J&A_(redacted).pdf

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

100 F STREET, NE

WASHINGTON, DC 20549

OFFICE OF

ACQUISITIONS

JUSTIFICATION FOR OTHER THAN FULL AND OPEN COMPETITION

Requisition Number: 65000-17-0044 Procurement Title: Business and Financial Information Service Estimated Value:

Statutory Authority: 41 U.S.C. 3304(a)(1) and FAR Part 6.302-1

JUSTIFICATION NUMBER: 2017-0014

Upon the basis of the following justification, I, as the Competition Advocate, hereby approve the use of other than full and open competition of the proposed contractual action pursuant the authority of 41 U.S.C. 3304(a)(1) and FAR Part 6.302-1, only one responsible source and no other supplies or services will satisfy agency requirements.

1. Identification of the agency and the contracting activity, and specific identification of the document as a "Justification for other than full and open competition."

U.S. Securities and Exchange Commission Office of Acquisitions 100 F .Street, NE Washington, DC 20549

This document serves a Justification for other than full and open competition.

2. Nature and/or description of the action being approved.

The U.S. Securities and Exchange Commission (SEC) intends to award a contract as an exception to the requirement for full and open competition to Thomson Reuters (Markets) LLC for a business and financial information service that provides access to real-time data, proprietary content, and third-party information combined with powerful application tools and communications.

This contract is for a base period of 12 months with four (4) 12-month option periods. This award will be Firm Fixed Price (FFP) and the base period will be funded with FY 2017 funds.

3. A description of the supplies or services required to meet the agency's needs (including the estimated value).

The requirement is for the following services:

• Institutional Brokers' Estimate System (UB/E/S) Estimates Data with monthly updates files via Wharton Research Data Services (WRDS),U.S. Earnings Consensus Surprise Data with monthly updates (comparison of expected consensus operating earnings and actual operating earnings),and IB/E/S Consensus Data for use with Standard & Poor's Compustat service (forward-looking consensus earnings estimates).

Insider Filing Data with historical and current insider transactions and holdings data via

WRDS. The data include transactions and holdings information filed on Form 3, Form 4, Form 5, Form 144, and supplemented by data from proxy statements. The forms mentioned above identify the holdings of registrants' securities owned by directors, officers and 10% shareholders.

Mutual Funds and 13F Institutions databases via WRDS, providing access to data on common stock holdings by mutual funds and investment companies in order to analyze investment performance, inveshnent decisions, trading patterns, and the returns generated by the holdings of the funds. The security coverage includes all domestic and Canadian common stocks, holdings and transactions for individual mutual funds and investment companies starting in the first quarter of 1980 and continuing to the present. The holdings data shall be identical to the information in the source forms, unadjusted for capitalization changes or mergers.

DealScan Database providing historical information on the terms and conditions of deals in the global commercial loan market. It provides access to loans' terms and conditions, high yield bonds, private placements, and hybrid financing structures originated globally from

1988 through the present. Information includes borrower, lender, purpose, amount, fees, covenants, financials and more.

SDC Platinum databases (Global New Issues including private and public issuances of equity and debt in international markets; Global Mergers &Acquisitions of all public and private corporate transactions involving at least 3% of the ownership of the company;

Global All Municipals covers all negotiated, competitively bid and privately placed U.S.

municipal new issues from 1966 to present and all sub-sovereign public finance new issues offered worldwide from 1963 to present).

Datastream Premium User CTD 3 Net & Datastream Worldscope CTD 3 (historical financial statistical database following global financial and economic information:

-Global Equities with up to 50 years of historical financial data on over 85,000 active and

80,000 inactive equities across more than 150 developed and emerging markets;

-Indices including more than 210,000 series from sources such as MSCI, FTSE, and

S&P; bond indices such as JP Morgan, Iboxx and Citigroup; governmental bond indices, and Datastream proprietary indices;

-Bonds-including historical price and volume data for 230,000 active and 500,000 matured and called bonds, warrants, convertibles, CDS, domestic and international issues;

-I/B/E/S Current Consensus including the most recent 18 months of analysts' consensus earnings estimates;

-Economic Indicators including sources as the International Monetary Fund, Organization for Economic Cooperation and Development, Eurostat, and Consensus

Economics;

-Global Foreign Exchange Rates-more than 20,000 daily rates dating back to 1965 from sources including WM/Reuters, tenfore, GTIS, Tullet Prebon, and ECB;

-Commodities &Energy-including prices and indices including over $32,000 series from sources including Platts, ICIS and Metal Bulletin;

-Unit and Investment Trusts-including pricing and dividend coverage of 120,000 funds;

and, -Worldscope Fundamentals-standardized annual and interim financial statements data and financial ratios covering 37,000 active companies and 27,000 inactive company's world-wide going back to 1980.

