50564 Federal Register / Vol. 86, No. 172 / Thursday, September 9, 2021 / Notices 

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

2 17 CFR 240.19b–4. 

3For a complete list of Participants, see Exhibit 

A to the Limited Liability Company Agreement of 

Consolidated Audit Trail, LLC, available at 

www.catnmsplan.com/sites/default/files/2020-07/ 

LLC-Agreement-of-Consolidated-Audit-Trail-LLCas-of-7.24.20.pdf. 

4 15 U.S.C. 78k–1. 

5 17 CFR 242.608. 

6See Letter from the Participants to Brent J. 

Fields, Secretary, Commission, dated September 30, 

2014; and Letter from Participants to Brent J. Fields, 

Secretary, Commission, dated February 27, 2015. 

On December 24, 2015, the Participants submitted 

an amendment to the CAT NMS Plan. See Letter 

from Participants to Brent J. Fields, Secretary, 

Commission, dated December 23, 2015. 

7 17 CFR 242.613. 

8See Securities Exchange Act Rel. No. 77724 

(Apr. 27, 2016), 81 FR 30614 (May 17, 2016). 

9See Securities Exchange Act Rel. No. 79318 

(Nov. 15, 2016), 81 FR 84696 (Nov. 23, 2016). 

10See Securities Exchange Act Rel. No. 80255 

(March 15, 2017), 82 FR 14563 (March 21, 2017). 

11See IEX Rule 1.160(s). 

12See, e.g., Securities Exchange Act Release No. 

67457 (July 18, 2012), 77 FR 45722, 45723 (August 

1, 2012). 

13See CAT NMS Plan, Appendix C, Section C.9. 

In compliance with this requirement, on May 15, 

2017, IEX, alongside the other Participants, filed a 

proposed rule change to eliminate the OATS Rules 

and amend IEX Rule 8.220 (the Electronic Blue 

Sheets or ‘‘EBS’’ rule). See Securities Exchange Act 

Release No. 80788 (May 26, 2017), 82 FR 25400 

(June 1, 2017) (SR–IEX–2017–18) (‘‘original 

proposal’’). IEX filed an amendment to the original 

proposal on August 24, 2017. See Letter from 

Claudia Crowley to Brent Fields dated August 24, 

2017, available at https://www.sec.gov/comments/ 

sr-iex-2017-18/iex201718-2243339-160872.pdf. The 

original proposal was subsequently withdrawn but 

provided similar views and mechanisms for 

eliminating the OATS rule as this proposed rule 

change does, and, as noted above, also proposed to 

amend the EBS rules. See Securities Exchange Act 

Release No. 82524 (January 17, 2018), 83 FR 3239 

(January 23, 2018) (Notice of Withdrawal of File No. 

SR–IEX–2017–18). IEX notes that the current filing 

addresses only the elimination of the OATS rule. 

p.m. until 9:00 p.m. (CT), at the Palo 

Community Center, located at 2800 

Hollenbeck Road, in Palo, Iowa. The 

virtual public meeting will occur during 

the week of October 4, 2021, and will 

be noticed separately with details 

provided on the NRC’s public meeting 

website at https://www.nrc.gov/pmns/ 

mtg. 

The NRC is continuing to closely 

monitor the Coronavirus Disease 2019 

public health emergency and will make 

changes or cancellations to these 

meetings as necessary to protect public 

health and safety. The most current 

information for both the planned DAEC 

PSDAR meetings will be available on 

the NRC’s public meeting website 

previously referenced, or by contacting 

the individual listed in the FOR FURTHER

INFORMATION CONTACT section of this 

document. The NRC requests that 

comments that are not provided during 

the meetings be submitted in writing, as 

noted in section I, ‘‘Obtaining 

Information and Submitting 

Comments,’’ of this document, by 

December 20, 2021. 

Dated: September 2, 2021. 

For the Nuclear Regulatory Commission. 

Bruce A. Watson, 

Chief, Reactor Decommissioning Branch, 

Division of Decommissioning, Uranium 

Recovery, and Waste Programs, Office of 

Nuclear Material Safety and Safeguards. 

