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Federal Register / Vol. 86, No. 26 / Wednesday, February 10, 2021 / Notices
registration as a SIP, as well as an SDR.11
In 2019, the Commission stated that implementation of the SBS Reporting Rules can and should be done in a manner that carries out the fundamental policy goals of the SBS Reporting Rules while minimizing burdens as much as practicable.12 Noting ongoing concerns among market participants about incurring unnecessary burdens and the Commissions efforts to promote harmonization between the SBS
Reporting Rules and swap reporting rules, the Commission took the position that, for four years following Regulation SBSRs Compliance Date 1 in each asset class,13 certain actions with respect to the SBS Reporting Rules would not provide a basis for a Commission enforcement action.14 The no-action statements relevance to DDRs application for registration as an SDR
and SIP is discussed further below.
B. Standard for Registration As noted above, to be registered with the Commission as an SDR and maintain such registration, an SDR is required to comply with the requirements and core principles described in Section 13n of the Exchange Act, as well as with any requirement that the Commission may impose by rule or regulation.15 In addition, Rule 13n1c3 under the Exchange Act provides that the Commission shall grant the registration of an SDR if it finds that the SDR is so organized, and has the capacity, to be able to: i Assure the prompt, accurate, and reliable performance of its functions as an SDR; ii comply with any applicable provisions of the securities laws and the rules and regulations thereunder; and iii carry out its functions in a manner consistent with the purposes of Section 13n of the Exchange Act and the rules and regulations thereunder.16 The Commission shall deny the registration 11 See
Form SDR, Instruction 2.
No. 3487780 Dec. 18, 2019, 85 FR
6270, 6347 Feb. 4, 2020 ANE Adopting Release.
13 See id. Under Regulation SBSR, the first compliance date Compliance Date 1 for affected persons with respect to an SBS asset class is the first Monday that is the later of: i Six months after the date on which the first SDR that can accept transaction reports in that asset class registers with the Commission; or ii one month after the compliance date for registration of SBS dealers and major SBS participants SBS entities. Id. at 6346.
The compliance date for registration of SBS entities is October 6, 2021. See id. at 6270, 6345.
14 See id. The specific rule provisions of the SBS
Reporting Rules affected by the no-action statement are discussed in Part II.B.
15 See 15 U.S.C. 78mn3.
16 17 CFR 240.13n1c3.
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of an SDR if it does not make any such finding.17 Similarly, to be registered with the Commission as a SIP, the Commission must find that such applicant is so organized, and has the capacity, to be able to assure the prompt, accurate, and reliable performance of its functions as a SIP, comply with the provisions of the Exchange Act and the rules and regulations thereunder, carry out its functions in a manner consistent with the purposes of the Exchange Act, and, insofar as it is acting as an exclusive processor, operate fairly and efficiently.18
In determining whether an applicant meets the criteria set forth in Rule 13n 1c, the Commission will consider the information reflected by the applicant on its Form SDR, as well as any additional information obtained from the applicant. For example, Form SDR
requires an applicant to provide a list of the asset classes for which the applicant is collecting and maintaining data or for which it proposes to collect and maintain data, a description of the functions that it performs or proposes to perform, general information regarding its business organization, and contact information.19 Obtaining this information and other information reflected on Form SDR and the exhibits theretoincluding the applicants overall business structure, financial condition, track record in providing access to its services and data, technological reliability, and policies and procedures to comply with its statutory and regulatory obligations will enable the Commission to determine whether to grant or deny an application for registration.20
Furthermore, the information requested in Form SDR will enable the Commission to assess whether the applicant is so organized and has the capacity to comply and carry out its functions in a manner consistent with the federal securities laws and the rules and regulations thereunder, including the SBS Reporting Rules.21
Consistent with the Commissions noaction statement in the ANE Adopting Release,22 an entity wishing to register with the Commission as an SDR must still submit an application on Form SDR
but can address the rule provisions included in the no-action statement by discussing how the SDR complies with 17 Id.
18 See 19 See
15 U.S.C. 78k1b3.
SDR Adopting Release, supra note 7, at
14459.
20 See id. at 14458.
21 See id. at 1445859.
22 See supra notes 1214 and accompanying text.

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comparable Commodity Futures Trading Commission CFTC requirements.23
Accordingly, in such instances the Commission will not assess an SDR
application for consistency or compliance with the rule provisions included in the Commissions no-action statement. Specifically, the Commission identified the following provisions as not providing a basis for an enforcement action against a registered SDR for the duration of the relief provided in the Commission statement: Under Regulation SBSR, aspects of 17 CFR
242.901a, 901c2 through 7, 901d, 901e, 902, 903b, 906a and b, and 907a1, a3, and a4 through 6;
under the SDR Rules, aspects of Section 13n5B of the Exchange Act and 17
CFR 240.13n4b3 thereunder, and aspects of 17 CFR 240.13n5b1iii;
and under Section 11Ab of the Exchange Act, any provision pertaining to SIPs.24 Thus, an SDR applicant will not need to include materials in its application explaining how it would comply with the provisions noted above, and could instead rely on its discussion about how it complies with comparable CFTC requirements.25 The applicant may instead represent in its application that it: i Is registered with the CFTC as a swap data repository; ii is in compliance with applicable requirements under the swap reporting rules; iii satisfies the standard for Commission registration of an SDR
under Rule 13n1c; and iv intends to rely on the no-action statement included in the ANE Adopting Release for the period set forth in the ANE Adopting Release with respect to any SBS asset class or classes for which it intends to accept transaction reports.26
III. Summary of DDRs Application on Form SDR
As noted above, DDR intends to operate as a registered SDR for the equity, credit, and interest rate derivatives asset classes.27 In its application, DDR represents that it is provisionally registered with the CFTC
as a swap data repository, is in compliance with applicable requirements under the CFTC reporting rules applicable to a registered swap data repository, and intends to rely on 23 See
supra note 14.
ANE Adopting Release provides additional discussion of the particular aspects of the affected rules that would not provide a basis for an enforcement action. See ANE Adopting Release, supra note 12, at 634748.
25 Id. at 6348.
26 Id. For example, an applicant need not describe in Exhibit S its functions as a SIP.
27 See Rulebook, Ex. HH, sec. 3.1; see also Disclosure Document, Ex. D6, sec. 1.
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