[Federal Register Volume 82, Number 53 (Tuesday, March 21, 2017)]
[Notices]
[Pages 14526-14547]
[FR Doc No: 2017-05505]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80256; File Nos. SR-BatsBYX-2017-02; SR-BatsBZX-2017-
08; SR-BatsEDGA-2017-03; SR-BatsEDGX-2017-08; SR-BOX-2017-07; SR-C2-
2017-007; SR-CBOE-2017-012; SR-CHX-2017-03; SR-ISE-2017-08; SR-IEX-
2017-04; SR-ISEGemini-2017-04; SR-ISEMercury-2017-03; SR-MIAX-2017-03;
SR-PEARL-2017-04; SR-NASDAQ-2017-008; SR-BX-2017-007; SR-PHLX-2017-07;
SR-NYSE-2017-01; SR-NYSEArca-2017-03; SR-NYSEArca-2017-04; SR-NYSEMKT-
2017-02; SR-NSX-2017-03]

Self-Regulatory Organizations; Bats BYX Exchange Inc.; Bats BZX
Exchange, Inc.; Bats EDGA Exchange, Inc.; Bats EDGX Exchange, Inc.; BOX
Options Exchange LLC; C2 Options Exchange, Incorporated; Chicago Board
Options Exchange, Incorporated; Chicago Stock Exchange, Inc.;
International Securities Exchange, LLC; Investors Exchange LLC; ISE
Gemini, LLC; ISE Mercury, LLC; Miami International Securities Exchange
LLC; MIAX PEARL, LLC; The NASDAQ Stock Market LLC; NASDAQ BX, Inc.;
NASDAQ PHLX, Inc.; New York Stock Exchange LLC; NYSE Arca, Inc.; NYSE
MKT LLC; NYSE National, Inc.; Order Approving Proposed Rule Changes To
Adopt Consolidated Audit Trail Compliance Rules

March 15, 2017.

I. Introduction

    On January 17, 2017,\1\ January 30, 2017,\2\ January 31, 2017,\3\
February 1, 2017,\4\ and February 2, 2017,\5\ Bats BYX Exchange, Inc.
(``Bats BYX''), Bats BZX Exchange, Inc. (``Bats BZX''), Bats EDGA
Exchange, Inc. (``Bats EDGA''), Bats EDGX Exchange, Inc. (``Bats
EDGX''), BOX Options Exchange LLC (``BOX''), C2 Options Exchange,
Incorporated (``C2''), Chicago Board Options Exchange, Incorporated
(``CBOE''), Chicago Stock Exchange, Inc. (``CHX''), International
Securities Exchange, LLC (``ISE''), ISE Gemini, LLC (``ISE Gemini''),
ISE Mercury, LLC (``ISE Mercury''), Investors Exchange LLC (``IEX''),
Miami International Securities Exchange LLC (``MIAX''), MIAX PEARL, LLC
(``MIAX PEARL''), NASDAQ BX, Inc. (``BX''), NASDAQ PHLX LLC (``Phlx''),
The NASDAQ Stock Market LLC (``NASDAQ''), the New York Stock Exchange
LLC (``NYSE''), NYSE Arca, Inc. (``NYSE Arca''), NYSE MKT LLC (``NYSE
MKT''), and NYSE National, Inc. (``NYSE National'') (f/k/a National
Stock Exchange, Inc.) \6\ (collectively, ``the Exchanges'') filed with
the Securities and Exchange Commission (``Commission''), pursuant to
Section 19(b)(1) of the Securities Exchange Act of 1934 (``Act'') \7\
and Rule 19b-4 thereunder,\8\ proposed rule changes to implement the
compliance rules regarding the National Market System Plan Governing
the Consolidated Audit Trail (the ``CAT NMS Plan'' or ``Plan'')(``CAT
Compliance Rules'' or ``Rules'').\9\ On January 30, 2017, NYSE, NYSE
Arca, and NYSE MKT each submitted amendments to their respective
proposed rule filings.\10\ Those proposed rule changes were published
for comment in the Federal Register on February 6, 2017.\11\ The
proposed rule changes submitted by Bats BYX, Bats BZX, Bats EDGX, BOX,
CBOE, CHX, IEX, MIAX, MIAX PEARL, NYSE National, NASDAQ, and NASDAQ
PHLX were published for comment in the Federal Register on February 8,
2017.\12\ The proposed rule

changes submitted by BX, C2, Bats EDGA, ISE, ISE Gemini, and ISE
Mercury were published for comment in the Federal Register on February
9, 2017.\13\ On March 7, 2017, BX, ISE, ISE Gemini, ISE Mercury, NASDAQ
and PHLX each filed an amendment to its respective proposed rule
change.\14\ The Commission received 3 comments in response to the
proposed rule changes.\15\ On March 15, the Participants \16\ submitted
a response to the comment letters.\17\ This order approves the proposed
rule changes.\18\
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    \1\ The New York Stock Exchange LLC, NYSE Arca, Inc., and NYSE
MKT LLC filed their proposed rule changes on January 17, 2017.
    \2\ Bats BYX Exchange, Inc., Bats BZX Exchange, Inc., Bats EDGA
Exchange, Inc., Bats EDGX Exchange, Inc., C2 Options Exchange,
Incorporated, Chicago Board Options Exchange, Incorporated,
International Securities Exchange, LLC, Miami International
Securities Exchange LLC, NASDAQ PHLX LLC and NYSE National Inc.
filed their proposed rule changes on January 30, 2017.
    \3\ BOX Options Exchange LLC and The NASDAQ Stock Market LLC
filed their proposed rule changes on January 31, 2017.
    \4\ Chicago Stock Exchange, Inc. and MIAX PEARL, LLC filed their
proposed rule changes on February 1, 2017.
    \5\ International Securities Exchange, LLC, ISE Gemini, LLC, ISE
Mercury, LLC and NASDAQ BX, Inc. filed their proposed rule changes
on February 2, 2017.
    \6\ NYSE National filed SR-NSX-2017-03 as the National Stock
Exchange, Inc.
    \7\ 15 U.S.C. 78s(b)(1).
    \8\ 17 CFR 240.19b-4.
    \9\ The proposed CAT Compliance Rules of C2 and MIAX PEARL
incorporate by reference the proposed CAT Compliance Rules of CBOE
and MIAX, respectively. C2 and MIAX PEARL have requested exemptions
from the rule filing requirements of Section 19(b) of the Exchange
Act for changes to their proposed CAT Compliance Rules that are
effected solely by virtue of changes to the proposed CBOE and MIAX
CAT Compliance Rules. See Letter from Laura G. Dickman, Lead
Counsel, CBOE, to Brent J. Fields, Secretary, Commission, dated
January 30, 2017; Letter from Deborah L. Carroll, Associate General
Counsel, MIAX PEARL, to Brent J. Fields, Secretary, Commission,
dated February 17, 2017.
    \10\ These amendments replaced the original proposed rule
changes in their entirety prior to publication of these proposed
rule changes for notice and comment.
    \11\ See Securities Exchange Act Release Nos. 79907 (January 31,
2017), 82 FR 9413 (``NYSE Notice''); 79911 (January 31, 2017), 82 FR
9435 (``NYSE MKT Notice''); 79909 (January 31, 2017) 82 FR 9464
(``NYSE Arca Notice 1''); 79908 (January 31, 2017), 82 FR 9450
(``NYSE Arca Notice 2'').
    \12\ See Securities Exchange Act Release Nos. 79944 (February 2,
2017), 82 FR 9846 (``Bats BYX Notice''); 79927 (February 2, 2017),
82 FR 9874 (February 8, 2017) (``Bats BZX Notice''); 79962 (February
3, 2017), 82 FR 10047 (``Bats EDGA Notice''); 79949 (February 2,
2017), 82 FR 9765 (``Bats EDGX Notice''); 79932 (February 2, 2017),
82 FR 9819 (``BOX Notice''); 79950 (February 2, 2017), 82 FR 9916
(``CBOE Notice''); 79948 (February 2, 2017), 82 FR 9904 (``CHX
Notice''); 79934 (February 2, 2107), 82 FR 9891 (``IEX Notice'');
79937 (February 2, 2017), 82 FR 9790 (``MIAX Notice''); 79938
(February 2, 2017), 82 FR 9929 (``MIAX PEARL Notice''); 79933
(February 2, 2017), 82 FR 9942 (``NYSE National''); 79935 (February
2, 2017), 82 FR 9831 (``NASDAQ Notice''); 79945 (February 2, 2017),
82 FR 9778 (``Phlx Notice'').
    \13\ See Securities Exchange Act Release Nos. 79960 (February 3,
2017), 82 FR 10159 (``BX Notice''); 79953 (February 3, 2017), 82 FR
9819 (``C2 Notice''); 79967 (February 3, 2017), 82 FR 10105 (``ISE
Notice''); 79965 (February 3, 2017), 82 FR 10147 (``ISE Gemini
Notice''); 79963 (February 3, 2017), 82 FR 10130 (``ISE Mercury
Notice'').
    \14\ These amendments modified Section 2 of the Form 19b-4s
submitted by BX, ISE, ISE Gemini, ISE Mercury, NASDAQ, and Phlx to
state that on February 24, 2017, the exchanges obtained the
necessary approval from their Board of Directors for the proposed
rule changes. These amendments do not affect the substance of the
filings and therefore are not subject to notice and comment.
    \15\ See letters from William H. Herbert, Managing Director,
Financial Information Forum, dated March 1, 2017 (``FIF Letter'');
Bonnie Wachtel, Wachtel & Co Inc., dated March 2, 2017 (``Wachtel
Letter''); and Manisha Kimmel, Chief Regulatory Officer, Wealth
Management, Thomson Reuters, dated March 2, 2017 (``Thomson Reuters
Letter''). These comment letters were submitted in response in to
SR-FINRA-2017-003, however the comments therein are applicable to
all the CAT Compliance Rules, and therefore are discussed in this
Order.
    \16\ See infra Section II.
    \17\ See Letter from Participants to Brent J. Fields, Secretary,
Commission, dated March 15, 2017 (``Participants' Response
Letter'').
    \18\ The Commission notes that for purposes of this Order,
unless otherwise specified, capitalized terms used in this Order are
defined as set forth in the Notices or in the CAT NMS Plan.
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II. Background

    On September 30, 2014, Bats BYX, Bats BZX, Bats EDGA, Bats EDGX,
BOX, C2, CBOE, CHX, Financial Industry Regulatory Authority, Inc.
(``FINRA''), ISE, IEX, ISE Gemini, ISE Mercury, MIAX, MIAX PEARL, BX,
PHLX, NASDAQ, NYSE, NYSE MKT, NYSE Arca, and NYSE National
(collectively, the ``Participants'') filed with the Commission,
pursuant to Section 11A of the Exchange Act \19\ and Rule 608 of
Regulation NMS thereunder,\20\ the CAT NMS Plan.\21\ The Participants
filed the Plan to comply with Rule 613 of Regulation NMS under the
Exchange Act.\22\ The Plan was published for comment in the Federal
Register on May 17, 2016,\23\ and approved by the Commission, as
modified, on November 15, 2016.\24\
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    \19\ 15 U.S.C. 78k-1.
    \20\ 17 CFR 242.608.
    \21\ See Letter from the Participants to Brent J. Fields,
Secretary, Commission, dated September 30, 2014; and Letter from
Participants to Brent J. Fields, Secretary, Commission, dated
February 27, 2015. On December 24, 2015, the Participants submitted
an amendment to the CAT NMS Plan. See Letter from Participants to
Brent J. Fields, Secretary, Commission, dated December 23, 2015. The
CAT NMS Plan was approved by the Commission, with limited changes
made by the Commission, on November 15, 2016. See infra note 24.
    \22\ 17 CFR 242.613.
    \23\ Securities Exchange Act Release No. 77724 (April 27, 2016),
81 FR 30614 (May 17, 2016).
    \24\ Securities Exchange Act Release No. 79318 (November 15,
2016), 81 FR 84696 (November 23, 2016) (``Approval Order'').
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    The Plan is designed to create, implement and maintain a
consolidated audit trail (``CAT'') that would capture customer and
order event information for orders in NMS Securities and OTC Equity
Securities, across all markets, from the time of order inception
through routing, cancellation, modification, or execution in a single
consolidated data source. Each Participant is required to enforce
compliance by its Industry Members, as applicable, with the provisions
of the Plan, by adopting a Compliance Rule applicable to their Industry
Members.\25\ The Exchanges' proposed rules set forth Compliance Rules
implementing provisions of the CAT NMS Plan that are applicable to
their members.\26\
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    \25\ See 17 CFR 242.613(g)(1).
    \26\ The Commission notes that the CAT NMS Plan defines an
``Industry Member'' as a member of a national securities exchange or
a member of a national securities association. CAT NMS Plan, supra
note 21, at Section 1.1. Because the Exchanges' proposed CAT
Compliance Rules implement the CAT NMS Plan, the term ``Industry
Member'' is used throughout these Rules, and the term ``Industry
Member'' means a member of the Exchange. The Commission notes that
the individual Exchanges use different terms in their rulebooks to
refer to an ``Industry Member.''
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III. Description of the Proposed Rule Changes

    The proposed CAT Compliance Rules include twelve rules covering the
following areas: (1) Definitions; (2) clock synchronization; (3)
Industry Member Data reporting; (4) Customer information reporting; (5)
Industry Member information reporting; (6) time stamps; (7) clock
synchronization rule violations; (8) connectivity and data
transmission; (9) development and testing; (10) recordkeeping; (11)
timely, accurate and complete data; and (12) compliance dates.

