subsections 

following would be renumbered, (ii), 

(iii), (iv) and (v). Also, to conform the 

numbering of sections to reflect the 

deletion and renumbering of previous 

sections as described above, Section 18 

would be renumbered as Section 10. 

Elimination of the Canadian-Link 

Service Guide 

DTC proposes to eliminate the full 

text of the Guide. The Guide relates to 

Procedures necessary for the DVP 

settlement of Canadian-Link 

Transactions. These Procedures cover 

all operational aspects of the service as 

it relates to DVP activity, including DVP 

transaction processing, risk controls and 

tracking established to control for failed 

DVP transactions in the processing of 

end-of-day sweeps. Due to the 

elimination of money settlement 

through the Canadian-Link Service, this 

Guide would become obsolete. 

Proposed Changes to the OA 

The OA sets forth requirements that a 

Security must meet to become and 

remain eligible for DTC services and 

provides for the orderly processing of 

such Securities and timely payments to 

Participants. 

Proposed Changes to Text of the OA 

Relating to Eligibility Requirements/ 

Non-U.S. Denominated Securities 

Section I.C.5. of the OA contains 

provisions relating to the eligibility of 

Securities denominated in a non-U.S. 

currencies and processing of 

distribution payments in non-U.S. 

currencies. This section currently 

contains references to CAD settlement 

through the Canadian-Link Service. To 

reflect the proposed elimination of 

money settlement in the Canadian-Link 

Service, DTC proposes to amend this 

section to remove references to the 

availability of Canadian dollar 

settlement. Since, as described above, 

DTC would continue to process 

distributions in CAD, this section would 

continue to provide for such 

distributions in CAD. The proposed rule 

change would make a grammatical 

change that does not affect the 

substance of the section. 

Proposed Changes to Dividend and 

Income Payment Notification 

Procedures 

Section IV of the OA sets forth 

Dividend and Income Payment 

Notification Procedures. Subsection B of 

this section describes currency 

provisions relating to dividend and 

income payments, and specifically 

refers to such payments made in CAD. 

The text includes mentions of CAD 

settlement performed through the 

Canadian-Link Service. It also refers to 

the service generally as ‘‘Canadian 

dollar settlement.’’ In order to reflect the 

proposed elimination of CAD settlement 

through the Canadian-Link Service, DTC 

would (i) revise this section to delete 

provisions referring to or describing 

CAD settlement and (ii) modify a 

statement relating to Securities eligible 

to receive payments in CAD from 

referencing Securities eligible for 

Canadian dollar settlement to Securities 

eligible for the Canadian-Link Service. 

Also, the proposed rule change in this 

regard would cause a defined term for 

CDS to be deleted as it falls within a 

paragraph that describes CAD 

settlement. The proposed rule change 

moves the defining term for CDS to a 

sentence that would not be eliminated 

by the proposal. 

Effective Date 

The proposed rule change would 

become effective upon filing with the 

Commission. 

2. Statutory Basis 

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

requires, in part, that the Rules be 

designed to promote the prompt and 

accurate clearance and settlement of 

Securities transactions.69 DTC believes 

that the proposed rule change is 

consistent with this provision because it 

would provide enhanced clarity and 

transparency for participants with 

respect to services offered by DTC by 

updating the Rules to remove the ability 

to access services that Canadian-Link 

Participants have not recently utilized 

and are unlikely to utilize in the future. 

Therefore, by providing enhanced 

clarity and transparency in the Rules 

regarding the services provided by DTC, 

DTC believes the proposed rule change 

would promote the prompt and accurate 

clearance and settlement of Securities 

transactions, consistent with the 

requirements of the Act, in particular 

Section 17A(b)(3)(F), cited above. 

(B) Clearing Agency’s Statement on 

Burden on Competition 

DTC does not believe that the 

proposed rule change would have any 

impact on competition. Participants 

have not used the Canadian-Link 

Service for DVP Securities and/or CAD 

Funds transactions in several years. 

