[Federal Register Volume 85, Number 234 (Friday, December 4, 2020)]
[Notices]
[Pages 78371-78381]
[FR Doc No: 2020-26676]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-90534; File No. SR-DTC-2020-017]

Self-Regulatory Organizations; The Depository Trust Company;
Notice of Filing of Proposed Rule Change to Allow for the Deposit of
Electronic Certificates of Deposit and Technical Changes

November 30, 2020.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934

(``Act'') \1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on November 20, 2020, The Depository Trust Company (``DTC'') filed with
the Securities and Exchange Commission (``Commission'') the proposed
rule change as described in Items I, II and III below, which Items have
been prepared by the clearing agency. The Commission is publishing this
notice to solicit comments on the proposed rule change from interested
persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change

    The proposed rule change \3\ consists of amendments to the
Procedures \4\ of DTC. Specifically, the proposed rule change would
amend the OA and Underwriting Service Guide to implement a new
application and secured electronic vault (``E-vault'') for requests for
eligibility, execution, Delivery and storage of certificates of deposit
(``CDs'') that are issued by state and federal chartered banks that are
Eligible Securities \5\ in electronic form. Technical changes with
respect to spelling, punctuation and spacing of text would also be
made. The use of the new application and E-vault would replace an
existing legacy platform and paper-based model for Delivery and storage
of CDs maintained in DTC's secured physical vault, as more fully
described below.
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    \3\ Capitalized terms not defined herein are defined in the
Rules, By-Laws and Organization Certificate of DTC (the ``Rules''),
available at www.dtcc.com/~/media/Files/Downloads/legal/rules/
dtc_rules.pdf, the DTC Operational Arrangements (Necessary for
Securities to Become and Remain Eligible for DTC Services) (``OA''),
available at http://www.dtcc.com/~/media/Files/Downloads/legal/
issue-eligibility/eligibility/operational-arrangements.pdf, and the
DTC Underwriting Service Guide (``Underwriting Service Guide''),
available at http://www.dtcc.com/~/media/Files/Downloads/legal/
service-guides/Underwriting-Service-Guide.pdf.
    \4\ The OA and the Underwriting Service Guide constitute
Procedures of DTC. Pursuant to the Rules, the term ``Procedures''
means the Procedures, service guides, and regulations of DTC adopted
pursuant to Rule 27, as amended from time to time. See Rule 1,
Section 1, supra note 3. DTC's Procedures are filed with the
Commission. They are binding on DTC and each Participant in the same
manner as they are bound by the Rules. See Rule 27, supra note 3.
The OA is also binding on each issuer and agent of an Eligible
Security. See OA, supra note 3 at 5, supra note 3. DTC also
maintains service guides that constitute Procedures relating to
services it offers. Available at http://www.dtcc.com/legal/rules-and-procedures?subsidiary=DTC&pgs=1.
    \5\ Generally, Eligible Securities must have been issued in a
transaction (i) registered with the Commission pursuant to the
Securities Act; (ii) exempt from registration pursuant to a
Securities Act exemption without transfer or ownership restrictions;
or (iii) pursuant to Rule 144A, 17 CFR 230.144A, or Regulation S, 17
CFR 230.901-230.905, under the Securities Act. See OA, supra note 3
at 2-3.
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II. Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

    In its filing with the Commission, the clearing agency included
statements concerning the purpose of and basis for the proposed rule
change and discussed any comments it received on the proposed rule
change. The text of these statements may be examined at the places
specified in Item IV below. The clearing agency has prepared summaries,
set forth in sections A, B, and C below, of the most significant
aspects of such statements.

(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change

1. Purpose
    The proposed rule change of DTC would amend the Procedures of DTC.
Specifically, the proposed rule change would amend the OA and
Underwriting Service Guide to implement a new application and secured
E-vault for requests for eligibility, execution, Delivery and storage
of CDs that are (i) Eligible Securities and (ii) issued by state and
federal chartered banks in electronic form. The use of the new
application and E-vault would replace an existing legacy platform for
Delivery and storage of CDs maintained in DTC's secured physical vault,
as more fully described below.
Background
    DTC (i) makes eligible for Deposit, processes and holds physical
retail CDs issued by various U.S. banks and Deposited by Participants
and (ii) credits interests in those CDs to Participant's Securities
Accounts.\6\ As described below, the use of physical certificates
presents operational concerns to Participants and to DTC and DTC has
undertaken efforts to promote dematerialization of Securities. To
address operational concerns relating to processing of physical CDs,
DTC has developed a system that would eliminate the need for physical
certificates for certain issue types of CDs by allowing them to be
issued and held in electronic form, as described below.
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    \6\ See OA, supra note 3, at 9-10.
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    Upon implementation, the proposed rule change would address
operational concerns of Participants relating to the amount of time and
manual effort currently required for the issuance and redemption of
physical CDs by allowing for a fully electronic process for the
execution and Delivery of the affected CD certificates. As such, the
proposed rule change would also reduce the need for DTC to (i) perform
manual processing relating to CD Deposits and (ii) reserve space in its
secure physical vault currently used for CDs by allowing for the
storage of CDs in electronic form in a secure E-vault.
    The proposed electronic process would also address concerns
relating to potential disruptions in the physical transport of paper
CDs to DTC currently made using courier and overnight delivery
services. Such disruptions may be caused by weather-related issues,
such as Superstorm Sandy which impacted physical securities processing
in 2012, and other previously unforeseen circumstances, such as the
COVID-19 pandemic. Although, DTC has been able to maintain securities
eligibility and processing operations during such circumstances,
including by utilizing a letter of securities possession \7\ (``LOP'')
process that enables DTC to accept Delivery of securities represented
in physical form even if the circumstances prevent physical delivery at
that time, such disruptions could delay the Deposit of CDs and impact
the timely closing of issuances and otherwise affect liquidity in the
marketplace for CDs.
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    \7\ See Underwriting Service Guide, supra note 3 at 17.
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Current DTC Eligibility Process for CDs
    Only Participants can request that DTC make a Security eligible for
Deposit.\8\ It is therefore incumbent on an issuer to have a
relationship with an underwriter or other financial institution that is
a Participant, or is directly associated with a Participant, that is
willing to sponsor the eligibility process for the issuer's
Securities.\9\ A Participant may submit a Deposit eligibility request
for a CD through the underwriting services of DTC at the time a
security is initially being offered and distributed to the marketplace
or at a later time for already issued and outstanding securities.\10\
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    \8\ See id. at 1.
    \9\ Id.
    \10\ Id.
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    Participants must provide an eligibility request for the specified
securities to Underwriting by submitting all required issuer and
securities data and all related offering documents, at a minimum,
through the online Securities Origination, Underwriting and Reliable
Corporate Action Environment (``UW SOURCE'') system.\11\
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    \11\ Id. at 2.
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    CDs are book entry-only (``BEO'') Securities \12\ registered to
DTC's