A. Definitions

    The proposed CAT Compliance Rules set forth the definitions for the
terms used in each Exchange's proposed CAT Compliance Rule.\27\ Each of
the defined terms in the proposed CAT Compliance Rules is discussed
below.
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    \27\ See proposed Bats BYX Rule 4.5; Bats BZX Rule 4.5; Bats
EDGA Rule 4.5; Bats EDGX Rule 4.5; BX Rule 900 and Chapter IX,
Section 8, paragraph (a); BOX Rule 16010; C2 Chapter 6, Section F;
CBOE Rule 6.85; CHX Article 23, Rule 1; IEX Rule 11.610; ISE Rule
900; ISE Gemini Rule 900; ISE Mercury Rule 900; MIAX Rule 1701; MIAX
PEARL Chapter XVII; Nasdaq Rules 6810 and Chapter IX, Section 8,
paragraph (a); NYSE Rule 6810; NYSE Arca Equities Rule 6.6810; NYSE
Arca Options Rule 11.6810; NYSE MKT Rule 6810; NYSE National Rule
14.1; Phlx Rule 910A.
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1. Account Effective Date
(a) Customer Information Approach
    Rule 613 of Regulation NMS requires that certain data elements be
reported to the CAT to enable regulators to identify Customers
associated with orders. The Exchanges note that Rule 613(c)(7)(i)(A)
requires an Industry Member to report the ``Customer-ID'' for each
Customer for the original receipt or origination of an order,\28\ and
that ``Customer-ID'' is defined in Rule 613(j)(5) to mean ``with
respect to a customer, a code that uniquely and consistently identifies
such customer for purposes of providing data to the Central
Repository.'' \29\ Rule 613(c)(8) requires Industry Members to use the
same Customer-ID for each Customer.\30\ The Exchanges note that the
Commission granted the Participants exemptive relief to permit the use
of an alternative approach to the requirement that an Industry Member
report a Customer-ID for every Customer upon original receipt or
origination.\31\ The alternative approach is called the ``Customer
Information Approach.''
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    \28\ 17 CFR 242.613(c)(7)(i)(A).
    \29\ 17 CFR 242.613(j)(5).
    \30\ 17 CFR 242.613(c)(8).
    \31\ See Securities Exchange Act Release No. 77265 (March 1,
2016), 81 FR 11856 (March 7, 2016) (``Exemption Order''). See also
Letter from Participants to Brent J. Fields, Secretary, Commission,
dated January 30, 2015 (``Exemptive Request Letter'').
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    The Exchanges state that under the Customer Information Approach,
the CAT NMS Plan requires each Industry Member to assign a unique Firm
Designated ID to each Customer, and that for the Firm Designated ID,
Industry Members are permitted to use an account number or any other
identifier defined by the firm, provided each identifier is unique
across the firm for each business date (i.e., a single firm may not
have multiple separate customers with the same identifier on

any given date).\32\ Prior to their commencement of reporting to the
CAT, Industry Members must submit an initial set of Customer
information to the Central Repository, including the Firm Designated
ID, Customer Identifying Information and Customer Account Information
(which may include, as applicable, the Customer's name, address, date
of birth, individual tax payer identifier number (``ITIN'')/social
security number (``SSN''), individual's role in the account (e.g.,
primary holder, joint holder, guardian, trustee, person with power of
attorney) and Legal Entity Identifier (``LEI'') and/or Large Trader ID
(``LTID'')). This process is referred to as the ``customer definition
process.''
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    \32\ See infra Section III.A.17 for a discussion of the
application of the term ``Firm Designated ID.''
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    The Exchanges note that in accordance with the Customer Information
Approach, Industry Members are required to report only the Firm
Designated ID for each new order submitted to the Central Repository,
rather than the ``Customer-ID'' with individual order events. Within
the Central Repository, each Customer will be uniquely identified by
identifiers or a combination of identifiers such as ITIN/SSN, date of
birth, and as applicable, LEI and LTID. The Plan Processor will be
required to use these unique identifiers to map orders to specific
Customers across all Industry Members and Participants. To ensure
information identifying a Customer is up to date, Industry Members will
be required to submit to the Central Repository daily and periodic
updates for reactivated accounts, newly established accounts, and
revised Firm Designated IDs or associated reportable Customer
information.
(b) Definition of Account Effective Date
    In connection with the Customer Information Approach, Industry
Members will be required to report ``Customer Account Information'' to
the Central Repository. ``Customer Account Information'' is defined in
Rule 613(j)(4) to ``include, but not be limited to, account number,
account type, customer type, date account opened, and large trader
identifier (if applicable).'' \33\ Therefore, when reporting Customer
Account Information, an Industry Member is required to report the date
an account was opened. The Exchanges note that the Participants
requested and received from the Commission an exemption to allow an
``Account Effective Date'' to be reported in lieu of an account open
date in certain limited circumstances.\34\ The definition of ``Account
Effective Date'' as set forth in the proposed CAT Compliance Rules
describes those limited circumstances in which an Industry Member may
report an ``Account Effective Date'' rather than the account open date.
The Exchanges state that the proposed definition is the same as the
definition of ``Account Effective Date'' set forth in Section 1.1 of
the CAT NMS Plan, provided, however, that specific dates have replaced
the descriptions of those dates set forth in Section 1.1 of the Plan.
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    \33\ 17 CFR 242.613(j)(4).
    \34\ On September 2, 2015, the Participants filed a supplement
to the Exemptive Request Letter. See Letter from the Participants to
Brent J. Fields, Secretary, Commission, dated September 2, 2015.
This supplement to the Exemptive Request Letter further addressed
the use of an ``effective date'' in lieu of a ``date account
opened.''
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    Specifically, the proposed CAT Compliance Rules define ``Account
Effective Date'' to mean, with regard to those circumstances in which
an Industry Member has established a trading relationship with an
institution but has not established an account with that institution:
(1) When the trading relationship was established prior to November 15,
2018 for Industry Members other than Small Industry Members, or prior
to November 15, 2019 for Small Industry Members, either (a) the date
the relationship identifier was established within the Industry Member;
(b) the date when trading began (i.e., the date the first order was
received) using the relevant relationship identifier; or (c) if both
dates are available, the earlier date will be used to the extent that
the dates differ; or (2) when the trading relationship was established
on or after November 15, 2018 for Industry Members other than Small
Industry Members, or on or after November 15, 2019 for Small Industry
Members, the date the Industry Member established the relationship
identifier, which would be no later than the date the first order was
received.\35\
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    \35\ See proposed Bats BYX Rule 4.5(a)(1); Bats BZX Rule
4.5(a)(1); Bats EDGA Rule 4.5(a)(1); Bats EDGX Rule 4.5(a)(1); BX
Rules 6810(a)(1) and Chapter IX, Section 8, paragraph (a)(i)(1); BOX
Rule 16010(a)(1); C2 Chapter 6, Section F ; CBOE Rule 6.85(a)(i);
CHX Article 23, Rule 1(a)(1); IEX Rule 11.610(a)(1); ISE Rule
900(a)(1); ISE Gemini Rule 900(a)(1); ISE Mercury 900(a)(1); MIAX
Rule 1701(a)(1); MIAX PEARL Chapter XVII; NASDAQ Rule 6810(a)(1) and
Chapter IX Section 8, paragraph (a)(i)(1); NYSE Rule 6810(a)(1);
NYSE Arca Equities Rule 6.6810(a)(1); NYSE Arca Options Rule
11.6810(a)(1); NYSE MKT Rule 6810(a)(1); NYSE National Rule
14.1(a)(1); Phlx Rule 910A(a)(1).
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    The proposed CAT Compliance Rules state that an ``Account Effective
Date'' means, where an Industry Member changes back office providers or
clearing firms prior to November 15, 2018 for Industry Members other
than Small Industry Members, or prior to November 15, 2019 for Small
Industry Members, the date an account was established at the relevant
Industry Member, either directly or via transfer.\36\
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    \36\ See proposed Bats BYX Rule 4.5(a)(2); Bats BZX Rule
4.5(a)(2); Bats EDGA Rule 4.5(a)(2); Bats EDGX Rule 4.5(a)(2); BX
Rules 6810(a)(2) and Chapter IX, Section 8, paragraph (a)(i)(2); BOX
Rule 16010(a)(2); C2 Chapter 6, Section F ; CBOE Rule 6.85(a)(ii);
CHX Article 23, Rule 1(a)(2); IEX Rule 11.610(a)(2); ISE Rule
900(a)(1); ISE Gemini Rule 900(a)(1); ISE Mercury 900(a)(1); MIAX
Rule 1701(a)(2); MIAX PEARL Chapter XVII; NASDAQ Rules 6810(a)(2)
and Chapter IX, Section 8, paragraph (a)(i)(2); NYSE Rule
6810(a)(2); NYSE Arca Equities Rule 6.6810(a)(2); NYSE Arca Options
Rule 11.6810(a)(2); NYSE MKT Rule 6810(a)(2); NYSE National Rule
14.1(a)(2); Phlx Rule 910(a)(2).
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    The proposed CAT Compliance Rules state that an ``Account Effective
Date'' means, where an Industry Member acquires another Industry Member
prior to November 15, 2018 for Industry Members other than Small
Industry Members, or prior to November 15, 2019 for Small Industry
Members, the date an account was established at the relevant Industry
Member, either directly or via transfer.\37\
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    \37\ See proposed Bats BYX Rule 4.5(a)(3); Bats BZX Rule
4.5(a)(3); Bats EDGA Rule 4.5(a)(3); Bats EDGX Rule 4.5(a)(3); BX
Rules 6810(a)(3) and Chapter IX, Section 8, paragraph (a)(i)(3); BOX
Rule 16010(a)(3); C2 Chapter 6, Section F; CBOE Rule 6.85(a)(iii);
CHX Article 23, Rule 1(a)(3); IEX Rule 11.610(a)(3); ISE Rule
900(a)(3); ISE Gemini Rule 900(a)(3); ISE Mercury 900(a)(3);MIAX
Rule 1701(a)(3); MIAX PEARL Chapter XVII; NASDAQ Rule 6810(a)(3) and
Chapter IX Section 8, paragraph (a)(i)(3); NYSE Rule 6810(a)(3);
NYSE Arca Equities Rule 6.6810(a)(3); NYSE Arca Options Rule
11.6810(a)(3); NYSE MKT Rule 6810(a)(3); NYSE National Rule
14.1(a)(3); Phlx Rule 910A(a)(3).
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    The proposed CAT Compliance Rules state that ``Account Effective
Date'' means, where there are multiple dates associated with an account
established prior to November 15, 2018 for Industry Members other than
Small Industry Members, or prior to November 15, 2019 for Small
Industry Members, the earliest available date.\38\
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    \38\ See proposed Bats BYX Rule 4.5(a)(4); Bats BZX Rule
4.5(a)(4); Bats EDGA Rule 4.5(a)(4); Bats EDGX Rule 4.5(a)(4); BX
Rules 6810(a)(4) and Chapter IX, Section 8, paragraph (a)(i)(4); BOX
Rule 16010(a)(4); C2 Chapter 6, Section F; CBOE Rule 6.85(a)(iv);
CHX Article 23, Rule 1(a)(4); IEX Rule 11.610(a)(4); ISE Rule
900(a)(4); ISE Gemini Rule 900(a)(4); ISE Mercury 900(a)(4); MIAX
Rule 1701(a)(4); MIAX PEARL Chapter XVII; NASDAQ Rule 6810(a)(4) and
Chapter IX Section 8, paragraph (a)(i)(4); NYSE Rule 6810(a)(4);
NYSE Arca Equities Rule 6.6810(a)(4); NYSE Arca Options Rule
11.6810(a)(4); NYSE MKT Rule 6810(a)(4); NYSE National Rule
14.1(a)(4); Phlx Rule 910A(a)(4).
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    The proposed CAT Compliance Rules state that an ``Account Effective
Date'' means, with regard to Industry Member proprietary accounts
established prior to November 15, 2018 for Industry Members other than
Small Industry Members, or prior to November 15, 2019 for Small
Industry Members: (1) The date established for the account in the
Industry Member or in a system of the

Industry Member or (2) the date when proprietary trading began in the
account (i.e., the date on which the first orders were submitted from
the account).\39\
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    \39\ See proposed Bats BYX Rule 4.5(a)(5); Bats BZX Rule
4.5(a)(5); Bats EDGA Rule 4.5(a)(5); Bats EDGX Rule 4.5(a)(5); BX
Rules 6810(a)(5) and Chapter IX, Section 8, paragraph (a)(i)(5); BOX
Rule 16010(a)(5); C2 Chapter 6, Section F; CBOE Rule 6.85(a)(v); CHX
Article 23, Rule 1(a)(5); IEX Rule 11.610(a)(5); ISE Rule 900(a)(5);
ISE Gemini Rule 900(a)(5); ISE Mercury 900(a)(5); MIAX Rule
1701(a)(5); MIAX PEARL Chapter XVII; NASDAQ Rule 6810(a)(5) and
Chapter IX Section 8, paragraph (a)(i)(5); NYSE Rule 6810(a)(5);
NYSE Arca Equities Rule 6.6810(a)(5); NYSE Arca Options Rule
11.6810(a)(5); NYSE MKT Rule 6810(a)(5); NYSE National Rule
14.1(a)(5); Phlx Rule 910A(a)(5).
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    In addition, with regard to the provisions defining ``Account
Effective Date'' as: (1) Where an Industry Member changes back office
providers or clearing firms prior to November 15, 2018 for Industry
Members other than Small Industry Members, or prior to November 15,
2019 for Small Industry Members, the date an account was established at
the relevant Industry Member, either directly or via transfer; \40\ (2)
where an Industry Member acquires another Industry Member prior to
November 15, 2018 for Industry Members other than Small Industry
Members, or prior to November 15, 2019 for Small Industry Members, the
date an account was established at the relevant Industry Member, either
directly or via transfer; \41\ (3) where there are multiple dates
associated with an account established prior to November 15, 2018 for
Industry Members other than Small Industry Members, or prior to
November 15, 2019 for Small Industry Members, the earliest available
date; \42\ and (4) with regard to Industry Member proprietary accounts
established prior to November 15, 2018 for Industry Members other than
Small Industry Members, or prior to November 15, 2019 for Small
Industry Members: (i) The date established for the account in the
Industry Member or in a system of the Industry Member or (ii) the date
when proprietary trading began in the account (i.e., the date on which
the first orders were submitted from the account); \43\ the proposed
CAT Compliance Rules state that the Account Effective Date will be no
later than the date trading occurs at the Industry Member or in the
Industry Member's system.\44\
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    \40\ See supra note 36.
    \41\ See supra note 37.
    \42\ See supra note 38.
    \43\ See supra note 39.
    \44\ Id.
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2. Active Accounts
    Under the Customer Information Approach, Industry Members are
required to report Customer Identifying Information and Customer
Account Information for only those accounts that are active.
Accordingly, the proposed CAT Compliance Rules define ``Active
Accounts'' as an account that has had activity in Eligible Securities
within the last six months.\45\ The Exchanges state that this is the
same definition as set forth in Section 1.1 of the CAT NMS Plan.
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    \45\ See proposed Bats BYX Rule 4.5(b); Bats BZX Rule 4.5(b);
Bats EDGA Rule 4.5(b); Bats EDGX Rule 4.5(b); BX Rules 6810(b) and
Chapter IX, Section 8, paragraph (a)(ii); BOX Rule 16010(b); C2
Chapter 6, Section F; CBOE Rule 6.85(b); CHX Article 23, Rule 1(b);
IEX Rule 11.610(b); ISE Rule 900(b), ISE Gemini Rule 900(b); ISE
Mercury 900(b); MIAX Rule 1701(b); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(b) and Chapter IX Section 8, paragraph (a)(ii); NYSE Rule
6810(b); NYSE Arca Equities Rule 6.6810(b); NYSE Arca Options Rule
11.6810(b); NYSE MKT Rule 6810(b); NYSE National Rule 14.1(b); and
Phlx Rule 910A(b).
---------------------------------------------------------------------------

3. Allocation Report
(a) Allocation Report Approach
    Rule 613(c)(7)(vi)(A) of Regulation NMS requires each Industry
Member to record and report to the Central Repository ``the account
number for any subaccounts to which the execution is allocated (in
whole or in part).'' \46\ The Exchanges note that the Participants
requested and received from the Commission exemptive relief from Rule
613 for an alternative to this approach (``Allocation Report
Approach'').\47\ The Allocation Report Approach permits Industry
Members to record and report to the Central Repository an Allocation
Report that includes, among other things, the Firm Designated ID for
any account(s) to which executed shares are allocated when an execution
is allocated in whole or part in lieu of requiring the reporting of the
account number for any subaccount to which an execution is allocated,
as is required by Rule 613.\48\ Under Rule 613, regulators would be
able to link the subaccount to which an allocation was made to a
specific order. In contrast, under the Allocation Report Approach,
regulators would only be able to link an allocation to the account to
which it was made, and not to a specific order.
---------------------------------------------------------------------------

    \46\ 17 CFR 242.613(c)(7)(vi)(A).
    \47\ On April 3, 2015, the Participants filed a supplement
related to their Exemptive Request Letter. See Letter from Robert
Colby, FINRA, on behalf of the Participants, to Brent J. Fields,
Secretary, Commission, dated April 3, 2015. This supplement provided
examples of how the proposed relief related to allocations would
operate.
    \48\ See Exemptive Request Letter, supra note 31, at 26-27;
Exemption Order, supra note 31.
---------------------------------------------------------------------------

