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Federal Register / Vol. 86, No. 152 / Wednesday, August 11, 2021 / Notices period of time to select a new Administrator.
With respect to the comment on limiting the type of professional service firms that may serve the role of the independent Administrator,789 the Commission believes that the CT Plan should not limit the scope of firms based solely on the type or size of the firm, but should instead use the criteria required to be considered in selecting the Administrator pursuant to the Administrator Selection Procedures adopted by the Operating Committee.
Finally, regarding the commenters statement in support of public comment on the selection of a new Administrator,790 Section 6.3 provides that the Operating Committee may solicit and consider comment as part of the process of establishing the Administrator Selection Procedures, and the Administrator Selection Procedures are required to set forth the entities other than the Voting Representatives that are eligible to comment on the selection of the Administrator.791 The Commission also believes that the inclusion of Non-SRO
Voting Representatives as full members of the Operating Committee, together with the Commissions modification of the proposed CT Plan in Section 4.4gi to prohibit discussions in Executive Session regarding contract negotiations with the Administrator, will help ensure that the Operating Committee considers broad industry viewpoints in the process of establishing the Administrator Selection Procedures. As a result, the Commission believes that the CT Plan, as modified, addresses this issue.
Although the provisions for the establishment of the Administrator Selection Procedures are reasonably designed to ensure that the Operating Committee establishes a process that governs the selection of a new Administrator through a fair, transparent, and competitive process, the Commission is modifying a sentence in Article VI, Section 6.3 of the CT Plan.
In particular, Section 6.3 states that the Administrator Selection Procedures shall be established by the Voting Representatives pursuant to Article IV, Section 4.3 of the CT Plan. The Commission is modifying Section 6.3 by replacing the phrase Voting Representatives with the phrase Operating Committee in order to remove any inconsistency and potential confusion in this section regarding the
vote that would be required to establish the Administrator Selection Procedures.
As described above, Section 4.3 governs the action of the Operating Committee, which has the specific authority under the CT Plan for selecting, overseeing, and specifying the role and responsibilities of the Administrator.792
The reference to Voting Representatives is the only instance found in Section 6.3
when discussing the body responsible for establishing the Administrator Selection Procedures, and modifying the provision to instead refer to the Operating Committee will make clear that an augmented majority vote of the Operating Committee is necessary to establish those procedures. Accordingly, for the reasons discussed above, the Commission is approving Article VI, Section 6.3, as modified and renumbered as Section 6.4 of the CT
Plan.
8. Regulatory Matters Article VII of the CT Plan sets forth the provisions governing regulatory matters. Section 7.1 of Article VII
addresses regulatory and operational halts. Section 7.1a provides that a Member must notify the Processor if it has concerns about its ability to collect and transmit quotes, orders, or last sale prices, or where it has declared an Operational Halt or suspension of trading in one or more Eligible Securities, pursuant to the procedures adopted by the Operating Committee.
Sections 7.1bf provide procedures for the initiation of a regulatory halt and the resumption of trading following a regulatory halt. In particular, Section 7.1d provides that the Primary Listing Market will determine when to resume trading. In making that determination, the Primary Listing Market will make a good-faith determination and consider the totality of information to determine whether resuming trading would promote a fair and orderly market.
Section 7.1d further provides that the Primary Listing Market retains discretion to delay the resumption of trading if it believes that trading will not resume in a fair and orderly manner.
In the Notice, the Commission sought comment on these provisions.793 One commenter argues that good faith is too loose of a requirement. 794 The Commission, however, believes that the proposed good-faith standard set forth in Section 7.1 is appropriate because it addresses potential concerns that 792 See
789 See
Data Boiler Letter I, supra note 31, at 4,
44.
790 See
id.
791 See Article VI, Section 6.3d of the CT Plan.

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Article IV, Section 4.1aii of the CT

Plan.
793 See Notice, supra note 3, 85 FR at 64572
Question 46.
794 Data Boiler Letter I, supra note 31, at 45.

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primary listing markets may be subject to commercial pressures in making decisions to call regulatory halts or resume trading thereafter and also because it is combined with the requirement that the primary listing markets consider the broader interests of the national market system with respect to declaring regulatory trading halts and resuming trading thereafter, thereby promoting the maintenance of fair and orderly markets and enhancing the protection of investors.795 Section 7.1bii of the CT Plan requires the primary listing market to also consider the severity of the issue, its expected duration, and potential impact on market participants. Section 7.1bii also requires the primary listing market to consult with, or seek input from, as feasible, the affected trading centers, processors, and others when making any such determinations. Moreover, Section 7.1civ and Section 7.1d1 each require the primary listing market to consider whether its determination would promote a fair and orderly market. Consequently, the Commission has determined that a good-faith determination, based on the totality of information and focusing on the promotion of fair and orderly markets, is reasonably designed to ensure that trading is halted and resumed in an appropriate manner. Additionally, consistent with its recent approval of the same provisions regarding trading halts in the existing Equity Data Plans, the Commission finds that the provisions of Section 7.1 are reasonably designed to enhance the resiliency of the national market system by clearly memorializing the coordinated actions to be taken by the Participants during such events so that trading may resume in a fair and orderly manner. 796
Accordingly, the Commission is approving Section 7.1 as proposed.
795 For example, Article VIIIa of the CTA Plan does not prevent any Participant that is an exchange from halting or suspending trading, or any Participant that is a national securities association from suspending the furnishing of quotation information, in any Eligible Security for any reason it deems adequate. Any Participant which does so halt or suspend trading or the furnishing of quotation information shall immediately advise the Processor of its actions and the reasons therefor, and also advise the Processor when such halt or suspension is terminated. Moreover, Article X of the UTP Plan permits the Listing Market to declare a regulatory halt, whenever, in the exercise of its regulatory functions, the Listing Market for an Eligible Security determines that a Regulatory Halt is appropriate and to terminate a halt, whenever the Listing Market determines.
796 Securities Exchange Act Release Nos. 92070
May 28, 2021, 86 FR 29849, 29851 June 3, 2021
File No. SRCTA/CQ202101; and 92071 May 28, 2021, 86 FR 29846, 29848 June 3, 2021 File No. S72489.

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