43098 Federal Register / Vol. 87, No. 137 / Tuesday, July 19, 2022 / Notices 

25 15 U.S.C. 78s(b)(3)(A)(iii). 

26 17 CFR 240.19b–4(f)(6). 

27 15 U.S.C. 78s(b)(3)(A)(iii). 

28 17 CFR 240.19b–4(f)(6). In addition, Rule 19b– 

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

give the Commission written notice of its 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 complied with this requirement. 

29 15 U.S.C. 78s(b)(2)(B). 30 17 CFR 200.30–3(a)(12). 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

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 25 and Rule 

19b–4(f)(6) thereunder.26 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 27 and Rule 19b-4(f)(6)(iii) 

thereunder.28

At any time within 60 days of the 

filing of such 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 

under Section 19(b)(2)(B) 29 of the Act 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– 

NYSECHX–2022–14 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–NYSECHX–2022–14. 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–NYSECHX–2022–14 and 

should be submitted on or before 

August 9, 2022. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.30

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–15302 Filed 7–18–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–808, OMB Control No. 

3235–0762] 

Proposed Collection; Comment 

Request; Extension: Rule 15l–1 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA 

Services, 100 F Street NE, 

Washington, DC 20549–2736 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the 

Securities and Exchange Commission 

(‘‘Commission’’) is soliciting comments 

on the existing collection of information 

provided for in Rule 15l–1 (17 CFR 

240.15l–1), under the Securities 

Exchange Act of 1934 (15 U.S.C. 78a et 

seq.). The Commission plans to submit 

this existing collection of information to 

the Office of Management and Budget 

(‘‘OMB’’) for extension and approval. 

Rule 15l–1 established a standard of 

conduct for broker-dealers and natural 

persons who are associated persons of a 

broker-dealer (together, ‘‘brokerdealers’’) when making a 

recommendation of any securities 

transaction or investment strategy 

involving securities to a retail customer 

(‘‘Regulation Best Interest’’). Regulation 

Best Interest requires broker-dealers, 

when making a recommendation of any 

securities transaction or investment 

strategy involving securities to a retail 

customer, to act in the best interest of 

the retail customer at the time the 

recommendation is made, without 

placing the financial or other interest of 

the broker-dealer or natural person who 

is an associated person making the 

recommendation ahead of the interest of 

the retail customer. 

The information that must be 

collected pursuant to Regulation Best 

Interest is intended to: (1) improve 

disclosure about the scope and terms of 

the broker-dealer’s relationship with the 

retail customer, which would foster 

retail customers’ understanding of their 

relationship with a broker-dealer; (2) 

enhance the quality of 

recommendations provided by 

establishing an express best interest 

obligation under the federal securities 

laws; (3) enhance the disclosure of a 

broker-dealer’s conflicts of interest; and 

(4) establish obligations that require 

mitigation, and not just disclosure, of 

conflicts of interest arising from 

financial incentives associated with 

broker-dealer recommendations. The 

information will therefore help establish 

a framework that protects investors and 


jspears on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 87, No. 137 / Tuesday, July 19, 2022 / Notices 43099 

1While Rule 18a–3 contains requirements that 

apply to both nonbank SBSDs and MSBSPs, the 

particular requirements that constitute a collection 

of information relate only to nonbank SBSDs. 2 7 nonbank SBSDs × 210 hours = 1,470 hours. 

These amounts are annualized over three years 

resulting in 70 (210 hours/3 years) hours per 

nonbank SBSD per year and an industry wide 

annual burden of 490 recordkeeping hours. 3 7 nonbank SBSDs × 60 hours = 420 hours. 4 490 hours + 420 hours = 910 hours. 

5 5 nonbank SBSDs × 50 hours = 250 hours. These 

amounts are annualized over three years resulting 

in 16.67 (50 hours/3 years) hours per nonbank 

SBSD per year and an industry wide annual burden 

of 83.33 recordkeeping hours, rounded down to 83 

hours. 

6 5 nonbank SBSDs × 250 hours = 1,250 hours. 

7 (250 hours/3 years) + 1,250 hours = 1,333.33 

hours, rounded down to 1,333 hours. 

promotes efficiency, competition, and 

capital formation. 

There are approximately 2,683 

respondents that must comply with 

Rule 15l–1. The aggregate annual 

burden for all respondents is estimated 

to be 2,568,434 hours, or 957 hours per 

respondent (2,568,434 hours/2,683 

respondents). Under Rule 15l–1, 

respondents will also incur cost 

burdens. The aggregate annual cost 

burden for all respondents is estimated 

to be $12,085,860, or $4,505 per 

respondent ($12,085,860/2,681 

respondents). 

Written comments are invited on: (a) 

whether the proposed collection of 

information is necessary for the proper 

performance of the functions of the 

Commission, including whether the 

information will have practical utility; 

(b) the accuracy of the Commission’s 

estimate of the burden of the collection 

of information; (c) ways to enhance the 

quality, utility, and clarity of the 

information collected; and (d) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques or other forms of information 

technology. Consideration will be given 

to comments and suggestions submitted 

in writing by September 19, 2022. 