nominee, Cede & Co. BEO Securities are DTC-eligible Securities for
which (i) physical certificates are not available to investors and (ii)
DTC, through its nominee, Cede & Co., will hold the entire balance of
the offering, either at DTC (in physical form) or through a FAST Agent
in DTC's Fast Automated Securities Transfer (``FAST'') program. Issuers
of BEO Securities must submit to DTC a Letter of Representations
(``LOR'') among the issuer, its agent (as applicable) and DTC, prior to
such issue being determined to be eligible. For corporate and municipal
securities, there are two acceptable forms of LOR: A Blanket Issuer
Letter of Representations (``BLOR'') or an Issuer Letter of
Representations (``ILOR''). A BLOR is issuer specific and applicable to
all DTC-eligible securities (debt and/or equity) of the same issuer.
Once a BLOR is on file for an issuer, a new BLOR is not required for
future issuances unless the issuer's name changes (in which case an
opinion of counsel may also be required). An ILOR may be used for
discrete issuances, and is applicable only to that issue of securities,
such as trust issuances. Each issuer of a BEO Security must submit to
DTC a fully executed LOR on DTC's preprinted form. This LOR represents
the issuer's agreement to comply with the requirements set forth in the
OA, as amended from time to time.\13\
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    \12\ Id. at 4.
    \13\ Id.
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    Once DTC has determined to make a Security eligible, a Participant
may Deposit the Security at DTC for crediting to its Securities
Account. For a CD issuance, the issuing bank and Depositing Participant
must coordinate the execution and Delivery of the physical certificate
to DTC in order for the Participant to timely receive credit by the
anticipated closing date.\14\ Once DTC receives an acceptable Deposit
of an eligible CD from a Participant, DTC credits a Security
Entitlement \15\ in the CD to the Participant's Securities Account \16\
and DTC holds the original paper certificate in its secure vault for
the duration of the term of the CD.
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    \14\ See DTC Deposits Service Guide (``Deposits Guide''),
available at http://www.dtcc.com/~/media/Files/Downloads/legal/
service-guides/Deposits.pdf, at 8. The closing date is the date on
which Underwriting will distribute an issue to the underwriter's
Participant account at DTC for book-entry delivery and settlement
upon notification by both the underwriter and the issuer that an
issue has closed (i.e., the distribution date). See Underwriting
Guide, supra note 3, at 6. On the closing date, when an issuer or
its agent and the underwriter confirm with DTC that the issue has
closed and verifies pertinent data, DTC releases the position from
an internal DTC account and credits the underwriter's Participant
account, provided that DTC received the certificates. See id. at 9.
    \15\ Pursuant to Rule 1, the term ``Security Entitlement'' has
the meaning given to the term ``security entitlement'' in Section 8-
102 of the New York Uniform Commercial Code (``NYUCC''). See Rule 1,
supra note 3. See also NYUCC 8-102. The interest of a Participant or
Pledgee in a Security credited to its Account is a Security
Entitlement. See Rule 1, supra note 3.
    \16\ See Deposits Guide, supra note 14, at 8.
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Proposal
    Pursuant to the proposed rule change, DTC is proposing to launch a
new program to support Deposit of electronic CDs that would be issued
by banks (``E-CDs''). The program would allow E-CDs to be
electronically generated, signed, delivered to DTC and held in
electronic form in a secure E-vault.
    Upon implementation of the proposed rule change, CDs of state and
federally chartered banks containing certain standard terms that
conform to one of four proposed templates (``System E-CD Templates'')
would be eligible for the new program, as described below. The System
E-CD Templates were developed with input from DTC Participants that act
as underwriters of CD. The templates would cover four basic types of
CDs, specifically (i) Fixed Rate Non-Callable, (ii) Fixed Rate
Callable, (iii) Step Rate Non-Callable and (iv) Step Rate Callable.\17\
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    \17\ A Fixed Rate CD pays a fixed interest rate over the entire
term of the CD. A Step Rate CD allows for increases in the interest
rate at specific, intervals that are pre-defined by the issuer. A
Callable CD contains a call feature that gives the issuing bank the
ability to redeem the CD prior to its stated maturity, usually
within a given time frame and at a preset call price as set forth in
the ``call provision'' in the master certificate. A certificate
without such a provision cannot not be called by the issuer prior to
maturity date (Non-Callable).
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    After implementation, in order to facilitate needs of issuers and
underwriters, DTC may, at its own discretion, (i) edit the System E-CD
Templates and/or (ii) add additional templates for use in the E-CD
program as published via Important Notice that would also be deemed
System E-CD Templates. Any edits to the System E-CD Templates would not
affect E-CDs that were previously issued into DTC.
    More complex CDs that do not conform to the System E-CD Templates,
including those referred to as structured CDs, would be excluded from
the proposed new process, because they typically contain terms that are
not amenable to the creation of fixed templates in the format proposed
herein.
    Upon implementation, Participants would request eligibility for E-
CDs that conform to the System E-CD Templates through a new system
referred to as Underwriting Central (``UWC''). UW SOURCE would continue
to remain available for other types of issuances, including the
issuances of CDs in physical form.
    In order to request eligibility of a CD to be issued in electronic
form, the Underwriter would provide all required information relating
to the CD through UWC, including but not limited to offering
documentation and the terms to be populated in the electronic
certificate. The relevant data (e.g., interest rate(s) and maturity
date) will be populated into the templates as entered by the
underwriter into the UWC application. It would be the responsibility of
the Underwriter to disseminate the electronic master certificate to the
issuer for electronic signature via UWC. The issuer would be required
to electronically sign and Deliver the master certificate to DTC prior
to closing.
    For CDs that do not conform to the System E-CD Templates,
eligibility request would continue to be entered by the Underwriter
through UW SOURCE and a physical certificate delivered to DTC prior to
closing.
    Whether issued in electronic or physical form, securities should be
delivered to DTC by no later than noon Eastern Time on the business day
prior to the Closing Date as currently specified in Exhibit B of the
OA.
    In addition, each issuer that opts to issue E-CDs would be required
to provide a new BLOR designed for use with the E-CD program, as
described below.
Legal Framework Supporting Issuance of Electronic CDs
    The following discussion is provided by DTC and includes its own
analysis of applicable state law provisions that DTC believes supports
the validity of the issuance and Deposit of E-CDs at DTC pursuant to
the proposed rule change. Based on its analysis, DTC believes that the
proposed rule change would allow E-CDs to be electronically generated,
signed, Delivered to DTC and held in electronic form in a secure E-
vault within a legal framework that supports the validity of E-CDs in a
manner comparable to that of physical issuance and Deposit of CDs that
are eligible for DTC services pursuant to the Rules and Procedures.
This analysis is not part of the proposed rule, but a separate,
analysis of applicable law. DTC emphasizes that neither the following,
nor any aspect of the proposed rule change, is intended by DTC to be
legal advice by DTC to any Participant, issuer or other third party,
and should not be considered to be legal advice by DTC to any
Participant, issuer, or other third party.

DTC's Rules are Governed by the Law of New York
    DTC's activities and its Rules are structured in accordance with
the laws of New York and the United States, and provide that they shall
be governed by, and construed in accordance with, the law of New
York.\18\ A principal law comprising the legal framework under which
DTC operates includes, but is not limited to, the NYUCC, which among
other things, supports a legal framework for the issuance of Securities
and the indirect holding system, under which DTC credits in Securities
to its Participants.
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    \18\ See Rule 2, supra note 3.
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NYUCC and Electronic Signature Laws; and Impact Regarding E-CDs
    CDs are ``negotiable instruments'' under Article 3 of the Uniform
Commercial Code (the ``UCC''),\19\ which has been adopted in New York
under the NYUCC,\20\ and, depending on how they are structured, may
also be ``securities'' and/or ``financial assets,'' as defined in
Article 8 of the UCC, which has been adopted in New York under the
NYUCC.\21\ In addition, because the CDs are held in DTC through the
indirect holding system, the rights and duties of DTC, as a securities
intermediary, and its Participants, as entitlement holders, are
governed by Part 5 of Article 8 of the UCC,\22\ also adopted in New
York under the NYUCC. In this regard, the rights and obligations
associated with CDs held at DTC are governed by the relevant provisions
of the NYUCC.
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    \19\ Unless otherwise specified, citations in this proposed rule
change to provisions of the UCC are to the UCC as adopted in New
York under the NYUCC.
    \20\ See NYUCC 3-102 and 3-104 (defining CDs as negotiable
instruments).
    \21\ See NYUCC 8-102 (for NYUCC definitions of ``financial
asset'' and ``security'').
    \22\ See NYUCC 8-501-8-508.
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    Section 8-110 of the UCC provides that only the law of the issuer's
jurisdiction will govern the ``validity'' of a ``security''--the laws
of another jurisdiction cannot be selected to govern validity issues.
The term ``validity'' is not defined in the UCC. DTC believes that laws
governing the creation and existence of an electronic record as a
substitute for a written instrument may be viewed as laws that govern
the ``validity'' of an instrument.\23\
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    \23\ See Comment 2 to Section 8-110 of the UCC (explaining that
the law of the issuer's jurisdiction governs the validity of a
security in order to ensure that a single body of law governs the
questions addressed in Part 2 of Article 8). Part 2 of Article 8 of
the UCC describes the circumstances in which an issuer can and
cannot assert invalidity as a defense against purchasers, including
lack of genuineness, unauthorized signatures and incomplete
certificates. This implies that the term ``validity'' in Section 8-
110 of the UCC refers to a broader set of issues than just the
validity of issuance of the security under the issuer's governing
documents and local law.
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    An E-CD that is both a negotiable instrument and a security, will
be governed as to its validity by the law of the issuer's jurisdiction,
by virtue of Section 8-110 of the UCC. If the validity of a security is
determined to include its electronic nature, then the electronic
signature and record laws of each individual issuer's jurisdiction
would apply to each E-CD. Therefore, requiring an E-CD to be a security
could adversely impact the valid issuance of the E-CD if the laws of
the issuer's jurisdiction do not contemplate the electronic signature
of a security.
    However, as discussed below, Article 3 negotiable instruments allow
for a choice of law. In this regard, DTC believes that requiring E-CDs
to be issued as negotiable instruments would facilitate the valid
issuance of E-CDs regardless of an issuer's jurisdiction, so long as
the law of a jurisdiction that contemplates the use of electronic
signatures as part of a valid issuance is chosen to govern the E-CD.
    As more fully described in the discussion of electronic signature
laws provided by DTC below, DTC proposes to apply New York law for this
purpose, but also proposes to design the E-CD program such that E-CDs
issued into DTC would be valid under the laws of all states that allow
the use of electronic records and signatures in any transaction that
would otherwise require a paper document and/or wet-ink signature.
Discussion of Electronic Signature Laws
The New York Electronic Signatures and Records Act
    The New York Electronic Signatures and Records Act \24\ (``ESRA'')
governs the validity of electronic records and signatures in New York.
ESRA is like UETA in that it accords the same power and effect to
electronic records and signatures as would otherwise be accorded to
writings under New York law.
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    \24\ N.Y. State Tech. Law Sec.  30[] (McKinney 2012).
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    ESRA does not apply to negotiable instruments, such as CDs, unless
an electronic record of such instrument is created, stored or
transferred in a manner that meets the Uniqueness Standard. If the
Uniqueness Standard is met, then CDs that are issued, created and
signed electronically have the same power and effect as paper CDs under
New York law.
The Uniform Electronic Transactions Act
    The Uniform Electronic Transactions Act \25\ (``UETA''), has been
adopted in various forms by 47 U.S. states.\26\ UETA generally allows
parties to agree to use electronic records and signatures in any
transaction that would have otherwise required a paper document and/or
wet-ink signature.
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    \25\ Unif. Electronic Transactions Act (Unif. L. Comm'n 1999).
    \26\ Illinois, New York and Washington have not adopted UETA.
Although it has adopted UETA, California has not adopted Section 16
of UETA, which, as described in further detail below, is the section
of UETA that provides for the electronic creation, signature and
storage of negotiable instruments such as CDs.
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    Section 16 of UETA \27\ provides legal support for the creation,
transferability and enforceability, of, among other things, negotiable
instruments such as CDs, if they meet the following standards:
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    \27\ Unif. Elec. Transactions Act Sec.  16 (Unif. L. Comm'n
1999).
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     The E-CD must be a ``transferable record,'' which is
defined, in part, as an electronic record that would be a note under
Article 3 of the UCC (CDs are notes in all relevant UETA
jurisdictions), and the issuer has expressly agreed that it is a
transferable record.
     The E-CD must initially be created as an electronic
record, and not as a paper document that is converted to one.\28\
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    \28\ See Comment 2 to Section 16 of UETA (explaining that
Section 16 is not intended to cover the conversion of a paper note
to an electronic record; instead, transferable records must be
electronic at the time they are created).
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     Each E-CD must be stored in a system that meets the
following standards (the ``Section 16 Safe Harbor''):
    [cir] The E-CD is created, stored and assigned in a manner that a
single authoritative copy of the transferable record exists which is
unique, identifiable and, subject to certain exceptions, unalterable
(the ``Uniqueness Standard'').
    [cir] The authoritative copy must (i) identify the person claiming
control (i.e., the person to which the transferable record was issued
or transferred), (ii) be maintained by the person claiming control or
its designee and (iii) be unalterable except with the permission of the
person claiming control.
    [cir] Copies of and authorized revisions to the authoritative copy
must be clearly marked as such.
    DTC believes that any E-CD that is a transferable record and is
stored in a system that falls within the Section 16