(b) Definition of Allocation Report
    To assist in implementing the Allocation Report Approach, the
proposed CAT Compliance Rules define an ``Allocation Report.''
Specifically, an ``Allocation Report'' means a report made to the
Central Repository by an Industry Member that identifies the Firm
Designated ID for any account(s), including subaccount(s), to which
executed shares are allocated and provides the security that has been
allocated, the identifier of the firm reporting the allocation, the
price per share of shares allocated, the side of shares allocated, the
number of shares allocated to each account, and the time of the
allocation; provided, for the avoidance of doubt, any such Allocation
Report shall not be required to be linked to particular orders or
executions.\49\ The Exchanges state that this is the same definition as
set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \49\ See proposed Bats BYX Rule 4.5(c); Bats BZX Rule 4.5(c);
Bats EDGA Rule 4.5(c); Bats EDGX Rule 4.5(c); BX Rules 6810(c) and
Chapter IX, Section 8, paragraph (a)(iii); BOX Rule 16010(c); C2
Chapter 6, Section F; CBOE Rule 6.85(c); CHX Article 23, Rule 1(c);
IEX Rule 11.610(c); ISE Rule 900(c); ISE Gemini Rule 900(c); ISE
Mercury 900(c); MIAX Rule 1701(c); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(c) and Chapter IX Section 8, paragraph (a)(iii); NYSE
Rule 6810(c); NYSE Arca Equities Rule 6.6810(c); NYSE Arca Options
Rule 11.6810(c); NYSE MKT Rule 6810(c); NYSE National Rule 14.1(c);
Phlx Rule 910A(c).
---------------------------------------------------------------------------

4. Business Clock
    To create the required audit trail, Industry Members are required
to record the date and time of various Reportable Events to the Central
Repository. Industry Members will use ``Business Clocks'' to record
such dates and times. Accordingly, the proposed CAT Compliance Rules
define the term ``Business Clock'' as a clock used to record the date
and time of any Reportable Event required to be reported under each
Exchange's proposed CAT Compliance Rule.\50\ The Exchanges state that
this is the same definition as set forth in Section 1.1 of the CAT NMS
Plan, except a reference to Rule 613 at the end of the definition in
Section 1.1 of the Plan is replaced with a reference to each Exchange's
proposed CAT Compliance Rule. The Exchanges state that this change is
intended to recognize that the Industry Members' obligations with
regard to the CAT are set forth in

each Exchange's proposed CAT Compliance Rule.
---------------------------------------------------------------------------

    \50\ See proposed Bats BYX Rule 4.5(d); Bats BZX Rule 4.5(d);
Bats EDGA Rule 4.5(d); Bats EDGX Rule 4.5(d); BX Rules 6810(d) and
Chapter IX, Section 8, paragraph (a)(iv); BOX Rule 16010(d); C2
Chapter 6, Section F; CBOE Rule 6.85(d); CHX Article 23, Rule 1(d);
IEX Rule 11.610(d); ISE Rule 900(d); ISE Gemini Rule 900(d); ISE
Mercury 900(d); MIAX Rule 1701(d); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(d) and Chapter IX Section 8, paragraph (a)(iv); NYSE Rule
6810(d); NYSE Arca Equities Rule 6.6810(d); NYSE Arca Options Rule
11.6810(d); NYSE MKT Rule 6810(d); NYSE National Rule 14.1(d); and
Phlx Rule 910A(d).
---------------------------------------------------------------------------

5. CAT
    The proposed CAT Compliance Rules define the term ``CAT'' to mean
the consolidated audit trail contemplated by Rule 613.\51\ The
Exchanges state that this is the same definition as set forth in
Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \51\ See proposed Bats BYX Rule 4.5(e); Bats BZX Rule 4.5(e);
Bats EDGA Rule 4.5(e); Bats EDGX Rule 4.5(e); BX Rules 6810(e) and
Chapter IX, Section 8, paragraph (a)(v); BOX Rule 16010(e); C2
Chapter 6, Section F; CBOE Rule 6.85(e); CHX Article 23, Rule 1(e);
IEX Rule 11.610(e); ISE Rule 900(e); ISE Gemini Rule 900(e); ISE
Mercury 900(e); MIAX Rule 1701(e); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(e) and Chapter IX Section 8, paragraph (a)(iv); NYSE Rule
6810(e); NYSE Arca Equities Rule 6.6810(e); NYSE Arca Options Rule
11.6810(e); NYSE MKT Rule 6810(e); NYSE National Rule 14.1(e); and
Phlx Rule 910A(e).
---------------------------------------------------------------------------

6. CAT NMS Plan
    The proposed CAT Compliance Rules define the term ``CAT NMS Plan''
to mean the National Market System Plan Governing the Consolidated
Audit Trail, as amended from time to time.\52\
---------------------------------------------------------------------------

    \52\ See proposed Bats BYX Rule 4.5(f); Bats BZX Rule 4.5(f);
Bats EDGA Rule 4.5(f); Bats EDGX Rule 4.5(f); BX Rules 6810(f) and
Chapter IX, Section 8, paragraph (a)(vi); BOX Rule 16010(f); C2
Chapter 6, Section F; CBOE Rule 6.85(f); CHX Article 23, Rule 1(f);
IEX Rule 11.610(f); ISE Rule 900(f), ISE Gemini Rule 900(f); ISE
Mercury 900(f); MIAX Rule 1701(f); MIAX PEARL Chapter XVII; NYSE
Rule 6810(f); NYSE Arca Equities Rule 6.6810(f); NYSE Arca Options
Rule 11.6810(f); NYSE MKT Rule 6810(f); NYSE National Rule 14.1(f);
and Phlx Rule 910A(f).
---------------------------------------------------------------------------

7. CAT-Order-ID
(a) Daisy Chain Approach
    The Exchanges state that under the CAT NMS Plan, a ``daisy chain
approach'' would be used to link and reconstruct the complete lifecycle
of each Reportable Event in CAT. According to this approach, Industry
Members would assign their own identifiers to each order event. Within
the Central Repository, the Plan Processor would replace the identifier
provided by the Industry Member for each Reportable Event with a single
identifier, called the CAT Order-ID, for all order events pertaining to
the same order. This CAT Order-ID would be used to link the Reportable
Events related to the same order.
(b) Definition of CAT-Order-ID
    To implement a daisy chain approach, the Exchanges propose to
define in the proposed CAT Compliance Rules the term ``CAT-Order-ID''
to mean a unique order identifier or series of unique order identifiers
that allows the Central Repository to efficiently and accurately link
all Reportable Events for an order, and all orders that result from the
aggregation or disaggregation of such order.\53\ The Exchanges state
that this is the same definition as set forth in Rule 613(j)(1), and
Section 1.1 of the CAT NMS Plan defines ``CAT-Order-ID'' by reference
to Rule 613(j)(1).\54\
---------------------------------------------------------------------------

    \53\ See proposed Bats BYX Rule 4.5(g); Bats BZX Rule 4.5(g);
Bats EDGA Rule 4.5(g); Bats EDGX Rule 4.5(g); BX Rules 6810(g) and
Chapter IX, Section 8, paragraph (a)(vii); BOX Rule 16010(g); C2
Chapter 6, Section F; CBOE Rule 6.85(g); CHX Article 23, Rule 1(g);
IEX Rule 11.610(g); ISE Rule 900(g); ISE Gemini Rule 900(g); ISE
Mercury 900(g); MIAX Rule 1701(g); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(g) and Chapter IX Section 8, paragraph (a)(vii); NYSE
Rule 6810(g); NYSE Arca Equities Rule 6.6810(g); NYSE Arca Options
Rule 11.6810(g); NYSE MKT Rule 6810(g); NYSE National Rule 14.1(g);
and Phlx Rule 910A(g).
    \54\ See 17 CFR 242.613(j)(1).
---------------------------------------------------------------------------

8. CAT Reporting Agent
    The CAT NMS Plan permits an Industry Member to use a third party,
such as a vendor, to report the required data to the Central Repository
on behalf of the Industry Member.\55\ The Exchanges state that such a
third party, referred to in the proposed CAT Compliance Rules as a
``CAT Reporting Agent,'' would be one type of a Data Submitter,\56\ as
that term is used in the CAT NMS Plan. Therefore, the proposed CAT
Compliance Rules define the term ``CAT Reporting Agent'' \57\ to mean a
Data Submitter that is a third party that enters into an agreement with
an Industry Member pursuant to which the CAT Reporting Agent agrees to
fulfill such Industry Member's obligations under each Exchange's
proposed CAT Compliance Rule.\58\
---------------------------------------------------------------------------

    \55\ See CAT NMS Plan, supra note 21, at Appendix C, Section
A.1(a).
    \56\ See infra Section III.A.14 defining ``Data Submitter.''
    \57\ The Exchanges also note that this definition is based on
FINRA's definition of a ``Reporting Agent'' as set forth in FINRA's
Order Audit Trail System (``OATS'') rules. Specifically, FINRA Rule
7410(n) defines a ``Reporting Agent'' as a third party that enters
into any agreement with a member pursuant to which the Reporting
Agent agrees to fulfill such FINRA member's reporting obligations
under FINRA Rule 7450. The Exchanges represent that the Reporting
Agent for OATS fulfills a similar role to the CAT Reporting Agent.
    \58\ See proposed Bats BYX Rule 4.5(h); Bats BZX Rule 4.5(h);
Bats EDGA Rule 4.5(h); Bats EDGX Rule 4.5(h); BX Rules 6810(h) and
Chapter IX, Section 8, paragraph (a)(viii); BOX Rule 16010(h); C2
Chapter 6, Section F; CBOE Rule 6.85(h); CHX Article 23, Rule 1(h);
IEX Rule 11.610(h); ISE Rule 900(h); ISE Gemini Rule 900(h); ISE
Mercury 900(h); MIAX Rule 1701(h); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(h) and Chapter IX, Section 8, paragraph (a)(viii); NYSE
Rule 6810(h); NYSE Arca Equities Rule 6.6810(h); NYSE Arca Options
Rule 11.6810(h); NYSE MKT Rule 6810(h); NYSE National Rule 14.1(h);
and Phlx Rule 910A(h).
---------------------------------------------------------------------------

9. Central Repository
    The proposed CAT Compliance Rules define the term ``Central
Repository'' to mean the repository responsible for the receipt,
consolidation, and retention of all information reported to the CAT
pursuant to Rule 613 of Regulation NMS and the CAT NMS Plan.\59\ The
Exchanges state that this is the same definition as set forth in
Section 1.1 of the CAT NMS Plan, except they use the phrase ``CAT NMS
Plan'' in place of the phrase ``this Agreement.''
---------------------------------------------------------------------------

    \59\ See proposed Bats BYX Rule 4.5(i); Bats BZX Rule 4.5(i);
Bats EDGA Rule 4.5(i); Bats EDGX Rule 4.5(i); BX Rules 6810(i) and
Chapter IX, Section 8, paragraph (a)(ix); BOX Rule 16010(i); C2
Chapter 6, Section F; CBOE Rule 6.85(i); CHX Article 23, Rule 1(i);
IEX Rule 11.610(i); ISE Rule 900(i); ISE Gemini Rule 900(i); ISE
Mercury 900(i); MIAX Rule 1701(i); MIAX PEARL Chapter XVII; NYSE
Rule 6810(i); NYSE Arca Equities Rule 6.6810(i); NYSE Arca Options
Rule 11.6810(i); NYSE MKT Rule 6810(i); NYSE National Rule 14.1(i) ;
and Phlx Rule 910A(i).
---------------------------------------------------------------------------

10. Compliance Threshold
    The proposed CAT Compliance Rules state that each Industry Member
shall be required to meet a separate compliance threshold which will be
an Industry Member-specific rate that may be used as the basis for
further review or investigation into the Industry Member's performance
with regard to the CAT.\60\ The proposed CAT Compliance Rules define
the Industry Member-specific rate noted as the term ``Compliance
Threshold.'' \61\ The Exchanges state that this definition has the same
substantive meaning as the definition set forth in Section 1.1 of the
CAT NMS Plan.
---------------------------------------------------------------------------

    \60\ See proposed Bats BYX Rule 4.15(d); Bats BZX Rule 4.15(d);
Bats EDGA Rule 4.15(d); Bats EDGX Rule 4.15(d); BX Rules 6893(d) and
Chapter IX, Section 8, subparagraph (k)(iv); BOX Rule 16093(d); C2
Chapter 6, Section F; CBOE Rule 6.95(d); CHX Article 23, Rule 11(d);
IEX Rule 11.693(d); MIAX Rule 1711(d); MIAX PEARL Chapter XVII; ISE
Rule 910(d); ISE Gemini Rule 910(d); ISE Mercury Rule 910(d); NASDAQ
Rules 6893(d) and Chapter IX, Section 8, subparagraph (k)(iv); NYSE
Rule 6893(d); NYSE Arca Equities Rule 6.6893(d); NYSE Arca Options
Rule 11.6893(d); NYSE MKT Rule 6893(d); NYSE National Rule 14.11(d);
and Phlx Rule 993A(d).
    \61\ See proposed Bats BYX Rule 4.5(j); Bats BZX Rule 4.5(j);
Bats EDGA Rule 4.5(j); Bats EDGX Rule 4.5(j); BX Rules 6810(j) and
Chapter IX, Section 8, paragraph (a)(x); BOX Rule 16010(j); C2
Chapter 6, Section F; CBOE Rule 6.85(j); CHX Article 23, Rule 1(j);
IEX Rule 11.610(j); ISE Rule 900(j), ISE Gemini Rule 900(j); ISE
Mercury 900(j); MIAX Rule 1701(j); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(j) and Chapter IX, Section 8, paragraph (a)(x); NYSE Rule
6810(j); NYSE Arca Equities Rule 6.6810(j); NYSE Arca Options Rule
11.6810(j); NYSE MKT Rule 6810(j); NYSE National Rule 14.1(j); and
Phlx Rule 910A(j).
---------------------------------------------------------------------------

11. Customer
    Industry Members are required to submit to the Central Repository
certain information related to their Customers, including Customer
Identifying Information and Customer Account Information, as well as
data related to their Customer's Reportable Events. Accordingly, the
proposed CAT Compliance Rules define the term

``Customer.'' Specifically, the term ``Customer'' is defined to mean:
(1) The account holder(s) of the account at an Industry Member
originating the order; and (2) any person from whom the Industry Member
is authorized to accept trading instructions for such account, if
different from the account holder(s).\62\ The Exchanges state that this
is the same definition as set forth in Rule 613(j)(3), except the
Exchanges propose to replace the references to a registered broker-
dealer or broker-dealer with a reference to an Industry Member for
consistency of terms used in each Exchange's proposed CAT Compliance
Rule.\63\ The Exchanges also note that Section 1.1 of the CAT NMS Plan
defines ``Customer'' by reference to Rule 613(j)(3).
---------------------------------------------------------------------------

    \62\ See proposed Bats BYX Rule 4.5(k); Bats BZX Rule 4.5(k);
Bats EDGA Rule 4.5(k); Bats EDGX Rule 4.5(k); BX Rules 6810(k) and
Chapter IX, Section 8, paragraph (a)(xi); BOX Rule 16010(k); C2
Chapter 6, Section F; CBOE Rule 6.85(k); CHX Article 23, Rule 1(k);
IEX Rule 11.610(k); ISE Rule 900(k); ISE Gemini Rule 900(k); ISE
Mercury 900(k); MIAX Rule 1701(k); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(k) and Chapter IX, Section 8, paragraph (a)(xi); NYSE
Rule 6810(k); NYSE Arca Equities Rule 6.6810(k); NYSE Arca Options
Rule 11.6810(k); NYSE MKT Rule 6810(k); NYSE National Rule 14.1(k);
and Phlx Rule 910A(k).
    \63\ 17 CFR 242.613(j)(3).
---------------------------------------------------------------------------