Also, based on discussions DTC has had 

with Participants regarding their use of 

the Canadian-Link Service, DTC 

believes Participants are unlikely to use 

the service for this purpose in the 

future. Therefore, DTC believes that the 

proposed rule change should have no 

effect on Participants, other than to 

remove references to the ability for 

Participants to conduct DVP 

transactions through the Canadian-Link 

Service from the Rules and Procedures, 

which transactions are unlikely to be 

conducted by Participants. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 86, No. 136 / Tuesday, July 20, 2021 / Notices 38389 

70 15 U.S.C. 78s(b)(3)(A). 

71 17 CFR 240.19b–4(f). 

72 17 CFR 200.30–3(a)(12). 

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

2 15 U.S.C. 78a. 

3 17 CFR 240.19b–4. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change Received From Members, 

Participants, or Others 

DTC has not received or solicited any 

written comments relating to this 

proposal. DTC will notify the 

Commission of any written comments 

received by DTC. 

III. Date of Effectiveness of the 

Proposed Rule Change, and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A) 70 of the Act and paragraph 

(f) 71 of Rule 19b–4 thereunder. At any 

time within 60 days of the filing of the 

proposed rule change, the Commission 

summarily may temporarily suspend 

such rule change if it appears to the 

Commission that such action is 

necessary or appropriate in the public 

interest, for the protection of investors, 

or otherwise in furtherance of the 

purposes of the Act. 

IV. Solicitation of Comments 

Interested persons are invited to 

submit written data, views and 

arguments concerning the foregoing, 

including whether the proposed rule 

change is consistent with the Act. 

Comments may be submitted by any of 

the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

DTC–2021–012 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–2021–012. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the proposed rule 

change that are filed with the 

Commission, and all written 

communications relating to the 

proposed rule change between the 

Commission and any person, other than 

those that may be withheld from the 

public in accordance with the 

provisions of 5 U.S.C. 552, will be 

available for website viewing and 

printing in the Commission’s Public 

Reference Room, 100 F Street NE, 

Washington, DC 20549 on official 

business days between the hours of 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of 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– 

2021–012 and should be submitted on 

or before August 10, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.72

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–15345 Filed 7–19–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92405; File No. SR– 

NYSEArca–2021–56] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Filing and 

Immediate Effectiveness of Proposed 

Rule Change To Amend the NYSE Arca 

Equities Listing Fee Schedule 

July 14, 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 June 30, 

2021, NYSE Arca, Inc. (‘‘NYSE Arca’’ or 

the ‘‘Exchange’’) filed with the 

Securities and Exchange Commission 

(the ‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III 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 

The Exchange proposes to amend the 

NYSE Arca Equities listing fee schedule 

to modify the initial listing fees for 

equity securities and warrants and 

adopt fee provisions specific to groups 

of three or more listed REITs under 

common control. The proposed rule 

change is available on the Exchange’s 

website at www.nyse.com, at the 

principal office of the Exchange, and at 

the Commission’s Public Reference 

Room. 

II. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

In its filing with the Commission, the 

self-regulatory organization 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 those statements may be examined at 

the places specified in Item IV below. 

The Exchange has prepared summaries, 

set forth in sections A, B, and C below, 

of the most significant parts of such 

statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and the 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

Initial Listing Fees 

NYSE Arca charges initial listing fees 

for the listing of common stock, 

preferred stock and warrants of 

operating companies based on the 

number of shares of the issuer 

outstanding at the time of initial listing 

(or, in the case of listed foreign private 

issuers, the number of shares 

outstanding in the United States), based 

on the following current schedule: 

Up to and including 30 million shares 

outstanding—$100,000 

More than 30 million shares outstanding 

up to and including 50 million shares 

outstanding—$125,000 

More than 50 million shares 

outstanding—$150,000 

The Exchange proposes to reduce the 

initial fee levels to the following: 

Up to and including 30 million shares 

outstanding—$55,000 

More than 30 million shares outstanding 

up to and including 50 million shares 

outstanding—$60,000 

More than 50 million shares 

outstanding—$75,000 

The Exchange believes that these 

proposed fee levels are more consistent 


khammond on DSKJM1Z7X2PROD with NOTICES