81 FR 30575 - Self-Regulatory Organizations; ICE Clear Europe Limited; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Accounts Categories for Positions of Clearing Member Affiliates
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 81, Issue 95 (May 17, 2016)
Federal Register Volume 81, Issue 95 (May 17, 2016)
| Page Range | 30575-30577 | |
| FR Document | 2016-11539 |
[Federal Register Volume 81, Number 95 (Tuesday, May 17, 2016)] [Notices] [Pages 30575-30577] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-11539] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Release No. 34-77809; File No. SR-ICEEU-2016-006] Self-Regulatory Organizations; ICE Clear Europe Limited; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to Accounts Categories for Positions of Clearing Member Affiliates May 11, 2016. 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 28 2016, ICE Clear Europe Limited (``ICE Clear Europe'' or ``Clearing House'') filed with the Securities and Exchange Commission (``Commission'') the proposed rule changes described in Items I, II and III below, which Items have been prepared by ICE Clear Europe. ICE Clear Europe filed the proposal pursuant to Section 19(b)(3)(A) of the Act,\3\ and Rule 19b-4(f)(i) \4\ thereunder, so that the proposal was effective upon filing with the Commission. The Commission is publishing this 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. \3\ 15 U.S.C. 78s(b)(3)(A). \4\ 17 CFR 240.19b-4(f)(4)(i). --------------------------------------------------------------------------- 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 clarify the account categories to be used for positions of affiliates of Clearing Members. II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, ICE Clear Europe included statements concerning the purpose of and basis for the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. ICE Clear Europe has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. [[Page 30576]] A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose ICE Clear Europe submits proposed amendments to its Clearing Procedures to clarify the account categories in which positions of affiliates of Clearing Members are to be maintained, in light of applicable US and EU regulatory requirements. ICE Clear Europe does not propose to amend its Rules in connection with these changes. Under CFTC rules, the positions of an affiliate of an FCM are considered ``proprietary'' for purposes of segregation requirements and thus cannot be held in a customer account.\5\ As a result, FCMs, including FCM/BD Clearing Members, have historically carried such positions in their proprietary accounts. However, under the European Market Infrastructure Regulation (``EMIR''),\6\ when applicable to ICE Clear Europe, a clearing member will be required to treat an affiliate as a client \7\ for various purposes, and accordingly positions of the affiliate should be held in a separate account from the proprietary positions of the clearing member.\8\ Accordingly, ICE Clear Europe proposes to establish new position-keeping accounts for use by FCM/BD Clearing Members for positions of their affiliates, which will be separate from the clearing member's own positions (and thus satisfy the EMIR requirement) but at the same time will not be customer accounts for purposes of applicable CFTC requirements. Although it is expected that these accounts will at present be principally relevant to F&O Contracts of affiliates of FCM/BD Clearing Members, the accounts would also be used for CDS Contracts of such persons, as and when ICE Clear Europe accepts such contracts cleared through FCM/BD Clearing Members. --------------------------------------------------------------------------- \5\ See, e.g., 17 CFR 1.3(y), 17 CFR 1.20(e)(2). \6\ Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012 on OTC derivatives, central counterparties and trade repositories, as well as various implementing regulations and technical standards. \7\ EMIR Article 2(15). EMIR defines ``client'' as ``an undertaking with a contractual relationship with a clearing member of a CCP which enables that undertaking to clear its transactions with that CCP,'' which suggests that an affiliate can be a client of a clearing member. This understanding of a client is supported in other EU legislation such as MiFID (see Directive 2004/39/EC of the European Parliament and of the Council on 21 April 2004 on markets in financial instruments amending Council Directives 85/611/EEC and 93/6/EEC and Directive 2000/12/EC of the European Parliament and of the Council and repealing Council Directive 93/22/EEC), and in UK case law where affiliates have consistently been treated as clients to whom regulatory obligations were owed. See Re Lehman Brothers International (Europe) (in administration) [2012] UKSC 6. \8\ EMIR Article 39(4). --------------------------------------------------------------------------- Specifically, ICE Clear Europe proposes to amend paragraph 2.3(b) of the Clearing Procedures to establish new position-keeping accounts, labeled the ``F'' and ``R'' accounts, which will be required to be used for all positions of affiliates of FCM/BD Clearing Members. The ``F'' account will use a gross margin model (for positions in contracts margined on a gross basis under the Rules and Procedures); the ``R'' account will use a net margin model (for positions in contracts margined on a net basis under the Rules and Procedures). Both accounts will be treated as separate Proprietary Accounts for purposes of the Rules (and accordingly the accounts will not constitute Customer Accounts of the FCM/BD Clearing Member). New paragraph 2.3(f) has been added to provide a definition of ``affiliate'' for this purpose, based on the relevant definitions of proprietary accounts under CFTC rules. Paragraph 2.3 has also been revised to clarify the treatment of positions of affiliates