Safe Harbor will have the same rights and obligations of an equivalent
writing under the UCC.\29\
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    \29\ Because Section 16 of UETA only contemplates a transferable
record that has been electronic since its creation and requires that
the transferable record comply with the Section 16 Safe Harbor,
including the Uniqueness Standard, at all times, DTC believes that
the legal issues relating to the electronic signature of a
negotiable instrument such as a CD are necessarily intertwined with
its electronic creation and storage. Thus, an electronic negotiable
instrument cannot be created outside of an appropriate system that
complies with the Section 16 Safe Harbor even if electronically
signed.
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    Because the Section 16 UETA provisions are more robust than ESRA
and the guidance in Section 16 of UETA is more developed, the E-CDs
that would be made eligible by DTC would be structured to meet the
requirements of UETA, including the Section 16 Safe Harbor, even
though, as discussed below, the E-CDs will also be structured so that
they are governed by New York law (including ESRA).\30\ This construct
will help ensure that an E-CD also will remain valid in the
jurisdictions that have adopted Section 16 of UETA, in the unlikely
event that a court of competent jurisdiction would determine not to
recognize the selection of New York law.
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    \30\ Although Section 307 of ESRA does not provide the same
robust provisions and commentary as Section 16 of UETA, it is still
sufficiently clear that E-CDs that meet the Uniqueness Standard are
valid.
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E-Sign
    The federal Electronic Signatures in Global and National Commerce
Act \31\ (``E-Sign'') generally provides for the legal effect, validity
and enforceability of electronic signatures and records relating to
transactions in interstate or foreign commerce and preempts state law
with respect to such transactions except to the extent the state has
enacted UETA or other alternative procedures or requirements that are
consistent with E-Sign. E-Sign generally tracks the provisions of UETA
but does not apply to transactions that are governed by the UCC, such
as the issuance of CDs. E-Sign's equivalent of Section 16 of UETA
expressly limits the use of transferable records to debt obligations
secured by an interest in real property (i.e., mortgage notes).
Instead, state law must provide for the electronic creation and
signature of a CD for it to be valid.
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    \31\ Electronic Signatures in Global and National Commerce 15
U.S.C. Sec.  70[].
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Others
    In addition to New York, Illinois and Washington also did not adopt
UETA. Illinois adopted an electronic records and signatures law that is
similar to UETA and contains a section that is analogous to Section 16
of UETA. Washington adopted an electronic records and signatures law
that is very different than UETA and does not clearly contemplate or
provide for the issuance of electronic negotiable instruments such as
CDs. As noted above, California has not adopted Section 16 of UETA.
Therefore DTC is unable to conclude whether CDs that are created,
signed and stored electronically would be valid under Washington or
California law because it has not identified a legal framework under
those laws whereby an issuer could issue a valid E-CD that could in
turn be Deposited at DTC in accordance with the proposed rule change.
Proposed Rule Changes
    Pursuant to the proposed rule change, DTC would amend the OA and
Underwriting Service Guide, and create a new BLOR and the System E-CD
Templates to be used exclusively for the issuance of E-CDs, in order to
implement the proposed UWC system and E-vault for the issuance Delivery
and Deposit of E-CDs and put in place the Procedures and a framework
that conforms to the legal requirements for the maintenance of valid E-
CDs, as described above.
Each Issuer that Opts to Participate in the E-CD Program Would Sign a
New BLOR.
    Pursuant to the proposed rule change, the OA would require each E-
CD issuer to submit a new BLOR (``E-CD BLOR'') to DTC through UWC prior
to its first issuance of E-CDs. In order to minimize the additional
provisions in the Electronic Master Certificate (as defined below), the
E-CD BLOR would contain supplemental terms related to the E-CD program
(in addition to the representations that are currently included in a
BLOR). The new E-CD BLOR would provide that all E-CDs issued in
connection therewith and under one of the base CUSIP numbers set forth
on the face of the E-CD BLOR would be part of the same transaction in
which the E-CD BLOR was executed.\32\
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    \32\ Section 3-119 of the NYUCC provides that a negotiable
instrument may be ``modified or affected by any other written
agreement executed as part of the same transaction.''
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    Pursuant to Section 3-119 of the UCC, a holder in due course of a
negotiable instrument must have notice of any separate agreement in
order to be subject to its limitations. Therefore, the Electronic
Master Certificate (as defined below) would contain a reference to the
new E-CD BLOR.\33\
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    \33\ While a CD cannot expressly be made subject to the terms of
an additional agreement, Section 3-105(1)(c) of the UCC permits the
CD to refer to or state that it arises out of a separate agreement.
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Each Issuer Issuing E-CDs Would Electronically Sign and Issue an
Electronic Master Certificate.
    E-CDs would be issued on a new form of master electronic
certificate (``Electronic Master Certificate'') that has been specially
created for the E-CD program. A separate electronic Master Certificate
would be issued by the issuer for each broker that participates in an
E-CD offering. Because E-CDs must necessarily be created, signed and
thereafter maintained in electronic form using a system that complies
with the Section 16 Safe Harbor, including the Uniqueness Standard, DTC
would only make eligible E-CDs that have been initiated by the related
broker/dealer through UWC, then created, signed and submitted to DTC
through an electronic signature system designed by DTC for this
purpose. UWC would allow Participants to initiate a new E-CD issuance
by creating a draft Electronic Master Certificate using the applicable
System E-CD Template that would be sent to an issuer for verification
and signature. The issuer will verify and affix its electronic
signature to the Electronic Master Certificate created by the
Participant in a manner that creates an executed Electronic Master
Certificate that complies with the Uniqueness Standard.
Once Issued, Each Original Electronic Master Certificate Would be
Automatically Stored in an Electronic Vault Repository.
    Once an issuer verifies and affixes its electronic signature to an
Electronic Master Certificate, the Electronic Master Certificate would
be automatically stored in an E-vault repository that complies with the
Section 16 Safe Harbor, and the Electronic Master Certificate would
immediately be deemed ``Delivered'' to DTC. The E-vault will identify
Cede & Co. as the person to which the Electronic Master Certificate was
issued. The E-vault will maintain an audit trail that will track all
events that occur with respect to the Electronic Master Certificate,
including any authorized changes, such as notations to reflect
withdrawals, which will be noted in the audit trail instead of on the
body of the Electronic Master Certificate. The audit trail will be
incorporated as part of the Electronic

Master Certificate in accordance with the BLOR.
E-CDs Would be Governed by New York Law.
    The parties would select New York law as the governing law for all
E-CDs, as described below. Because there are variations between the
electronic record and signature laws (including in the provisions of
UETA, as adopted) across the various U.S. jurisdictions, the selection
of New York law (including ESRA) as the law governing the E-CDs would
allow DTC to structure a single E-CD program that will be valid for
issuers in all U.S. jurisdictions.
    DTC believes that the System E-CD Templates for the E-CDs and the
proposed BLOR to be used for E-CD issuances have been structured in a
manner that complies with the applicable rules governing jurisdiction
selection, as follows:
     Each BLOR would provide that the laws of New York would
govern the terms of the E-CD, which is issued and payable to DTC in New
York. The jurisdiction selection rule in Section 1-301 of the UCC,
which applies to CD issuances under Article 3 of the UCC, allows
parties to a transaction that bears a reasonable relation to a state to
select the laws of that state to govern their rights and duties.
     Each Electronic Master Certificate would have a minimum
denomination of $250,000. The jurisdiction selection rule in Section 5-
1401 of the New York General Obligations Law allows parties to any
transaction that results in an obligation of at least $250,000 to
select New York law to govern their rights and obligations.
     Each Electronic Master Certificate would expressly provide
that it is payable in New York. The general rule in New York (and in
most other jurisdictions) is that a note (such as a CD) that is
executed in one state and payable in another, is governed as to its
nature, validity, interpretation and effect by the laws of the state
where it is made payable.
E-CDs Would be Structured as ``financial assets''--but not as
``Securities''--Under Article 8 of the UCC.
    Section 8-110 of the UCC provides that only the law of the issuer's
jurisdiction will govern the ``validity'' of a ``security''--the laws
of another jurisdiction cannot be selected to govern validity issues.
The term ``validity'' is not defined in the UCC. DTC believes that laws
governing the creation and existence of an electronic record as a
substitute for a written instrument may be viewed as laws that govern
the ``validity'' of an instrument.\34\
---------------------------------------------------------------------------

