23 December, 2024
Working Group Updates 12/23/2024
23 December, 2024
- TRACE / RTRS. The Working Group discussed a rule change by the Federal Reserve Board relating to the reporting by Covered Depository Institutions (CDIs) of Treasury trades to TRACE. The Working Group reviewed the updated list of CDIs posted by FINRA. The Working Group discussed the need to split the current combined settlement and reporting process for munis into separate processes. The Working Group discussed questions from FIF members relating to one-minute reporting and the requirement to report a manual trade indicator.
- Rule 606; FINRA Rule 6470. The Working Group discussed Rule 606(a) reporting for various multi-leg scenarios. The Working Group discussed firms reporting for Rule 606(a) based on adopt-by-reference. FIF provided an update on the current status of discussions with the SEC and FINRA on how to calculate the percentage of orders routed to different venues for Rule 606(a) reporting. FIF members provided an update on an FIF member call with FINRA representatives relating to the implementation of new FINRA Rule 6470.
- Short Position Reporting. FIF hosted two calls this week for the Short Sales / Reg SHO / Short Reporting Working Group. The Working Group discussed the current version of the SEC Technical Specification and EDGAR filing issues. The Working Group discussed how to identify Threshold A and Threshold B securities and calculating the net change in gross short position. The Working Group discussed the classification of ETFs as Threshold A or Threshold B securities. The Working Group discussed a draft FIF letter to the SEC supplementing the prior request for an extension of the implementation date for Form SHO reporting. FIF submitted this letter to the SEC.
- OFR Repo Reporting Working Group. The Working Group discussed reporting corrections and resubmitting files for prior observation dates. The Working Group discussed the scenario where a repo is entered into in the evening Eastern time. The Working Group discussed reporting for cancelled repos. The Working Group continued its discussion of a draft FIF letter to the OFR. FIF submitted this letter to the OFR.
- Front Office Committee. The Front Office Committee reviewed applicable updates and notices from the SEC, FINRA, FINRA CAT and the equity and option exchanges. FIF reviewed the SEC’s recent approval of 24X Exchange to operate as an exchange.
- CAT Transaction Reporting Working Group. The Working Group reviewed the SEC approval of the rule filing by the CAT Plan Participants to reduce CAT operating costs. The Working Group discussed the pass-through of CAT fees for on-exchange and off-exchange trades. The Working Group discussed FINRA invoices for CAT billing. The Working Group discussed the expected monthly fees for CAT reporting for 2025. The Working Group reviewed a draft request to FINRA CAT to add a flag for options that is equivalent to the YE flag. The Working Group reviewed a draft letter to FINRA relating to CAT reporting when there is an early-close and representative order linkage for options. FIF submitted this letter to FINRA.
Eduard Kotlyar