12. Customer Account Information
    As discussed above, under the Customer Information Approach,
Industry Members are required to report Customer Account Information to
the Central Repository as part of the customer definition process.
Accordingly, the Exchanges propose to define the term ``Customer
Account Information'' to clarify what customer information would need
to be reported to the Central Repository.
    The proposed CAT Compliance Rules define the term ``Customer
Account Information'' to include, in part, account number, account
type, customer type, date account opened, and large trader identifier
(if applicable).\64\ The proposed CAT Compliance Rules, however,
provide an alternative definition of ``Customer Account Information''
in two limited circumstances. First, in those circumstances in which an
Industry Member has established a trading relationship with an
institution but has not established an account with that institution,
the Industry Member will: (1) Provide the Account Effective Date in
lieu of the ``date account opened''; (2) provide the relationship
identifier in lieu of the ``account number''; and (3) identify the
``account type'' as a ``relationship.'' \65\ Second, in those
circumstances in which the relevant account was established prior to
November 15, 2018 for Industry Members other than Small Industry
Members, or prior to November 15, 2019 for Small Industry Members, and
no ``date account opened'' is available for the account, the Industry
Member will provide the Account Effective Date in the following
circumstances: (1) Where an Industry Member changes back office
providers or clearing firms and the date account opened is changed to
the date the account was opened on the new back office/clearing firm
system; (2) where an Industry Member acquires another Industry Member
and the date account opened is changed to the date the account was
opened on the post-merger back office/clearing firm system; (3) where
there are multiple dates associated with an account in an Industry
Member's system, and the parameters of each date are determined by the
individual Industry Member; and (4) where the relevant account is an
Industry Member proprietary account.\66\ The proposed definition is the
same as the definition of ``Customer Account Information'' set forth in
Section 1.1 of the CAT NMS Plan; provided, however, that specific dates
have replaced the descriptions of those dates set forth in Section 1.1
of the Plan.
---------------------------------------------------------------------------

    \64\ See proposed Bats BYX Rule 4.5(l); Bats BZX Rule 4.5(l);
Bats EDGA Rule 4.5(l); Bats EDGX Rule 4.5(l); BX Rules 6810(l) and
Chapter IX, Section 8, paragraph (a)(xii); BOX Rule 16010(l); C2
Chapter 6, Section F; CBOE Rule 6.85(l); CHX Article 23, Rule 1(l);
ISE Rule 900(l); ISE Gemini Rule 900(l); ISE Mercury 900(l); IEX
Rule 11.610(l); MIAX Rule 1701(l); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(l) and Chapter IX, Section 8, paragraph (a)(xii); NYSE
Rule 6810(l); NYSE Arca Equities Rule 6.6810(l); NYSE Arca Options
Rule 11.6810(l); NYSE MKT Rule 6810(l); NYSE National Rule 14.1(l));
and Phlx Rule 910A(l).
    \65\ See proposed Bats BYX Rule 4.5(l)(1); Bats BZX Rule
4.5(l)(1); Bats EDGA Rule 4.5(l)(1); Bats EDGX Rule 4.5(l)(1); C2
Chapter 6, Section F; CBOE Rule 6.85(l)(i); BX Rules 6810(l)(1) and
Chapter IX, Section 8, paragraph (a)(xii)(1); BOX Rule 16010(l)(1);
CHX Article 23, Rule 1(l)(1); IEX Rule 11.610(l)(1); ISE Rule
900(l)(1); ISE Gemini Rule 900(l)(1); ISE Mercury 900(l)(1); MIAX
Rule 1701(l)(1); MIAX PEARL Chapter XVII; NASDAQ Rules 6810(l)(1)
and Chapter IX, Section 8, paragraph (a)(xii)(1); NYSE Rule
6810(l)(1); NYSE Arca Equities Rule 6.6810(l)(1); NYSE Arca Options
Rule 11.6810(l)(1); NYSE MKT Rule 6810(l)(1); NYSE National Rule
14.1(l)(1); and Phlx Rule 910A(l)(1).
    \66\ See proposed Bats BYX Rule 4.5(l)(2); Bats BZX Rule
4.5(l)(2); Bats EDGA Rule 4.5(l)(2); Bats EDGX Rule 4.5(l)(2); BX
Rules 6810(l)(2) and Chapter IX, Section 8, paragraph (a)(xii)(2);
BOX Rule 16010(l)(2); C2 Chapter 6, Section F; CBOE Rule
6.85(l)(ii); CHX Article 23, Rule 1(l)(2); IEX Rule 11.610(l)(2);
ISE Rule 900(l)(2); ISE Gemini Rule 900(l)(2); ISE Mercury
900(l)(2); MIAX Rule 1701(l)(2); MIAX PEARL Chapter XVII; Nasdaq
Rules 6810(l)(2) and Chapter IX, Section 8, paragraph (a)(xii)(2);
NYSE Rule 6810(l)(2); NYSE Arca Equities Rule 6.6810(l)(2); NYSE
Arca Options Rule 11.6810(l)(2); NYSE MKT Rule 6810(l)(2); NYSE
National Rule 14.1(l)(2); and Phlx Rule 910A(l)(2).
---------------------------------------------------------------------------

13. Customer Identifying Information
    As discussed above, under the Customer Information Approach,
Industry Members are required to report Customer Identifying
Information to the Central Repository as part of the customer
definition process. Accordingly, the Exchanges propose to define the
term ``Customer Account Information'' in the proposed CAT Compliance
Rules to include, but not be limited to: name, address, date of birth,
ITIN/SSN, individual's role in the account (e.g., primary holder, joint
holder, guardian, trustee, person with the power of attorney). With
respect to legal entities, ``Customer Identifying Information''
includes, but is not limited to, name, address, EIN/LEI or other
comparable common entity identifier, if applicable. The definition
further notes that an Industry Member that has an LEI for a Customer
must submit the Customer's LEI in addition to other information of
sufficient detail to identify the Customer.\67\ The Exchanges state
that this is the same definition as set forth in Section 1.1 of the CAT
NMS Plan.
---------------------------------------------------------------------------

    \67\ See proposed Bats BYX Rule 4.5(m); Bats BZX Rule 4.5(m);
Bats EDGA Rule 4.5(m); Bats EDGX Rule 4.5(m); BX Rules 6810(m) and
Chapter IX, Section 8, paragraph (a)(xiii); BOX Rule 16010(m); C2
Chapter 6, Section F; CBOE Rule 6.85(m); CHX Article 23, Rule 1(m);
IEX Rule 11.610(m); ISE Rule 900(m); ISE Gemini Rule 900(m); ISE
Mercury 900(m); MIAX Rule 1701(m); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(m) and Chapter IX, Section 8, paragraph (a)(xiii); NYSE
Rule 6810(m); NYSE Arca Equities Rule 6.6810(m); NYSE Arca Options
Rule 11.6810(m); NYSE MKT Rule 6810(m); NYSE National Rule 14.1(m);
and Phlx Rule 910A(m).
---------------------------------------------------------------------------

14. Data Submitter
    The CAT NMS Plan uses the term ``Data Submitter'' to refer to any
person that reports data to the Central Repository.\68\ Such Data
Submitters may include those entities that are required to submit data
to the Central Repository (e.g., national securities exchanges,
national securities associations and Industry Members), third-parties
that may submit data to the CAT on behalf of CAT Reporters (i.e., CAT
Reporting Agents), and outside parties that are not required to submit
data to the CAT but from which the CAT may receive data (e.g.,
securities information processors (``SIPs'')). To include this term in
the proposed CAT Compliance Rules, the Exchanges propose to define
``Data Submitter'' to mean any person that reports data to the Central
Repository, including national securities exchanges, national
securities associations, broker-dealers, the SIPs for the CQS, CTA, UTP

and Plan for Reporting of Consolidated Options Last Sale Reports and
Quotation Information (``OPRA'') Plans, and certain other vendors or
third parties that may submit data to the Central Repository on behalf
of Industry Members.\69\
---------------------------------------------------------------------------

    \68\ See CAT NMS Plan, supra note 21 at Appendix C, Section
A.1(a).
    \69\ See proposed Bats BYX Rule 4.5(n); Bats BZX Rule 4.5(n);
Bats EDGA Rule 4.5(n); Bats EDGX Rule 4.5(n); BX Rules 6810(n) and
Chapter IX, Section 8, paragraph (a)(xiv); BOX Rule 16010(n); C2
Chapter 6, Section F; CBOE Rule 6.85(n); CHX Article 23, Rule 1(n);
IEX Rule 11.610(n); ISE Rule 900(n); ISE Gemini Rule 900(n); ISE
Mercury 900(n); MIAX Rule 1701(n); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(n) and Chapter IX, Section 8, paragraph (a)(xiv); NYSE
Rule 6810(n); NYSE Arca Equities Rule 6.6810(n); NYSE Arca Options
Rule 11.6810(n); NYSE MKT Rule 6810(n); NYSE National Rule 14.1(n);
and Phlx Rule 910A(n).
---------------------------------------------------------------------------

15. Eligible Security
    The reporting requirements of the proposed CAT Compliance Rules
only apply to Reportable Events in Eligible Securities. Currently, an
Eligible Security includes NMS Securities and OTC Equity Securities.
Accordingly, the proposed CAT Compliance Rules define the term
``Eligible Security'' to include: (1) All NMS Securities; and (2) all
OTC Equity Securities.\70\ The Exchanges state that this is the same
definition as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \70\ See proposed Bats BYX Rule 4.5(o); Bats BZX Rule 4.5(o);
Bats EDGA Rule 4.5(o); Bats EDGX Rule 4.5(o); BX Rules 6810(o) and
Chapter IX, Section 8, paragraph (a)(xv); BOX Rule 16010(o); C2
Chapter 6, Section F; CBOE Rule 6.85(o); CHX Article 23, Rule 1(o);
IEX Rule 11.610(o); ISE Rule 900(o); ISE Gemini Rule 900(o); ISE
Mercury 900(o); MIAX Rule 1701(o); MIAX PEARL Chapter XVII; NYSE
Rule 6810(o); NYSE Arca Equities Rule 6.6810(o); NYSE Arca Options
Rule 11.6810(o); NYSE MKT Rule 6810(o); NYSE National Rule 14.1(o));
and Phlx Rule 910A(o).
---------------------------------------------------------------------------

16. Error Rate
(a) Generally
    The CAT NMS Plan requires the Plan Processor to: (1) Measure and
report errors every business day; (2) provide Industry Members daily
statistics and error reports as they become available, including a
description of such errors; (3) provide monthly reports to Industry
Members that detail an Industry Member's performance and comparison
statistics; (4) define educational and support programs for Industry
Members to minimize Error Rates; and (5) identify, daily, all Industry
Members exceeding the maximum allowable Error Rate. To timely correct
data-submitted errors to the Central Repository, the CAT NMS Plan
requires that the Central Repository receive and process error
corrections at all times. Further, the CAT NMS Plan requires that
Industry Members be able to submit error corrections to the Central
Repository through a web-interface or via bulk uploads or file
submissions, and that the Plan Processor, subject to the Operating
Committee's approval, support the bulk replacement of records and the
reprocessing of such records. The Participants, furthermore, require
that the Plan Processor identify Industry Member data submission errors
based on the Plan Processor's validation processes.\71\
---------------------------------------------------------------------------

    \71\ Approval Order, supra note 24, at 84718.
---------------------------------------------------------------------------

(b) Definition of Error Rate
    To implement the requirements of the CAT NMS Plan related to the
Error Rate, the Exchanges propose to define the term ``Error Rate'' in
the proposed CAT Compliance Rules. ``Error Rate'' is defined to mean
the percentage of Reportable Events collected by the Central Repository
in which the data reported does not fully and accurately reflect the
order event that occurred in the market.\72\ The Exchanges state that
this is the same definition as set forth in Rule 613(j)(6), and Section
1.1 of the CAT NMS Plan defines ``Error Rate'' by reference to Rule
613(j)(6).\73\
---------------------------------------------------------------------------

    \72\ See proposed Bats BYX Rule 4.5(p); Bats BZX Rule 4.5(p);
Bats EDGA Rule 4.5(p); Bats EDGX Rule 4.5(p); BX Rules 6810(p) and
Chapter IX, Section 8, paragraph (a)(xvii); BOX Rule 16010(p); C2
Chapter 6, Section F; CBOE Rule 6.85(p); CHX Article 23, Rule 1(p);
IEX Rule 11.610(p); ISE Rule 900(p); ISE Gemini Rule 900(p); ISE
Mercury 900(p); MIAX Rule 1701(p); MIAX PEARL Chapter XVII; Nasdaq
Rules 6810(p) and Chapter IX, Section 8, paragraph (a)(xvi); NYSE
Rule 6810(p); NYSE Arca Equities Rule 6.6810(p); NYSE Arca Options
Rule 11.6810(p); NYSE MKT Rule 6810(p); NYSE National Rule 14.1(p);
and Phlx Rule 910A(p).
    \73\ 17 CFR 242.613(j)(6).
---------------------------------------------------------------------------

(c) Maximum Error Rate
    Under the CAT NMS Plan, the Operating Committee would set the
maximum Error Rate that the Central Repository would tolerate from an
Industry Member reporting data to the Central Repository.\74\ The
Operating Committee would review and reset the maximum Error Rate, at
least annually.\75\ If an Industry Member reports CAT data to the
Central Repository with errors such that their error percentage exceeds
the maximum Error Rate, then such Industry Member would not be in
compliance with the CAT NMS Plan or Rule 613.\76\ The Exchanges state
that, according to the CAT NMS Plan, the Exchanges or the SEC may take
appropriate action against an Industry Member for failing to comply
with its CAT reporting obligations.\77\ The CAT NMS Plan sets the
initial Error Rate at 5%.\78\ The Exchanges state that it is
anticipated that the maximum Error Rate will be reviewed and lowered by
the Operating Committee once Industry Members begin to report to the
Central Repository.\79\
---------------------------------------------------------------------------

    \74\ CAT NMS Plan, supra note 21, at Section 6.5(d)(i).
    \75\ CAT NMS Plan, supra note 21, at Appendix C, Section A.3(b).
    \76\ CAT NMS Plan, supra note 21, at Appendix C, Section A.3(b);
17 CFR 242.613(g)-(h).
    \77\ CAT NMS Plan, supra note 21, at Appendix C, Section A.3(b).
    \78\ CAT NMS Plan, supra note 21, at Section 6.5(d)(i).
    \79\ CAT NMS Plan, supra note 21, at Appendix C, Section A.3(b).
---------------------------------------------------------------------------

17. Firm Designated ID
    As discussed above, under the Customer Information Approach, the
CAT NMS Plan requires each Industry Member to utilize a unique Firm
Designated ID. Industry Members will be permitted to use as the Firm
Designated ID an account number or any other identifier defined by the
firm, provided each identifier is unique across the firm for each
business date. Industry Members will be required to report only the
Firm Designated ID for each new order submitted to the Central
Repository, rather than the ``Customer-ID'' with individual order
events. Accordingly, the Exchanges propose to define the term ``Firm
Designated ID'' in the proposed CAT Compliance Rules to mean a unique
identifier for each trading account designated by Industry Members for
purposes of providing data to the Central Repository, where each such
identifier is unique among all identifiers from any given Industry
Member for each business date.\80\ The Exchanges state that this is the
same definition as set forth in Section 1.1 of the CAT NMS Plan.
Industry Members will be permitted to use an account number or any
other identifier defined by the firm, provided each identifier is
unique across the firm for each business date (i.e., a single firm may
not have multiple separate customers with the same identifier on any
given date).
---------------------------------------------------------------------------

    \80\ See proposed Bats BYX Rule 4.5(q); Bats BZX Rule 4.5(q);
Bats EDGA Rule 4.5(q); Bats EDGX Rule 4.5(q); BX Rules 6810(q) and
Chapter IX, Section 8, paragraph (a)(xvii); BOX Rule 16010(q); C2
Chapter 6, Section F; CBOE Rule 6.85(q); CHX Article 23, Rule 1(q);
IEX Rule 11.610(q); ISE Rule 900(q); ISE Gemini Rule 900(q); ISE
Mercury 900(q); MIAX Rule 1701(q); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(q) and Chapter IX, Section 8, paragraph (a)(xvii); NYSE
Rule 6810(q); NYSE Arca Equities Rule 6.6810(q); NYSE Arca Options
Rule 11.6810(q); NYSE MKT Rule 6810(q) (NYSE MKT proposed adding a
rule reference, in NYSE MKT Rule 0--Equities, to make clear due to
the organization of its rulebook that ``the proposed [CAT Compliance
Rules] would apply to Industry Members of the Exchange's equities
and options markets.''); NYSE National Rule 14.1(q); and Phlx Rule
910A(q).