    \34\ See Comment 2 to Section 8-110 of the UCC (explaining that
the law of the issuer's jurisdiction governs the validity of a
security in order to ensure that a single body of law governs the
questions addressed in Part 2 of Article 8). Part 2 of Article 8 of
the UCC describes the circumstances in which an issuer can and
cannot assert invalidity as a defense against purchasers, including
lack of genuineness, unauthorized signatures and incomplete
certificates. This implies that the term ``validity'' in Section 8-
110 of the UCC refers to a broader set of issues than just the
validity of issuance of the security under the issuer's governing
documents and local law.
---------------------------------------------------------------------------

    CDs may be both ``negotiable instruments'' under Article 3 of the
UCC and ``securities'' under Article 8 of the UCC, in which case the
provisions of Article 8 will govern the CD.\35\ This means that an E-CD
that is both a negotiable instrument and a security, will be governed
as to its validity by the law of the issuer's jurisdiction, by virtue
of Section 8-110 of the UCC. If the validity of a security is
determined to include its electronic nature, then the electronic
signature and record laws of each individual issuer's jurisdiction
would apply to each E-CD, and the selection of New York's ESRA would
not be valid. As a result, any jurisdiction that has not enacted a law
that clearly provides for electronic negotiable records would
necessarily have to be excluded from the E-CD program.\36\
---------------------------------------------------------------------------

    \35\ See Section 3-103(1) of the UCC (providing that Article 3
does not apply to investment securities); Comment 2 to Section 3-103
of the UCC (explaining that if an instrument is negotiable in form
under Article 3, but is, because of its manner of use, a
``security'' under Article 8, Article 8 and not Article 3 applies);
and Section 8-103(d) of the UCC and Comment 5 to Section 8-103 of
the UCC (providing that a writing that is a security certificate is
governed by Article 8, even though it also meets the requirements of
Article 3).
    \36\ In particular, as noted above, if the E-CDs are Article 8
securities, then DTC would be unable to conclude that E-CDs would be
valid under the laws of California and Washington, and issuers in
California and Washington would likely be excluded from the E-CD
program.
---------------------------------------------------------------------------

    In order to ensure that the parties can properly choose New York
law, including ESRA, to govern the E-CDs, E-CDs would be structured so
that they are not Article 8 Securities. To do this, each Electronic
Master Certificate would provide that it can be transferred only by
delivery and indorsement. A ``security,'' as defined in Section 8-
102(a)(15) of the UCC, must be in ``bearer'' or ``registered'' form.
``Bearer form'' requires that the security be payable to bearer.
Because each Electronic Master Certificate would be payable to Cede &
Co., as nominee for DTC, it would not be in bearer form. ``Registered
form'' requires that transfers of a security be registered upon books
maintained for that purpose by or on behalf of the issuer, or the
security certificate must so state. Because E-CDs would be
transferrable only by delivery and indorsement and not on the books of
the issuer, they will not be in registered form and therefore will not
fall within the definition of ``security'' in Article 8 of the UCC.
    Although the E-CDs would not be Article 8 securities, under Section
8-103(d) of the UCC they will still be ``financial assets'' if held in
a securities account.\37\ DTC Rule 6 provides, among other things, that
DTC will accept Securities for deposit and may offer such other
services as are consistent with its purposes and powers.\38\
``Securities'' are defined in the DTC Rules as anything that would be a
``financial asset'' under Section 8-102 of the UCC. The DTC Rules
further provide that any item credited to a securities account will be
deemed a Security under the DTC Rules and treated as a financial asset
under Article 8 of the UCC. Accordingly, E-CDs, each of which will be a
financial asset under Article 8 of the UCC, may be made eligible by
DTC, credited by DTC to the securities accounts of its participants,
and treated as a ``Security'' for all purposes, in each case under the
DTC Rules.
---------------------------------------------------------------------------

    \37\ Section 8-103(d) of the UCC provides, in part, ``a
negotiable instrument governed by Article 3 is a financial asset if
it is held in a securities account.'' See also, the definition of
``financial asset'' in Section 8-102(a)(9) of the UCC, which
provides that any property held by a securities intermediary for
another person in a securities account will be a financial asset if
the securities intermediary has expressly agreed with the other
person that the property is to be treated as such.
    \38\ DTC's corporate powers are listed in its Organization
Certificate, which include, among other things, the receipt on
deposit for safe-keeping money, securities, papers of any kind and
any other personal property for the account of its participants in
connection with DTC's acting as a clearing corporation.
---------------------------------------------------------------------------

    The rules relating to the indirect holding system, security
entitlements and the rights and duties of securities intermediaries
(e.g., DTC) and entitlement holders, which are specified in Part 5 of
Article 8 of the UCC, apply to all financial assets.\39\ Thus, although

the E-CDs would not be securities, because they would be financial
assets, they may be issued and deposited with DTC, and DTC can credit
security entitlements therein to its Participants, as it currently does
with respect to paper CDs.\40\ E-CDs would be maintained as fungible
bulk by DTC, in accordance with the requirement in Section 8-504 of the
UCC that a securities intermediary maintain a financial asset in a
quantity corresponding to the aggregate of all security entitlements it
has established therein.\41\
---------------------------------------------------------------------------

    \39\ See Comment 5 to Section 8-103 of the UCC (explaining that
the indirect holding rules apply to any Article 3 negotiable
instrument that is held through a securities intermediary; Comment 9
to Section 8-102 of the UCC (explaining that the indirect holding
rules in Part 5 of Article 8 may apply to financial assets even
where the rules in Parts 2, 3 and 4 of Article 8 do not apply); and
Comment 1 to Section 8-104 of the UCC (explaining that Article 3 and
not Article 8 specifies how one acquires a direct interest in a
bankers' acceptance, which is a negotiable instrument under Article
3 and a financial asset under Article 8, and Part 5 of Article 8
governs the rights of a clearing corporation's participants with
respect to a bankers' acceptance that is held by the clearing
corporation on account for its participants).
    \40\ DTC currently accepts for deposit bankers' acceptances,
which are not Article 8 securities, and proposes to do the same with
respect to the E-CDs.
    \41\ Comment 1 to Section 8-504 of the UCC explains that Section
8-504 recognizes the reality that these items are held as fungible
bulk and are not identified to a customer. The language in Section
8-504 of the UCC applies to all financial assets (not just
securities) and would therefore provide the basis for holding E-CDs
as fungible bulk, even if they are not Article 8 securities.
---------------------------------------------------------------------------

Summary of Selected E-CD Terms
    Section 3-104 of the UCC provides that a negotiable instrument may
only contain an unconditional promise to pay a sum certain, a
prescribed set of other obligations and powers, and no other promise,
order, obligation or power. Because it is unclear exactly what would
constitute an additional obligation or power, only those provisions
that are necessary to ensure that a holder can ascertain all of the E-
CDs essential terms \42\ would be included in the Electronic Master
Certificate, either directly, or by reference to the issuer's E-CD
BLOR.
---------------------------------------------------------------------------

    \42\ See Comment 8 to Section 3-105 of the UCC (``an instrument
is not negotiable unless the holder can ascertain all of its
essential terms from its face'').
---------------------------------------------------------------------------

Selected Terms Contained in the Master Electronic Certificate
    The following terms would be included in each System E-CD Template:
     The E-CD would be payable in New York--this ensures that
the E-CD will be governed by New York law.
     The E-CD is issued in connection with a BLOR between the
issuer and DTC--this allows for the additional terms contained in the
BLOR to modify or affect the terms of the E-CD and puts any holder of
the E-CD on notice of the existence of such additional terms.
     The E-CD is an electronic record created in accordance
with ESRA, and a transferable record under UETA--this makes clear the
issuer's intent that the E-CD be a valid electronic instrument under
both ESRA and UETA.\43\
---------------------------------------------------------------------------

    \43\ Section 16 of UETA requires that the issuer expressly agree
that the E-CD is a transferable record. Comment 2 to Section 16 of
UETA explains that it is likely that this agreement will be set
forth in the body of the electronic record.
---------------------------------------------------------------------------