Lipper Hedge Fund Database with access to detailed quantitative and qualitative information on active and inactive hedge funds. The database includes data elements for each fund, including historical price and performance data; fund manager profile and contact information; fund structure, fees and expenses, leverage, and strategy; inception date; fund domicile; strategy classification details; and investment methodology and focus descriptions.

SEC Filings and Analyst Reports with access to SEC filings in real-time with an extensive historical archive, and third-party information combined with powerful application tools.

SEC filings. The filings must include images of the original submissions as well as a searchable database of the submissions. It must include images of all filings submitted in paper, including forms 144, D, 3, 4 and 5, etc. so as to include ownership data on funds, firms, insider holdings, and Officers and Directors information. The historical coverage of the images must extend back to the 1980's and for filings before 1980, images shall be added upon request. The service shall provide the capability to compare changes between a company's sequential filings by identifying changes, additions and deletions in successive filings. Access shall be provided to a substantial body of equity research reports in a searchable system, including Investext, both historical and current. The historical coverage must extend back to 1985 with over 1,500 contributors. Access shall be provided to public companies' public disclosure events, including conference calls, webcasts, transcripts, call summaries, and company issued guidance. The format shall include audio, when available, as well as written in a searchable database. The historical coverage shall extend back to 2005.

The estimated value of the Base Year is nd the total estimated value of the contract is for the base period and all options.

4. An identification of the statutory authority permitting other than full and open competition.

The statutory authority permitting other than full and open competition for this requirement is, 41 U.S.C. 3304(a)(1)_as implemented by FAR 6.302-1, only one responsible source and no other supplies or services will satisfy agency requirements.

5. A demonstration that the proposed contractor's unique qualifications or the nature of the acquisition requires use of the authority cited.

Thomson Reuters (Markets) LLC is the only source that can provide the content delivered in the format required by the SEC. The data that the SEC requires to be deliverable through the Wharton Research Data Services (WRDS) platform is available only from Thomson Reuters.

They compile and publish the data, and provide it to WRDS. These data sets are: UB/E/S data files, Insider Filing Feed US, Mutual Funds Ownership Current and History, 13F Ownership Current and History, and DealScan. These products are the only ones in these categories that are offered via the WRDS platform. The WRDS platform enables Commission staff to conduct studies more efficiently, since the data can be accessed through the statistical platform currently used for analysis. WRDS is auser-friendly, web-based, data management system designed to retrieve information from a wide variety of financial and economic data sources, and to facilitate large-scale data research. In addition to being available via WRDS, the Mutual Funds Ownership Current and History and 13F Ownership Current and History holdings data meet the requirement of being identical to the information in the source forms, unadjusted for capitalization changes or mergers. DealScan meets the data requirements, providing key data for all syndicated loans in the market, available for Commission-wide access and large scale cross-sectional analyses. In addition, DealScan's search capabilities will allow investigation teams to isolate recent loans and loan amendments that may have led to illegal insider trading. Insider Filing Data is the only comprehensive source of historical insider trading transactions that is deliverable through the Wharton Research Data Services (WRDS) platform.

UB/E/S is the only service available on the WRDS platform that provides earnings estimates, expected and actual operating earnings, current consensus earnings forecasts, and historical consensus earnings estimates. In addition, IB/E/S has the most comprehensive coverage of forecast contributors and countries worldwide, and provides a unique identifier that enables users to trace a company's historical estimates even though other identifiers, such as CUSIP numbers, may have changed.

SDC Platinum databases (Global New Issues, Global Mergers &Acquisitions and Global All Municipals) are required because the product has the broadest coverage of securities, with the most extensive historical range. In addition, it enables the download of large datasets that are necessary for research and analysis of capital markets, mergers and acquisitions, syndicated loans, and private equity.

Datastream is analytical software proprietary to Thomons Reuters that is customizable and enables the simultaneous use of Thomson databases of company fundamentals and both adjusted and unadjusted equity price histories and eight historical and financial statistical data bases follows global financial and economic information. It also has the most in-depth economic coverage along with the longest historical range of any financial product.

Lipper Hedge Fund Database, produced by Thomson Reuters, is one of several sources of information on hedge funds that are available for use in the SEC's OIDS research platform.