---------------------------------------------------------------------------

18. Industry Member
    The proposed CAT Compliance Rules define the term ``Industry
Member'' to mean ``a member of a national securities exchange or a
member of a national securities association.'' \81\ The Exchanges state
that this is the same definition as set forth in Section 1.1 of the CAT
NMS Plan.
---------------------------------------------------------------------------

    \81\ See proposed Bats BYX Rule 4.5(r); Bats BZX Rule 4.5(r);
Bats EDGA Rule 4.5(r); Bats EDGX Rule 4.5(r); BX Rules 6810(r) and
Chapter IX, Section 8, paragraph (a)(xviii); BOX Rule 16010(r); C2
Chapter 6, Section F; CBOE Rule 6.85(r); CHX Article 23, Rule 1(r);
IEX Rule 11.610(r); ISE Rule 900(r); ISE Gemini Rule 900(r); ISE
Mercury 900(r); MIAX Rule 1701(r); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(r) and Chapter IX, Section 8, paragraph (a)(xviii); NYSE
Rule 6810(r); NYSE Arca Equities Rule 6.6810(r); NYSE Arca Options
Rule 11.6810(r); NYSE MKT Rule 6810(r); NYSE National Rule 14.1(r);
Phlx Rule 910A(r).
---------------------------------------------------------------------------

19. Industry Member Data
    The proposed CAT Compliance Rules state that the term ``Industry
Member Data'' has the meaning set forth in each Exchange's proposed CAT
Compliance Rule.\82\ The Exchanges state that this definition has the
same substantive meaning as the definition set forth in Section 1.1 of
the CAT NMS Plan.
---------------------------------------------------------------------------

    \82\ See proposed Bats BYX Rule 4.5(s); Bats BZX Rule 4.5(s);
Bats EDGA Rule 4.5(s); Bats EDGX Rule 4.5(s); BX Rules 6810(s) and
Chapter IX, Section 8, paragraph (a)(xix); BOX Rule 16010(s); C2
Chapter 6, Section F; CBOE Rule 6.85(s); CHX Article 23, Rule 1(s);
IEX Rule 11.610(s); ISE Rule 900(s); ISE Gemini Rule 900(s); ISE
Mercury 900(s); MIAX Rule 1701(s); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(s) and Chapter IX, Section 8, paragraph (a)(xix); NYSE
Rule 6810(s); NYSE Arca Equities Rule 6.6810(s); NYSE Arca Options
Rule 11.6810(s); NYSE MKT Rule 6810(s); NYSE National Rule 14.1(s);
and Phlx Rule 910A(s).
---------------------------------------------------------------------------

20. Initial Plan Processor
    The proposed CAT Compliance Rules define the term ``Initial Plan
Processor'' to mean the first Plan Processor selected by the Operating
Committee in accordance with Rule 613, Section 6.1 of the CAT NMS Plan
and the National Market System Plan Governing the Process for Selecting
a Plan Processor and Developing a Plan for the Consolidated Audit
Trail.\83\ The Exchanges state that this is the same definition as set
forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \83\ See proposed Bats BYX Rule 4.5(t); Bats BZX Rule 4.5(t);
Bats EDGA Rule 4.5(t); Bats EDGX Rule 4.5(t); BX Rules 6810(t) and
Chapter IX, Section 8, paragraph (a)(xx); BOX Rule 16010(t); C2
Chapter 6, Section F; CBOE Rule 6.85(t); CHX Article 23, Rule 1(t);
IEX Rule 11.610(t); ISE Rule 900(t); ISE Gemini Rule 900(t); ISE
Mercury 900(t); MIAX Rule 1701(t); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(t) and Chapter IX, Section 8, paragraph (a)(xx); NYSE
Rule 6810(t); NYSE Arca Equities Rule 6.6810(t); NYSE Arca Options
Rule 11.6810(t); NYSE MKT Rule 6810(t); NYSE National Rule 14.1(t);
and Phlx Rule 910A(t).
---------------------------------------------------------------------------

21. Listed Option or Option
    The Exchanges represent that the reporting requirements of the CAT
NMS Plan and the proposed CAT Compliance Rules apply to Eligible
Securities, which includes NMS Securities, which, in turn, includes
Listed Options. Certain requirements of the proposed CAT Compliance
Rules apply specifically to Listed Options. Accordingly, ``Listed
Option'' or ``Option'' have the meaning set forth in Rule 600(b)(35) of
Regulation NMS.\84\ Rule 600(b)(35) of Regulation NMS defines a listed
option as ``any option traded on a registered national securities
exchange or automated facility of a national securities association.''
\85\ The Exchanges state that the proposed definition of ``Listed
Option'' is the same definition as the definition set forth in Section
1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \84\ See proposed Bats BYX Rule 4.5(u); Bats BZX Rule 4.5(u);
Bats EDGA Rule 4.5(u); Bats EDGX Rule 4.5(u); BX Rules 6810(u) and
Chapter IX, Section 8, paragraph (a)(xxi); BOX Rule 16010(u); C2
Chapter 6, Section F; CBOE Rule 6.85(u); CHX Article 23, Rule 1(u);
IEX Rule 11.610(u); ISE Rule 900(u); ISE Gemini Rule 900(u); ISE
Mercury 900(u); MIAX Rule 1701(u); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(u) and Chapter IX, Section 8, paragraph (a)(xxi); NYSE
Rule 6810(u); NYSE Arca Equities Rule 6.6810(u); NYSE Arca Options
Rule 11.6810(u); NYSE MKT Rule 6810(u); NYSE National Rule 14.1(u);
and Phlx Rule 910A(u).
    \85\ 17 CFR 242.600(b)(35).
---------------------------------------------------------------------------

22. Manual Order Event
(a) Manual Order Event Approach
    The CAT NMS Plan sets forth clock synchronization and timestamp
requirements for Industry Members which reflect exemptions for Manual
Order Events granted by the Commission.\86\ Specifically, the Plan
requires Industry Members to record and report the time of each
Reportable Event using timestamps reflecting current industry standards
(which must be at least to the millisecond) or, if an Industry Member's
order handling or execution system uses timestamps in increments finer
than milliseconds, such finer increments, when reporting to the Central
Repository. For Manual Order Events, however, the Plan provides that
such events must be recorded in increments up to and including one
second, provided that Industry Members record and report the time the
event is captured electronically in an order handling and execution
system (``Electronic Capture Time'') in milliseconds. In addition,
Industry Members are required to synchronize their respective Business
Clocks (other than such Business Clocks used solely for Manual Order
Events) at a minimum to within 50 milliseconds of the time maintained
by the National Institute of Standards and Technology (``NIST''), and
maintain such synchronization. Each Industry Member is required to
synchronize its Business Clocks used solely for Manual Order Events,
however, at a minimum to within one second of the time maintained by
the NIST.
---------------------------------------------------------------------------

    \86\ See Exemption Order, supra note 31.
---------------------------------------------------------------------------

(b) Definition of Manual Order Event
    In order to clarify what a Manual Order Event is for clock
synchronization and time stamp purposes, the Exchanges propose to
define the term ``Manual Order Event'' in the proposed CAT Compliance
Rules.\87\ Specifically, the term ``Manual Order Event'' means a non-
electronic communication of order-related information for which
Industry Members must record and report the time of the event. The
Exchanges state that this is the same definition as set forth in
Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \87\ See proposed Bats BYX Rule 4.5(v); Bats BZX Rule 4.5(v);
Bats EDGA Rule 4.5(v); Bats EDGX Rule 4.5(v); BX Rules 6810(v) and
Chapter IX, Section 8, paragraph (a)(xxii); BOX Rule 16010(v); C2
Chapter 6, Section F; CBOE Rule 6.85(v); CHX Article 23, Rule 1(v);
IEX Rule 11.610(v); ISE Rule 900(v); ISE Gemini Rule 900(v); ISE
Mercury 900(v); MIAX Rule 1701(v); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(v) and Chapter IX, Section 8, paragraph (a)(xxii); NYSE
Rule 6810(v); NYSE Arca Equities Rule 6.6810(v); NYSE Arca Options
Rule 11.6810(v); NYSE MKT Rule 6810(v); NYSE National Rule 14.1(v);
and Phlx Rule 910A(v).
---------------------------------------------------------------------------

23. Material Terms of the Order
    The proposed CAT Compliance Rules require Industry Members to
record and report to the Central Repository Material Terms of the Order
with certain Reportable Events (e.g., for the original receipt or
origination of an order, for the routing of an order). Accordingly, the
Exchanges propose to define the term ``Material Terms of the Order'' to
include: The NMS Security or OTC Equity Security symbol; security type;
price (if applicable); size (displayed and non-displayed); side (buy/
sell); order type; if a sell order, whether the order is long, short,
short exempt; open/close indicator (except on transactions in
equities); time in force (if applicable); if the order is for a Listed
Option, option type (put/call), option symbol or root symbol,
underlying symbol, strike price, expiration date, and open/close
(except on market maker quotations); and any special handling
instructions.\88\ The

Exchanges state that this is the same definition as set forth in
Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \88\ See proposed Bats BYX Rule 4.5(w); Bats BZX Rule 4.5(w);
Bats EDGA Rule 4.5(w); Bats EDGX Rule 4.5(w); BX Rules 6810(w) and
Chapter IX, Section 8, paragraph (a)(xxiii); BOX Rule 16010(w); C2
Chapter 6, Section F; CBOE Rule 6.85(w); CHX Article 23, Rule 1(w);
IEX Rule 11.610(w); ISE Rule 900(w); ISE Gemini Rule 900(w); ISE
Mercury 900(w); MIAX Rule 1701(w); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(w) and Chapter IX, Section 8, paragraph (a)(xxiii); NYSE
Rule 6810(w); NYSE Arca Equities Rule 6.6810(w); NYSE Arca Options
Rule 11.6810(w); NYSE MKT Rule 6810(w); NYSE National Rule 14.1(w);
and Phlx Rule 910A(w).
---------------------------------------------------------------------------

24. NMS Security
    NMS Securities are one of the types of Eligible Securities for the
CAT. Therefore, the Exchanges propose to define the term ``NMS
Security'' to mean any security or class of securities for which
transaction reports are collected, processed, and made available
pursuant to an effective transaction reporting plan, or an effective
national market system plan for reporting transactions in Listed
Options.\89\ The Exchanges state that this is the same definition as
set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \89\ See proposed Bats BYX Rule 4.5(x); Bats BZX Rule 4.5(x);
Bats EDGA Rule 4.5(x); Bats EDGX Rule 4.5(x); BX Rules 6810(x) and
Chapter IX, Section 8, paragraph (a)(xxiv); BOX Rule 16010(x); C2
Chapter 6, Section F; CBOE Rule 6.85(x); CHX Article 23, Rule 1(x);
IEX Rule 11.610(x); ISE Rule 900(x); ISE Gemini Rule 900(x); ISE
Mercury 900(x); MIAX Rule 1701(x); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(x) and Chapter IX, Section 8, paragraph (a)(xxiv); NYSE
Rule 6810(x); NYSE Arca Equities Rule 6.6810(x); NYSE Arca Options
Rule 11.6810(x); NYSE MKT Rule 6810(x); NYSE National Rule 14.1(x);
and Phlx Rule 910A(x).
---------------------------------------------------------------------------

25. NMS Stock
    Under the CAT NMS Plan, the Operating Committee may establish
different Trading Days for NMS Stocks, as defined in Rule 600(b)(47) of
Regulation NMS,\90\ Listed Options, OTC Equity Securities, and any
other securities that are included as Eligible Securities from time to
time.\91\ Accordingly, the Exchanges propose to define the term ``NMS
Stock'' to mean any NMS Security other than an option.\92\ The
Exchanges state that this is the same definition as set forth in Rule
600(b)(47) of Regulation NMS.\93\
---------------------------------------------------------------------------

    \90\ 17 CFR 242.600(b)(47).
    \91\ See CAT NMS Plan, supra note 21, at Section 1.1 (defining
``Trading Day'').
    \92\ See proposed Bats BYX Rule 4.5(y); Bats BZX Rule 4.5(y);
Bats EDGA Rule 4.5(y); Bats EDGX Rule 4.5(y); BX Rules 6810(y) and
Chapter IX, Section 8, paragraph (a)(xxv); BOX Rule 16010(y); C2
Chapter 6, Section F; CBOE Rule 6.85(y); CHX Article 23, Rule 1(y);
IEX Rule 11.610(y); ISE Rule 900(y); ISE Gemini Rule 900(y); ISE
Mercury 900(y); MIAX Rule 1701(y); MIAX PEARL Chapter XVII; NASDAQ
Rules 6810(y) and Chapter IX, Section 8, paragraph (a)(xxv); NYSE
Rule 6810(y); NYSE Arca Equities Rule 6.6810(y); NYSE Arca Options
Rule 11.6810(y); NYSE MKT Rule 6810(y); NYSE National Rule 14.1(y);
and Phlx Rule 910A(y).
    \93\ 17 CFR 242.600(b)(47).
---------------------------------------------------------------------------

26. Operating Committee
    The proposed CAT Compliance Rules define the term ``Operating
Committee'' to mean the governing body of the CAT NMS, LLC designated
as such and described in Article IV of the CAT NMS Plan.\94\ The
Exchanges state that this is the same definition as set forth in
Section 1.1 of the CAT NMS Plan, except the Exchanges propose to use
the phrase ``CAT NMS LLC'' in place of the phrase ``the Company'' for
clarity.
---------------------------------------------------------------------------

    \94\ See proposed Bats BYX Rule 4.5(z); Bats BZX Rule 4.5(z);
Bats EDGA Rule 4.5(z); Bats EDGX Rule 4.5(z); BX Rules 6810(z) and
Chapter IX, Section 8, paragraph (a)(xxvi); BOX Rule 16010(z); C2
Chapter 6, Section F; CBOE Rule 6.85(z); CHX Article 23, Rule 1(z);
IEX Rule 11.610(z); ISE Rule 900(z); ISE Gemini Rule 900(z); ISE
Mercury 900(z); MIAX Rule 1701(z); MIAX PEARL Chapter XVII; NYSE
Rule 6810(z); NASDAQ Rules 6810(z) and Chapter IX, Section 8,
paragraph (a)(xxvi); NYSE Arca Equities Rule 6.6810(z); NYSE Arca
Options Rule 11.6810(z); NYSE MKT Rule 6810(z); NYSE National Rule
14.1(z); and Phlx Rule 910A(z).
---------------------------------------------------------------------------

27. Options Market Maker
(a) Options Market Maker Quote Exemption
    Rule 613(c)(7) provides that the CAT NMS Plan must require each
Industry Member to record and electronically report to the Central
Repository details for each order and each reportable event, including
the routing and modification or cancellation of an order.\95\ Rule
613(j)(8) defines ``order'' to include ``any bid or offer.'' \96\
Therefore, under Rule 613, the details for each Options Market Maker
quotation must be reported to the Central Repository by both the
Options Market Maker and the options exchange to which it routes its
quote.
---------------------------------------------------------------------------

    \95\ 17 CFR 242.613(c)(7).
    \96\ 17 CFR 242.613(j)(8).
---------------------------------------------------------------------------

    The Participants, however, requested and received exemptive relief
from Rule 613 of Regulation NMS so that the CAT NMS Plan may permit
Options Market Maker quotes to be reported to the Central Repository by
the relevant options exchange in lieu of requiring that such reporting
be done by both the options exchange and the Options Market Maker, as
is required by Rule 613.\97\ In accordance with the exemptive relief,
Options Market Makers will be required to report to the options
exchange the time at which a quote in a Listed Option is sent to the
options exchange. Such time information also will be reported to the
Central Repository by the options exchange in lieu of reporting by the
Options Market Maker.
---------------------------------------------------------------------------

    \97\ See Exemptive Request Letter, supra note 31, at 2;
Exemption Order, supra note 31.
---------------------------------------------------------------------------

