Document ID: SEC-2017-1341-0001
Agency: sec
Document Type: Notice
Title: Self-Regulatory Organizations; Proposed Rule Changes: The Depository Trust Co.
Posted Date: 2017-08-09T04:00Z

[Federal Register Volume 82, Number 152 (Wednesday, August 9, 2017)]
[Notices]
[Pages 37274-37276]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-16739]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-81305; File No. SR-DTC-2017-015]

Self-Regulatory Organizations; The Depository Trust Company; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Establish the Effective Date of the Settlement Cycle Rule Changes

August 3, 2017.
    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 31, 2017, 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.
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    \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).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    DTC is filing this proposed rule change to (i) establish September 
5, 2017 as the effective date (``Effective Date'') of the settlement 
cycle rule changes (``T2 Changes'') submitted pursuant to rule filing 
SR-DTC-2016-013 (``Prior Rule Filing''),\5\ (ii) incorporate the T2 
Changes into the DTC Settlement Service Guide (``Settlement Guide'') 
\6\ and DTC Distributions Service Guide (``Distributions Guide'') \7\ 
(collectively, ``Guides'') as of the Effective Date, and (iii) amend 
the legends (``Legends'') on the respective cover pages of the Guides 
in order to include the Effective Date and self-eliminating language 
for the Legends, and remove the Legends' current reference to DTC 
making a subsequent rule filing with the Commission, as this proposal 
is that subsequent rule filing.\8\
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    \5\ See Securities Exchange Act Release No. 79304 (November 14, 
2016), 81 FR 81825 (November 18, 2016) (SR-DTC-2016-013).
    \6\ Available at http://www.dtcc.com/~/media/Files/Downloads/
legal/service-guides/Settlement.pdf.
    \7\ Available at http://www.dtcc.com/~/media/Files/Downloads/
legal/service-guides/Distributions-Service-Guide-FINAL-January-
2017.pdf.
    \8\ Capitalized terms not otherwise defined herein have the 
respective meanings set forth in the DTC Rules, By-laws and 
Organization Certificate, available at http://www.dtcc.com/~/media/
Files/Downloads/legal/rules/dtc_rules.pdf.
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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

[[Page 37275]]

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 Prior Rule Filing \9\ was filed by DTC pursuant to Section 
19(b)(3)(A) of the Act,\10\ and was effective upon filing with the 
Commission.
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    \9\ Supra note 5.
    \10\ 15 U.S.C. 78s(b)(3)(A).
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    The purpose of the Prior Rule Filing was to amend the Guides to 
make technical revisions related to the anticipated industry-wide move 
to a shorter standard settlement cycle from the third business day 
after the trade date (``T+3'') to the second business day after the 
trade date (``T+2''). Although the Prior Rule Filing \11\ became 
effective pursuant to Section 19(b)(3)(A) of the Act, the Prior Rule 
Filing \12\ stated that the T2 Changes would not become effective and 
would not be implemented until an effective date is established by a 
subsequent proposed rule change to be submitted by DTC under Rule 19b-4 
of the Act.\13\
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    \11\ Supra note 5.
    \12\ Id.
    \13\ 17 CFR 240.19b-4.
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    DTC is filing this proposed rule change to (i) establish the 
Effective Date for the T2 Changes, which is also the compliance date 
for the Commission's amendment to Rule 15c6-1(a) under the Act,\14\ 
(ii) incorporate the T2 Changes into the Guides as of the Effective 
Date, and (iii) amend the Legends on the respective cover pages of the 
Guides in order to include the Effective Date and self-eliminating 
language for the Legends, and remove the Legends' current reference to 
DTC making a subsequent rule filing with the Commission, as this 
proposal is that subsequent rule filing.
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    \14\ The Commission adopted an amendment to the Settlement Cycle 
Rule (Rule 15c6-1(a)) under the Act to shorten the standard 
settlement cycle for most broker-dealer transactions from T+3 to 
T+2. See Amendment to Securities Transaction Settlement Cycle, 
Exchange Act Release No. 80295 (March 22, 2017), 82 FR 15564 (March 
29, 2017).
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2. Statutory Basis
    Section 17A(b)(3)(F) of the Act requires, in part, that the Guides 
be designed to promote the prompt and accurate clearance and settlement 
of securities transactions.\15\ The proposed rule change would 
establish the Effective Date for the T2 Changes and provide DTC 
participants (``Participants'') with an understanding of when the T2 
Changes will begin to affect them. Knowing when the T2 Changes will 
begin to affect Participants would enable them to timely fulfill their 
obligations to DTC, which would in turn ensure that securities 
transactions would be promptly and accurately cleared and settled 
within the industry standard settlement cycle and, by extension, 
facilitate the prompt and accurate clearance and settlement of 
securities transactions submitted to DTC for clearing and settlement. 
Therefore, DTC believes that the proposed rule change would promote the 
prompt and accurate clearance and settlement of securities 
transactions, consistent with Section 17A(b)(3)(F) of the Act cited 
above.
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    \15\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Clearing Agency's Statement on Burden on Competition

    DTC does not believe that the proposed rule change to (i) establish 
the Effective Date for the T2 Changes, (ii) incorporate the T2 Changes 
into the Guides as of the Effective Date, and (iii) amend the 
respective Legends on the cover pages of the Guides in order to include 
the Effective Date and self-eliminating language for the Legends, and 
remove the Legends' current reference to DTC making a subsequent rule 
filing with the Commission would have any impact, or impose any burden, 
on competition because the proposed rule change is intended to provide 
additional clarity in the Guides regarding when the T2 Changes would 
become effective for Participants. As such, the proposed rule change 
would not impact a particular category of Participants nor would it 
impact particular types of Participants' businesses.

(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) of the Act \16\ and paragraph (f) of Rule 19b-4 
thereunder.\17\ 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.
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    \16\ 15 U.S.C. 78s(b)(3)(A).
    \17\ 17 CFR 240.19b-4(f).
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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-2017-015 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-DTC-2017-015. 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 Web site (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 Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549-1090 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 
Web site (http://dtcc.com/legal/sec-rule-filings.aspx). All comments 
received will be posted without change; the Commission does not edit 
personal identifying information from submissions. You should submit 
only information that you wish to make available publicly. All 
submissions should refer to File Number SR-DTC-

[[Page 37276]]

2017-015 and should be submitted on or before August 30, 2017.
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    \18\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\18\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-16739 Filed 8-8-17; 8:45 am]
 BILLING CODE 8011-01-P