[FR Doc. 2021–19417 Filed 9–8–21; 8:45 am] 

BILLING CODE 7590–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92868; File No. SR–IEX– 

2021–10] 

Self-Regulatory Organizations; 

Investors Exchange LLC; Notice of 

Filing and Immediate Effectiveness of 

a Proposed Rule Change To Eliminate 

IEX Rule 11.420 (Order Audit Trail 

System (‘‘OATS’’) Requirements) To 

Reflect the September 1, 2021 

Retirement of OATS 

September 2, 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 August 

31, 2021, the Investors Exchange LLC 

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

Securities and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I and II 

below, which Items have been prepared 

by the self-regulatory organization. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

Pursuant to the provisions of Section 

19(b)(1) of the Act, and Rule 19b–4 

thereunder, IEX is filing with the 

Commission a proposed rule change to 

eliminate IEX Rule 11.420 (Order Audit 

Trail System (‘‘OATS’’) Requirements) 

to reflect that as of September 1, 2021, 

the Financial Industry Regulatory 

Authority, Inc. (‘‘FINRA’’) will have 

retired OATS, and Industry Members 

will be effectively reporting to the 

consolidated audit trail (‘‘CAT’’) 

adopted pursuant to the National 

Market System Plan Governing the 

Consolidated Audit Trail (the ‘‘CAT 

NMS Plan’’ or ‘‘Plan’’). 

The text of the proposed rule change 

is available at the Exchange’s website at 

www.iextrading.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 these statements may be examined at 

the places specified in Item IV below. 

The self-regulatory organization has 

prepared summaries, set forth in 

Sections A, B, and C below, of the most 

significant aspects of such statements. 

A. Self-Regulatory Organization’s 

Statement of the Purpose of, and 

Statutory Basis for, the Proposed Rule 

Change 

1. Purpose 

IEX is filing with the Commission a 

proposed rule change to eliminate IEX 

Rule 11.420 to reflect that as of 

September 1, 2021, FINRA will have 

retired OATS, and Industry Members 

will be effectively reporting to the CAT 

adopted pursuant to the CAT NMS Plan. 

I Background 

IEX, FINRA, and the other national 

securities exchanges (collectively, the 

‘‘Participants’’) 3 filed with the 

Commission, pursuant to Section 11A of 

the Exchange Act 4 and Rule 608 of 

Regulation NMS thereunder,5 the CAT 

NMS Plan.6 The Participants filed the 

Plan to comply with Rule 613 of 

Regulation NMS under the Exchange 

Act.7 The Plan was published for 

comment in the Federal Register on 

May 17, 2016,8 and approved by the 

Commission, as modified, on November 

15, 2016.9 On March 15, 2017, the 

Commission approved the new IEX Rule 

Series 11.600 10 to implement 

provisions of the CAT NMS Plan that 

are applicable to IEX Members.11

The CAT NMS Plan is intended to 

create, implement, and maintain a 

consolidated audit trail that will capture 

in a single consolidated data source 

customer and order event information 

for orders in NMS Securities and OTC 

Equity Securities, across all markets, 

from the time of order inception through 

routing, cancellation, modification, or 

execution.12 Among other things, the 

CAT NMS Plan, as modified by the 

Commission, requires each Participant 

to ‘‘file with the SEC the relevant rule 

change filing to eliminate or modify its 

duplicative rules within six (6) months 

of the SEC’s approval of the CAT NMS 

Plan.’’ 13 The Plan notes that ‘‘the 


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Federal Register / Vol. 86, No. 172 / Thursday, September 9, 2021 / Notices 50565 

Proposed amendments to the EBS rules would be 

subject to a separate rule filing made in conjunction 

with SEC rulemaking to amend Rule 17a–25 under 

the Exchange Act. 17 CFR 240.17a–25. 

14See CAT NMS Plan, Appendix C, Section C.9. 

15 ‘‘Small Industry Member’’ is defined in IEX 

Rule 11.610(pp) as an Industry Member that 

qualifies as a small broker-dealer as defined in Rule 

0–10(c) of the Exchange Act. On April 20, 2020, the 

Commission granted exemptive relief from certain 

provisions of the CAT NMS Plan related to brokerdealers that do not qualify as Small Industry 

Members solely because such broker-dealers satisfy 

Rule 0–10(i)(2) under the Exchange Act in that they 

introduce transactions on a fully disclosed basis to 

clearing firms that are not small businesses or small 

organizations (referred to as ‘‘Introducing Industry 

Members’’). Specifically, the Commission provided 

exemptive relief from requiring Introducing 

Industry Members to comply with the requirements 

of the CAT NMS Plan that apply to Industry 

Members other than Small Industry Members 

(‘‘Large Industry Members’’), provided that the 

Participants require such Introducing Industry 

Members to comply with the requirements of the 

CAT NMS Plan that apply to Small Industry 

Members. See Securities Exchange Act Release No. 