(b) Definition of Options Market Maker
    To implement the requirements related to Option Market Maker
quotes, the Exchanges propose to define the term ``Options Market
Maker'' to mean a broker-dealer registered with an exchange for the
purpose of making markets in options contracts traded on the
exchange.\98\ The Exchanges state that this is the same definition as
set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \98\ See proposed Bats BYX Rule 4.5(aa); Bats BZX Rule 4.5(aa);
Bats EDGA Rule 4.5(aa); Bats EDGX Rule 4.5(aa); BX Rules 6810(aa)
and Chapter IX, Section 8, paragraph (a)(xxvii); BOX Rule 16010(aa);
C2 Chapter 6, Section F; CBOE Rule 6.85(aa); CHX Article 23, Rule
1(aa); IEX Rule 11.610(aa); ISE Rule 900(aa); ISE Gemini Rule
900(aa); ISE Mercury 900(aa); MIAX Rule 1701(aa); MIAX PEARL Chapter
XVII; BX Rules 6810(aa) and Chapter IX, Section 8, paragraph
(a)(xxvii); NYSE Rule 6810(aa); NYSE Arca Equities Rule 6.6810(aa);
NYSE Arca Options Rule 11.6810(aa); NYSE MKT Rule 6810(aa); NYSE
National Rule 14.1(aa); and Phlx Rule 910A(aa).
---------------------------------------------------------------------------

28. Order
    The proposed CAT Compliance Rules require each Industry Member to
record and electronically report to the Central Repository certain
details for each order. Accordingly, the Exchanges propose to define
the term ``Order'' with respect to Eligible Securities, to include: (1)
Any order received by an Industry Member from any person; (2) any order
originated by an Industry Member; or (3) any bid or offer.\99\ The
Exchanges state that this is the same definition as set forth in Rule
613(j)(8),\100\ except the Exchanges propose to replace the phrase
``member of a national securities exchange or national securities
association'' with the term ``Industry Member.'' The Exchanges also
note that Section 1.1 of the CAT NMS Plan defines ``Order'' by
reference to Rule 613(j)(8).
---------------------------------------------------------------------------

    \99\ See proposed Bats BYX Rule 4.5(bb); Bats BZX Rule 4.5(bb);
Bats EDGA Rule 4.5(bb); Bats EDGX Rule 4.5(bb); BX Rules 6810(bb)
and Chapter IX, Section 8, paragraph (a)(xxviii); BOX Rule
16010(bb); C2 Chapter 6, Section F; CBOE Rule 6.85(bb); CHX Article
23, Rule 1(bb); IEX Rule 11.610(bb); ISE Rule 900(bb); ISE Gemini
Rule 900(bb); ISE Mercury 900(bb); MIAX Rule 1701(bb); MIAX PEARL
Chapter XVII; NASDAQ Rules 6810(bb) and Chapter IX, Section 8,
paragraph (a)(xxviii); NYSE Rule 6810(bb); NYSE Arca Equities Rule
6.6810(bb); NYSE Arca Options Rule 11.6810(bb); NYSE MKT Rule
6810(bb); NYSE National Rule 14.1(bb); and Phlx Rule 910A(bb).
    \100\ See 17 CFR 242.613(j)(8).
---------------------------------------------------------------------------

29. OTC Equity Security
    OTC Equity Securities are one of the types of Eligible Securities
for the CAT. Therefore, the Exchanges propose to define the term ``OTC
Equity Security'' to mean any equity security, other than an NMS
Security, subject to prompt last sale reporting rules of a registered
national securities association and

reported to one of such association's equity trade reporting
facilities.\101\ The Exchanges state that this is the same definition
as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \101\ See proposed Bats BYX Rule 4.5(cc); Bats BZX Rule 4.5(cc);
Bats EDGA Rule 4.5(cc); Bats EDGX Rule 4.5(cc); BX Rules 6810(cc)
and Chapter IX, Section 8, paragraph (a)(xxix); BOX Rule 16010(cc);
C2 Chapter 6, Section F; CBOE Rule 6.85(cc); CHX Article 23, Rule
1(cc); IEX Rule 11.610(cc); ISE Rule 900(cc); ISE Gemini Rule
900(cc); ISE Mercury 900(cc); MIAX Rule 1701(cc); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(cc) and Chapter IX, Section 8, paragraph
(a)(xxix); NYSE Rule 6810(cc); NYSE Arca Equities Rule 6.6810(cc);
NYSE Arca Options Rule 11.6810(cc); NYSE MKT Rule 6810(cc); NYSE
National Rule 14.1(cc); and Phlx Rule 910A(cc).
---------------------------------------------------------------------------

30. Participant
    The proposed CAT Compliance Rules define the term ``Participant''
\102\ to mean each Person identified as such in Exhibit A of the CAT
NMS Plan, as amended, in such Person's capacity as a Participant in CAT
NMS, LLC.\103\ The Exchanges state that this is the same definition in
substance as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \102\ The Commission notes that the proposed CHX CAT Compliance
Rules use the term ``Plan Participant'' instead of ``Participant,''
but the definitions are the same. See proposed CHX Article 23, Rule
1(dd).
    \103\ See proposed Bats BYX Rule 4.5(dd); Bats BZX Rule 4.5(dd);
Bats EDGA Rule 4.5(dd); Bats EDGX Rule 4.5(dd); BX Rules 6810(dd)
and Chapter IX, Section 8, paragraph (a)(xxx); BOX Rule 16010(dd);
C2 Chapter 6, Section F; CBOE Rule 6.85(dd); CHX Article 23, Rule
1(dd); IEX Rule 11.610(dd); ISE Rule 900(dd); ISE Gemini Rule
900(dd); ISE Mercury 900(dd); MIAX Rule 1701(dd); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(dd) and Chapter IX, Section 8, paragraph
(a)(xxx); NYSE Rule 6810(dd); NYSE Arca Equities Rule 6.6810(dd);
NYSE Arca Options Rule 11.6810(dd); NYSE MKT Rule 6810(dd); NYSE
National Rule 14.1(dd); and Phlx Rule 910A(dd).
---------------------------------------------------------------------------

31. Person
    The proposed CAT Compliance Rules define the term ``Person'' to
mean any individual, partnership, limited liability company,
corporation, joint venture, trust, business trust, cooperative or
association and any heirs, executors, administrators, legal
representatives, successors and assigns of such Person where the
context so permits.\104\ The Exchanges state that this is the same
definition as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \104\ See proposed Bats BYX Rule 4.5(ee); Bats BZX Rule 4.5(ee);
Bats EDGA Rule 4.5(ee); Bats EDGX Rule 4.5(ee); BX Rules 6810(ee)
and Chapter IX, Section 8, paragraph (a)(xxxi); BOX Rule 16010(ee);
C2 Chapter 6, Section F; CBOE Rule 6.85(ee); CHX Article 23, Rule
1(ee); IEX Rule 11.610(ee); ISE Rule 900(ee); ISE Gemini Rule
900(ee); ISE Mercury 900(ee); MIAX Rule 1701(ee); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(ee) and Chapter IX, Section 8, paragraph
(a)(xxxi); NYSE Rule 6810(ee); NYSE Arca Equities Rule 6.6810(ee);
NYSE Arca Options Rule 11.6810(ee); NYSE MKT Rule 6810(ee); NYSE
National Rule 14.1(ee); and Phlx Rule 910A(ee).
---------------------------------------------------------------------------

32. Plan Processor
    The proposed CAT Compliance Rules define the term ``Plan
Processor'' to mean the Initial Plan Processor or any other Person
selected by the Operating Committee pursuant to Rule 613 and Sections
4.3(b)(i) and 6.1 of the CAT NMS Plan, and with regard to the Initial
Plan Processor, the National Market System Plan Governing the Process
for Selecting a Plan Processor and Developing a Plan for the
Consolidated Audit Trail, to perform the CAT processing functions
required by Rule 613 of Regulation NMS and set forth in the CAT NMS
Plan.\105\
---------------------------------------------------------------------------

    \105\ See proposed Bats BYX Rule 4.5(ff); Bats BZX Rule 4.5(ff);
Bats EDGA Rule 4.5(ff); Bats EDGX Rule 4.5(ff); BX Rules 6810(ff)
and Chapter IX, Section 8, paragraph (a)(xxxii); BOX Rule 16010(ff);
C2 Chapter 6, Section F; CBOE Rule 6.85(ff); CHX Article 23, Rule
1(ff); IEX Rule 11.610(ff); ISE Rule 900(ff); ISE Gemini Rule
900(ff); ISE Mercury 900(ff); MIAX Rule 1701(ff); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(ee) and Chapter IX, Section 8, paragraph
(a)(xxxi); NYSE Rule 6810(ff); NYSE Arca Equities Rule 6.6810(ff);
NYSE Arca Options Rule 11.6810(ff); NYSE MKT Rule 6810(ff); NYSE
National Rule 14.1(ff); and Phlx Rule 910A(ff).
---------------------------------------------------------------------------

33. Received Industry Member Data
    The proposed CAT Compliance Rules state that the term ``Received
Industry Member Data'' has the meaning set forth in each Industry
Member's proposed CAT Compliance Rule.\106\ The Exchanges represent
that this definition has the same substantive meaning as the definition
set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \106\ See proposed Bats BYX Rule 4.5(gg); Bats BZX Rule 4.5(gg);
Bats EDGA Rule 4.5(gg); Bats EDGX Rule 4.5(gg); BX Rules 6810(gg)
and Chapter IX, Section 8, paragraph (a)(xxxiii); BOX Rule
16010(gg); C2 Chapter 6, Section F; CBOE Rule 6.85(gg); CHX Article
23, Rule 1(gg); IEX Rule 11.610(gg); ISE Rule 900(gg); ISE Gemini
Rule 900(gg); ISE Mercury 900(gg); MIAX Rule 1701(gg); MIAX PEARL
Chapter XVII; NASDAQ Rules 6810(gg) and Chapter IX, Section 8,
paragraph (a)(xxxiii); NYSE Rule 6810(gg); NYSE Arca Equities Rule
6.6810(gg); NYSE Arca Options Rule 11.6810(gg); NYSE MKT Rule
6810(gg); NYSE National Rule 14.1(gg); and Phlx Rule 910A(gg).
---------------------------------------------------------------------------

34. Recorded Industry Member Data
    The proposed CAT Compliance Rules state that the term ``Recorded
Industry Member Data'' has the meaning set forth in each Industry
Member's proposed CAT Compliance Rule.\107\ The Exchanges state that
this definition has the same substantive meaning as the definition set
forth in in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \107\ See proposed Bats BYX Rule 4.5(hh); Bats BZX Rule 4.5(hh);
Bats EDGA Rule 4.5(hh); Bats EDGX Rule 4.5(hh); BX Rules 6810(hh)
and Chapter IX, Section 8, paragraph (a)(xxxiv); BOX Rule 16010(hh);
C2 Chapter 6, Section F; CBOE Rule 6.85(hh); CHX Article 23, Rule
1(hh); IEX Rule 11.610(hh); ISE Rule 900(hh); ISE Gemini Rule
900(hh); ISE Mercury 900(hh); MIAX Rule 1701(hh); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(hh) and Chapter IX, Section 8, paragraph
(a)(xxxiii); NYSE Rule 6810(hh); NYSE Arca Equities Rule 6.6810(hh);
NYSE Arca Options Rule 11.6810(hh); NYSE MKT Rule 6810(hh); NYSE
National Rule 14.1(hh); and Phlx Rule 910A(hh).
---------------------------------------------------------------------------

35. Reportable Event
    The proposed CAT Compliance Rules require each Industry Member to
record and electronically report to the Central Repository certain
details for each Reportable Event. The Exchanges propose to define the
term ``Reportable Event'' to include, but not be limited to, the
original receipt or origination, modification, cancellation, routing,
execution (in whole or in part) and allocation of an order, and receipt
of a routed order.\108\ The Exchanges state that this is the same
definition as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \108\ See proposed Bats BYX Rule 4.5(ii); Bats BZX Rule 4.5(ii);
Bats EDGA Rule 4.5(ii); Bats EDGX Rule 4.5(ii); BX Rules 6810(ii)
and Chapter IX, Section 8, paragraph (a)(xxxv); BOX Rule 16010(ii);
C2 Chapter 6, Section F; CBOE Rule 6.85(ii); CHX Article 23, Rule
1(ii); IEX Rule 11.610(ii); ISE Rule 900(ii); ISE Gemini Rule
900(ii); ISE Mercury 900(ii); MIAX Rule 1701(ii); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(ii) and Chapter IX, Section 8, paragraph
(a)(xxxv); NYSE Rule 6810(ii); NYSE Arca Equities Rule 6.6810(ii);
NYSE Arca Options Rule 11.6810(ii); NYSE MKT Rule 6810(ii); NYSE
National Rule 14.1(ii); and Phlx Rule 910A(ii).
---------------------------------------------------------------------------

36. SRO
    The Exchanges propose to define the term ``SRO'' to mean any self-
regulatory organization within the meaning of Section 3(a)(26) of the
Exchange Act.\109\ The Exchanges state that this is the same definition
as set forth in Section 1.1 of the CAT NMS Plan.
---------------------------------------------------------------------------

    \109\ See 15 U.S.C. 78c(a)(26); proposed Bats BYX Rule 4.5(jj);
Bats BZX Rule 4.5(jj); Bats EDGA Rule 4.5(jj); Bats EDGX Rule
4.5(jj); BX Rules 6810(jj) and Chapter IX, Section 8, paragraph
(a)(xxxvi); BOX Rule 16010(jj); C2 Chapter 6, Section F; CBOE Rule
6.85(jj); CHX Article 23, Rule 1(jj); IEX Rule 11.610(jj);); ISE
Rule 900(jj); ISE Gemini Rule 900(jj); ISE Mercury 900(jj); MIAX
Rule 1701(jj); MIAX PEARL Chapter XVII; NASDAQ Rules 6810(jj) and
Chapter IX, Section 8, paragraph (a)(xxxvi); NYSE Rule 6810(jj);
NYSE Arca Equities Rule 6.6810(jj); NYSE Arca Options Rule
11.6810(jj); NYSE MKT Rule 6810(jj); NYSE National Rule 14.1(jj);
and Phlx Rule 910A(jj).
---------------------------------------------------------------------------

37. SRO-Assigned Market Participant Identifier
(a) Existing Identifier Approach
    The Participants requested and received exemptive relief from Rule
613 of Regulation NMS so that the CAT NMS Plan may permit the
``Existing Identifier Approach,'' which would allow an Industry Member
to report an existing SRO-Assigned Market Participant Identifier in
lieu of requiring

the reporting of a universal CAT-Reporter-ID (that is, a code that
uniquely and consistently identifies an Industry Member for purposes of
providing data to the Central Repository).\110\ The CAT NMS Plan
reflects the Existing Identifier Approach for purposes of identifying
each Industry Member associated with an order or Reportable Event.
Under the Existing Identifier Approach, Industry Members are required
to record and report to the Central Repository an SRO-Assigned Market
Participant Identifier for orders and certain Reportable Events to be
used by the Central Repository to assign a unique CAT-Reporter-ID to
identify Industry Members.
---------------------------------------------------------------------------

    \110\ See Exemptive Request Letter, supra note 31, at 19;
Exemption Order, supra note 31 at 40-41.
---------------------------------------------------------------------------

    For the Central Repository to link the SRO-Assigned Market
Participant Identifier to the CAT-Reporter-ID, each SRO will submit to
the Central Repository, on a daily basis, all SRO-Assigned Market
Participant Identifiers used by its Industry Members, as well as
information to identify each such Industry Member, including CRD number
and LEI, if the SRO has collected such LEI of the Industry Member.
Additionally, each Industry Member is required to submit to the Central
Repository the CRD number of the Industry Member as well as the LEI of
the Industry Member (if the Industry Member has an LEI). The Plan
Processor will use this information to assign a CAT-Reporter-ID to each
Industry Member for internal use within the Central Repository.
(b) Definition of SRO-Assigned Market Participant Identifier
    To implement the Existing Identifier Approach, the Exchanges
propose to define the term ``SRO-Assigned Market Participant
Identifier'' to mean an identifier assigned to an Industry Member by an
SRO or an identifier used by a Participant.\111\ The Exchanges state
that this is the same definition as set forth in Section 1.1 of the CAT
NMS Plan.
---------------------------------------------------------------------------

