30 Day Notice

47936

Federal Register / Vol. 88, No. 141 / Tuesday, July 25, 2023 / Notices

SECURITIES AND EXCHANGE
COMMISSION
[SEC File No. 270–616, OMB Control No.
3235–0671]

Submission for OMB Review;
Comment Request; Extension: Rule
613 of Regulation NMS

ddrumheller on DSK120RN23PROD with NOTICES1

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
connection in connection with a
National Market System (NMS) Plan
filed with the Commission under Rule
613 (17 CFR 242.613), under the
Securities Exchange Act of 1934 (15
U.S.C. 78a et seq.).
Rule 613 of Regulation NMS (17 CFR
part 242) required national securities
exchanges and national securities
associations (‘‘Participants’’) to jointly
submit to the Commission a national
market system (‘‘NMS’’) plan to govern
the creation, implementation, and
maintenance of a consolidated audit
trail (‘‘CAT’’) and Central Repository for
the collection of information for NMS
securities. On February 27, 2015, the
Participants submitted the CAT NMS
Plan to the Commission.1 On April 27,
2016, the Commission published a
notice soliciting comments from the
public (‘‘CAT NMS Plan Notice’’).2 On
1 See Letter from Participants to Brent J. Fields,
Secretary, Commission, dated February 27, 2015.
The Participants filed the CAT NMS Plan on
September 30, 2014. See Letter from the
Participants, to Brent J. Fields, Secretary,
Commission, dated September 30, 2014. The CAT
NMS Plan filed on February 27, 2015, was an
amendment to and replacement of the Initial CAT
NMS Plan (the ‘‘Amended and Restated CAT NMS
Plan’’). On December 24, 2015, the Participants
submitted an Amendment to the Amended and
Restated CAT NMS Plan. See Letter from
Participants to Brent J. Fields, Secretary,
Commission, dated December 23, 2015 (the
‘‘Amendment’’). On February 9, 2016, the
Participants filed with the Commission an identical,
but unmarked, version of the Amended and
Restated CAT NMS Plan, dated February 27, 2015,
as modified by the Amendment, as well as a copy
of the request for proposal issued by the
Participants to solicit Bids from parties interested
in serving as the Plan Processor for the consolidated
audit trail. Unless the context otherwise requires,
the ‘‘CAT NMS Plan’’ shall refer to the Amended
and Restated CAT NMS Plan, as modified by the
Amendment.
2 See Securities Exchange Act Release No. 77724
(April 27, 2016), 81 FR 30613 (May 17, 2016). The

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18:12 Jul 24, 2023

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November 15, 2016, the Commission
approved the CAT NMS Plan (‘‘CAT
NMS Plan Order’’), including the
information collections proposed in the
CAT NMS Plan Notice, and certain
additional information collections.3
Since July 2020, the date of the last
PRA renewal, the Commission believes
one additional information collection
was completed: a one-time independent
audit of the fees, costs, and expenses
incurred by the Participants on behalf of
CAT NMS, LLC prior to the Effective
Date 4 of the Plan; 5 In addition. certain
information collection requirements
have completed at least the
implementation stage, although certain
ongoing costs remain, including: (1)
development of a Central Repository
tasked with the receipt, consolidation,
and retention of reported order and
execution information submitted by
Participants and their members; 6 (2) the
requirement that each Participant, and
any member of such Participant, record
and electronically report to the Central
Repository details for each order and
Reportable Event documenting the life
of an order through the process of
original receipt or origination, routing,
modification, cancellation, and
execution (in whole or in part) for each
NMS security; 7 (3) the requirement that
the CAT NMS Plan require the Central
Repository to collect and retain on a
current and continuous basis NBBO
information for each NMS security,
transaction reports reported pursuant to
an effective transaction reporting plan,
and Last Sale Reports reported pursuant
to the Options Price Reporting
Authority Plan; 8 (4) the requirement
that the CAT NMS Plan must require
that every national securities exchange
and national securities association
develop and implement a surveillance
system, or enhance existing surveillance
systems, reasonably designed to make
use of the consolidated information
contained in the consolidated audit
trail; 9 (5) an annual requirement that
that the CAT LLC financials be (i) in
compliance with GAAP, (ii) be audited
burdens associated with the CAT NMS Plan Notice
were submitted under OMB number 3235–0671
which relates to the NMS Plan required to be filed
under Rule 613.
3 See Securities Exchange Act Release No. 79318
(November 15, 2016), 81 FR 84696 (November 23,
2016), available at https://www.sec.gov/rules/sro/
nms/2016/34-79318.pdf (‘‘CAT NMS Plan Order’’).
4 The ‘‘Effective Date’’ is the date the Commission
approved the CAT NMS Plan, which is November
15, 2016. See id.
5 See CAT NMS Plan Order, supra note 3, at
84940.
6 See 17 CFR 242.613.
7 See 17 CFR 242.613(c)(1), (c)(5), (c)(6), (c)(7).
8 See 17 CFR 242.613(e)(7).
9 See 17 CFR 242.613(f).

