May 26, 2020

Vanessa Countryman
Secretary
Securities and Exchange Commission
100 F Street NE., Washington, DC 20549

Re: File No. S7-03-20; Market Data Infrastructure Proposed Rule

Dear Ms. Countryman:

The Securities Industry and Financial Markets Association (“SIFMA”)1 respectfully submits this letter to the U.S. Securities and Exchange Commission (“Commission”) to comment on the proposal to amend 17 CFR 242, Rules 600 and 603 and to adopt new Rule 614 of Regulation National Market System (“Regulation NMS”) under the Securities Exchange Act of 1934 (“Exchange Act”) to update the national market system for the collection, consolidation, and dissemination of information with respect to quotations for and transactions in national market system (“NMS”) stocks (“Infrastructure Proposal”).2 SIFMA commends the Commission for its efforts to improve and modernize the current market data infrastructure and supports the Infrastructure Proposal in this respect as another positive step in these efforts. This support also extends to the Commission’s recently approved market data governance proposal (“Governance Proposal”).3 We believe that the Infrastructure Proposal, if adopted with targeted revisions noted in this letter, would modernize the current market data infrastructure, especially regarding the need to disseminate additional content in the feeds by the Securities Information Processors (“SIPs”) and to put forth a solution to address latency in the SIPs. We therefore urge the Commission to adopt the majority of the Infrastructure Proposal that relates to these market data infrastructure changes.

We further recommend that the Commission consider making the proposed changes related to the definition of “protected bid or protected offer” that affect the application of Rule 611 of Regulation NMS (“Order Protection Rule” or “OPR”) and Rule 610(d) of Regulation NMS (“Locked and Crossed Markets Requirement”) in a separate proposal, as they warrant further industry dialogue and consideration given the broader market structure implications, added complexity and potential impact on trading associated with these changes. Most importantly, these changes raise significant best execution concerns that are not addressed in the Infrastructure Proposal and that warrant additional, separate consideration from the changes to enhance the market data infrastructure.

SIFMA notes at the outset that the Infrastructure Proposal builds on the Governance Proposal. SIFMA believes that from a staging perspective, the adoption and implementation of the Governance Proposal allows for a smoother and more efficient adoption of the changes contemplated in the Infrastructure Proposal. In particular, creating a single NMS plan for the collection and dissemination of market data will set the stage for an effective implementation of the system changes contemplated under the Infrastructure Proposal to improve and modernize the current market data infrastructure.

1 SIFMA is the leading trade association for broker-dealers, investment banks and asset managers operating in the U.S. and global capital markets. On behalf of our industry’s nearly 1 million employees, we advocate for legislation, regulation and business policy, affecting retail and institutional investors, equity and fixed income markets and related products and services. We serve as an industry coordinating body to promote fair and orderly markets, informed regulatory compliance, and efficient market operations and resiliency. We also provide a forum for industry policy and professional development. SIFMA, with offices in New York and Washington, D.C., is the U.S. regional member of the Global Financial Markets Association
(GFMA). For more information, visit http://www.sifma.org.
2 Exchange Act Release No. 88216 (Feb. 14, 2020), 85 FR 16726 (Mar. 24, 2020).
3 Exchange Act Release No. 88827 (May 6, 2020), 85 FR 28702 (May 13, 2020).