Corporate Action Liability Notification Service

SMART/Track provides a centralized communications hub for the transmission of various message types between participants. DTCC currently offers four SMART/Track services:

 

  • Agency Lending Disclosure: transmits open loan data between lenders and borrowers.
  • Buy-Ins: tracks the status of buy-in notices and Municipal Securities Rulemaking Board (MSRB) closeouts between participants.
  • Corporate Action: tracks liability notifications between participants on voluntary action events.
  • Stock Loan Recall Messaging: transmits stock loan recall messages between counterparties.

ABOUT

The SMART/Track for Corporate Action Liability Notification Service is a Web-based system that provides automated communication and tracking of corporate action liability notices for securities undergoing a voluntary corporate action event. Participants can easily create, send, process and track broker-to-broker/bank and CNS liability notices through the service. Email notifications are generated automatically when activity occurs.

Who Can Use the Service

Any existing NSCC clearing firm or DTC settling member can use the service.

Benefits

The service:

  • Reduces the costs and risk associated with manual, paper-based fax and phone notifications.
  • Provides an audit trail with a complete record of actions taken regarding a notice, including time, date and the person taking the action. An online archive retains the notices for seven years.
  • Reduces message delivery risk through tracking and acknowledgment functionality.

How the Service Works

SMART/Track for Corporate Action Liability Notifications allows users to:

  • Create and transmit a notice.
  • Accept or reject a notice.
  • View notices they have received or sent.
  • Cancel a notice within specified time parameters.
  • Search for active or archived notices using specific field criteria
  • Update a notice.

Participants must register for access to SMART/Track for Buy-ins by designating an Access Coordinator, using the forms available through this link: Access Coordinator Forms. For assistance, participants can contact their Relationship Manager of the Service Activation Group at DTCC. The Access Coordinator then will register and approve the firm’s users.

Creating a Liability Notice

Participants can create broker-to-broker/bank liability notices for securities undergoing a voluntary corporate action event. Participants also use SMART/Track to notify CNS of their intention to participate in a voluntary corporate event for a security being processed in CNS.

The user's contact information, gathered during the online registration process, automatically populates the input screen. Users can then fill in the remaining fields detailing their liability information.

SMART/Track has a link to DTC’s Reorganization Inquiry for Participants System (RIPS). Once the participant enters the security ID for a broker-to-broker/bank liability notice, all recent offer information on that security will become available from the RIPS database. Users may choose one of the offers in the database or select “Other” and fill in each field manually. If a user selects an offer from the RIPS database, some fields will be automatically populated.

Participants can also add comments or notes regarding a broker-to-broker/bank notice in a free-form field on the create screen.

Participants can create and send a broker-to-broker/bank notice to a single or multiple counterparties up to a maximum of 20. When multiple copies of the notice will be sent out, the information does not have to be recreated for each message.

SMART/Track for Corporate Action Liability Notices reviews the liability data for broker-to-broker/bank and CNS notices to ensure it is complete then makes it available to the counterparty indicated or CNS.

Responding to a Notice

Participants receiving a broker-to-broker/bank liability notice can either accept or reject the notice. If rejecting, the participant must enter a reason for the reject by selecting a reason from the drop-down box or entering text in the comment box.

Updating a Notice

Participants initiating a broker-to-broker corporate action liability notice can reduce the quantity of shares for which it is holding the counterparty liable.

For CNS liability notices, a participant can change any of the fields on the liability notice, except the security ID field, until the notice is sent to CNS on the day the notice is created. Participants can reduce the liability quantity the following business day until 12:00 noon.

Canceling a Notice

Participants initiating a broker-to-broker corporate action liability notice can also cancel the notice. The status of the notice changes to indicate that it has been cancelled.

Participants can cancel a CNS liability notice until the notice is sent to CNS on the day it is created. The notice can be cancelled the following business day until 12:00 noon.

Participants can use the free-form field to add comments or notes to the notice being cancelled.

Viewing a Notice

Participants can view the status of all notices and search or sort all notices using specific field criteria. Participants can view a list of notices that they sent or received as well as details of specific notices, including history with details of when the action was taken, the date and time that action was taken and the person who took the action.

Searching for an Active or Archived Notice

Participants can search for active or archived notices within a specific date range, including for all notices within that range or by notice type. Participants can further search within notice type by specific data fields. Notices are automatically archived based on certain date parameters. Archived notices are kept online for seven years.

E-Mail Notifications

SMART/Track generates e-mail notifications to participants for every corporate action liability notice created and transmitted in SMART/Track as well as for every action taken regarding the liability notification. The sender and receiver of corporate action liability notices receive start-of-day e-mails for all notices that are still open and pending action that day (return date, DTC expiration date, or DTC protect date). Intraday e-mails are sent when the notice is created and transmitted; the liability quantity is reduced; and the notice is accepted, rejected or cancelled. An e-mail notice is also sent when the expiration date, DTC expiration date, protect expiration date or DTC protect expiration date for a liability notice associated with a RIPs offer changes.

For More Information

Please contact Client Support at 1-888-382-2721, Option 2 then Option 1

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