88703 (April 20, 2020), 85 FR 23115 (April 24, 

2020) (Order Granting Limited Exemptive Relief 

Related to Certain Introducing Brokers From the 

Requirements of the CAT NMS Plan) (the 

‘‘Introducing Brokers Exemptive Order’’). As used 

herein, the term ‘‘Small Industry Member’’ includes 

Introducing Industry Members in accordance with 

the Introducing Brokers Exemptive Order. 

16See supra note 14. 

17See Securities Exchange Act Release No. 90535 

(November 30, 2020), 85 FR 78395 (December 4, 

2020) (SR–FINRA–2020–024) (‘‘OATS Retirement 

Plan Order’’). 

18As set forth in the OATS Retirement Plan 

Order, the 180 day ‘‘applicable period’’ ran from 

October 26, 2020 to April 26, 2021. October 26, 

2020 was the date that Industry Members were 

required to begin correcting all errors for inter-firm 

linkages and exchange/TFR/ORF match validations. 

19See supra note 17. 

20See Securities Exchange Act Release No. 92239 

(June 23, 2021), 86 FR 34293 (June 29, 2021) (SR– 

FINRA–2021–017) (‘‘OATS Retirement Filing’’). 

21Appendix D of the CAT NMS Plan, Section 7.2, 

for example, requires that certain file validations 

(e.g., file transmission and receipt are in the correct 

formats, confirmation of a valid SRO-Assigned 

Market Participant Identifier, etc.), and syntax and 

context checks (e.g., format checks, data type 

checks, consistency checks, etc.) be performed on 

all submitted records. 

elimination of such rules and the 

retirement of such systems [will] be 

effective at such time as CAT Data meets 

minimum standards of accuracy and 

reliability.’’ 14 Specifically, the Plan 

requires the rule filing to discuss the 

following: 

• Specific accuracy and reliability 

standards that will determine when 

duplicative systems will be retired, 

including, but not limited to, whether 

the attainment of a certain Error Rate 

should determine when a system 

duplicative of the CAT can be retired; 

• whether the availability of certain 

data from Small Industry Members 15

two years after the Effective Date would 

facilitate a more expeditious retirement 

of duplicative systems; and 

• whether individual Industry 

Members can be exempted from 

reporting to duplicative systems once 

their CAT reporting meets specified 

accuracy and reliability standards, 

including, but not limited to, ways in 

which establishing cross-system 

regulatory functionality or integrating 

data from existing systems and the CAT 

would facilitate such Individual 

Industry Member exemptions.16

On November 30, 2020, the 

Commission approved a FINRA rule 

filing proposing to eliminate the FINRA 

OATS system once FINRA members are 

effectively reporting to the CAT and the 

CAT’s accuracy and reliability meet 

certain standards.17 Specifically, FINRA 

proposed that before OATS could be 

retired, the CAT generally must achieve 

a sustained error rate for Industry 

Member reporting in five categories for 

a period of at least 180 days 18 of 5% or 

lower on a pre-correction basis, and 2% 

or lower on a post-correction basis 

(measured at T+5). In addition to the 

maximum error rates and matching 

thresholds (hereafter the ‘‘threshold 

requirements’’), FINRA’s use of CAT 

Data must confirm that (i) there are no 

material issues that have not been 

corrected, (ii) the CAT includes all data 

necessary to allow FINRA to continue to 

meet its surveillance obligations, and 

(iii) the Plan Processor is sufficiently 

meeting its obligations under the CAT 

NMS Plan relating to the reporting and 

linkage in the initial phase of reporting 

(‘‘Phase 2a’’) of Industry Member Data. 

In the OATS Retirement Plan Order, 

the Commission approved FINRA’s 

proposal for how it would measure the 

CAT Data’s accuracy and reliability. 