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by an independent public accounting
firm, and (iii) be made publicly
available; 10 and (6) a requirement that
each Participant conduct background
checks for its employees and contractors
that will use the CAT System.11
This Notice addresses both the
ongoing information collection
requirements noted above and the
remaining information collection
requirements noticed in the CAT NMS
Plan Notice and certain additional
information collections of the CAT NMS
Plan Order, which are: (1) a one-time
report from the Participants discussing
the feasibility and advisability of
allowing Industry Members to bulk
download the Raw Data that it has
submitted to the Central Repository; 12
(2) a one-time assessment of the nature
and extent of errors in the Customer
information submitted to the Central
Repository and whether the correction
of certain data fields over others should
be prioritized from the Participants; 13
(3) a one-time report on the impact of
tiered fees on market liquidity,
including an analysis of the impact of
the tiered-fee structure on Industry
Members provision of liquidity from the
Participants; 14 and (4) an assessment of
the projected impact of any Material
Systems Change on the Maximum Error
Rate, prior to the implementation of
such Material Systems Change from the
Participants; 15
The Commission believes that the
CAT NMS Plan, once fully
implemented, will improve the quality
of the data available to regulators in four
areas that affect the ultimate
effectiveness of core regulatory efforts—
completeness, accuracy, accessibility
and timeliness.16 The improvements in
these data qualities would substantially
improve regulators’ ability to perform
analysis and reconstruction of market
events, and market analysis and
research to inform policy decisions, as
well as perform regulatory activities, in
particular market surveillance,
examinations, investigations, and other
enforcement functions.
10 Id.
11 Id. The Commission believes that these
background checks are necessary to ensure that
only authorized and qualified persons are using the
CAT System.
12 Id. at 84941.
13 Id.
14 Id. at 84941–84942.
15 Id. at 84942. The Commission believes that four
assessments would be filed annually.
16 See CAT NMS Plan Order, supra note 3, at
45727 (discussing four ‘‘qualities’’ of trade and
order data that impact the effectiveness of core
Participant and Commission regulatory efforts:
accuracy, completeness, accessibility, and
timeliness).

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Federal Register / Vol. 88, No. 141 / Tuesday, July 25, 2023 / Notices
The Commission estimates that 1375
respondents 17 will require an aggregate
total of approximately 4,931,332 hours
per year to comply with the collection
of information. The Commission further
estimates that the aggregate cost to
comply with the collection of
information will be approximately
$328,662,911 per year.
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.
The public may view background
documentation for this information
collection at the following website:
www.reginfo.gov. Find this particular
information collection by selecting
‘‘Currently under 30-day Review—Open
for Public Comments’’ or by using the
search function. Written comments and
recommendations for the proposed
information collection should be sent by
August 24, 2023 to (i) www.reginfo.gov/
public/do/PRAMain and (ii) David
Bottom, Director/Chief Information
Officer, Securities and Exchange
Commission, c/o John Pezzullo, 100 F
Street NE, Washington, DC 20549, or by
sending an email to: PRA_Mailbox@
sec.gov.
Dated: July 19, 2023.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2023–15648 Filed 7–24–23; 8:45 am]
BILLING CODE 8011–01–P

[Release No. 34–97946; File No. SR–BX–
2023–016]

ddrumheller on DSK120RN23PROD with NOTICES1

July 19, 2023.