     The E-CD would be stored in the E-vault--this is necessary
to understand how the notation and transfer provisions in the
Electronic Master Certificate will work.
     The E-CD may be transferred only by delivery and
indorsement--this ensures that the E-CD would not be an Article 8
security and, therefore, not subject to the limitation on jurisdiction
selection with respect to validity.
Selected Terms Contained in the BLOR:
     Paper out provision--this allows DTC to convert the E-CD
to a paper CD, if deemed necessary, without further action from the
issuer.
     Selection of New York governing law and jurisdiction--
included in the BLOR to minimize additions to the Electronic Master
Certificate.
     No contravention representation by the issuer--the issuer
is responsible for ensuring that the issuance of an E-CD complies with
applicable local law and regulation and the issuer's governing
documents.
Other Proposed Changes to the OA
    In addition to the proposed changes described above, the OA would
be amended as follows:
    a. Section I.A.1. would be amended to add a reference to UWC, in
addition to UW SOURCE, as a system that may be used by Participants to
submit eligibility requests. Additionally, the hyperlink to the website
of DTC's parent, The Depository Trust & Clearing Corporation (``DTCC'')
for information on UW SOURCE will be amended to refer to the
Underwriting section of DTCC's website. The proposed changes in this
section would facilitate Participants' ability to access DTC's systems
for eligibility requests.
    b. Section 1.B.1 relating to the documentation requirements for BEO
Securities would be amended to add a new subsection c. with the
following text under a new heading titled ``Electronic Certificates for
Retail CDs'':
    Issuers leveraging the use of electronic master certificates for
Retail CDs must submit to DTC on DTC's form, a fully executed BLOR and
its associated Rider, for each base CUSIP issuing Retail CDs through
the electronic process. For the current form of the E-CD BLOR please
refer to https://www.dtcc.com/legal/issue-eligibility.
    In addition, subsection a. of this Section, which describes the
current Letter of Representation requirements for BEO Securities, would
be amended in order to clarify that the requirements described in that
subsection apply to BEO Securities other than E-CDs, namely FAST
securities or securities where a physical master certificate is
delivered to DTC.
    The proposed changes to this section would facilitate Participants'
and issuers' access to documentation used in connection with
eligibility requests.
    c. Section 1.C.1., which relates to considerations relating to
eligibility of CDs, would be amended to add a subsection c. that would
be titled ``Electronic Master Certificates,'' to provide for issuance
and Delivery of E-CDs and a legal disclaimer as follows:
    In lieu of issuing and delivering physical master certificates to
DTC, the Underwriter can facilitate issuance of Retail CDs for state
and federally chartered banks in electronic form by using specific
master certificate templates (``System E-CD Templates'') provided by
DTC through UWC.
    The relevant data (e.g., maturity date) will be populated into a
System E-CD Template as entered by the Underwriter into the UWC
application. It is the responsibility of the Underwriter to disseminate
the populated electronic master certificate to the Issuer for
electronic signature via UWC. The Issuer must electronically sign the
electronic master certificate prior to closing.
    Each electronic master certificate is stored in a secure electronic
vault maintained by DTC.
    For Retail CDs that do not conform to the System E-CD Templates, a
physical master certificate must be delivered to DTC prior to closing.

    Note:  Whether issued in electronic or physical form, securities
should be delivered to DTC by no later than noon ET on the business
day prior to the Closing Date as outlined in Exhibit B.

    IMPORTANT LEGAL NOTICE:
    DTC DOES NOT VALIDATE, CERTIFY, REPRESENT OR SEEK TO CONFIRM (i)
THE VALIDITY OF THE DATA ELEMENTS ENTERED BY A PARTICIPANT, ITS
CORRESPONDENT UNDERWRITERS AND OR VENDORS INTO UWC (TOGETHER WITH ANY
OTHER PERSON USING UWC, ``UWC USERS'') OR (ii) THE FITNESS OF THE
ELECTRONIC MASTER CERTIFICATES FOR ANY PURPOSE. USE OF UWC AND/OR
ELECTRONIC MASTER CERTIFICATES BY ANY UWC USER SHALL BE DEEMED TO
CONSTITUTE A WAIVER OF ANY AND ALL CLAIMS (WHETHER DIRECT OR INDIRECT)
AGAINST DTC AND ITS AFFILIATES, AND AN AGREEMENT THAT DTC

AND ITS AFFILIATES SHALL NOT BE LIABLE FOR ANY LOSS, COST, EXPENSE OR
LIABILITY IN RELATION TO THE USE OF UWC AND/OR DISSEMINATION OR USE OF
RELATED DOCUMENTATION, INCLUDING MASTER CERTIFICATES OF DEPOSIT, WHICH
ARE PROVIDED ``AS IS.''
    EACH PARTICIPANT AGREES TO INDEMNIFY AND HOLD HARMLESS DTC AND ITS
AFFILIATES FROM AND AGAINST ANY AND ALL LOSSES, DAMAGES, COSTS,
JUDGMENTS, CHARGES AND EXPENSES ARISING OUT OF OR RELATING TO ANY USE
OF UWC BY THE PARTICIPANT AND/OR ANY UWC USER, INCLUDING BUT NOT
LIMITED TO ANY ISSUANCES OF CERTIFICATES OF DEPOSIT AND RELATED
TRANSACTIONS BY SUCH PERSON OR ITS AFFILIATES, AGENTS, CUSTOMERS OR
DESIGNEES.''
    This proposed change would facilitate the implementation and use of
System E-CD Templates, as described above, and set forth a disclaimer
by DTC and indemnification consistent with the requirements of DTC's
current Rule and Procedures which allocate the responsibility to
Participants for the accuracy of information and instructions provided
by them to DTC and the indemnification of DTC by Participants in this
regard.\44\
---------------------------------------------------------------------------

    \44\ See OA, supra note 3 at ii-iii and Rule 6, supra note 3.
---------------------------------------------------------------------------

    d. Exhibit B, which sets forth timeframes for submission of
documents by Participants to DTC Underwriting in connection with
eligibility requests, would be revised to reflect that the timeframes
described in the exhibit relate to documents and information submitted
through UWC, in addition to UW SOURCE. The proposed change to Exhibit B
would align timeframes for submissions through UWC with those that
apply to submissions to UWSOURCE.
    e. Technical changes with respect to spelling, punctuation and
spacing of text would also be made. The proposed technical changes to
the OA would provide enhanced clarity for Participants and Issuers with
respect to Procedures relating to eligibility processing and the
Deposit of CDs.
Proposed Changes to the Underwriting Service Guide
    a. A glossary description provided for BLOR in the Underwriting
Guide currently describes a BLOR as an agreement between DTC and an
issuer of municipal securities. As described above, a BLOR or LOR is
required to be submitted with respect to any issue of BEO Securities
which also includes corporate Securities. Pursuant to the proposed rule
change, the text would be clarified so that the description of the term
BLOR is not described as limited to applying only to municipal
Securities. The proposed change to this glossary description would
provide enhanced clarity for Participants and Issuers with respect to
Procedures relating to eligibility documentation required for BEO
Securities.
    b. Pursuant to the proposed rule change, DTC would eliminate
references to the Participant Terminal System (``PTS'') functions ART
and PUND as these functions have become obsolete. ART related to
inquiries about transactions of a Participant processed by DTC and PUND
related to inquiries relating to issues and certificates for issues
held by a Participant. Participant inquiries may now be directed to the
Client Center available on dtcc.com.\45\ The proposed rule change would
update the Underwriting Service Guide to provide clarity for
Participants on how to submit inquires relating to DTC's services.\46\
---------------------------------------------------------------------------

    \45\ See Securities Exchange Act Release No. 88050 (January 27,
2020), 85 FR 5728 (January 31, 2020) (File No. SR-DTC-2020-002).
    \46\ Id.
---------------------------------------------------------------------------

    c. Pursuant to the proposed rule change, a reference to the IMPP
function in PTS would be deleted. The IMPP function allowed
Participants to view Important Notices about underwriting, transfer
agents, and money market instruments (``MMI''). This function is not
being widely used by Participants. All DTC Important Notices are
accessible on dtcc.com.\47\
---------------------------------------------------------------------------

    \47\ See https://www.dtcc.com/legal/important-notices.
---------------------------------------------------------------------------

    d. The Section titled ``Packaging Inquiries'' provides information
and requirements relating to the delivery of securities to DTC.
Pursuant to the proposed rule change, DTC would add the following text
under a subheading titled ``Retail (brokered) Certificates of Deposit''
to note the existence of the proposed process for E-CDs with a
reference to the OA for additional information:
    In lieu of issuing and delivering physical master certificates to
DTC, the Underwriter can facilitate issuance of Retail CDs for state
and federally chartered banks in electronic form by using available
master certificate templates through the Underwriting Central system
(``UWC''), in accordance with the provisions of the OA.
    Each electronic master certificate deposited at DTC is stored in a
secure electronic vault maintained by DTC.''
    This Section would also include use, waiver of liability and
indemnification provisions as follows:
    IMPORTANT LEGAL NOTE:
    DTC DOES NOT VALIDATE, CERTIFY, REPRESENT OR SEEK TO CONFIRM (i)
THE VALIDITY OF THE DATA ELEMENTS ENTERED BY A PARTICIPANT, ITS
CORRESPONDENT UNDERWRITERS AND OR VENDORS INTO UWC (TOGETHER WITH ANY
OTHER PERSON USING UWC, ``UWC USERS'') OR (ii) THE FITNESS OF THE
ELECTRONIC MASTER CERTIFICATES FOR ANY PURPOSE. USE OF UWC AND/OR
ELECTRONIC MASTER CERTIFICATES BY ANY UWC USER SHALL BE DEEMED TO
CONSTITUTE A WAIVER OF ANY AND ALL CLAIMS (WHETHER DIRECT OR INDIRECT)
AGAINST DTC AND ITS AFFILIATES, AND AN AGREEMENT THAT DTC AND ITS
AFFILIATES SHALL NOT BE LIABLE FOR ANY LOSS, COST, EXPENSE OR LIABILITY
IN RELATION TO THE USE OF UWC AND/OR DISSEMINATION OR USE OF RELATED
DOCUMENTATION, INCLUDING MASTER CERTIFICATES OF DEPOSIT, WHICH ARE
PROVIDED ``AS IS.''
    EACH PARTICIPANT AGREES TO INDEMNIFY AND HOLD HARMLESS DTC AND ITS
AFFILIATES FROM AND AGAINST ANY AND ALL LOSSES, DAMAGES, COSTS,
JUDGMENTS, CHARGES AND EXPENSES ARISING OUT OF OR RELATING TO ANY USE
OF UWC BY THE PARTICIPANT AND/OR ANY UWC USER, INCLUDING BUT NOT
LIMITED TO ANY ISSUANCES OF CERTIFICATES OF DEPOSIT AND RELATED
TRANSACTIONS BY SUCH PERSON OR ITS AFFILIATES, AGENTS, CUSTOMERS OR
DESIGNEES.
    The proposed changes to this section would facilitate the
implementation and use of System E-CD Templates, as described above,
and set forth a disclaimer by DTC and indemnification consistent with
the requirements of DTC's current Rule and Procedures which allocate
the responsibility to Participants for the accuracy of information and
instructions provided by them to DTC and the indemnification of DTC by
Participants in this regard.\48\
---------------------------------------------------------------------------