    \111\ For example, an Industry Member would be permitted to use
any existing SRO-Assigned Market Participant Identifier (e.g., FINRA
MPID, NASDAQ MPID, NYSE Mnemonic, CBOE User Acronym and CHX Acronym)
when reporting order information to the Central Repository. See 15
U.S.C. 78c(a)(26); proposed Bats BYX Rule 4.5(kk); Bats BZX Rule
4.5(kk); Bats EDGA Rule 4.5(kk); Bats EDGX Rule 4.5(kk); BX Rules
6810(kk) and Chapter IX, Section 8, paragraph (a)(xxxvii); BOX Rule
16010(kk); C2 Chapter 6, Section F; CBOE Rule 6.85(kk); CHX Article
23, Rule 1(kk); IEX Rule 11.610(kk); ISE Rule 900(kk); ISE Gemini
Rule 900(kk); ISE Mercury 900(kk); MIAX Rule 1701(kk); MIAX PEARL
Chapter XVII; NASDAQ Rules 6810(kk) and Chapter IX, Section 8,
paragraph (a)(xxxvii); NYSE Rule 6810(kk); NYSE Arca Equities Rule
6.6810(kk); NYSE Arca Options Rule 11.6810(kk); NYSE MKT Rule
6810(kk); NYSE National Rule 14.1(kk); and Phlx Rule 910A(kk).
---------------------------------------------------------------------------

38. Small Industry Member
    The Exchanges represent that the requirements of the proposed CAT
Compliance Rules differ to some extent for Small Industry Members
versus Industry Members other than Small Industry Members. For example,
the compliance dates for reporting data to the CAT are different for
Small Industry Members versus other Industry Members. Accordingly, to
clarify the requirements that apply to which Industry Members, the
Exchanges propose to define the term ``Small Industry Member'' to mean
an Industry Member that qualifies as a small broker-dealer as defined
in Exchange Act Rule 0-10(c).\112\ The Exchanges state that this is the
same in substance as the definition of ``Small Industry Member'' as set
forth in Section 1.1 of the CAT NMS Plan. Specifically, Section 1.1 of
the CAT NMS Plan defines a ``Small Industry Member'' as ``an Industry
Member that qualifies as a small broker-dealer as defined in Rule
613.'' The definition of a small broker-dealer under Rule 613, in turn,
is a small broker-dealer as defined in Exchange Act Rule 0-10(c).
---------------------------------------------------------------------------

    \112\ 17 CFR 240.0-10(c); proposed Bats BYX Rule 4.5(ll); Bats
BZX Rule 4.5(ll); Bats EDGA Rule 4.5(ll); Bats EDGX Rule 4.5(ll); BX
Rules 6810(ll) and Chapter IX, Section 8, paragraph (a)(xxxviii);
BOX Rule 16010(ll); C2 Chapter 6, Section F; CBOE Rule 6.85(ll); CHX
Article 23, Rule 1(ll); IEX Rule 11.610(ll); ISE Rule 900(ll); ISE
Gemini Rule 900(ll); ISE Mercury 900(ll); MIAX Rule 1701(ll); MIAX
PEARL Chapter XVII; NASDAQ Rules 6810(ll) and Chapter IX, Section 8,
paragraph (a)(xxxviii); NYSE Rule 6810(ll); NYSE Arca Equities Rule
6.6810(ll); NYSE Arca Options Rule 11.6810(ll); NYSE MKT Rule
6810(ll); NYSE National Rule 14.1(ll); and Phlx Rule 910A(ll).
---------------------------------------------------------------------------

39. Trading Day
    The proposed CAT Compliance Rules establish the deadlines for
reporting certain data to the Central Repository using the term
``Trading Day.'' Accordingly, the Exchanges propose that the term
``Trading Day'' shall have the meaning as is determined by the
Operating Committee.\113\ For the avoidance of doubt, the Exchanges
represent that the Operating Committee may establish different Trading
Days for NMS Stocks, Listed Options, OTC Equity Securities, and any
other securities that are included as Eligible Securities from time to
time.
---------------------------------------------------------------------------

    \113\ See proposed Bats BYX Rule 4.5(mm); Bats BZX Rule 4.5(mm);
Bats EDGA Rule 4.5(mm); Bats EDGX Rule 4.5(mm); BX Rules 6810(mm)
and Chapter IX, Section 8, paragraph (a)(xxxix); BOX Rule 16010(mm);
C2 Chapter 6, Section F; CBOE Rule 6.85(mm); CHX Article 23, Rule
1(mm); IEX Rule 11.610(mm); ISE Rule 900(mm); ISE Gemini Rule
900(mm); ISE Mercury 900(mm); MIAX Rule 1701(mm); MIAX PEARL Chapter
XVII; NASDAQ Rules 6810(mm) and Chapter IX, Section 8, paragraph
(a)(xxxix); NYSE Rule 6810(mm); NYSE Arca Equities Rule 6.6810(mm);
NYSE Arca Options Rule 11.6810(mm); NYSE MKT Rule 6810(mm); NYSE
National Rule 14.1(mm); and Phlx Rule 910A(mm).
---------------------------------------------------------------------------

B. Clock Synchronization
    Rule 613(d)(1) of Regulation NMS requires Industry Members to
synchronize their Business Clocks to the time maintained by NIST,
consistent with industry standards.\114\ To comply with this provision,
Section 6.8 of the Plan sets forth the clock synchronization
requirements for Industry Members.\115\ To implement these provisions
with regard to its Industry Members, the Exchanges propose CAT
Compliance Rules to require their Industry Members to comply with the
clock synchronization requirements of the Plan.\116\
---------------------------------------------------------------------------

    \114\ 17 CFR 242.613(d)(1). Related to the clock synchronization
requirements, the Commission notes that the Participants also filed
a request for an exemption from the March 15, 2017 filing deadline
requirement set forth Section 6.7(a)(ii) of the CAT NMS Plan and in
the proposed CAT Compliance Rules. See infra note 161. The
Commission granted the Participants' exemption request. See infra
note 163.
    \115\ In addition, Section 6.7(a)(ii) of the Plan sets forth the
timeline for CAT Reporters to comply with the clock synchronization
requirements.
    \116\ See proposed Bats BYX Rule 4.6; Bats BZX Rule 4.6; Bats
EDGA Rule 4.6; Bats EDGX Rule 4.6; BX Rule 6820 and Section IX,
Section 8, subparagraph (b); BOX Rule 16020; C2 Chapter 6, Section
F; CBOE Rule 6.86; CHX Article 23, Rule 2; IEX Rule 11.620; ISE Rule
901; ISE Gemini Rule 901; ISE Mercury Rule 901; MIAX Rule 1702; MIAX
PEARL Chapter XVII; Nasdaq Rule 6820 and Section IX, Section 8,
subparagraph (b); NYSE Rule 6820; NYSE Arca Equities Rule 6.6820;
NYSE Arca Options Rule 11.6820; NYSE MKT Rule 6820; NYSE National
Rule 14.2; and Phlx Rule 920A.
---------------------------------------------------------------------------

1. Clock Synchronization
    The proposed CAT Compliance Rules set forth the manner in which
Industry Members must synchronize their Business Clocks. The Rules
require each Industry Member to synchronize its Business Clocks, other
than such Business Clocks used solely for Manual Order Events or used
solely for the time of allocation on Allocation Reports, at a minimum
to within a fifty (50) millisecond tolerance of the time maintained by
the NIST atomic clock, and maintain such synchronization. The Exchanges
represent that this is the same requirement as set forth in Section
6.8(a)(ii)(A) of the CAT NMS Plan.
    The proposed CAT Compliance Rules require each Industry Member to
synchronize (1) its Business Clocks used solely for Manual Order Events
and (2) its Business Clocks used solely for the time of allocation on
Allocation Reports at a minimum to within a one second

tolerance of the time maintained by the NIST atomic clock, and maintain
such synchronization. The Exchanges state that this is the same
requirement as set forth in Section 6.8(a)(iii) and (iv) of the CAT NMS
Plan. The proposed CAT Compliance Rules clarify that the tolerance
described in paragraphs (a)(1) and (2) of the proposed Rules includes
all of the following: (1) The time difference between the NIST atomic
clock and the Industry Member's Business Clock; (2) the transmission
delay from the source; and (3) the amount of drift of the Industry
Member's Business Clock.
    The proposed CAT Compliance Rules require Industry Members to
synchronize their Business Clocks every business day before market open
to ensure that timestamps for Reportable Events are accurate.\117\ In
addition, to maintain clock synchronization, Business Clocks must be
checked against the NIST atomic clock and re-synchronized, as
necessary, throughout the day.
---------------------------------------------------------------------------

    \117\ The proposed CBOE and C2 CAT Compliance Rules require
Industry Members to synchronize their business clocks before each
trading session. See proposed CBOE Rule 6.86(a)(iv); C2 Chapter 6,
Section F.
---------------------------------------------------------------------------

2. Documentation
    The proposed CAT Compliance Rules set forth documentation
requirements with regard to clock synchronization. Specifically, the
proposed Rules require Industry Members to document and maintain their
synchronization procedures for their Business Clocks. The proposed
Rules require Industry Members to keep a log of the times when they
synchronize their Business Clocks and the results of the
synchronization process. This log is required to include notice of any
time a Business Clock drifts more than the applicable tolerance
specified in the Rules. Such logs must include results for a period of
not less than five years ending on the then current date, or for the
entire period for which the Industry Member has been required to comply
with this Rule if less than five years. The Exchanges state that these
documentation requirements are the same as those set forth in the
``Sequencing Orders and Clock Synchronization'' section of Appendix C
of the CAT NMS Plan.
3. Certification
    The proposed CAT Compliance Rules set forth certification
requirements with regard to clock synchronization. Specifically, the
Rules require each Industry Member to certify to a Participant that its
Business Clocks satisfy the synchronization requirements set forth in
the proposed CAT Compliance Rules periodically in accordance with the
certification schedule established by the Operating Committee pursuant
to the CAT NMS Plan. The Exchanges state that this requirement is the
same requirement as set forth in Section 6.8(a)(ii)(B), (iii) and (iv)
of the CAT NMS Plan. The Exchanges state that they intend to announce
to their Industry Members the certification schedule established by the
Operating Committee.\118\
---------------------------------------------------------------------------

    \118\ The Exchanges will do so via Regulatory Circular,
Regulatory Information Circular, Information Circular, Circular,
Information Memorandum or Trader Update, as applicable.
---------------------------------------------------------------------------

4. Violation Reporting
    The proposed CAT Compliance Rules establish reporting requirements
with regard to clock synchronization. These proposed Rules require
Industry Members to report to the Plan Processor and FINRA violations
of the clock synchronization requirements of the proposed Rules
pursuant to the thresholds set by the Operating Committee pursuant to
the CAT NMS Plan. The Exchanges represent that this requirement is the
same requirement as set forth in Section 6.8(a)(ii)(C), (iii) and (iv)
of the CAT NMS Plan. The Exchanges intend to announce to their Industry
Members the relevant thresholds established by the Operating
Committee.\119\
---------------------------------------------------------------------------

    \119\ Id.
---------------------------------------------------------------------------

C. Industry Member Data Reporting

    Rule 613(c) of Regulation NMS requires the CAT NMS Plan to set
forth certain provisions requiring Industry Members to record and
report data to the CAT.\120\ To comply with this provision, Section 6.4
of the CAT NMS Plan sets forth the data reporting requirements for
Industry Members. To implement these provisions with regard to its
Industry Members, the Exchanges propose provisions in their CAT
Compliance Rules addressing Industry Member Data Reporting to require
their Industry Members to comply with the Industry Member Data
reporting requirements of the Plan.\121\ The proposed CAT Compliance
Rules have five sections covering: (1) Recording and reporting Industry
Member Data, (2) timing of the recording and reporting, (3) the
applicable securities covered by the recording and reporting
requirements, (4) the security symbology to be used in the recording
and reporting, and (5) error correction requirements, each of which is
described below.
---------------------------------------------------------------------------

    \120\ See 17 CFR 242.613(c).
    \121\ See proposed Bats BYX Rule 4.7; Bats BZX Rule 4.7; Bats
EDGA Rule 4.7; Bats EDGX Rule 4.7; BX Rule 6830 and Section IX,
Section 8, subparagraph (c); BOX Rule 16030; C2 Chapter 6, Section
F; CBOE Rule 6.87(b); CHX Article 23, Rule 3; IEX Rule 11.630; ISE
Rule 902; ISE Gemini Rule 902; ISE Mercury Rule 902; MIAX Rule 1703;
MIAX PEARL Chapter XVII; Nasdaq Rule 6830 and Section IX, Section 8,
subparagraph (c); NYSE Rule 6830; NYSE Arca Equities Rule 6.6830;
NYSE Arca Options Rule 11.6830; NYSE MKT Rule 6830; NYSE National
Rule 14.3; Phlx Rule 930A.
---------------------------------------------------------------------------

1. Recording and Reporting Industry Member Data
    The proposed CAT Compliance Rules describe the recording and
reporting of Industry Member Data to the Central Repository. The
proposed Rules cover Recorded Industry Member Data, Received Industry
Member Data and Options Market Maker data. The proposed CAT Compliance
Rules set forth the recording and reporting requirements required in
Section 6.4(d)(i)-(iii) of the CAT NMS Plan.
    The proposed CAT Compliance Rules require, subject to provisions
regarding Options Market Makers, each Industry Member to record and
electronically report to the Central Repository the following details
for each order and each Reportable Event, as applicable (``Recorded
Industry Member Data'') in the manner prescribed by the Operating
Committee pursuant to the CAT NMS Plan:
     For original receipt or origination of an order: (1) Firm
Designated ID(s) for each Customer; (2) CAT-Order-ID; (3) SRO-Assigned
Market Participant Identifier of the Industry Member receiving or
originating the order; (4) date of order receipt or origination; (5)
time of order receipt or origination (using timestamps pursuant to the
proposed Rules \122\); and (6) Material Terms of the Order;
---------------------------------------------------------------------------

    \122\ See infra note 135.
---------------------------------------------------------------------------

     for the routing of an order: (1) CAT-Order-ID; (2) date on
which the order is routed; (3) time at which the order is routed (using
timestamps pursuant to the proposed Rules \123\); (4) SRO-Assigned
Market Participant Identifier of the Industry Member routing the order;
(5) SRO-Assigned Market Participant Identifier of the Industry Member
or Participant to which the order is being routed; (6) if routed
internally at the Industry Member, the identity and nature of the
department or desk to which the order is routed; and (7) Material Terms
of the Order;
---------------------------------------------------------------------------

    \123\ Id.
---------------------------------------------------------------------------

     for the receipt of an order that has been routed, the
following information: (1) CAT-Order-ID; (2) date on which the order is
received; (3) time at which the order is received (using timestamps

pursuant to the proposed Rules \124\); (4) SRO-Assigned Market
Participant Identifier of the Industry Member receiving the order; (5)
SRO-Assigned Market Participant Identifier of the Industry Member or
Participant routing the order; and (6) Material Terms of the Order;
---------------------------------------------------------------------------

    \124\ Id.
---------------------------------------------------------------------------

     if the order is modified or cancelled: (1) CAT-Order-ID;
(2) date the modification or cancellation is received or originated;
(3) time at which the modification or cancellation is received or
originated (using timestamps pursuant to the proposed Rules \125\); (4)
price and remaining size of the order, if modified; (5) other changes
in the Material Terms of the Order, if modified; and (6) whether the
modification or cancellation instruction was given by the Customer or
was initiated by the Industry Member;
---------------------------------------------------------------------------

