SEC Approves Revised CAT Funding Model

The SEC approved proposed amendments submitted by participants of the National Market System Plan Governing the Consolidated Audit Trail ("CAT NMS Plan") to revise the plan's funding model and to establish a fee schedule.

The amendments became effective upon the SEC's approval.

Statements

SEC Chair Gary Gensler said that the Order addressed an "important but narrow issue" regarding the allocation of funding of recoverable costs for CAT. He added that the Order resolves the issue while leaving the rest of the CAT NMS Plan in place.

SEC Commissioner Jaime Lizárraga underscored that the "faster the CAT is completed the sooner investors in our markets can realize the full benefits from the strengthened market oversight it is designed to facilitate."

SEC Commissioner Caroline A. Crenshaw emphasized "the importance of the CAT to the performance of regulatory activities in modern, interconnected markets," noting that "the full implementation of the CAT has yet to be realized." She called for CAT implementation to be "executed faithfully and expeditiously."

SEC Commissioner Hester M. Peirce argued that the SEC has "fail[ed] to grapple with the need to establish a realistic constraint on CAT costs."

SEC Commissioner Mark T. Uyeda dissented from the Order because of the "over-arching issues" that have yet to be resolved, including the "ballooning expenses" for CAT. He argued that it is of "vital importance" to ensure that the regulatory benefits outweigh the costs. He maintained that many challenges still need to be addressed before CAT can "live up to its full promise."