Specifically, the Commission endorsed 

FINRA’s proposal that FINRA’s review 

of CAT Data and error rates would be 

based on data and linkages in Phase 2a, 

which replicate the data in OATS today 

and thus are most relevant for OATS 

retirement purposes. Phase 2a Data 

includes all events and scenarios 

covered by OATS and applies only to 

equities. And FINRA would not 

consider options order events or Phase 

2c data and validations, which are not 

in OATS today, for purposes of OATS 

retirement.19

On June 17, 2021, FINRA made an 

immediately effective filing setting forth 

the basis for its determination that the 

accuracy and reliability of the CAT met 

the standards approved by the 

Commission in the OATS Retirement 

Plan Order and designating September 

1, 2021 as the date on which FINRA 

would retire OATS.20 Specifically, 

FINRA determined that the CAT met the 

threshold requirements endorsed by the 

Commission in the OATS Retirement 

Plan Order for Industry Member 

reporting in each of the following 

categories: 

A. Rejection Rates and Data Validations 

As described in the OATS Retirement 

Filing, the Plan Processor must perform 

certain basic data validations, and if a 

record does not pass these basic data 

validations, it must be rejected and 

returned to the CAT Reporter to be 

corrected and resubmitted.21 FINRA 

determined that for the applicable 

period, aggregate rejection rates across 

all Industry Member Reporters were 

0.03% pre-correction and 0.01% postcorrection, which far exceeds the 

threshold requirements of a 5% or lower 

pre-correction error rate and a 2% or 

lower post-correction error rate. 

B. Intra-Firm Linkages 

As described in the OATS Retirement 

Filing, the Plan Processor must be able 

to link all related order events from all 

CAT Reporters involved in the lifecycle 

of an order. At a minimum, this 

requirement includes the creation of an 

order lifecycle between all order events 

handled within an individual CAT 

Reporter, including orders routed to 

internal desks or departments with 

different functions (e.g., an internal 

ATS). FINRA determined that for the 

applicable period, the intra-firm linkage 

accuracy rates across all Industry 

Member Reporters were 99.07% precorrection and 99.99% post-correction, 

which far exceeds the threshold 

requirements of 95% or higher precorrection and 98% or higher postcorrection (in other words, the intrafirm linkages accuracy far exceeds the 

threshold requirement that there be less 

than 5% inaccuracy pre-correction and 

less than 2% inaccuracy postcorrection). 

C. Inter-Firm Linkages 

As described in the OATS Retirement 

Filing, the Plan Processor must be able 

to create the lifecycle between orders 

routed between broker-dealers. FINRA 

determined that for the applicable 

period, the intra-firm linkage accuracy 

rates across all Industry Member 

Reporters were 99.08% pre-correction 

and 99.84% post-correction, which far 

exceed the threshold requirements of 

95% or higher pre-correction and 98% 

or higher post-correction (in other 

words, the inter-firm linkages accuracy 

far exceeds the threshold requirement 

that there be less than 5% inaccuracy 

pre-correction and less than 2% 

inaccuracy post-correction). 


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22See Letter from Lisa C. Horrigan, Associate 

General Counsel, FINRA, to Vanessa Countryman, 

Secretary, Commission, dated October 29, 2020. 

23See supra note 20. 

24FINRA conducts surveillance on behalf of IEX 

pursuant to the Regulatory Service Agreement 

entered into by IEX and FINRA (‘‘RSA’’). Therefore, 

any references in this rule filing to FINRA 

surveillance include FINRA’s use of either OATS or 

CAT Data in furtherance of the regulatory services 

it provides on behalf of IEX. 

25For example, according to the CAT Reporting 

Technical Specification for Participants (version 

4.0.0–r4 dated April 20, 2021), additional linkage 

error feedback for off-exchange trade reports was 

effective as of June 1, 2021. The Technical 

Specifications can be found on the CAT NMS Plan 

website at www.catnmsplan.com/sites/default/files/ 

2021-04/04.20.2021-CAT-Reporting-TechnicalSpecifications-for-Participants-4.0.0-r4.pdf. 

26See supra note 20. 

27As noted in the FINRA OATS Retirement 

Filing, user acceptance testing is the final stage of 

any software development lifecycle and enables 

actual users to test the system to confirm it is able 

to carry out the required tasks it was designed to 

address in real-world situations. 

28See supra note 20. 

29For example, for the month of July 2021, IEX’s 

compliance error rate for CAT Data reporting was 

0.0435% (i.e., 99.9565% of records were 

successfully reported). 

