Joint Industry Plan; Order Instituting Proceedings To Determine Whether To Approve or Disapprove an Amendment to the National Market System Plan Governing the Consolidated Audit Trail
Published Date: 11/26/2025
Notice
Summary
Big stock market players like exchanges and FINRA want to change how they pay for the Consolidated Audit Trail, a system that tracks all stock trades. They’ve proposed a new fee plan to make funding fairer and clearer, and the SEC is now deciding if it’s a good idea. If approved, these changes could affect fees soon and help keep the system running smoothly.
Analyzed Economic Effects
5 provisions identified: 1 benefits, 3 costs, 1 mixed.
Per‑trade executed‑share fees for brokers
Under the Proposed Amendment, Industry Members that are the CAT Executing Broker for the buyer (CEBB) or seller (CEBS) must pay a CAT Fee for each transaction in Eligible Securities equal to: executed equivalent shares × one‑third × the Fee Rate. The Fee Rate is calculated by the Operating Committee (based on budgeted CAT costs divided by projected executed equivalent share volume) and may be set at the start of the year and updated once during the year.
Historical cost recovery charged to brokers
The Proposed Amendment allows one or more Historical CAT Assessments to recover Past CAT Costs; each Historical CAT Assessment seeks to recover two‑thirds of Historical CAT Costs from CAT Executing Brokers (CEBB and CEBS). Any Historical Recovery Period must be at least 24 months and no more than five years; the notice cites Historical CAT Assessment 1 with a Historical Fee Rate of $0.000013 per executed equivalent share using a two‑year recovery period.
Fee rate timing and required fee filings
CAT Fees related to Prospective CAT Costs would have a Fee Rate calculated twice yearly (at the start of the year and once during the year) by dividing reasonably budgeted CAT costs by projected executed equivalent share volume; Participants must file fee proposals with the SEC under Section 19(b) (these filings include the Fee Rate, budget detail, reconciliation and volume projection). CAT Fees do not sunset automatically and remain in place until replaced by new CAT Fees.
Budget reserve and surplus treatment
CAT LLC would be allowed to include a reserve of up to 25% of the annual budget and must exclude the reserve amount from the budget calculation; if collected CAT fees exceed CAT costs (including the 25% reserve), the surplus will be used to offset future fees. The annual budget must list categories (technology, legal, consulting, insurance, professional/administration, public relations) and five specified technology subcategories.
Participants barred from new pass‑through fees
The Proposed Amendment would add a provision where each Participant agrees not to file with the SEC a proposed rule change under Section 19(b)(4) to establish a new fee for passing through its Participant CAT fee to its members. The amendment explicitly does not address whether Industry Members may pass through their own CAT fees to customers.
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