Notice2025-11609
Self-Regulatory Organizations; Investors Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend IEX Rule 11.660 of the Exchange's Consolidated Audit Trail Compliance Rule Regarding the National Market System Plan Governing the Consolidated Audit Trail To Be Consistent With the Exemptive Relief Granted by the Commission From Certain Provisions Related to Timestamp Granularity
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Published
June 25, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 120 (Wednesday, June 25, 2025)</title>
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[Federal Register Volume 90, Number 120 (Wednesday, June 25, 2025)]
[Notices]
[Pages 27061-27063]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-11609]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103294; File No. SR-IEX-2025-12]
Self-Regulatory Organizations; Investors Exchange LLC; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
IEX Rule 11.660 of the Exchange's Consolidated Audit Trail Compliance
Rule Regarding the National Market System Plan Governing the
Consolidated Audit Trail To Be Consistent With the Exemptive Relief
Granted by the Commission From Certain Provisions Related to Timestamp
Granularity
June 20, 2025.
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 June 17, 2025, Investors Exchange LLC (``IEX'' or the ``Exchange'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I and II below, which Items
have been prepared by the Exchange. 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. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Pursuant to the provisions of Section 19(b)(1) under the Act,\3\
and Rule 19b-4 thereunder,\4\ IEX is filing with the Commission a
proposed rule change to amend IEX Rule 11.660 of the Exchange's
compliance rule (``CAT Compliance Rule'') regarding the National Market
System Plan Governing the Consolidated Audit Trail (the ``CAT NMS
Plan'' or ``Plan'') \5\ to be consistent with the exemptive relief
granted by the Commission from certain provisions of the CAT NMS Plan
related to timestamp granularity (``2025 Timestamp Granularity
Exemption'').\6\ Specifically, the Exchange proposes to update the
expiration date of the exemption in Rule 11.660(a)(2) from April 8,
2025 to April 8, 2030. The Exchange has designated this proposal as
non-controversial and provided the Commission with the notice required
by Rule 19b-4(f)(6)(iii) under the Act.\7\
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\3\ 15 U.S.C. 78s(b)(1).
\4\ 17 CFR 240.19b-4.
\5\ Unless otherwise specified, capitalized terms used in this
rule filing are defined as set forth in the CAT Compliance Rule.
\6\ Securities Exchange Act Rel. No. 102980 (May 2, 2025), 90 FR
19334 (May 7, 2025).
\7\ 17 CFR 240.19b-4(f)(6)(iii).
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The text of the proposed rule change is available at the Exchange's
website at <a href="https://www.iexexchange.io/resources/regulation/rule-filings">https://www.iexexchange.io/resources/regulation/rule-filings</a>, at the principal office of the Exchange, and at the
Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the self-regulatory organization
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
[[Page 27062]]
of these statements may be examined at the places specified in Item IV
below. The self-regulatory organization has prepared summaries, set
forth in Sections A, B, and C below, of the most significant aspects of
such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The purpose of this proposed rule change is to amend Rule 11.660 of
the CAT Compliance Rule to be consistent with the 2025 Timestamp
Granularity Exemption. Under the 2025 Timestamp Granularity Exemption,
the Commission extended the existing exemptive relief pursuant to which
Industry Members that capture timestamps in increments more granular
than nanoseconds must truncate the timestamps after the nanosecond
level for submission to CAT, rather than rounding such timestamps up or
down, from April 8, 2025 to April 8, 2030. Accordingly, the Exchange
proposes to update the expiration date of the exemption in Rule
11.660(a)(2) from April 8, 2025 to April 8, 2030.
On February 3, 2020, the Participants filed with the Commission a
request for exemptive relief from the requirement in Section 6.8(b) of
the CAT NMS Plan for each Participant, through its CAT Compliance Rule,
to require that, to the extent that its Industry Members utilize
timestamps in increments finer than nanoseconds in their order handling
or execution systems, such Industry Members utilize such finer
increment when reporting CAT Data to the Central Repository.\8\ On
April 8, 2020, the Participants received the requested exemptive
relief.\9\ As a condition to this exemption, the Participants, through
their CAT Compliance Rules, required Industry Members that capture
timestamps in increments more granular than nanoseconds to truncate the
timestamps after the nanosecond level for submission to CAT, rather
than rounding up or down in such circumstances. The exemption was to
remain in effect for five years, until April 8, 2025.
