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Federal Register / Vol. 86, No. 136 / Tuesday, July 20, 2021 / Notices Default Exchange Rate 62 and USD
Funds.63
Cross references to sections of Rule 30
for certain defined terms would be revised to reflect renumbering of the respective referenced sections, as more fully described below. The referenced section for the term A Canadian-Link Participants would be revised from Section 1h1 to Section 1e1, B
Canadian-Link Securities from Section 1h14 to Section 1e8, C
Canadian-Link Transactions from Section 1h11 to Section 1e5, CDS
Business Day from Section 11a to Section 7a, D CDS Participants from Section 1h2 to Section 1e2, E Cross-Border Securities from Section 1h12 to Section 1e6, F
Cross-Border Transactions from Section 1h9 to Section 1e3, G
DTC Business Day from Section 11a to Section 7a, I Intra-DTC
Securities from Section 1h13 to Section 1e7, and Intra-DTC
Transactions from Section 1h10 to Section 1e4.

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Section 1Overview of Canadian Link Service Section 1 of Rule 30 describes the scope of services offered by DTC
relating to the Canadian-Link Service.
Pursuant to the proposed rule change, Section 1 of Rule 30 would be revised to remove references to the processing of CAD Securities and CAD Funds transactions through the Canadian-Link service and provide only for processing of Free Deliveries through the link.
These changes include:
i Consolidate subsection a of Section 1 by eliminating references to DTC processing of 1 Cross-Border CAD
Securities Transactions, 2 CrossBorder USD Securities Transactions, 3
Intra-DTC CAD Securities Transactions, 4 Cross-Border CAD Funds Transactions and 5 Intra-DTC CAD
Funds Transactions, and instead refer to processing of Free Deliveries only.
ii Subsection b of Section 1 which currently states, among other things, that DTC provides the Canadian-Link 62 Pursuant to Rule 30, Section 16a, the term Payment Default Exchange Rate is defined as the exchange rate determined by a formula taking into account all factors incident to the default of such Participant in the payment of its Canadian-Link CAD Net Settlement Debit that shall be fixed by DTC and set forth in the Procedures. The exchange rate relates to any amount of USD Funds has to be exchanged for an amount of CAD Funds to pay or re-fund a DTC Omnibus Account CAD Net Settlement Debit to CDS in accordance with Section 13 of this Rule 30 because a Canadian-Link Participant failed to pay DTC the amount of its Canadian-Link CAD Net Settlement Debit. Id.
63 Pursuant to Rule 30, Section 1h4, the term USD Funds is defined as funds denominated in US dollars. Id.

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Service as a Securities Intermediary for its Participants, and all transactions in Securities and transfers of funds are subject to the Rules and Procedures of the Corporation, including this Rule 30
and the Procedures adopted pursuant to Rule 30, would be amended to delete the reference to and transfers of funds. This reference would be deleted as DTC would no longer offer the ability to process CAD Funds Transactions through the Canadian-Link Service. As indicated above, DTC notes that distributions such as principal, interest and dividend payments relating Securities held at CDS by DTC on behalf of Participants would continue to be processed through DTCs CAD Settling Bank to DTC Participants, pursuant to the applicable provisions of the OA.
Processing of such distributions are conducted through DTCs asset servicing functions and are not part of the DVP functionality that DTC
proposes to eliminate from its Rules and Procedures.
iii DTC would amend Subsection c of Section 1 to change references to seller and purchaser of Securities to Deliverer 64 and Receiver, 65
respectively, to harmonize the use of terms with DTCs rules related to settlement of Securities Deliveries and receives generally. DTC would also amend the text of this subsection to reflect the proposal that DVP
transactions would no longer be processed through the Canadian-Link Service. In this regard, references to settlement in CAD would be deleted, and the text would refer to the crediting and debiting of Securities from a Deliverer to a Receiver. Also, Subsection d directly below Subsection c, which refers to crossborder settlement of transactions in USD
would be deleted in its entirety to reflect the elimination of DVP
settlement through the service. Since Subsection c, as described above, would be written to address the Deliveries and Receives of Securities, generally, Securities transactions previously covered under Subsection d would be covered under the proposed revisions to Subsection c.
iv Subsection e of Section 1
describes the processing of CAD
Securities Transactions between DTC
Participants. DTC proposes to amend Subsection e of Section 1 to reflect the elimination of money settlement 64 Pursuant to Rule 1, the term Deliverer, as used with respect to a Delivery of a Security, means the Person which Delivers the Security. See Rule 1, supra note 5.
65 Pursuant to Rule 1, the term Receiver, as used with respect to a Delivery of a Security, means the Person which receives the Security. Id.

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relating to transactions conducted through the Canadian-Link Service. In this regard, a sentence that describes the debiting and crediting of Securities between Participants and references the term Intra-DTC CAD Securities Transaction would be revised to refer to intra-DTC Securities transaction instead, to reflect that movements of Securities between Participants would continue to be permitted through the Canadian-Link Service, even though the ability to settle a Securities transaction in CAD would be eliminated. In addition, DTC would change references to seller and purchaser of Securities to Deliverer and Receiver, respectively, to harmonize the use of terms with DTCs rules related to settlement of Securities deliveries and receives generally. DTC
would also revise Subsection e so that it would be renumbered as Subsection d to reflect the deletion of the current Subsection d, described above.
v DTC would delete Subsection f of Section 1 which states: A Cross-Border CAD Funds Transaction between a Participant of the Corporation and a participant of CDS is processed through the facilities of CDS. In addition, DTC
would delete Subsection g of Section 1 which states: An Intra-DTC CAD
Funds Transaction between a Participant of the Corporation and another Participant of Corporation is processed though Canadian settlement banks acting for the Corporation and such Participants. Both subsections would be obsolete because of the elimination of CAD processing through the Canadian-Link Service.
vi Subsection h of Section 1 would be amended to delete explanations of certain definitions described above, including CAD Funds, USD Funds, Funds, Cross-Border Securities Transactions, Canadian-Link Securities Transactions, Canadian-Link Funds Transactions, and Canadian-Link CAD
Money Settlement. Also the definitions of Intra-DTC Transactions, Cross-Border Securities, Cross-Border Transactions and Intra-DTC Securities would be amended to reflect the above-described elimination of money settlement in the Canadian-Link Service so that transactions are not referred to as involving DVP settlement or payment of funds. In this regard, references to the terms Cross-Border USD Securities Transactions and Cross-Border CAD
Securities Transactions as elements of the definition of Cross-Border Transactions would be replaced with an undefined term Cross-border securities transactions to reflect that movements of Securities between Canadian-Link Participants and CDS

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