These databases contain information that hedge funds voluntarily report. While these sources may overlap in their coverage of funds, each contains unique funds not reported elsewhere. The aggregation of Lipper Hedge Fund data with additional content through OIDS fulfills the requirement for comprehensive coverage and analytical tools needed to perform on-going hedge fund industry surveillance.

The Thomson Reuters web based financial tool is required for filings and analyst reports because it provides access to analyst reports that are distributed exclusively through Thomson Reuters, and SEC staff require access to a broad array of analyst reports. It also has the most complete collection of historical SEC filings of any service.

SEC staff must have access to the most prominent industry analytical tools to keep up to date with the information, data, and analysis used by the industry it regulates. Thomson Reuters services are necessary for that effort because they provide the most extensive historical files, comprehensive data coverage, proprietary news, and industry analysis that enables SEC staff to write and interpret rules, check for compliance, manage risk assessment, conduct surveillance, and take enforcement action. Without this comprehensive collection of resources, the SEC would not have complete information to support these activities.

6. A description of efforts made to ensure that offers are solicited from as many potential sources as is practicable, including whether a notice was or will be publicized as required by subpart 5.2 and, if not, which exception under 5.202 applies.

The SEC Office of Acquisitions posted a synopsis on FedBizOpps on 02 February 2017 to provide notification that the SEC intends to award a sole source procurement to Thomson Reuters (Markets) LLC in accordance with FAR 5.201. Any responses to the notice will be reviewed and any sources that express interest in the procurement will be added to a list being maintained in the contract file (see number 10).

7. A determination by the contracting officer that the anticipated cost to the Government will be fair and reasonable.

The Contracting Officer has determined that the anticipated price is fair and reasonable.

8. A description of the market research conducted (see Part 10) and the results or a statement of the reason market research was not conducted.

Knowledgeable individuals in the Division of Economics, Risk, and Analysis (DERA) and business librarians were consulted, and research was conducted on the Internet The previous contract provided for three components: (1) Compliance and Regulatory Information; (2) Filings, Analyst Reports, and Research Data and Information; and (3) Financial Database Information.

Market research revealed that no other sources can provide the required financial database information in the format required by the SEC.

In an attempt to promote competition for the other two components, (1) daily updates for Regulatory and Compliance Information and (2). Filings, Analyst Reports and Research Data and Information, the Office of Acquisitions (OA) posted two Source Sought Announcements to determine if there are other capable sources available:

- Sources Sought Announcement SECHQ117Q0001 was posted to seek potential sources that can provide compliance and regulatory information. One source responded to the announcement and provided information demonstrating that the company can meet the SEC's requirement. Therefore, OA has made a determination to remove the regulatory and compliance information component of the requirement and compete it in a separate acquisition. —

- Sources Sought Announcement SECHQ117Q0008 was posted to seek potential sources that can meet the SEC's requirement for Filings, Analyst Reports and Research Data and Information. Seven (7) companies responded to the Sources Sought Announcement and provided information and capability statements. Each company's response was reviewed by OSI and it was determined that none of the seven companies can meet the SEC's requirement. A list of the seven companies and their responses will be retained in the contract file to document market research.

Based on the research, the recommendation of those consulted, and the Sources Sought

Announcements, the SEC has concluded that only the compliance and regulatory information can be competed separately. Thomson Reuters possesses unique capabilities and is the only source available in the marketplace to provide the Filings, Analyst Reports, and Research Data and Information as well as the Financial Database Information. A market research report was completed to document research efforts for this requirement. The report is included in the contract file.

9. Any other facts supporting the use of other than full and open competition:

None applicable.

10. A listing of the sources, if any, that expressed, in writing, an interest in the acquisition.:

The following seven companies responded to the SEC's Source Sought Announcement

(SECHQ117Q0008) for Filings, Analyst Reports and Research Data and Information:

A list of sources that express an interest in actions under this J&A will be maintained in the contract file.

11. A statement of the actions, if any, the agency may take to remove or overcome any barriers to competition before any subsequent acquisition for the supplies or services required.:

a) Procurement History: SECHQ115P0179 was awarded as an exception to full and open competition for a period of performance: O 1 October 2015 through 31 March 2017.

b) An attempt was made to separate requirements to allow for potential competition; however, a review of the capabilities statements did not indicate sufficient qualified sources capable of fulfilling the requirements listed in this justification. The Commission will continue to research the capabilities of the marketplace to determine if similar products/services maybe utilized to fulfill these requirements in the future.