On September 28, 2016, the SEC proposed an amendment to Exchange Act Rule 15c6-1(a) in order to shorten the standard settlement cycle from three business days (“T+3”) to two business days (“T+2”) following the applicable trade date. This amendment would affect settlements for most broker-dealer securities transactions, requiring prior agreement for any transaction with a settlement cycle longer than T+2. The SEC cited several reasons for the proposed amendment, including (1) reducing credit, market, and liquidity risk, (2) reducing systematic risk for participants in the U.S. financial markets, and (3) increasing the operational efficiency of post-trade processes. The SEC has requested comments on the proposed amendment from industry professionals, specifically with respect to the economic effects of shortening the settlement cycle to T+2, including any costs, benefits, burdens, or effects on efficiency, competition, and capital formation. The proposed amendment is available for public comment for 60 days after publication in the Federal Register.
The proposed amendment is available at: https://www.sec.gov/rules/proposed/2016/34-78962.pdf.