13 February, 2023
Working Group Update 2/13/2023
13 February, 2023
- SEC Order Competition Rule Proposal. Members of the Data and Technology Committee, the Front Office Committee and the Compliance and Surveillance Working Group continued their discussion of the SEC’s Order Competition Rule proposal, including the exception for certain large orders, impact on best execution obligations, auction responses, surveillance of auction activity, attribution of the originating broker, the exception from the attribution requirement, failed auctions and submitting market orders as segmented orders.
- FIF Rule 605 Working Group. The Rule 605 Working Group continued its discussion of the SEC’s recent rule proposal on Disclosure of Order Execution Information, including size improvement statistics, reporting share-weighted average, median and 99% percentile time to execution, the summary report, and weighting execution quality stats by shares, notional amount, spread and symbol.
- SEC Reg NMS rule proposal. The Front Office Committee, the Data and Technology Committee and the Compliance and Surveillance Working Group continued their discussion of the recent SEC rule proposal on Minimum Pricing Increments, Access Fees and Transparency of Better Priced Orders, including potential duplication of NBBO and odd lot quotes, dissemination of the best odd lot order, applicable period for tick size determination, dissemination of mixed lot orders, the vendor display rule, the implementation period, and the potential impact on CAT reporting volume and costs.
- OFR Proposal on Reporting for Bilateral Repos. The OFR Repo Reporting Working Group and the TRACE/Fixed Income Working Group reviewed and discussed the first draft of an FIF comment letter on a recent proposal by the Treasury Department’s Office of Financial Research to require daily reporting for non-centrally cleared bilateral repos.
- FIF CAT Transaction Reporting Working Group. The Working Group discussed issues and questions from FIF members on routing to an internal employee at the NYSE floor booth and reporting for a too late to modify/too late to cancel scenario. The Working Group discussed recent FINRA CAT updates to the CAT release scope and schedule. The Working Group discussed FIF’s call with the SEC staff on February 3 on CAT reporting for verbal activity. The Working Group discussed the letter submitted by options market participants to the SEC on February 6 relating to CAT reporting of verbal activity for options.
- FIF CAT CAIS Working Group. The Working Group reviewed draft FIF member comments and questions for FINRA CAT on the following: FAQ Q71 (reporting for an FDID with multiple CAT Customers with the same identifier); daily resubmission of the same FDID with errors; daily resubmissions (FAQ Q16); and the periodic refresh process. The Working Group reviewed a list of open items on CAIS, including CAIS errors relating to closed accounts, the requirement to report the reason for an FDID or role change, the requirement for a clearing firm to have uniform identifiers across correspondent firms, reporting for mass transfers, and the recommendations submitted by FIF members on January 11 relating to Full CAIS implementation.
Eduard Kotlyar