    \48\ See Underwriting Service Guide at 2-3, supra note 3 at ii-
iii and Rule 6, supra note 3.
---------------------------------------------------------------------------

System Access and Information Security Considerations
    A Participant controls access to its account and transaction
information relating to its holdings and activity in DTC's systems
through DTCC's access

coordinator program.\49\ This program includes, but is not limited to,
controls on access to UWSOURCE, and would also encompass UWC access
upon implementation of the proposal. DTC may provide to the issuer of
any security, including but not limited to CDs, at any time credited to
the Account of a Participant the name of the Participant and the amount
of the issuer's securities so credited, and the Corporation is
authorized to provide similar information to any appropriate
governmental authority.\50\ An issuer must provide authorization
annually for a third party agent to obtain access to an position
information with respect to Securities of such issuer.\51\
---------------------------------------------------------------------------

    \49\ https://www.dtcc.com/client-center/access-coordinators.
    \50\ See Rule 2, supra note 3.
    \51\ See OA, supra note 3 at 55.
---------------------------------------------------------------------------

    DTCC, for itself and on behalf of its subsidiaries, including DTC,
maintains a privacy policy, which among other things, states that DTCC
maintains an information security program setting forth standards for
maintaining administrative, technical and physical safeguards to
protect the personal information provided by users of services, which
would include personal information provided through the E-CD program,
against accidental, unlawful or unauthorized destruction, loss,
alteration, access, disclosure or use. DTCC periodically tests the
security protections of its information systems and monitors the
effectiveness of its information security controls, systems and
procedures.\52\
---------------------------------------------------------------------------

    \52\ See Privacy Policy on DTCC website, available at https://www.dtcc.com/privacy.
---------------------------------------------------------------------------

Implementation Timeframes
    The proposed rule change would be implemented by DTC in two phases,
with the first phase beginning after approval of the proposed rule
change by the Commission and prior to the end of January 2021.
    Initially, underwriters would be invited to participate, on a
voluntary basis. The underwriters that would participate in this
initial phase are those that expressed interest in participating after
outreach by DTC to those Participants that participated in the
development of the proposed E-CD program. The Participants that would
participate during the first phase are those Participants that expect
to be able to submit an issuance during this phase that would meet the
requirements of the proposed E-CD program, as those requirements are
described above. This phased approach to implementation would
facilitate a smooth transition, from an operational perspective, for
ultimately making UWC available for all E-CD offerings of state and
federally chartered banks that conform to the System Templates.
    Subsequently, the E-CD program would be made available to all
underwriters in early 2021, with the implementation date of such
availability to be announced via Important Notice. Upon approval of the
proposed rule change, a legend would be added to the OA and
Underwriting Service Guide indicating that the applicable provisions
relating to E-CDs would apply only to (i) issuers whose issuances are
submitted to DTC through UWC and (ii) Participants that submit and/or
hold eligible issuances submitted through UWC, during this first phase,
until a date to be announced by DTC via Important Notice when the E-CD
program would become available, on a voluntary basis, for all eligible
issuances. This legend would read as follows:
    Applicable provisions relating to UWC and Electronic Master
Certificates for Certificates of Deposit, as described herein, apply
only to (i) Issuers whose issuances are submitted to DTC through UWC,
and (ii) Participants that submit and/or hold eligible issuances
submitted through UWC during an initial phase of the electronic CD
program, until a date to be announced by DTC via Important Notice when
the E-CD program would become available, on a voluntary basis, for all
eligible issuances of state and federally chartered banks. This legend
will be removed upon full implementation of the E-CD program on a date
to be announced via Important Notice.
    Issuers and underwriters that choose not to use the new E-CD
program could continue to use the existing process through UW SOURCE,
including making Deposits using physical certificates.
2. Statutory Basis
Section 17A(b)(3(F) of the Act
    The Clearing Agencies believe that the Framework is consistent with
Section 17A(b)(3)(F) of the Act,\53\ for the reasons described below.
---------------------------------------------------------------------------

    \53\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    Section 17A(b)(3)(F) of the Act \54\ requires, inter alia, that the
rules of a clearing agency be designed to assure the safeguarding of
securities and funds which are in the custody or control of the
clearing agency or for which it is responsible. As described above, the
proposed rule change would provide for the issuance of Electronic
Master Certificates for E-CDs which would be stored in a secure E-
Vault, as described above. Therefore, by providing for the storage of
E-CDs in a secure electronic vault, the proposed rule change is
designed to assure the safeguarding of securities which are in the
custody or control of DTC.
---------------------------------------------------------------------------

    \54\ Id.
---------------------------------------------------------------------------

    Section 17A(b)(3)(F) of the Act also requires that the rules of the
clearing agency be designed, inter alia, to promote the prompt and
accurate clearance and settlement of securities transactions. DTC
believes that the proposed rule change is consistent with this
provision of the Act because DTC believes that the proposed E-CD
program would reduce closing delays caused by disruptions to physical
delivery of certificates by eliminating the need for DTC to receive
original paper master certificates in advance of CD issuances that
would be eligible for issuance through the new program. Therefore, by
facilitating the potential reduction of closing delays for issuances of
CDs that utilize the E-CD program, DTC believes that the proposed rule
change would promote the prompt and accurate clearance and settlement
of securities transactions.
    DTC also believes that the proposed rule changes are consistent
with Section 17A(b)(3)(F), cited above, because by making technical
changes with respect to spelling, punctuation and spacing of text
within the Procedures, as described above, the proposed rule change
would provide enhanced clarity for Participants and Issuers with
respect to Procedures relating to eligibility processing and the
Deposit of CDs. By providing Participants and Issuers with enhanced
clarity with regard to the Procedures relating to, and therefore
facilitating eligibility processing and the Deposit of CDs that may be
the subject of transactions processed through the DTC system, DTC
believes that the proposed rule change would promote the prompt and
accurate clearance and settlement of securities transactions consistent
with the Act.
Rule 17Ad-22(e)(1)
    Rule 17Ad-22(d)(1) promulgated under the Act \55\ requires that
each registered clearing agency shall establish, implement, maintain
and enforce written policies and procedures reasonably designed to
provide for a well-founded, clear, transparent, and enforceable legal
basis for each aspect of its activities in all relevant jurisdictions.
As described above, DTC believes that requiring E-CDs at DTC to be
negotiable instruments governed by New York law would allow for the
valid issuance into

DTC of E-CDs of issuers in all relevant jurisdictions. Therefore, by
providing for E-CDs to be deemed negotiable instruments governed by New
York law, as described above, DTC believes that DTC's Rules and
Procedures, as amended by the proposed rule change, would provide for a
well-founded, clear, transparent, and enforceable legal basis for the
valid issuance of E-CDs into DTC from issuers domiciled in any relevant
jurisdiction.
---------------------------------------------------------------------------

    \55\ 17 CFR 240.1717Ad-22(d)(1).
---------------------------------------------------------------------------

    Also, as described above, because DTC believes the Section 16 UETA
provisions are more robust than ESRA and the guidance in Section 16 of
UETA is more developed, the proposal provides would provide that E-CDs
that would be made eligible by DTC would be structured to meet the
requirements of UETA, including the Section 16 Safe Harbor, even
though, as discussed above, the E-CDs would also be structured so that
they are governed by New York law (including ESRA).\56\ DTC believes
that this construct will help ensure that an E-CD also would be valid
in the jurisdictions that have adopted Section 16 of UETA, in the
unlikely event that a court of competent jurisdiction would determine
not to recognize the selection of New York law. Therefore, DTC believes
that structuring E-CDs to meet the requirements of UETA would allow
DTC's Rules and Procedures to provide additional support for a well-
founded, clear, transparent, and enforceable legal basis for the valid
issuance of E-CDs into DTC from issuers domiciled in jurisdictions that
have adopted Section 16 of UETA.
---------------------------------------------------------------------------

    \56\ Although Section 307 of ESRA does not provide the same
robust provisions and commentary as Section 16 of UETA, it is still
sufficiently clear that E-CDs that meet the Uniqueness Standard are
valid.
---------------------------------------------------------------------------