30See supra note 20. 

31See supra note 20. 

32See supra note 20. 

D. Order Linkage Rates 

As described in the OATS Retirement 

Filing, in addition to creating linkages 

within and between broker-dealers, the 

Plan Processor must be able to create 

lifecycles to link various pieces of 

related orders. For example, the Plan 

requires linkages of order information to 

create an order lifecycle from 

origination or receipt to cancellation or 

execution. This category essentially 

combines all of the order-related 

linkages to capture an overall snapshot 

of order linkages in the CAT.22 FINRA 

determined that for the applicable 

period, the order-related linkage 

accuracy rates across all Industry 

Member Reporters were 99.66% precorrection and 99.93% post-correction, 

which far exceed the threshold 

requirements of 95% or higher precorrection and 98% or higher postcorrection (in other words, the order 

linkages accuracy far exceeds the 

threshold requirement that there be less 

than 5% inaccuracy pre-correction and 

less than 2% inaccuracy postcorrection). 

E. Exchange and TRF/ORF Match Rates 

As described in the OATS Retirement 

Filing, an order lifecycle must be 

created to link orders routed from 

broker-dealers to exchanges and 

executed orders and trade reports. 

FINRA determined that for the 

applicable period, the match rate across 

all equity exchanges for orders routed 

from Industry Members to an exchange 

was 99.51% pre-correction and 99.87% 

post-correction. This match rate far 

exceeds the threshold requirements of 

95% or higher pre-correction and 98% 

or higher post-correction (in other 

words, the match rate accuracy far 

exceeds the threshold requirement that 

there be less than 5% inaccuracy precorrection and less than 2% inaccuracy 

post-correction). 

Based upon the accuracy and 

reliability of the above five categories of 

CAT Data, FINRA determined that the 

CAT Data met the accuracy and 

reliability standards required for OATS 

retirement.23

II. FINRA’s Use of CAT Data 

Additionally, the OATS Retirement 

Plan Order set forth that before retiring 

OATS, FINRA’s use of CAT data must 

confirm that (i) there are no material 

issues that have not been corrected (e.g., 

delays in the processing of data, issues 

with query functions, etc.); (ii) the CAT 

includes all data necessary to allow 

FINRA to continue to meet its 

surveillance obligations; 24 and (iii) the 

Plan Processor is sufficiently meeting its 

obligations under the CAT NMS Plan 

relating to the reporting and linkage of 

Phase 2a Data. 

As set forth in FINRA’s OATS 

Retirement Filing, by September 1, 

2021, FINRA will be ready to retire its 

use of OATS data for cross-market 

surveillance, and replace it with a 

newly created surveillance data mart, 

the Pattern Optimized Datamart 

(‘‘POD’’), which incorporates equities 

(and options) data submitted by both 

Participants such as IEX and Industry 

Members. IEX, like other Participants, 

transitioned from reporting to FINRA 

via the RSA specification, to reporting 

via the CAT technical specification as of 

April 26, 2021, and full Participant 

equities reporting and linkage 

validations commenced on June 1, 

2021.25 Successful completion of the 

transition to the CAT specification for 

Participants was a prerequisite for 

FINRA to retire the OATS-based cross 

market surveillance patterns and 

leverage CAT Data and linkages in POD 

for its surveillance patterns. FINRA has 

completed all planned activities on 

schedule, including substantially 

completing the process of integrating 

CAT Data into POD and successfully 

running large amounts of production 

CAT Data for the month of May through 

POD.26 FINRA anticipates completing 

additional activities before the proposed 

OATS retirement date of September 1, 

2021, including planned user 

acceptance testing.27

Additionally, FINRA has confirmed 

that all of the data required to support 

the transition from OATS to CAT is 

available in CAT.28 Specifically, FINRA, 

supported by the Participants, 

conducted a mapping of all OATS data 

to CAT data, and then completed a ‘‘gap 

analysis’’ to address any issues with the 

field-level mapping of OATS to CAT 

data. Furthermore, IEX, along with other 

Participants, has had a very high 

compliance rate in reporting CAT Data 

using the CAT specifications (both in 

the testing and production 

environments).29 Reviewing the 

Participant submitted CAT Data and 

matching it with Industry Member data, 

FINRA determined that the data 

linkages in CAT are ‘‘comparable to the 

linkages between RSA exchange data 

and OATS data’’ currently used by 

FINRA.30 Accordingly, the CAT NMS 

Plan Operating Committee approved the 

cutover from the RSA specification to 

the CAT specification as the official 

source of Participant data as of June 1, 

2021, and today, all Industry Member 

and Participant equities data reported 

via the CAT specification is linked in 

the CAT production environment. 

