Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Decommission the Initial Public Offering Tracking System

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-104039; File No. SR-DTC-2025-014]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Decommission the Initial Public Offering Tracking System</SUBJECT> <DATE>September 24, 2025.</DATE> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)  <SU>1</SU> <FTREF/> and Rule 19b-4 thereunder, <SU>2</SU> <FTREF/> notice is hereby given that on September 19, 2025, 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. DTC filed the proposed rule change pursuant to Section 19(b)(3)(A) of the Act  <SU>3</SU> <FTREF/> and Rule 19b-4(f)(4) thereunder. <SU>4</SU> <FTREF/> The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. <FTNT> <SU>1</SU>  15 U.S.C. 78s(b)(1). </FTNT> <FTNT> <SU>2</SU>  17 CFR 240.19b-4. </FTNT> <FTNT> <SU>3</SU>  15 U.S.C. 78s(b)(3)(A). </FTNT> <FTNT> <SU>4</SU>  17 CFR 240.19b-4(f)(4). </FTNT> <HD SOURCE="HD1">I. Clearing Agency's Statement of the Terms of Substance of the Proposed Rule Change</HD> The proposed rule change would (i) amend the DTC Settlement Guide, Underwriting Guide, and the OA, <SU>5</SU> <FTREF/> to decommission the Initial Public Offering Tracking System (“IPO Tracking System”), <SU>6</SU> <FTREF/> an optional service used to track IPO share movement during the post-offering stabilization period, and, consequently, (ii) remove from the Guide to the DTC Fee Schedule  <SU>7</SU> <FTREF/> (“Fee Guide”) the related fee (“IPO Tracked Issue”) associated with the IPO Tracking System. <FTNT> <SU>5</SU>  Each term not otherwise defined herein has its respective meaning as set forth in the Rules, By-Laws and Organization Certificate of DTC (“Rules”), the Settlement Service Guide (“Settlement Guide”), the Underwriting Service Guide (“Underwriting Guide”), and the Operational Arrangements (Necessary for Securities to Become and Remain Eligible for DTC Services) (“OA”), <E T="03">available at www.dtcc.com/legal/rules-and-procedures.</E> </FTNT> <FTNT> <SU>6</SU>  Securities Exchange Act Release No. 57768 (May 2, 2008), 73 FR 26181 (May 8, 2008) (SR-DTC-2007-10). </FTNT> <FTNT> <SU>7</SU>   <E T="03">www.dtcc.com/-/media/Files/Downloads/legal/fee-guides/DTC-Fee-Schedule.pdf.</E> </FTNT> <HD SOURCE="HD1">II. Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> 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. <HD SOURCE="HD2">(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> The proposed rule change would (i) amend the DTC Settlement Guide, Underwriting Guide, and the OA, to decommission the IPO Tracking System, an optional service used to track IPO share movement during the post-offering stabilization period, and, consequently, (ii) remove from the Fee Guide the IPO Tracked Issue associated with the IPO Tracking System. <HD SOURCE="HD3">Background</HD> DTC continually evaluates the efficiency and effectiveness of the services it provides. As part of these evaluations, and in furtherance of ongoing modernization efforts, DTC seeks to streamline and simplify services and processes, including through the decommissioning of underutilized services. DTC proposes to decommission the IPO Tracking System due to (i) changes in the market structure and the availability of external tracking systems, and (ii) the operational complexity required to maintain the service, especially given its limited usage. The IPO Tracking System was established by DTC to support lead underwriters and syndicate managers in monitoring the book-entry movement of IPO shares during the post-offering stabilization period. The service was designed to enhance transparency by generating daily reports identifying Participant level deliveries and allocations of new issue securities for a limited tracking window following an offering. The IPO Tracking System requires the lead underwriter to initiate tracking eligibility by submitting instructions through DTC's underwriting portal (“UW SOURCE”) two business days prior to the scheduled closing date. Once activated, the IPO Tracking System provides automated reports, including data files made available to lead underwriters during the post-offering stabilization period. Over time, usage of the IPO Tracking System has declined significantly due to changes in market structure, the availability of external tracking systems, and reduced reliance by underwriters on DTC's IPO Tracking System data. In turn, the operational effort required to maintain the IPO Tracking System has