    DTC believes that with respect to all jurisdictions, including
those that have not adopted Section 16 of UETA or ESRA, the Procedures,
as amended pursuant to the proposed rule change, would continue to
facilitate the issuance of CDs in physical form into DTC. As indicated
above, the validity of a physical security does not depend on the
provisions of electronic signature laws. DTC believes that Article 8 of
the UCC as adopted in all relevant jurisdictions allows for the
physical issuance of CDs as securities. Therefore, an issuer from any
relevant jurisdiction would continue to be able to issue valid CDs in
physical form that meet DTC's eligibility requirements into DTC.
Therefore, DTC believes that DTC's Procedures, as amended pursuant to
the proposed rule change, would continue to provide a well-founded,
clear, transparent, and enforceable legal basis for the valid issuance
of CDs into DTC from issuers domiciled in any relevant jurisdiction.
Rule 17Ad-22(e)(10)
    Rule 17Ad-22(d)(10) promulgated under the Act \57\ requires that
each registered clearing agency shall establish, implement, maintain
and enforce written policies and procedures reasonably designed, inter
alia, to, as applicable, establish and maintain operational practices
that manage the risks associated with such physical deliveries. As
mentioned above, the proposed rule change would eliminate the
requirement for the delivery of a physical master certificate for a CD
offering to the extent it is eligible for, and processed through, the
electronic process established through UWC, and stored in the E-Vault.
DTC believes the proposed electronic process for Delivery of E-CDs to
DTC would reduce risks of loss related to the physical CDs that would
otherwise be physically transported to DTC for Deposit and later
returned to issuers or their agents for redemption upon maturity of the
CD. Therefore, by reducing the risk of loss of physical master
certificates by allowing their replacement with Electronic Master
Certificates, DTC believes that the proposed rule change would
establish and maintain operational practices that manage risks
associated with eligible offerings of CDs, as described above.
---------------------------------------------------------------------------

    \57\ 17 CFR 240.1717Ad-22(d)(10).
---------------------------------------------------------------------------

Rule 17Ad-22(e)(11)
    Rule 17Ad-22(e)(11) promulgated under the Act \58\ requires that
each covered clearing agency shall establish, implement, maintain and
enforce written policies and procedures reasonably designed to, as
applicable, when the covered clearing agency provides central
securities depository services: (i) Maintain securities in an
immobilized or dematerialized form for their transfer by book entry,
ensure the integrity of securities issues, and minimize and manage the
risks associated with the safekeeping and transfer of securities; (ii),
inter alia, prevent the unauthorized creation or deletion of
securities; and (iii) Protect assets against custody risk through
appropriate rules and procedures consistent with relevant laws, rules,
and regulations in jurisdictions where it operates.
---------------------------------------------------------------------------

    \58\ 17 CFR 240.1717Ad-22(d)(11)(i)(ii) and (iii).
---------------------------------------------------------------------------

    DTC believes the proposed rule change is consistent with the
provisions of Rule 17Ad-22(e)(11)(i), cited above, because (i) by
providing for the Deposit of Securities in the name of Cede & Co. to be
deposited in electronic form and stored in an electronic vault, the
proposed rule change would provide for the immobilization and
dematerialization of master certificates for the transfer of CDs by
book entry, (ii) the integrity of E-CDs would be maintained by such
storage in the secure electronic vault and (iii) it would minimize the
risks associated with the safekeeping and transfer of securities by
providing for purely electronic processing of the certificates and
therefore preventing potential of loss of certificates if the
applicable issues were to be issued and processed in physical form.
    DTC believes the proposed rule change is consistent with the
provisions of Rule 17Ad-22(e)(11)(ii), cited above, because it would
provide for a process allowing the issuance and Deposit of the related
Securities through the use of UWC and associated System Templates for
creation of E-CDs, signature of E-CDs and Delivery of the E-CDs to DTC
for storage in the E-Vault. Through the use of this centralized process
for issuance and processing of CDs, the proposed rule change would
facilitate the prevention of the unauthorized creation or deletion of
securities processed through the E-CD program.
    DTC believes the proposed rule change is consistent with the
provisions of Rule 17Ad-22(e)(11)(iii) because, as discussed above, it
would provide for Procedures for the issuance of E-CDs, Deposit of E-
CDs, and custody of E-CDs in the E-Vault in a manner consistent with
the requirements applicable to the validity of electronic negotiable
instruments under the NYUCC and the e-signature laws, as discussed
above. The applicable Procedures would be established through proposed
rule changes to the Underwriting Service Guide and the OA, and the
utilization of Electronic Master Certificates in the forms of System E-
CD Templates issued under the applicable E-CD BLOR, as discussed above.
Therefore, DTC believes that E-CDs issued, Deposited and stored in
accordance with the proposed rule change would be Financial Assets that
constitute Eligible Securities under the Rules, and would be valid and
binding negotiable instruments under applicable law, and therefore
protect the applicable assets against custody risk through appropriate
rules and procedures consistent with relevant laws, rules, and
regulations in jurisdictions where DTC operates.

(B) Clearing Agency's Statement on Burden on Competition

    Once the proposed rule change is fully implemented as described
above, DTC does not believe that the proposed rule change would have
any impact, or impose any burden, on competition because the proposed
rule change provides for an additional method under which Participants
may request eligibility of, process, and Deliver CDs on a voluntary
basis. The new method would be available to all Participants through
UWC, on a date to be announced by Important Notice.
    The existing method for Deposit of CDs at DTC, that includes the
use of a physical master certificate, would continue to remain
available to all Participants even after the new E-CD process was
implemented.
    DTC does not believe that the aspect of the proposed rule change to
initially make the proposed E-CD process available to a subset of
Participants prior to full implementation, as described above, would
have any impact, or impose any burden on competition. Participants not
participating in the initial phase described above would be able to
continue to Deposit eligible CDs in physical form. However, to the
extent the proposed rule change could cause a burden because certain
Participants would continue to be able to Deliver electronic
certificates during an interruption of Participants' ability to make
physical delivery of securities to DTC, and/or DTC's ability to accept
physical deliveries of securities, DTC does not believe the burden have
a significant impact on competition because Participants could utilize
the LOP process, mentioned above, to effect Delivery of a security
represented in physical form to DTC despite any such interruption of
physical delivery services.
    DTC does not believe that the proposed rule change to make
technical changes with respect to spelling, punctuation and spacing of
text within the Procedures, as described above, would have any impact,
or impose any burden, on competition because the technical changes
would merely provide enhanced clarity with respect to the Procedures
and not have an effect on the rights or obligations of Participants
and/or Issuers with respect to eligibility processing and Deposit of
Eligible Securities at DTC.

(C) Clearing Agency's Statement on Comments on the Proposed Rule Change
Received From Members, Participants, or Others

    DTC has not solicited or received any written comments relating to
this proposal. DTC will notify the Commission of any written comments
received by the DTC.

III. Date of Effectiveness of the Proposed Rule Change, and Timing for
Commission Action

    Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-DTC-2020-017 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549.

All submissions should refer to File Number SR-DTC-2020-017. This file
number should be included on the subject line if email is used. To help
the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the provisions
of 5 U.S.C. 552, will be available for website viewing and printing in
the Commission's Public Reference Room, 100 F Street NE, Washington, DC
20549 on official business days between the hours of 10:00 a.m. and
3:00 p.m. Copies of the filing also will be available for inspection
and copying at the principal office of DTC and on DTCC's website
(http://dtcc.com/legal/sec-rule-filings.aspx). All comments received
will be posted without change. Persons submitting comments are
cautioned that we do not redact or edit personal identifying
information from comment submissions. You should submit only
information that you wish to make available publicly. All submissions
should refer to File Number SR-DTC-2020-017 and should be submitted on
or before December 28, 2020.

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\59\
---------------------------------------------------------------------------

    \59\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-26676 Filed 12-3-20; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 87, Number 194 (Friday, October 7, 2022)]
[Notices]
[Pages 61054-61063]
[FR Doc No: 2022-21834]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket No. FDA-2022-N-2389]

Authorization of Emergency Use of a Biological Product in
Response to an Outbreak of Monkeypox; Availability

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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

SUMMARY: The Food and Drug Administration (FDA) is announcing the
issuance of an Emergency Use Authorization (EUA) (the Authorization)
under the Federal Food, Drug, and Cosmetic Act (FD&C Act) in response
to an outbreak of monkeypox. FDA has issued one Authorization for a
biological product as requested by the National Institute of Allergy
and Infectious Diseases (NIAID), a part of the National Institutes of
Health. The Authorization contains, among other things, conditions on
the emergency use of the authorized product. The Authorization follows
the August 9, 2022, determination by the Secretary of the Department of
Health and Human Services (HHS) that there is a public health
emergency, or a significant potential for a public health emergency,
that affects, or has a significant potential to affect, national
security or the health and security of United States (U.S.) citizens
living abroad, and that involves monkeypox virus. On the basis of such
determination, the Secretary of HHS declared, on August 9, 2022, that
circumstances exist justifying the authorization of emergency use of
vaccines pursuant to the FD&C Act, subject to the terms of any
authorization issued under that section. The Authorization, which
includes an explanation of the reasons for issuance, is reprinted in
this document.

DATES: The Authorization is effective as of August 9, 2022.

ADDRESSES: Submit written requests for a single copy of the EUA to the
Office of Counterterrorism and Emerging Threats, Food and Drug
Administration, 10903 New Hampshire Ave., Bldg. 1, Rm. 4338, Silver
Spring, MD 20993-0002. Send one self-addressed adhesive label to assist
that office in processing your request or include a fax number to which
the Authorization may be sent. See the SUPPLEMENTARY INFORMATION
section for electronic access to the Authorization.

FOR FURTHER INFORMATION CONTACT: Michael Mair, Office of
Counterterrorism and Emerging Threats, Food and Drug Administration,
10903 New Hampshire Ave., Bldg. 1, Rm. 4340, Silver Spring, MD 20993-
0002,<PHONE_NUMBER> (this is not a toll free number).