Thus, FINRA will use OATS data for 

surveillance patterns run through the 

end of the second quarter of 2021 and 

has already begun using CAT Data for 

its surveillance patterns for review 

periods beginning in the third quarter of 

2021.31 As detailed in the OATS 

Retirement Filing, FINRA will continue 

to conduct regular reviews to ensure 

confidence in the completeness and 

accuracy of Industry Member reporting, 

along with the ability to remediate any 

issues in a timely manner.32

III. OATS May be Retired in Light of the 

Accuracy and Reliability of the CAT 

Data 

IEX, like FINRA, believes that the 

three additional standards set forth in 

the OATS Retirement Order for retiring 

OATS have been satisfied. With respect 

to the first factor, IEX, like FINRA, does 

not believe that there are any material 

issues that have not been corrected (or 

could not be corrected in the course of 

operation of CAT, as approved by the 

Operating Committee) that would 

impact FINRA’s ability to incorporate 

and use CAT Data in FINRA’s 

surveillance program, which it conducts 

on behalf of IEX pursuant to the RSA. 

For example, the Plan requires that raw 

unprocessed data that has been ingested 

by the Plan Processor must be available 

to Participant regulatory staff and the 

SEC prior to 12:00 p.m. Eastern Time on 

T+1, and access to all iterations of 

processed data must be available to 


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33See CAT NMS Plan, Appendix D, Section 6.2. 34See CAT NMS Plan, Appendix C, Section 

A.2(a). 35See CAT NMS Plan, Appendix C, Section 

A.1(b). 36See CAT NMS Plan, Section 6.10(c). 37See supra note 20. 

38The Implementation Plan and Quarterly 

Progress Reports are available at 

www.catnmsplan.com/implementation-plan. 

39See FINRA Regulatory Notice 21–21 (June 

2021). 

40 In the unlikely event that FINRA determines it 

is unable to retire OATS effective September 1, 

2021, IEX will delay the retirement of IEX Rule 

11.420 pending the actual retirement of FINRA 

OATS. 41 15 U.S.C. 78f(b)(5). 

Participant regulatory staff and the SEC 

between 12:00 p.m. Eastern Time on 

T+1 and T+5.33 The Plan Processor also 

must ensure that regulators have access 

to corrected and linked order data by 

8:00 a.m. Eastern Time on T+5.34

Additionally, after ingestion by the 

Central Repository, the raw unprocessed 

data must be transformed into a format 

appropriate for data querying and 

regulatory output.35 The user-defined 

direct queries and bulk extracts must 

provide authorized users with the 

ability to retrieve CAT Data via a query 

tool or language that allows users to 

query all available attributes and data 

sources.36 FINRA’s use of the CAT Data 

has not uncovered any processing 

delays or other material issues 

impacting the availability of, and 

FINRA’s access to, the data.37

With respect to the second factor, IEX, 

like FINRA, believes that the CAT 

includes all data necessary for FINRA to 

meet its surveillance obligations after 

the retirement of OATS. FINRA must 

ensure that the CAT, as the single 

source of order and trade data, can 

enable FINRA to conduct accurate and 

effective market surveillance in 

accordance with its regulatory 

obligations. As noted above, Phase 2a 

Data includes all events and scenarios 

covered by OATS and is the most 

relevant for OATS retirement purposes. 

FINRA’s testing, analysis and use of the 

CAT Data (including integration into 

POD), as described above, has 

confirmed that the CAT includes all 

data necessary for FINRA to meet its 

surveillance obligations and that CAT is 

a reliable substitute for OATS. In 

addition, based on its qualitative data 

reviews, FINRA has concluded that 

Industry Member CAT Data, in the 

aggregate, is a sufficient replacement for 

OATS for purposes of FINRA’s 

surveillance program. 

