80 FR 20047 - Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of Filing of Proposed Rule Change Related to Settlement Finality

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 80, Issue 71 (April 14, 2015)

[Federal Register Volume 80, Number 71 (Tuesday, April 14, 2015)]
[Notices]
[Pages 20047-20049]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-08448]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-74676; File No. SR-ICC-2015-008]


Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of 
Filing of Proposed Rule Change Related to Settlement Finality

April 8, 2015.
    Pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that 
on April 1, 2015, ICE Clear Credit LLC (``ICC'') filed with the 
Securities and Exchange Commission (``Commission'') the proposed rule 
change as described in Items I, II, and III below, which Items have 
been prepared primarily by ICC. The Commission is publishing this

[[Page 20048]]

notice to solicit comments on the proposed rule change from interested 
persons.
---------------------------------------------------------------------------

    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
---------------------------------------------------------------------------

I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The principal purpose of the proposed changes is to amend ICC 
Clearing Rule 401 (``Rule 401'') \3\ in order to provide additional 
clarity regarding settlement finality with respect to Mark-to-Market 
Margin (as defined in ICC Rule 401).
---------------------------------------------------------------------------

    \3\ Pursuant to a telephone call with ICC's internal counsel on 
April 2, 2015, staff in the Division of Trading and Markets 
corrected an incorrect reference to ICC Rule 401(b)(ii). ICC 
intended to refer to ICC Rule 401.
---------------------------------------------------------------------------

II. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, ICC included statements 
concerning the purpose of and basis for the proposed rule change and 
discussed any comments it received on the proposed rule change. The 
text of these statements may be examined at the places specified in 
Item IV below. ICC has prepared summaries, set forth in sections A, B, 
and C below, of the most significant aspects of these statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and 
Statutory Basis for, the Proposed Rule Change

    ICC proposes changes to Rule 401 in order to provide additional 
clarity regarding settlement finality with respect to Mark-to-Market 
Margin. Specifically, ICC is proposing to add new subsections (k) and 
(l) to Rule 401. The new subsections are not intended to change any 
current ICC practices; rather, such changes are intended to provide 
additional clarity regarding settlement finality with respect to Mark-
to-Market Margin. All capitalized terms not defined herein are defined 
in the ICC Rules.
    ICC proposes adding language in Rule 401(k) to clarify that each 
Transfer of Mark-to-Market Margin shall constitute a settlement (within 
the meaning of U.S. Commodity Futures Trading Commission Rule 39.14 
\4\) and shall be final as of the time ICC's accounts are debited or 
credited with the relevant payment. Further, ICC proposes adding 
language in Rule 401(l) to state that once settlement of a Transfer of 
Mark-to-Market Margin in respect of the Margin Requirements for a Mark-
to-Market Margin Category is final, the fair value of the outstanding 
exposures for the relevant Contracts in that Mark-to-Market Margin 
Category (taking into account the Margin provided in respect of such 
Margin Requirement) will be reset to zero. Such additional language is 
consistent with ICC's current practices and is intended to provide 
further clarity regarding ICC's settlement cycle.
---------------------------------------------------------------------------

    \4\ 17 CFR 39.14(a).
---------------------------------------------------------------------------

    Section 17A(b)(3)(F) of the Act \5\ requires, among other things, 
that the rules of a clearing agency be designed to promote the prompt 
and accurate clearance and settlement of securities transactions, and 
to the extent applicable, derivative agreements, contracts and 
transactions and to comply with the provisions of the Act and the rules 
and regulations thereunder. ICC believes that the proposed rule change 
is consistent with the requirements of the Act and the rules and 
regulations thereunder applicable to ICC, in particular, to section 
17(A)(b)(3)(F),\6\ because ICC believes that the proposed rule change 
will assure the prompt and accurate clearance and settlement of 
securities transactions, derivatives agreements, contracts, and 
transactions. The proposed changes to the ICC Rules provide additional 
clarity regarding ICC's current settlement cycle. ICC believes the 
proposed revisions provide further clarity and transparency in the ICC 
Rules. ICC believes clarity and transparency in its Rules is of value 
to the market in order to provide a comprehensive understanding of 
ICC's operations. As such, the proposed rule change is designed to 
promote the prompt and accurate clearance and settlement of securities 
transactions, derivatives agreements, contracts, and transactions 
within the meaning of section 17A(b)(3)(F) \7\ of the Act.
---------------------------------------------------------------------------

    \5\ 15 U.S.C. 78q-1(b)(3)(F).
    \6\ Id.
    \7\ Id.
---------------------------------------------------------------------------

B. Self-Regulatory Organization's Statement on Burden on Competition

    ICC does not believe the proposed rule change would have any 
impact, or impose any burden, on competition. The changes, which 
clarify aspects of ICC's settlement cycle, result in no operational 
changes and apply uniformly across all market participants. Therefore, 
ICC does not believe the proposed rule change imposes any burden on 
competition that is inappropriate in furtherance of the purposes of the 
Act.

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants or Others

    Written comments relating to the proposed rule change have not been 
solicited or received. ICC will notify the Commission of any written 
comments received by ICC.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the self-regulatory organization consents, the Commission will:
    (A) By order approve or disapprove such proposed rule change, or
    (B) institute proceedings to determine whether the proposed rule 
change should be disapproved.

IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and 
arguments concerning the foregoing, including whether the proposed rule 
change is consistent with the Act. Comments may be submitted by any of 
the following methods:

Electronic Comments

     Use the Commission's Internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
File Number SR-ICC-2015-008 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.

All submissions should refer to File Number SR-ICC-2015-008. This file 
number should be included on the subject line if email is used. To help 
the Commission process and review your comments more efficiently, 
please use only one method. The Commission will post all comments on 
the Commission's Internet Web site (http://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than

[[Page 20049]]

those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for Web site viewing and 
printing in the Commission's Public Reference Room, 100 F Street NE., 
Washington, DC 20549, on official business days between the hours of 
10:00 a.m. and 3:00 p.m. Copies of such filings also will be available 
for inspection and copying at the principal office of ICE Clear Credit 
and on ICE Clear Credit's Web site at https://www.theice.com/clear-credit/regulation.
    All comments received will be posted without change; the Commission 
does not edit personal identifying information from submissions. You 
should submit only information that you wish to make available 
publicly. All submissions should refer to File Number SR-ICC-2015-008 
and should be submitted on or before May 5, 2015.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
---------------------------------------------------------------------------

    \8\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Brent J. Fields,
Secretary.
[FR Doc. 2015-08448 Filed 4-13-15; 8:45 am]
BILLING CODE 8011-01-P