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\8\ See Letter to Vanessa Countryman, Secretary, SEC, from
Michael Simon, CAT NMS Plan Operating Committee Chair, re: Request
for Exemption from Certain Provisions of the National Market System
Plan Governing the Consolidated Audit Trail related to Granularity
of Timestamps and Relationship Identifiers (Feb. 3, 2020).
\9\ See Securities Exchange Act Release No. 88608 (Apr. 8,
2020), 85 FR 20743 (Apr. 14, 2020).
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In 2020, the Exchange amended paragraph (a)(2) of Rule 11.660 to
reflect this exemptive relief.\10\ Specifically, the Exchange amended
Rule 11.660(a)(2) to state the following:
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\10\ See Securities Exchange Act Release No. 89118 (June 19,
2020), 85 FR 38421 (June 22, 2020).
Subject to paragraph (b), to the extent that any Industry
Member's order handling or execution systems utilize time stamps in
increments finer than milliseconds, such Industry Member shall
record and report Industry Member Data to the Central Repository
with time stamps in such finer increment up to nanoseconds;
provided, that Industry Members that capture timestamps in
increments more granular than nanoseconds must truncate the
timestamps after the nanosecond level for submission to CAT, rather
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than rounding such timestamps up or down, until April 8, 2025.
The language of Rule 11.660(a)(2) has not been changed since that
time.
The exemption granted in 2020, however would no longer be in effect
after April 8, 2025, unless the period the exemption is in effect is
extended by the SEC. Accordingly, on March 24, 2025, the Participants
filed with the Commission a request to extend the existing exemptive
relief for another five years, until April 8, 2030.\11\ On May 2, 2025,
the Participants received the requested exemptive relief from the
Commission via the 2025 Timestamp Granularity Exemption. As a condition
to this exemption, the Participants, through their CAT Compliance
Rules, are required to require Industry Members that capture timestamps
in increments more granular than nanoseconds to truncate the timestamps
after the nanosecond level for submission to CAT, rather than rounding
up or down in such circumstances. The SEC granted the 2025 Timestamp
Granularity Exemption for a period of five years, until April 8, 2030.
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\11\ See Letter to Vanessa Countryman, Secretary, SEC, from
Brandon Becker, CAT NMS Plan Operating Committee Chair, re: Request
for Exemption from Certain Provisions of the National Market System
Plan Governing the Consolidated Audit Trail related to Timestamp
Granularity (Mar. 24, 2025).
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Accordingly, the Exchange proposes to amend its CAT Compliance Rule
to reflect the extended period set forth in the 2025 Timestamp
Granularity Exemption, replacing the reference to April 8, 2025 with
April 8, 2030. Specifically, the Exchange proposes to amend paragraph
(a)(2) of Rule 11.660 to state:
Subject to paragraph (b), to the extent that any Industry
Member's order handling or execution systems utilize time stamps in
increments finer than milliseconds, such Industry Member shall
record and report Industry Member Data to the Central Repository
with time stamps in such finer increment up to nanoseconds;
provided, that Industry Members that capture timestamps in
increments more granular than nanoseconds must truncate the
timestamps after the nanosecond level for submission to CAT, rather
than rounding such timestamps up or down, until April 8, 2030.
2. Statutory Basis
The Exchange believes that the proposed rule change is consistent
with the provisions of Section 6(b)(5) of the Act,\12\ which require,
among other things, that the Exchange's rules must be designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, and, in general, to protect
investors and the public interest, and Section 6(b)(8) of the Act,\13\
which requires that the Exchange's rules not impose any burden on
competition that is not necessary or appropriate.
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\12\ 15 U.S.C. 78f(b)(6).
\13\ 15 U.S.C. 78f(b)(8).