With respect to the third factor, IEX, 

like FINRA, believes that the Plan 

Processor is sufficiently meeting its 

obligations under the CAT NMS Plan 

relating to the reporting and linkage of 

Phase 2a Data. As detailed in the 

Implementation Plan and Quarterly 

Progress Reports submitted by the Plan 

Participants, the Plan Processor has met 

its targeted completion dates for the 

milestones for Phase 2a, including, for 

example, production Go-Live for 

Equities 2a file submission and data 

integrity validation (Large Industry 

Members and Small OATS Reporters) 

on June 22, 2020; Production Go-Live 

for Equities 2a Intrafirm Linkage 

validations on July 27, 2020; and 

production go-live for firm-to-firm 

linkage validations for equities (Large 

Industry Members and Small OATS 

Reporters) and exchange and TRF/ORF 

linkage validations for equities (Large 

Industry Members and Small OATS 

Reporters) on October 26, 2020.38

Based on the foregoing, IEX agrees 

with FINRA’s determination that the 

CAT meets the accuracy and reliability 

standards approved by the Commission 

in the OATS Retirement Order for 

purposes of eliminating OATS. FINRA 

has determined to retire OATS effective 

September 1, 2021.39 Firms must 

continue to report to OATS all order 

events that occur on or prior to August 

31, 2021. Reports submitted to OATS for 

order events that occur after August 31, 

2021 will be rejected. In other words, 

August 31, 2021 will be the last ‘‘OATS 

Business Day,’’ as defined under FINRA 

Rule 7450(b)(3), for which OATS will 

accept order events and perform routine 

processing (including incorporation of 

corrections and repairs of rejections) 

occurring within the normal OATS 

timeframe for such activities. OATS will 

continue to accept reports for order 

events that occur on or prior to August 

31, 2021 (including, but not limited to, 

late and corrected reports for such order 

events) through September 16, 2021. 

Firms must ensure that their OATS 

reporting is accurate and complete for 

all order events that occur on or prior 

to August 31, 2021. IEX Rule 11.420, 

like the FINRA OATS Rules, will be 

deleted from the IEX rulebook effective 

September 1, 2021.40

In light of the foregoing, IEX, like 

FINRA, believes that retiring OATS as of 

September 1, 2021 is appropriate, 

particularly given the potential risks of 

continuing to run OATS and CAT in 

parallel for an additional period of time. 

Such potential risks may include, for 

example, on an industry-wide basis: (1) 

Processing and storage capacity issues 

from operating two systems (particularly 

in the event of extraordinary market 

volume); (2) cybersecurity risks from 

having data flow through two separate 

systems for a longer time period; (3) 

systems issues from reporting 

infrastructure that is near end-of-life; 

and (4) the expense and burden on CAT 

Reporters of dual reporting, particularly 

in the event of systems issues requiring 

correction and/or resubmission of data 

and competing resource priorities 

between OATS and CAT reporting and 

repair activities. 

IEX has filed the proposed rule 

change for immediate effectiveness and 

is seeking a waiver of the 30 day 

operative delay to allow its OATS rules 

to be retired concurrent with the 

September 1, 2021 retirement of 

FINRA’s OATS Rules. IEX will also 

announce the retirement of OATS via a 

trader alert to its Members. 

2. Statutory Basis 

IEX believes that the proposed rule 

change is consistent with the provisions 

of Section 6(b)(5) of the Act,41 which 

require, among other things, that IEX’s 

rules must be designed to prevent 

fraudulent and manipulative acts and 

practices, to promote just and equitable 

principles of trade, and, in general, to 

protect investors and the public interest. 

IEX believes that the proposed 

retirement of IEX Rule 11.420 fulfills the 

obligation in the CAT NMS Plan for IEX 

to submit a proposed rule change to 

eliminate or modify duplicative rules, 

and that the CAT NMS Plan has 

achieved the accuracy and reliability 

standards required by the Commission 

in the OATS Retirement Order. 