become disproportionate to the limited number of offerings utilizing the service. As such, DTC has decided to decommission the IPO Tracking System. <HD SOURCE="HD3">Proposed Changes</HD> To effectuate the decommissioning of the IPO Tracking System, DTC proposes to make the below described rule changes. <HD SOURCE="HD3">Settlement Guide</HD> The proposed changes would remove from the Settlement Guide all provisions relating to the IPO Tracking System, including deleting (i) the term “IPO” under the “memo segregation” definition in the “Important Terms” table, (ii) entry number nine under “Account Options,” and subsequent renumbering, (iii) the entire text of the section titled “Initial Public Offering (IPO) Tracking System,” which describes the goals of the IPO Tracking System and contact information, <SU>8</SU> <FTREF/> (iv) a reference to the IPO Tracking System in the section titled “Recycle Processing” relating to the preliminary processing of delivery transactions prior to the updating of DTC accounts, <SU>9</SU> <FTREF/> (v) Pend Hold references to IPO deliveries and the removal of pend queue logic for IPO positions; and (vi) the note under “How PTA Processing Works” stating that IPO transactions are not subject to PTA procedures. <FTNT> <SU>8</SU>   <E T="03">See</E> Settlement Guide, <E T="03">supra</E> note 5 at 38. </FTNT> <FTNT> <SU>9</SU>   <E T="03">Id.</E> at 51. </FTNT> <HD SOURCE="HD3">Underwriting Guide</HD> Similarly, DTC proposes to amend the Underwriting Guide to remove all references in the “IPO Tracking System”  <SU>10</SU> <FTREF/> section of the Underwriting Guide, which includes “About the Product,” “How the Product Works,” “Associated Participant Terminal System (PTS) Functions,” and the “IPO Tracking Contact Number.” These subsections collectively describe the IPO Tracking System, including setup procedures, control account activity, and report generation during the stabilization period. In addition, DTC proposes to remove defined terms related to IPOs in the “Overview” section of the Underwriting Guide, including the definitions of “initial public offering (IPO)” and “flipping.” <FTNT> <SU>10</SU>   <E T="03">See</E> Underwriting Guide, <E T="03">supra</E> note 5 at 9-10. </FTNT> <HD SOURCE="HD3">Fee Guide</HD> DTC proposes to eliminate the IPO Tracked Issue fee of $5,000 from the “Other Underwriting Services” section of the Fee Guide. <SU>11</SU> <FTREF/> This fee currently applies on a per-issue basis to IPO Tracking activity and will no longer be applicable as of the effective Decommission Date, as defined below in the Implementation section. <FTNT> <SU>11</SU>   <E T="03">See</E> Fee Guide, <E T="03">supra</E> note 7 at 28. </FTNT> <HD SOURCE="HD3">OA</HD> DTC proposes to update the OA to remove the eligibility requirements for IPO Tracking currently set forth in Exhibit B (Underwriting Standard Time Frames). <SU>12</SU> <FTREF/> Specifically, DTC would eliminate the row labeled “For IPO Tracked issues” including the “Time Frame” requirement that the lead underwriter indicate inclusion in the IPO Tracking System via UW SOURCE, no later than 3:00 p.m. ET, two business days prior to the Closing Date. <FTNT> <SU>12</SU>   <E T="03">See</E> OA, <E T="03">supra</E> note 5 at 88. </FTNT> <HD SOURCE="HD3">Implementation</HD> The final IPO issue eligible for tracking via the IPO Tracking System will be for tracking instructions submitted to DTC on or before October 2, 2025, after which DTC will update its rules, as described above, to remove references to the IPO Tracking System. Tracking for issues requested on or before October 2, 2025 will be tracked according to the period selected by the Participant ( <E T="03">i.e.,</E> 30, 60, or 90 days), after which the IPO Tracking System will be fully decommissioned, but no later than December 31, 2025, (“Decommission Date”). <HD SOURCE="HD3">2. Statutory Basis</HD> Section 17A(b)(3)(F) of the Act requires that the rules of the clearing agency be designed, <E T="03">inter alia,</E> to promote the prompt and accurate clearance and settlement of securities transactions. <SU>13</SU> <FTREF/> DTC believes that the proposed rule change is consistent with the Section 17A(b)(3)(F) of the Act, as cited above. <FTNT> <SU>13</SU>  15 U.S.C. 78q-1(b)(3)(F). </FTNT> As described above, the proposed rule change would (i) amend the Settlement Guide, Underwriting Guide and the OA to decommission the IP ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 17k characters. 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