Oct. 7, 2022
October 7, 2022 As public disclosure of SBS positions and related holdings will help to improve transparency and reduce systemic risk, any public dissemination of such information should be immediately expedited. Where an investment adviser has discretionary authority over a clients SBS trading, the Proposed Rule should clarify that SBS positions have to be reported at the advisee client level and at the investment adviser level. For separately managed accounts, reporting of SBS positions should be required for all assets managed without a reporting threshold. There should be no transition period as market participants should already have clear, proper records to facilitate such reporting. To avoid unnecessary and potentially misleading reporting, amended reports should only be required following a material acquisition or disposition relating to a previously reported SBS position. In terms of the information which must be reported, the Proposed Rule should be specific as to what related instruments need to be reported in Schedule 13B. Ideally, it should include all instruments. The obligation to report an SBS position should be triggered based on the involvement of U.S. personnel in arranging, negotiating and executing any SBS transaction as nondealers should know whether U.S. personnel are involved and therefore whether a reporting obligation exists. Rule 9j-1 should not be revised to include an affirmative defense from liability.