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The Exchange believes that this proposal is consistent with the Act
because it is consistent with the exemptive relief that has been in
place for five years, is consistent with the 2025 Timestamp Granularity
Exemption, and is designed to assist the Exchange and its Industry
Members in meeting regulatory obligations pursuant to the Plan. In
approving the Plan, the SEC noted that the Plan ``is necessary and
appropriate in the public interest, for the protection of investors and
the maintenance of fair and orderly markets, to remove impediments to,
and perfect the mechanism of a national market system, or is otherwise
in furtherance of the purposes of the Act.'' \14\ To the extent that
this proposal implements the Plan, including the exemptive relief
related thereto, and applies specific requirements to Industry Members,
the Exchange believes that this proposal furthers the objectives of the
Plan, as identified by the SEC, and is therefore consistent with the
Exchange Act.
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\14\ See Securities Exchange Act Release No. 79318 (Nov. 15,
2016), 81 FR 84696, 84697 (Nov. 23, 2016).
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
result in any burden on competition that is not necessary or
appropriate in furtherance of the purposes of the Exchange Act. The
Exchange notes that the proposed rule change is consistent with the
exemptive relief that has been in place for five years, is consistent
with the 2025 Timestamp Granularity Exemption, and is designed to
assist the Exchange in meeting its regulatory
[[Page 27063]]
obligations pursuant to the Plan. The Exchange also notes that the
amendment to the CAT Compliance Rule will apply equally to all Industry
Members that trade NMS Securities and OTC Equity Securities. In
addition, all national securities exchanges and FINRA are proposing
these amendments to their CAT Compliance Rules. Therefore, this is not
a competitive rule filing, and, therefore, it does not impose a burden
on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
Written comments were neither solicited nor received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed rule change pursuant to Section
19(b)(3)(A) of the Act \15\ and Rule 19b-4(f)(6) \16\ thereunder.
Because the foregoing proposed rule change does not: (i) significantly
affect the protection of investors or the public interest; (ii) impose
any significant burden on competition; or (iii) become operative for 30
days from the date on which it was filed, or such shorter time as the
Commission may designate, it has become effective pursuant to Section
19(b)(3)(A) of the Act \17\ and Rule 19b-4(f)(6) \18\ thereunder.
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\15\ 15 U.S.C. 78s(b)(3)(A).
\16\ 17 CFR 240.19b-4(f)(6).
\17\ 15 U.S.C. 78s(b)(3)(A).
\18\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)(iii)
requires the Exchange to give the Commission written notice of its
intent to file the proposed rule change, along with a brief
description and text of the proposed rule change, at least five
business days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
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A proposed rule change filed under Rule 19b-4(f)(6) \19\ normally
does not become operative prior to 30 days after the date of the
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\20\ the Commission
may designate a shorter time if such action is consistent with
protection of investors and the public interest. The Exchange has asked
the Commission to waive the 30-day operative delay so that the proposed
rule change may become operative immediately upon filing. The
Commission believes that waiving the 30-day operative delay is
consistent with the protection of investors and the public interest
because the proposal seeks to amend the Exchange's CAT Compliance Rule
to reflect the expiration date for exemptive relief relating to
timestamp granularity approved by the Commission on May 2, 2025, and
the proposal does not introduce any novel regulatory issues.
Accordingly, the Commission designates the proposed rule change to be
operative upon filing.\21\
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\19\ 17 CFR 240.19b-4(f)(6).
\20\ 17 CFR 240.19b-4(f)(6)(iii).
\21\ For purposes only of waiving the 30-day operative delay,
the Commission also has considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act. If the Commission
takes such action, the Commission will institute proceedings to
determine whether the proposed rule change should be approved or
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
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#b9cbccd5dc94dad6d4d4dcd7cdcaf9cadcda97ded6cf"><span class="__cf_email__" data-cfemail="1765627b723a74787a7a727963645764727439707861">[email protected]</span></a>. Please include
file number SR-IEX-2025-12 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-IEX-2025-12. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). 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
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-IEX-2025-12 and should be
submitted on or before July 16, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\22\
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\22\ 17 CFR 200.30-3(a)(12) and (59).
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Stephanie J. Fouse,
Assistant Secretary.
[FR Doc. 2025-11609 Filed 6-24-25; 8:45 am]
BILLING CODE 8011-01-P
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