Voglio sapere a riguardo di…

45782

Federal Register / Vol. 86, No. 155 / Monday, August 16, 2021 / Notices
Commission will use the FOCUS
Reports filed by the SBS Entities to both monitor the financial and operational condition of individual SBS Entities and to perform comparisons across SBS
Entities. The FOCUS Report Part IIC
elicits less information than the FOCUS
Report Part II because the Commission does not have responsibility for overseeing the capital and margin requirements applicable to these entities.
The FOCUS Report Parts II and IIC are standardized forms that elicit specific information through numbered line items. This facilitates cross-firm analysis and comprehensive monitoring of all SBS Entities registered with the Commission. Further, the Commission has designated the Financial Industry Regulatory Authority, Inc. FINRA to receive the FOCUS Reports from SBS
Entities.98 Broker-dealers registered with the Commission currently file their FOCUS Reports with FINRA through the eFOCUS system it administers. Using FINRAs eFOCUS system will enable broker-dealers, security-based swap dealers, and major security-based swap
participants to file FOCUS Reports on the same platform using the same preexisting templates, software, and procedures.
Paragraph a2 of Exchange Act rule 18a7 requires SBS Entities with a prudential regulator to file the FOCUS
Report Part IIC on a quarterly basis. The proposed Order would provide substituted compliance for this requirement subject to the condition that the Covered Entity file with the Commission periodic unaudited financial and operational information in the manner and format specified by the Commission by order or rule Manner and Format Condition and present the financial information in accordance with generally accepted accounting principles GAAP that the firms use to prepare general purpose publicly available or available to be issued financial statements in Switzerland Swiss GAAP Condition.99 The Commission believes that it would be appropriate to condition substituted compliance with respect to Exchange Act rule 18a7 on the Covered Entity filing unaudited financial and
operational information in a manner and format that facilitates cross-firm analysis and comprehensive monitoring of all SBS Entities registered with the Commission.100 For example, the Commission could by order or rule require Covered Entities with a prudential regulator to file the financial and operational information with FINRA using the FOCUS Report Part IIC
but permit the information input into the form to be the same information the SBS Entity reports to FINMA.
The following table summarizes the Commissions proposed preliminary positive substituted compliance determinations with respect to requirements of Exchange Act rule 18a 7 by listing in each row: 1 The paragraph of the proposed Order that sets forth the determination; 2 the paragraph of Exchange Act rule 18a7 to which the determination applies; 3 a brief description of the report required by the paragraph; and 4 a brief description of any additional conditions to applying substituted compliance to the requirements.101

EXCHANGE ACT RULE 18A7
Reporting Order paragraph
Rule paragraph
Rule description
d3i

a2

File FOCUS Reports

1 Manner and Format Condition.
2 Swiss GAAP Condition.

Exchange Act rule 18a8 requires SBS
Entities to send notifications to the Commission if certain adverse events occur.102 The proposed Order would provide substituted compliance for the requirements of Exchange Act rule 18a 8 applicable to SBS Entities with a prudential regulator subject to conditions and limitations. In particular, the requirements of: 1
Paragraph c of Exchange Act Rule 18a 8 that an SBS Entity that is a securitybased swap dealer and that files a notice of adjustment to its reported capital category with a U.S. prudential regulator must transmit a copy of the notice to the Commission; 2 paragraph
d of the rule that an SBS Entity provide notification to the Commission if it fails to make and keep current books and records under Exchange Act rule 18a5 and to transmit a subsequent report on steps being taken to correct the situation; and 3 paragraph h of the rule setting forth how to make the notifications required by Exchange Act 18a8.
Under the proposed Order, substituted compliance in connection with the notification requirements of Exchange Act rule 18a8 would be subject to the condition that the Covered Entity: 1 Simultaneously sends a copy of any notice required to be sent by Swiss notification laws to the Commission in the manner specified on
the Commissions website i.e., the SEC
Filing Condition; and 2 includes with the transmission the contact information of an individual who can provide further information about the matter that is the subject of the notice i.e., the Contact Information Condition. The purpose of this condition is to alert the Commission to financial or operational problems that could adversely affect the firmthe objective of Exchange Act rule 18a8.
In addition, the Order does not provide substituted compliance for paragraph g of Exchange Act rule 18a 8 that an SBS Entity that is a securitybased swap dealer provide notification if it fails to make a required deposit into its special reserve account for the
98 See Order Designating Financial Industry Regulatory Authority, Inc., to Receive Form X17A
5 FOCUS Report from Certain Security-Based Swap Dealers and Major Security-Based Swap Participants, Exchange Release No. 88866 May 14, 2020.
99 Under the proposed Order, Covered Entities with a prudential regulator would need to present the information reported in the FOCUS Report in accordance with GAAP that the firm uses to prepare publicly available or available to be issued general purpose financial statements in its home
jurisdiction instead of U.S. GAAP if other GAAP, such as International Financial Reporting Standards IFRS as issued by the International Accounting Standards Board IASB, is used by the Covered Entity in preparing publicly available or available to be issued general purpose financial statements in Switzerland.
100 The Manner and Format condition is included in the French and UK Substituted Compliance Orders. See French Substituted Compliance Order, 86 FR at 41651; UK Substituted Compliance Order, 86 FR at 4336162.

101 The chart below does not include the proposed conditions for applying substituted compliance to Exchange Act rule 18a7; namely that the Covered Entity: 1 Must be subject to and comply with specified requirements of foreign law;
and 2 must promptly furnish to a representative of the Commission upon request an English translation of a report. See para. d7 of the proposed Order setting forth the English translation requirement.
102 See 17 CFR 240.18a8.

5. Exchange Act Rule 18a8

lotter on DSK11XQN23PROD with NOTICES1

Conditions
VerDate Sep<11>2014

17:21 Aug 13, 2021

Jkt 253001

PO 00000

Frm 00081

Fmt 4703

Sfmt 4703

E:FRFM16AUN1.SGM

16AUN1