SEC Rule 17a-4(i)(1)(ii)(A) contains a requirement for
a third party who prepares or maintains the regulatory
records of a broker-dealer (regardless of whether the
records are in paper or electronic form) to file a
written undertaking with the SEC.
Since January 2023, the SEC introduced an alternative
version of the third party undertaking specifically for
cloud service providers like Google Cloud, referred to
as “Alternative Undertaking”. Previously, there was only
one version of third party undertaking referred to as
“Traditional Undertaking”.
Traditional Undertaking: Requires the third
party to agree, among other things, to permit
examination of the records by the relevant authority as
well as to promptly furnish to the relevant authority
true, correct, complete, and current hard copies of such
records.
Alternative Undertaking: Tailored to how cloud
service providers hold electronic records for regulated
entities and can be used instead of the Traditional
Undertaking.
SEC Rule 18a-6(f)(1)(ii)(A) contains a similar
requirement for SBS Entities.
Google Cloud’s support of the Alternative Undertaking requirement
To address the requirement for the Alternative
Undertaking, Google offers customers a SEC 17a-4(i)
Addendum or SEC 18a-6(f) Addendum for Google Cloud and
Google Workspace. Our
sales team
or your Google Cloud representative can help provide
access to this documentation. Customers will need to
provide your registrant name and registrant number. Once
a customer has signed the Addendum, Google will be able
to sign the Alternative Undertaking and share it with
the customer to be submitted to the relevant authority.
For more information about how to submit the
Alternative Undertaking to your relevant authority see:
The SEC
Staff Guidance for Filing Broker-Dealer Notices, Statements, Undertakings and Reports
The SEC
Staff Statement on Submitting Notices, Statements, Applications, and Reports for SBS Entities
For more information about the Alternative Undertaking
see page 56 of the SEC Final Rule -
Electronic Recordkeeping Requirements for Broker-Dealers, Security-Based Swap Dealers, and Major Security-Based Swap Participants. See
pages 137 and 145 for the exact wording of the
Alternative Undertaking for broker-dealers and SBS
Entities, respectively.
The differences between Traditional Undertaking, Alternative Undertaking, and Designated Third Party Undertaking
The Traditional Undertaking and the Alternative
Undertaking are different from the Designated Third
Party Undertaking under SEC Rule 17a-4(f)(3)(v)(A) and
Rule 18a-6(e)(3)(v)(A). A Designated Third Party or
“D3P” is a third party that a regulated entity retains
specifically to access electronic records for the
relevant authority’s review. This is not a service that
Google Cloud provides. If needed, regulated entities may
procure a D3P service and the D3P Undertaking from an
independent provider.