of Non-FCM/BD Clearing Members. New paragraph 2.3(f) also includes a definition of ``affiliate'' for this purpose, based on the EMIR definition of ``group.'' Conforming changes have been made to paragraph 2.3(b)(4) to use such definition. Additional clarifications have been made in paragraph 2.3(b)(5) as to the use by certain Non-FCM/BD Clearing Members of the ``T'' and ``K'' accounts (as separate Segregated Customer Omnibus Accounts for F&O or Segregated TTFCA Customer Omnibus Accounts for F&O) and of the ``F'' and ``R'' accounts as available for holding positions of their affiliates. Paragraph 2.3(c) has been revised to clarify that the Clearing House may establish additional position-keeping accounts for a Clearing Member to facilitate separate tracking of positions for each exchange non-clearing member for which the Clearing Member provides services. The revisions also clarify the treatment of such position-keeping accounts for exchange members as customer or proprietary, consistent with the requirements of the Rules and Clearing Procedures and applicable law. Amendments to paragraph 3.1(a) of the Clearing Procedures provide for the margining of the ``F'' and ``R'' accounts of FCM/BD Clearing members as separate Proprietary Accounts. The summary table following paragraph 3.2 of the Clearing Procedures has been amended to conform to the other changes made in the Clearing Procedures. 2. Statutory Basis ICE Clear Europe believes that the proposed amendments to the Clearing Procedures are consistent with the requirements of Section 17A of the Act \9\ and the regulations thereunder applicable to it.\10\ Section 17A(b)(3)(F) of the Act \11\ 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, to assure the safeguarding of securities and funds which are in the custody or control of the clearing agency or for which it is responsible and to protect investors and the public interest. --------------------------------------------------------------------------- \9\ 15 U.S.C. 78q-1. \10\ 17 CFR 240.17Ad-22. \11\ 15 U.S.C. 78q-1(b)(3)(F). --------------------------------------------------------------------------- The amendments are designed to clarify the treatment of positions of affiliates of Clearing Members in light of applicable legal and regulatory requirements. Specifically, for FCM/BD Clearing Members, the amendments establish separate accounts in which such positions must be held, in a manner that is consistent with both CFTC and EMIR requirements. Such accounts will allow positions of affiliates to be held separately from the Clearing Member's positions, consistent with the EMIR requirements, but will be treated as Proprietary Accounts under the Rules and Procedures, consistent with CFTC rules. The amendments also clarify the treatment of positions of affiliates of Non-FCM/BD Clearing Members, consistent with EMIR requirements. Overall, in ICE Clear Europe's view, the amendments will enhance its ability (and that of its Clearing Members) to track positions of Clearing Member affiliates and comply with relevant regulatory obligations. As a result, in ICE Clear Europe's view, the amendments will promote the prompt and accurate clearance and settlement of derivative transactions, are consistent with the safeguarding of funds and securities in the custody or control of ICE Clear Europe, and generally further the public interest. The amendments are therefore consistent with the requirements of Section 17A(b)(3)(F) of the Act \12\ and the regulations thereunder.\13\ --------------------------------------------------------------------------- \12\ 15 U.S.C. 78q-1(b)(3)(F). \13\ 17 CFR 240.17Ad-22. --------------------------------------------------------------------------- [[Page 30577]] B. Self-Regulatory Organization's Statement on Burden on Competition ICE Clear Europe does not believe the proposed changes to the Rules discussed herein would have any adverse impact, or impose any burden, on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposed amendments are intended to clarify the treatment of positions of affiliates of Clearing Member, consistent with applicable legal requirements. ICE Clear Europe does not believe the proposed amendments would adversely affect access to clearing by Clearing Members or their affiliates (or customers), adversely affect competition among Clearing Members or adversely affect the market for clearing services or limit market participants' choices for clearing transactions. Although the proposed amendments may impose additional compliance costs on Clearing Members, including because of the requirements to hold affiliate positions in separate accounts that are separately margined, ICE Clear Europe believes that such costs reflect, and are appropriate in light of, the legal requirements applicable to such positions. Although the amendments treat affiliate positions of FCM/BD Clearing Members and Non-FCM/BD Clearing Members differently in certain respects, in ICE Clear Europe's view such differences also result from the different legal frameworks applicable to such Clearing Members. As a result, ICE Clear Europe does not believe that the proposed amendments to the Clearing Procedures will impose any burden on competition not appropriate 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 ICE Clear Europe has not solicited or received any written comments with respect to the proposed changes. ICE Clear Europe will notify the Commission of any written comments received by ICE Clear Europe. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective upon filing pursuant to Section 19(b)(3)(A) \14\ of the Act and Rule 19b-4(f)(4)(i) \15\ thereunder. The amendments effect a change in an existing service of a registered clearing agency that does not adversely affect the safeguarding of securities or funds in the custody or control of the clearing agency or for which it is responsible, and does not significantly affect the respective rights or obligations of the clearing agency or persons using its clearing service, within the meaning of Rule 19b-4(f)(4)(i).