SUPPLEMENTARY INFORMATION:

I. Background

    Section 564 of the FD&C Act (21 U.S.C. 360bbb-3) allows FDA to
strengthen public health protections against biological, chemical,
nuclear, and radiological agents. Among other things, section 564 of
the FD&C Act allows FDA to authorize the use of an unapproved medical
product or an unapproved use of an approved medical product in certain
situations. With this EUA authority, FDA can help ensure that medical
countermeasures may be used in emergencies to diagnose, treat, or
prevent serious or life-threatening diseases or conditions caused by
biological, chemical, nuclear, or radiological agents when there are no
adequate, approved, and available alternatives (among other criteria).

II. Criteria for EUA Authorization

    Section 564(b)(1) of the FD&C Act provides that, before an EUA may
be issued, the Secretary of HHS must declare that circumstances exist
justifying the authorization based on one of the following grounds: (1)
a determination by the Secretary of Homeland Security that there is a
domestic emergency, or a significant potential for a domestic
emergency, involving a heightened risk of attack with a biological,
chemical, radiological, or nuclear agent or agents; (2) a determination
by the Secretary of Defense that there is a military emergency, or a
significant potential for a military emergency, involving a heightened
risk to U.S. military forces, including personnel operating under the
authority of title 10 or title 50, U.S. Code, of attack with (A) a
biological, chemical, radiological, or nuclear agent or agents; or (B)
an agent or agents that may cause, or are otherwise associated with, an
imminently life-threatening and specific risk to U.S. military forces;
\1\ (3) a determination by the Secretary of HHS that there is a public
health emergency, or a significant potential for a public health
emergency, that affects, or has a significant potential to affect,
national security or the health and security of U.S. citizens living
abroad, and that involves a biological, chemical, radiological, or
nuclear agent or agents, or a disease or condition that may be
attributable to such agent or agents; or (4) the identification of a
material threat by the Secretary of Homeland Security pursuant to
section 319F-2 of the Public Health Service (PHS) Act (42 U.S.C. 247d-
6b) sufficient to affect national security or the health and security
of U.S. citizens living abroad.
---------------------------------------------------------------------------

    \1\ In the case of a determination by the Secretary of Defense,
the Secretary of HHS shall determine within 45 calendar days of such
determination, whether to make a declaration under section 564(b)(1)
of the FD&C Act, and, if appropriate, shall promptly make such a
declaration.
---------------------------------------------------------------------------

    Once the Secretary of HHS has declared that circumstances exist
justifying an authorization under section 564 of the FD&C Act, FDA may
authorize the emergency use of a drug, device, or biological product if
the Agency concludes that the statutory criteria are satisfied. Under
section 564(h)(1) of the FD&C Act, FDA is required to publish in the
Federal Register a notice of each authorization, and each termination
or revocation of an authorization, and an explanation of the reasons
for the action. Under section 564(h)(1) of the FD&C Act, revisions to
an authorization shall be made available on the internet website of
FDA. Section 564 of the FD&C Act permits FDA to authorize the
introduction into interstate commerce of a drug, device, or biological
product intended for use in an actual or potential emergency when the
Secretary of HHS has declared that circumstances exist justifying the
authorization of emergency use. Products appropriate for emergency use
may include products and uses that are not approved, cleared, or
licensed under sections 505, 510(k), 512, or 515 of the FD&C Act (21
U.S.C. 355, 360(k), 360b, and 360e) or section 351 of the Public Health
Service Act (PHS Act) (42 U.S.C. 262), or conditionally approved under
section 571 of the FD&C Act (21 U.S.C. 360ccc).
    FDA may issue an EUA only if, after consultation with the HHS
Assistant Secretary for Preparedness and Response, the Director of the
National Institutes of Health, and the Director of the Centers for
Disease Control and Prevention (to the extent feasible and appropriate
given the applicable circumstances), FDA \2\ concludes: (1) that an
agent referred to in a declaration

of emergency or threat can cause a serious or life-threatening disease
or condition; (2) that, based on the totality of scientific evidence
available to FDA, including data from adequate and well-controlled
clinical trials, if available, it is reasonable to believe that: (A)
the product may be effective in diagnosing, treating, or preventing (i)
such disease or condition; or (ii) a serious or life-threatening
disease or condition caused by a product authorized under section 564
of the FD&C Act, approved or cleared under the FD&C Act, or licensed
under section 351 of the PHS Act, for diagnosing, treating, or
preventing such a disease or condition caused by such an agent; and (B)
the known and potential benefits of the product, when used to diagnose,
prevent, or treat such disease or condition, outweigh the known and
potential risks of the product, taking into consideration the material
threat posed by the agent or agents identified in a declaration under
section 564(b)(1)(D) of the FD&C Act, if applicable; (3) that there is
no adequate, approved, and available alternative to the product for
diagnosing, preventing, or treating such disease or condition; (4) in
the case of a determination described in section 564(b)(1)(B)(ii) of
the FD&C Act, that the request for emergency use is made by the
Secretary of Defense; and (5) that such other criteria as may be
prescribed by regulation are satisfied.
---------------------------------------------------------------------------

    \2\ The Secretary of HHS has delegated the authority to issue an
EUA under section 564 of the FD&C Act to the Commissioner of Food
and Drugs.
---------------------------------------------------------------------------

    No other criteria for issuance have been prescribed by regulation
under section 564(c)(5) of the FD&C Act.

III. The Authorization

    The Authorization follows the August 9, 2022, determination by the
Secretary of HHS that there is a public health emergency, or a
significant potential for a public health emergency, that affects, or
has a significant potential to affect, national security or the health
and security of U.S. citizens living abroad, and that involves
monkeypox virus. On the basis of such determination, the Secretary of
HHS declared, on August 9, 2022, that circumstances exist justifying
the authorization of emergency use of vaccines pursuant to section 564
of the FD&C Act, subject to the terms of any authorization issued under
that section. Notice of the Secretary's determination and declaration
was provided in the Federal Register on August 15, 2022 (87 FR 50090).
Having concluded that the criteria for issuance of the Authorization
under section 564(c) of the FD&C Act are met, FDA has issued the
authorization for the emergency use of a biological product during the
monkeypox outbreak. On August 9, 2022, FDA issued an EUA to NIAID for
the biological product JYNNEOS, subject to the terms of the
Authorization.
    The initial Authorization, which is included below in its entirety
after section IV of this document (not including the authorized
versions of the fact sheets and other written materials), provides an
explanation of the reasons for issuance, as required by section
564(h)(1) of the FD&C Act. Any subsequent reissuance of the
Authorization can be found on FDA's web page at: https://www.fda.gov/emergency-preparedness-and-response/mcm-legal-regulatory-and-policy-framework/emergency-use-authorization.

IV. Electronic Access

    An electronic version of this document and the full text of the
Authorization is available on the internet at: https://www.fda.gov/emergency-preparedness-and-response/mcm-legal-regulatory-and-policy-framework/emergency-use-authorization.
BILLING CODE 4164-01-P

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    Dated: September 30, 2022.
Lauren K. Roth,
Associate Commissioner for Policy.
[FR Doc. 2022-21834 Filed 10-6-22; 8:45 am]
BILLING CODE 4164-01-P


[Federal Register: March 17, 2006 (Volume 71, Number 52)]
[Notices]
[Page 13826]
[DOCID:fr17mr06-57]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. RP06-265-000]

Sabine Pipe Line LLC; Notice of Tariff Filing

March 9, 2006.
    Take notice that on March 2, 2006, Sabine Pipe Line LLC (Sabine)
tendered for filing as part of its FERC Gas Tariff, Original Volume No.
1, the tariff sheets listed on Attachment A to the filing, to become
effective April 1, 2006.
    Sabine states that it is proposing the revised tariff sheets as a
housekeeping measure to update addresses and contact information,
correct typographical errors and punctuation, and make minor
corrections to the Tariff.
    Any person desiring to intervene or to protest this filing must
file in accordance with Rules 211 and 214 of the Commission's Rules of
Practice and Procedure (18 CFR 385.211 and 385.214). Protests will be
considered by the Commission in determining the appropriate action to
be taken, but will not serve to make protestants parties to the
proceeding. Any person wishing to become a party must file a notice of
intervention or motion to intervene, as appropriate. Such notices,
motions, or protests must be filed in accordance with the provisions of
Section 154.210 of the Commission's regulations (18 CFR 154.210).
Anyone filing an intervention or protest must serve a copy of that
document on the Applicant. Anyone filing an intervention or protest on
or before the intervention or protest date need not serve motions to
intervene or protests on persons other than the Applicant.
    The Commission encourages electronic submission of protests and
interventions in lieu of paper using the ``eFiling'' link at http://www.ferc.gov.
 Persons unable to file electronically should submit an

original and 14 copies of the protest or intervention to the Federal
Energy Regulatory Commission, 888 First Street, NE., Washington, DC
20426.
    This filing is accessible on-line at http://www.ferc.gov, using the

``eLibrary'' link and is available for review in the Commission's
Public Reference Room in Washington, DC. There is an ``eSubscription''
link on the Web site that enables subscribers to receive e-mail
notification when a document is added to a subscribed docket(s). For
assistance with any FERC Online service, please e-mail
<EMAIL_ADDRESS>or call<PHONE_NUMBER> (toll free). For

TTY, call<PHONE_NUMBER>.

Magalie R. Salas,
Secretary.
[FR Doc. E6-3871 Filed 3-16-06; 8:45 am]

BILLING CODE 6717-01-P