Additionally, as discussed in the 

Purpose section, IEX believes that the 

use of CAT Data, whether by IEX 

directly, or by FINRA pursuant to the 

RSA, will continue to allow for accurate 

and effective surveillance of market 

activity on IEX. Therefore, IEX will 

continue to be able to fulfill its statutory 

obligation to protect investors and the 

public interest after the retirement of 

OATS. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

IEX does not believe that the 

proposed rule change will result in any 

burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. IEX notes 

that the proposed rule change 

implements provisions of the CAT NMS 

Plan, facilitates the retirement of certain 

existing regulatory systems, and is 

designed to assist the Exchange in 

meeting its regulatory obligations 

pursuant to the Plan. IEX also notes that 

the proposed rule change will apply 

equally to all firms that trade NMS 

Securities. In addition, all national 

securities exchanges and FINRA are 


lotter on DSK11XQN23PROD with NOTICES1
50568 Federal Register / Vol. 86, No. 172 / Thursday, September 9, 2021 / Notices 

42 15 U.S.C. 78s(b)(3)(A)(iii). 

43 17 CFR 240.19b–4(f)(6). 

44 15 U.S.C. 78s(b)(3)(A). 

45 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

4(f)(6)(iii) requires the Exchange to give the 

Commission written notice of the Exchange’s intent 

to file the proposed rule change, along with a brief 

description and text of 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. 

46 17 CFR 240.19b–4(f)(6). 

47 17 CFR 240.19b–4(f)(6)(iii). 

48See supra note 40. 

49For purposes only of waiving the 30-day 

operative delay, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

and capital formation. See 15 U.S.C. 78c(f). 50 17 CFR 200.30–3(a)(12). 

proposing substantially similar rule 

filings. Therefore, this is not a 

competitive rule filing, and, therefore, it 

does not impose a burden on 

competition. 

Furthermore, IEX notes that FINRA 

undertook an economic impact 

assessment of the potential costs and 

benefits associated with OATS 

retirement and determined that CAT 

meets or exceeds the OATS standards. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

Written comments were neither 

solicited nor received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The Exchange has filed the proposed 

rule change pursuant to Section 

19(b)(3)(A)(iii) of the Act 42 and Rule 

19b–4(f)(6) thereunder.43 Because the 

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 

prior to 30 days from the date on which 

it was filed, or such shorter time as the 

Commission may designate, if 

consistent with the protection of 

investors and the public interest, the 

proposed rule change has become 

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

of the Act 44 and Rule 19b–4(f)(6)(iii) 

thereunder.45

A proposed rule change filed under 

Rule 19b–4(f)(6) 46 normally does not 

become operative prior to 30 days after 

the date of the filing. However, pursuant 

to Rule 19b–4(f)(6)(iii),47 the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. The Exchange has asked the 

Commission to waive the 30-day 

operative delay so that the proposal may 

become operative by September 1, 2021, 

the first day on which FINRA will no 

longer accept OATS data (unless FINRA 

delays the OATS retirement past that 

date.) 48 As discussed above, IEX 

believes that it is appropriate for FINRA 

to retire OATS as of September 1, 2021. 

IEX states that the use of CAT Data, 

whether by IEX directly, or by FINRA 

pursuant to IEX’s RSA with FINRA, will 

continue to allow for accurate and 

effective surveillance of market activity 

on IEX. In addition, August 31, 2021, 

will be the last ‘‘OATS Business Day,’’ 

as defined under FINRA Rule 

7450(b)(3), and reports submitted to 

OATS for order events that occur after 

August 31, 2021, will be rejected. The 

Commission believes that it is 

consistent with the protection of 

investors and the public interest for IEX 

to delete its OATS reporting rules at the 

same time that FINRA retires OATS. 

Accordingly, the Commission hereby 

waives the 30-day operative delay and 

designates the proposal operative on 

September 1, 2021.49

At any time within 60 days of the 

filing of this 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 will institute proceedings 

to determine whether the proposed rule 

change 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– 

IEX–2021–10 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–IEX–2021–10. 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 will also be available for 

inspection and copying at the IEX’s 

principal office and on its internet 

website at www.iextrading.com. All 

comments received will be posted 

without change. 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–IEX– 

2021–10, and should be submitted on or 

before September 30, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.50

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–19422 Filed 9–8–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92867; File No. SR– 

NYSEArca–2021–65] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Notice of Designation of a 

Longer Period for Commission Action 

on a Proposed Rule Change To List 

and Trade Shares of the Sprott ESG 

Gold ETF Under NYSE Arca Rule 

8.201–E (Commodity-Based Trust 

Shares) 

September 2, 2021. 

On July 19, 2021, NYSE Arca, Inc. 

(‘‘NYSE Arca’’) filed with the Securities 

and Exchange Commission 


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