An agency may not conduct or 

sponsor, and a person is not required to 

respond to, a collection of information 

under the PRA unless it displays a 

currently valid OMB control number. 

Please direct your written comments 

to: David Bottom, Director/Chief 

Information Officer, Securities and 

Exchange Commission, c/o John 

Pezzullo, 100 F Street NE, Washington, 

DC 20549, or send an email to: PRA_

Mailbox@sec.gov. 

Dated: July 13, 2022. 

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2022–15314 Filed 7–18–22; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[SEC File No. 270–651, OMB Control No. 

3235–0702] 

Submission for OMB Review; 

Comment Request: Extension: Rule 

18a–3 

Upon Written Request, Copies Available 

From: Securities and Exchange 

Commission, Office of FOIA Services, 

100 F Street NE, Washington, DC 

20549–2736 

Notice is hereby given that pursuant 

to the Paperwork Reduction Act of 1995 

(‘‘PRA’’) (44 U.S.C. 3501 et seq.), the 

Securities and Exchange Commission 

(‘‘Commission’’) has submitted to the 

Office of Management and Budget 

(‘‘OMB’’) a request for approval of 

extension of the previously approved 

collection of information provided for in 

Rule 18a–3 (17 CFR 240.18a–3), under 

the Securities Exchange Act of 1934 (15 

U.S.C. 78a et seq.) (‘‘Exchange Act’’). 

Rule 18a–3 establishes minimum 

margin requirements for nonbank 

security-based swap dealers (‘‘SBSDs’’) 

and nonbank major security-based swap 

participants (‘‘MSBSPs’’) for noncleared security-based swaps. Under 

paragraph (e) of Rule 18a–3 nonbank 

SBSDs are required to monitor the risk 

of each account that holds non-cleared 

security based swaps for a counterparty 

and to establish, maintain, and 

document procedures and guidelines for 

monitoring the risk of accounts as part 

of its risk management control system 

required under Exchange Act Rule 

15c3–4. In addition, paragraph (d)(2) of 

Rule 18a–3 provides that a nonbank 

SBSD seeking approval to use a model 

to calculate initial margin will be 

subject to an application process 

consistent with Exchange Act Rule 

15c3–1e and paragraph (d) of Exchange 

Act Rule 18a–1, as applicable, governing 

the use of internal models to compute 

net capital.1

The total annual hour burden 

associated with Rule 18a–3 is 

approximately 2,243 hours calculated as 

follows: 

The Commission staff estimates that 

there are 7 nonbank SBSDs that are 

subject to Rule 18a–3. The staff further 

estimates that each would spend an 

average of approximately 210 hours 

establishing and documenting their Rule 

18a–3 counterparty risk monitoring 

procedures, for a one-time industrywide hour burden of approximately 

1,470 recordkeeping hours or 490 hours 

per year when annualized over three 

years.2 In addition, the staff estimates 

that each nonbank SBSD would spend 

an average of approximately 60 hours 

per year reviewing risks associated with 

its counterparties, for an annual 

industry-wide burden of approximately 

420 recordkeeping hours.3 Taken 

together, the annual industry-wide hour 

burden is approximately 910 hours.4

The Commission estimates it will take 

a nonbank SBSD approximately 50 

hours to prepare and submit an 

application to the Commission to seek 

authorization to use an internal model 

to calculate initial margin. The staff 

estimates that five non-bank SBSDs 

have sought Commission approval to 

use an internal model to calculate initial 

margin, resulting in a total industrywide one-time hour burden of 

approximately 250 hours or 

approximately 83 hours per year when 

annualized over three years.5 The 

Commission also estimates that each 

nonbank SBSD will spend 

approximately 250 hours per year 

reviewing, updating, and back testing 

their initial margin model, resulting in 

a total industry-wide annual hour 

burden of approximately 1,250 

recordkeeping hours.6 Taken together, 

the Commission estimates an annual 

industry-wide hour burden of 

approximately 1,333 hours.7

The total annual hour burden 

associated with Rule 18a–3 is thus 

approximately 2,243 hours (910 hours + 

1,333 hours). 

The total annual cost burden 

associated with Rule 18a–3 is 

approximately $3,333 calculated as 

follows: 

The 7 respondents subject to the 

collection of information may incur 

start-up costs in order to comply with 

this collection of information. These 

costs may vary depending on the size 

and complexity of the nonbank SBSD. 

In addition, the start-up costs may be 

less for the 2 nonbank SBSD 

respondents also registered as brokerdealers because these firms may already 

be subject to similar requirements with 

respect to other margin rules. For the 

remaining 5 nonbank SBSDs, because 

these written procedures may be novel 

undertakings for these firms, the 

Commission staff assumes these 

nonbank SBSDs will have their written 

risk analysis methodology reviewed by 

outside counsel. Therefore, the staff 

estimates that these 5 nonbank SBSDs 

will engage an outside counsel to review 

their written risk analysis methodology, 

at a rate of approximately $400 per hour 

for 5 hours (i.e., $2,000 in legal costs). 

This will result in a one-time industrywide external recordkeeping cost of 

approximately $10,000, or 


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