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 11,
2023, Nasdaq BX, Inc. (‘‘BX’’ or
‘‘Exchange’’) filed with the Securities
and Exchange Commission (‘‘SEC’’ or
‘‘Commission’’) the proposed rule
17 The Commission notes that 25 Participants (the
24 national securities exchanges and one national
securities association) and 1,350 broker-dealers are
subject to information collections requirements
pursuant to Rule 613 and the CAT NMS Plan.
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.

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The Exchange proposes to set fees for
the purchase of field-programmable gate
array (‘‘FPGA’’) technology as an
optional delivery mechanism for BX
TotalView.
The text of the proposed rule change
is available on the Exchange’s website at
https://listingcenter.nasdaq.com/
rulebook/bx/rules, 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
Exchange 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
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.

1. Purpose

Self-Regulatory Organizations; Nasdaq
BX, Inc.; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Establish Fees for
Field-Programmable Gate Array
Technology as an Optional Delivery
Mechanism for BX TotalView

18:12 Jul 24, 2023

I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change

A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change

SECURITIES AND EXCHANGE
COMMISSION

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change as described in Items I, II, and
III below, which Items have been
prepared by the Exchange. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.

The purpose of the proposed rule
change is to establish a fee schedule for
the purchase of field-programmable gate
array (‘‘FPGA’’) technology as an
optional delivery mechanism for BX
TotalView.3 This follows a recentlyfiled proposal to offer FPGA technology
as an optional delivery mechanism for
BX TotalView.4
3 This Proposal was initially filed by the
Exchange on May 23, 2023. See Securities Exchange
Act Release No. 97627 (May 31, 2023), 88 FR 37112
(June 6, 2023) (SR–BX–2023–014). On July 7, 2023,
that filing was withdrawn and replaced by the
instant filing. The instant filing provides additional
information regarding the Proposal, but does not
change it in substance.
4 See SR–BX–2023–011 (‘‘A proposal to offer
field-programmable gate array (‘FPGA’) technology
as an optional delivery mechanism for BX
TotalView.’’), available at https://
listingcenter.nasdaq.com/rulebook/BX/rulefilings.
A proposal to establish a fee schedule for the use
of FPGA technology for the Phlx exchange is being
filed concurrently with this proposal.

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47937

FPGA
FPGA is a hardware-based delivery
mechanism that utilizes an integrated
circuit that is programmed to reduce
‘‘jitter’’—a technical term of art referring
to the deviation in amplitude, phase
timing or width of a signal pulse in a
digital signal—that will allow data to be
processed in a more predictable, or
‘‘deterministic,’’ fashion. Reducing jitter
can be useful for certain customers due
to the variability in the timing of market
data packets transmitted by an exchange
over the course of the trading day.
Orders, and therefore market data
packets, typically accumulate in larger
numbers at the beginning and end of the
trading day, as well as during the peaks
of activity that occur at random
intervals during the day. These bursts of
activity may alter the time interval
between the delivery of data packets
because software processes information
at variable rates depending on load to
the system. Processing times may
increase at higher loads, and decrease
during periods of lesser activity. FPGA
technology processes data packets at a
constant time interval, without regard to
the number of packets processed. Higher
levels of determinism means less
variable queuing, which improves the
predictability of data transfer,
particularly during times of peak market
activity.
The benefits of determinism depend
on the use case of the customer, as well
as the customer’s specific system
architecture.
Higher determinism does not
necessarily mean lower latency. The
concepts of determinism and latency are
related, but distinct. Determinism refers
to predictability in the rate of data
transmission; latency refers to the time
required to process data or transport it
from one location to another. Low
latency is not necessarily deterministic,
and higher determinism does not
necessarily mean low latency. As such,
use of FPGA technology will increase
determinism, but does not guarantee
lower latency at all times.5
Among customers that seek a higher
degree of determinism, the benefits of
FPGA technology varies, as FPGA
technology is one possible solution,
among a catalog of possible solutions,
for increasing the consistency and
predictability of message throughput
over the course of the trading day. Some
customers are able to adequately control
jitter without using FPGA technology;
other customers address jitter using
specialized software, coding or other
5 Because software can be impacted by workload,
FPGA has lower latency during periods of peak
activity.

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