\16\ As noted above, the amendments provide for a separate proprietary account to be used for positions of affiliates of FCM/BD Clearing Members (as opposed to combining such positions in the same account as the Clearing Member's own positions), in order to be consistent with both CFTC and EMIR requirements. The amendments also provide that such accounts will be margined separately. Certain other clarifications are made with respect to the accounts used for positions of affiliates of Non-FCM/BD Clearing Members. In ICE Clear Europe's view, these changes will not adversely affect the safeguarding of funds or securities in the custody or control of ICE Clear Europe, from the perspective of Clearing Members or their affiliates or customers. Although the amendments impose certain additional requirements on Clearing Members that carry positions on behalf of their affiliates in terms of the use of a separate account, ICE Clear Europe also believes that the amendments will not significantly affect the rights or obligations of ICE Clear Europe or Clearing Members using its clearing services. As a result, ICE Clear Europe views these amendments as falling within Rule 19b- 4(f)(4)(i).\17\ --------------------------------------------------------------------------- \14\ 15 U.S.C. 78s(b)(3)(A). \15\ 17 CFR 240.19b-4(f)(4)(i). \16\ 17 CFR 240.19b-4(f)(4)(i). \17\ 17 CFR 240.19b-4(f)(4)(i). --------------------------------------------------------------------------- At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. 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 CommentsUse 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-ICEEU-2016-006 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-ICEEU-2016-006. 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 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 will also be available for inspection and copying at the principal office of ICE Clear Europe and on ICE Clear Europe's Web site at https://www.theice.com/clear-europe/regulation#rule-filings. 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-ICEEU-2016-006 and should be submitted on or before June 7, 2016. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.\18\ --------------------------------------------------------------------------- \18\ 17 CFR 200.30-3(a)(12). --------------------------------------------------------------------------- Robert W. Errett, Deputy Secretary. [FR Doc. 2016-11539 Filed 5-16-16; 8:45 am] BILLING CODE 8011-01-P
![Federal Register / Vol. 81, No. 95 / Tuesday, May 17, 2016 / Notices 30575
order routing practices, that the degree including whether the proposed rule SECURITIES AND EXCHANGE
to which fee changes in this market may change is consistent with the Act. COMMISSION
impose any burden on competition is Comments may be submitted by any of
extremely limited. the following methods: [Release No. 34–77809; File No. SR–ICEEU–
The Exchange’s proposal to no longer 2016–006]
pay Customer Rebates on options Electronic Comments
overlying NDX and MNX in any • Use the Commission’s Internet Self-Regulatory Organizations; ICE
Category does not impose an undue comment form (http://www.sec.gov/ Clear Europe Limited; Notice of Filing
burden on intra-market competition rules/sro.shtml); or and Immediate Effectiveness of a
because the Exchange would apply the
calculation of Customer rebates and • Send an email to rule-comments@ Proposed Rule Change Relating to
sec.gov. Please include File Number SR– Accounts Categories for Positions of
would pay rebates on qualifying orders
Phlx–2016–57 on the subject line. Clearing Member Affiliates
in a uniform manner. No market
participant would be paid a Customer Paper Comments May 11, 2016.
Rebate in options overlying NDX or
MNX. All market participants may • Send paper comments in triplicate Pursuant to Section 19(b)(1) of the
participate in the Customer Rebate to Secretary, Securities and Exchange Securities Exchange Act of 1934
Program. Members would continue to Commission, 100 F Street NE., (‘‘Act’’),1 and Rule 19b–4 thereunder,2
benefit from the inclusion of options Washington, DC 20549–1090. notice is hereby given that on April 28
overlying NDX and MNX in the total 2016, ICE Clear Europe Limited (‘‘ICE
All submissions should refer to File Clear Europe’’ or ‘‘Clearing House’’)
volume to qualify a market participant Number SR–Phlx–2016–57. This file
for a Customer Rebate. filed with the Securities and Exchange
number should be included on the
Also, the Exchange’s proposal to no Commission (‘‘Commission’’) the
subject line if email is used. To help the
longer pay Customer Rebates on options proposed rule changes described in
Commission process and review your
overlying NDX and MNX in any Items I, II and III below, which Items
comments more efficiently, please use
Category does not impose an undue have been prepared by ICE Clear
only one method. The Commission will
burden on inter-market competition Europe. ICE Clear Europe filed the
post all comments on the Commission’s
because there is only one other proposal pursuant to Section 19(b)(3)(A)
Internet Web site (http://www.sec.gov/
exchange that transacts options of the Act,3 and Rule 19b–4(f)(i) 4
rules/sro.shtml). Copies of the
overlying NDX and MNX through a thereunder, so that the proposal was
submission, all subsequent
contractual agreement with the effective upon filing with the
amendments, all written statements
Exchange. That venue may choose to Commission. The Commission is
with respect to the proposed rule
also not pay rebates on options publishing this notice to solicit
change that are filed with the
overlying NDX or MNX. Other venues comments on the proposed rule change
Commission, and all written
may not list these proprietary indices.