    \125\ Id.
---------------------------------------------------------------------------

     if the order is executed, in whole or in part: (1) CAT-
Order-ID; (2) date of execution; (3) time of execution (using
timestamps pursuant to the proposed Rules \126\); (4) execution
capacity (principal, agency or riskless principal); (5) execution price
and size; (6) SRO-Assigned Market Participant Identifier of the
Industry Member executing the order; (7) whether the execution was
reported pursuant to an effective transaction reporting plan or the
Plan for Reporting of Consolidated Options Last Sale Reports and
Quotation Information; and
---------------------------------------------------------------------------

    \126\ Id.
---------------------------------------------------------------------------

     other information or additional events as may be
prescribed pursuant to the CAT NMS Plan.
    The proposed CAT Compliance Rules require, subject to provisions
regarding Options Market Makers, each Industry Member to record and
report to the Central Repository the following, as applicable
(``Received Industry Member Data'') and collectively with the
information referred to in the proposed Rules governing Industry Member
Data in the manner prescribed by the Operating Committee pursuant to
the CAT NMS Plan:
     If the order is executed, in whole or in part: (1) An
Allocation Report; (2) SRO-Assigned Market Participant Identifier of
the clearing broker or prime broker, if applicable; and (3) CAT-Order-
ID of any contra-side order(s);
     if the trade is cancelled, a cancelled trade indicator;
and
     for original receipt or origination of an order, the Firm
Designated ID for the relevant Customer, and in accordance with the
proposed CAT Compliance Rules, Customer Account Information and
Customer Identifying Information for the relevant Customer.
    The proposed CAT Compliance Rules state that each Industry Member
that is an Options Market Maker is not required to report to the
Central Repository the Industry Member Data regarding the routing,
modification or cancellation of its quotes in Listed Options. Each
Industry Member that is an Options Market Maker, however, is required
to report to the Exchange the time at which its quote in a Listed
Option is sent to the Exchange (and, if applicable, any subsequent
quote modification time and/or cancellation time when such modification
or cancellation is originated by the Options Market Maker). The
proposed CAT Compliance Rules implement the Options Market Maker Quote
Exemption, as discussed above.
2. Timing of Recording and Reporting
    The proposed CAT Compliance Rules describe the requirements related
to the timing of recording and reporting of Industry Member Data.\127\
These Rules set forth the requirements related to the timing of the
recording and reporting requirements required in Section 6.4(b)(i)-(ii)
of the CAT NMS Plan.
---------------------------------------------------------------------------

    \127\ See proposed Bats BYX Rule 4.7(b); Bats BZX Rule 4.7(b);
Bats EDGA Rule 4.7(b); Bats EDGX Rule 4.7(b); BX Rule 6830(b) and
Section IX, Section 8, subparagraph (c)(ii); BOX Rule 16030(b); C2
Chapter 6, Section F; CBOE Rule 6.87(b); CHX Article 23, Rule 3(b);
IEX Rule 11.630(b); ISE Rule 902(b), ISE Gemini Rule 902(b); ISE
Mercury Rule 902(b); MIAX Rule 1703(b); MIAX PEARL Chapter XVII;
NASDAQ Rule 6830(b) and Section IX, Section 8, subparagraph (c)(ii);
NYSE Rule 6830(b); NYSE Arca Equities Rule 6.6830(b); NYSE Arca
Options Rule 11.6830(b); NYSE MKT Rule 6830(b); NYSE National Rule
14.3(b); and Phlx Rule 930A(b).
---------------------------------------------------------------------------

    The proposed CAT Compliance Rules require each Industry Member to
record Recorded Industry Member Data contemporaneously with the
applicable Reportable Event. The proposed Rules require each Industry
Member to report: (1) Recorded Industry Member Data to the Central
Repository by 8:00 a.m. Eastern Time on the Trading Day following the
day the Industry Member records such Recorded Industry Member Data; and
(2) Received Industry Member Data to the Central Repository by 8:00
a.m. Eastern Time on the Trading Day following the day the Industry
Member receives such Received Industry Member Data. The Rules state
that Industry Members may, but are not required to, voluntarily report
Industry Member Data prior to the applicable 8:00 a.m. Eastern Time
deadline.
3. Applicable Securities
    The proposed CAT Compliance Rules describe the securities to which
the recording and reporting requirements of the proposed Rules apply.
The proposed Rules set forth the description of applicable securities
as set forth in Section 6.4(c)(i) and (ii) of the CAT NMS Plan,
respectively.\128\ The proposed Rules require each Industry Member to
record and report to the Central Repository the Industry Member Data as
set forth in the Rules for each NMS Security registered or listed for
trading on such exchange or admitted to unlisted trading privileges on
such exchange. The proposed Rules require each Industry Member to
record and report to the Central Repository the Industry Member Data as
set forth in the Rules for each Eligible Security for which transaction
reports are required to be submitted to FINRA.
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    \128\ See proposed Bats BYX Rule 4.7(c); Bats BZX Rule 4.7(c);
Bats EDGA Rule 4.7(c); Bats EDGX Rule 4.7(c); BX Rule 6830(c) and
Section IX, Section 8, subparagraph (c)(iii); BOX Rule 16030(c); C2
Chapter 6, Section F; CBOE Rule 6.87(c); CHX Article 23, Rule 3(c);
IEX Rule 11.630(c); ISE Rule 902(c); ISE Gemini Rule 902(c); ISE
Mercury Rule 902(c); MIAX Rule 1703(c); MIAX PEARL Chapter XVII;
Nasdaq Rule 6830(c) and Section IX, Section 8, subparagraph (c);
NYSE Rule 6830(c)(iii); NYSE Rule 6830(c); NYSE Arca Equities Rule
6.6830(c); NYSE Arca Options Rule 11.6830(c); NYSE MKT Rule 6830(c);
NYSE National Rule 14.3(c); and Phlx Rule 930A(c).
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4. Security Symbology
    The proposed CAT Compliance Rules describe the security symbology
that Industry Members are required to use when reporting Industry
Member Data to the Central Repository. The proposed Rules require, for
each exchange-listed Eligible Security, each Industry Member to report
Industry Member Data to the Central Repository using the symbology
format of the exchange listing the security.\129\ The Exchanges state
that this requirement implements the requirement set forth in Section 2
of Appendix D of the CAT NMS Plan to use the listing exchange symbology
when reporting data to the Central Repository for exchange-listed
Eligible Securities.
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    \129\ See proposed Bats BYX Rule 4.7(d); Bats BZX Rule 4.7(d);
Bats EDGA Rule 4.7(d); Bats EDGX Rule 4.7(d); BX Rule 6830(d) and
Section IX, Section 8, subparagraph (c)(iv); BOX Rule 16030(d); C2
Chapter 6, Section F; CBOE Rule 6.87(d); CHX Article 23, Rule 3(d);
IEX Rule 11.630(d); ISE Rule 902(d); ISE Gemini Rule 902(d); ISE
Mercury Rule 902(d); MIAX Rule 1703(d); MIAX PEARL Chapter XVII;
NASDAQ Rule 6830(d) and Section IX, Section 8, subparagraph (c)(iv);
NYSE Rule 6830(d); NYSE Arca Equities Rule 6.6830(d); NYSE Arca
Options Rule 11.6830(d); NYSE MKT Rule 6830(d); NYSE National Rule
14.3(d); and Phlx Rule 930A(d).
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    For each Eligible Security that is not exchange-listed, however,
the Exchanges represent that there is no listing exchange to provide
the symbology format. Moreover, to date,

the requisite symbology format has not been determined. Therefore, the
proposed CAT Compliance Rules require, for each Eligible Security that
is not exchange-listed, each Industry Member to report Industry Member
Data to the Central Repository using such symbology format as approved
by the Operating Committee pursuant to the CAT NMS Plan. The Exchanges
state that they intend to announce to their Industry Members the
relevant symbology formats established by the Operating Committee.\130\
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    \130\ See supra note 118.
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5. Error Correction Timeline
    To ensure that the CAT contains accurate data, the CAT NMS Plan
requires Industry Members to correct erroneous data submitted to the
Central Repository. Therefore, the proposed CAT Compliance Rules
require that for each Industry Member for which errors in Industry
Member Data submitted to the Central Repository have been identified by
the Plan Processor or otherwise, such Industry Member submit corrected
Industry Member Data to the Central Repository by 8:00 a.m. Eastern
Time on T+3. The Exchanges represent that this requirement implements
the error correction requirement set forth in Section 6 of Appendix D
of the CAT NMS Plan.

D. Customer Information Reporting

    Section 6.4(d)(iv) of the CAT NMS Plan requires Industry Members to
submit to the Central Repository certain information related to their
Customers in accordance with the Customer Information Approach
discussed above. The Exchanges propose CAT Compliance Rules regarding
Customer information reporting to implement this provision of the CAT
NMS Plan with regard to their Industry Members.\131\
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    \131\ See proposed Bats BYX Rule 4.8; Bats BZX Rule 4.8; Bats
EDGA Rule 4.8; Bats EDGX Rule 4.8; BX Rule 6840 and Chapter IX,
Section 8, subparagraph (d); BOX Rule 16040; C2 Chapter 6, Section
F; CBOE Rule 6.88; CHX Article 23, Rule 4; IEX Rule 11.640; ISE Rule
903; ISE Gemini Rule 903; ISE Mercury Rule 903; MIAX Rule 1704; MIAX
PEARL Chapter XVII; NASDAQ Rule 6840 and Chapter IX, Section 8,
subparagraph (d); NYSE Rule 6840; NYSE Arca Equities Rule 6.6840;
NYSE Arca Options Rule 11.6840; NYSE MKT Rule 6840; NYSE National
Rule 14.4; and Phlx Rule 940A.
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1. Initial Set of Customer Information
    The proposed CAT Compliance Rules require each Industry Member to
submit to the Central Repository the Firm Designated ID, Customer
Account Information and Customer Identifying Information for each of
its Customers with an Active Account prior to such Industry Member's
commencement of reporting to the Central Repository and in accordance
with the deadlines set forth in the CAT Compliance Rules.
2. Daily Updates to Customer Information
    The proposed CAT Compliance Rules require each Industry Member to
submit to the Central Repository any updates, additions or other
changes to the Firm Designated ID, Customer Account Information and
Customer Identifying Information for each of its Customers with an
Active Account on a daily basis.
3. Periodic Updates to Complete Set of Customer Information
    The proposed CAT Compliance Rules also require each Industry
Member, on a periodic basis as designated by the Plan Processor and
approved by the Operating Committee, to submit to the Central
Repository a complete set of Firm Designated IDs, Customer Account
Information and Customer Identifying Information for each of its
Customers with an Active Account. This periodic refresh is intended to
ensure that the Central Repository has the most current information
identifying a Customer. The Exchanges represented that they intend to
announce to their Industry Members when such a periodic refresh is
required by the Plan Processor and the Operating Committee.\132\
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    \132\ See supra note 118.
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4. Error Correction Timeline
    Finally, the proposed CAT Compliance Rules address the correction
of erroneous Customer data reported to the Central Repository to ensure
an accurate audit trail. The Rules require, for each Industry Member
for which errors in Firm Designated ID, Customer Account Information
and Customer Identifying Information for each of its Customers with an
Active Account submitted to the Central Repository have been identified
by the Plan Processor or otherwise, such Member to submit corrected
data to the Central Repository by 5:00 p.m. Eastern Time on T+3. The
Exchanges state that this requirement implements the error correction
requirement set forth in Appendix C of the CAT NMS Plan.

E. Industry Member Information Reporting

    Section 6.4(d)(vi) of the CAT NMS Plan requires Industry Members to
submit to the Central Repository information sufficient to identify
such Industry Member, including CRD number and LEI, if such LEI has
been obtained, in accordance with the Existing Identifier Approach
discussed above. The proposed CAT Compliance Rules require each
Industry Member to submit to the Central Repository information
sufficient to identify such Industry Member, including CRD number and
LEI, if such LEI has been obtained, prior to such Industry Member's
commencement of reporting to the Central Repository and in accordance
with the deadlines set forth in the proposed Rules, and keep such
information up to date as necessary.\133\ The Exchanges state that this
provision implements Section 6.4(d)(vi) of the CAT NMS Plan with regard
to its Industry Members information reporting.
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    \133\ See proposed Bats BYX Rule 4.9; Bats BZX Rule 4.9; Bats
EDGA Rule 4.9; Bats EDGX Rule 4.9; BX Rules 6850 and Chapter IX,
Section 8, subparagraph (e); BOX Rule 16050; C2 Chapter 6, Section
F; CBOE Rule 6.89; CHX Article 23, Rule 5; IEX Rule 11.650; ISE Rule
904; ISE Gemini Rule 904; ISE Mercury Rule 904; MIAX Rule 1705; MIAX
PEARL Chapter XVII; NASDAQ Rule 6850 and Chapter IX, Section 8,
subparagraph (e); NYSE Rule 6850; NYSE Arca Equities Rule 6.6850;
NYSE Arca Options Rule 11.6850; NYSE MKT Rule 6850; NYSE National
Rule 14.5; and Phlx Rule 950A.
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F. Time Stamps

    Rule 613(d)(3) of Regulation NMS sets forth requirements for time
stamps used by CAT Reporters in recording and reporting data to the
CAT.\134\ To comply with this provision, Section 6.8(b) of the Plan
sets forth time stamp requirements for Industry Members. To implement
this provision with regard to its Industry Members, the Exchanges
propose CAT Compliance Rules to require their Industry Members to
comply with the time stamp requirements of the Plan.\135\
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    \134\ 17 CFR 242.613(d)(3).
    \135\ See proposed Bats BYX Rule 4.10; Bats BZX Rule 4.10; Bats
EDGA Rule 4.10; Bats EDGX Rule 4.10; BX Rules 6850 and Chapter IX,
Section 8, subparagraph (f); BOX Rule 16060; C2 Chapter 6, Section
F; CBOE Rule 6.90; CHX Article 23, Rule 6; IEX Rule 11.660; MIAX
Rule 1706; MIAX PEARL Chapter XVII; NASDAQ Rule 6850 and Chapter IX,
Section 8, subparagraph (f); NYSE Rule 6860; NYSE Arca Equities Rule
6.6860; NYSE Arca Options Rule 11.6860; NYSE MKT Rule 6860; NYSE
National Rule 14.6; and Phlx Rule 960A.
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1. Millisecond Time Stamps
    The proposed CAT Compliance Rules set forth the time stamp
increments to be used by Industry Members in their CAT reporting. The
Rules require each Industry Member to record and report Industry Member
Data to the Central Repository with time stamps in milliseconds. To the
extent that any Industry Member's order handling or execution systems
utilize time stamps in increments finer than milliseconds, the proposed
Rules require such Industry Member to record and report Industry Member
Data to the Central Repository with time stamps in such finer

increment, subject to the proposed Rules regarding Manual Order Events
and Allocation Reports.
2. One-Second Time Stamps/Electronic Order Capture
    The proposed CAT Compliance Rules set forth the permissible time
stamp increments for Manual Order Events and Allocation Reports.
Specifically, the proposed Rules permit each Industry Member to record
and report Manual Order Events to the Central Repository in increments
up to and including one second, provided that each Industry Member is
required to record and report the Electronic Capture Time in
milliseconds. In addition, the proposed CAT Compliance Rules permit
each Industry Member to record and report the time of Allocation
Reports in increments up to and including one second.

G. Clock Synchronization Rule Violations

    The proposed CAT Compliance Rules describe potential violations of
the clock synchronization time period requirements.\136\ The proposed
Rules state that an Industry Member that engages in a pattern or
practice of reporting Reportable Events outside of the required clock
synchronization time period without reasonable justification or
exceptional circumstances may be considered in violation of this Rule.
The Exchanges state that this provision implements the requirements of