communications relating to the from interested persons.
C. Self-Regulatory Organization’s proposed rule change between the
I. Self-Regulatory Organization’s
Statement on Comments on the Commission and any person, other than
Proposed Rule Change Received From those that may be withheld from the Statement of the Terms of Substance of
Members, Participants, or Others public in accordance with the the Proposed Rule Change
No written comments were either provisions of 5 U.S.C. 552, will be The principal purpose of the
solicited or received. available for Web site viewing and proposed changes is to clarify the
printing in the Commission’s Public account categories to be used for
III. Date of Effectiveness of the Reference Room, 100 F Street NE.,
Proposed Rule Change and Timing for positions of affiliates of Clearing
Washington, DC 20549, on official
Commission Action Members.
business days between the hours of
The foregoing rule change has become 10:00 a.m. and 3:00 p.m. Copies of the II. Self-Regulatory Organization’s
effective pursuant to Section filing also will be available for Statement of the Purpose of, and
19(b)(3)(A)(ii) of the Act.20 inspection and copying at the principal Statutory Basis for, the Proposed Rule
At any time within 60 days of the office of the Exchange. All comments Change
filing of the proposed rule change, the received will be posted without change;
Commission summarily may the Commission does not edit personal In its filing with the Commission, ICE
temporarily suspend such rule change if identifying information from Clear Europe included statements
it appears to the Commission that such submissions. You should submit only concerning the purpose of and basis for
action is: (i) Necessary or appropriate in information that you wish to make the proposed rule change. The text of
the public interest; (ii) for the protection available publicly. All submissions these statements may be examined at
of investors; or (iii) otherwise in should refer to File Number SR–Phlx– the places specified in Item IV below.
furtherance of the purposes of the Act. 2016–57 and should be submitted on or ICE Clear Europe has prepared
If the Commission takes such action, the before June 7, 2016. summaries, set forth in sections A, B,
Commission shall institute proceedings For the Commission, by the Division of and C below, of the most significant
to determine whether the proposed rule Trading and Markets, pursuant to delegated aspects of such statements.
jstallworth on DSK7TPTVN1PROD with NOTICES
should be approved or disapproved. authority.21
IV. Solicitation of Comments Robert W. Errett,
Interested persons are invited to Deputy Secretary.
submit written data, views and [FR Doc. 2016–11541 Filed 5–16–16; 8:45 am] 1 15 U.S.C. 78s(b)(1).
arguments concerning the foregoing, BILLING CODE 8011–01–P 2 17 CFR 240.19b–4.
3 15 U.S.C. 78s(b)(3)(A).
20 15 U.S.C. 78s(b)(3)(A)(ii). 21 17 CFR 200.30–3(a)(12). 4 17 CFR 240.19b–4(f)(4)(i).
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A. Self-Regulatory Organization’s Contracts of such persons, as and when changes made in the Clearing
Statement of the Purpose of, and ICE Clear Europe accepts such contracts Procedures.
Statutory Basis for, the Proposed Rule cleared through FCM/BD Clearing
Change Members. 2. Statutory Basis
1. Purpose Specifically, ICE Clear Europe ICE Clear Europe believes that the
proposes to amend paragraph 2.3(b) of proposed amendments to the Clearing
ICE Clear Europe submits proposed the Clearing Procedures to establish new
amendments to its Clearing Procedures Procedures are consistent with the
position-keeping accounts, labeled the requirements of Section 17A of the Act 9
to clarify the account categories in ‘‘F’’ and ‘‘R’’ accounts, which will be
which positions of affiliates of Clearing and the regulations thereunder
required to be used for all positions of
Members are to be maintained, in light applicable to it.10 Section 17A(b)(3)(F)
affiliates of FCM/BD Clearing Members.
of applicable US and EU regulatory of the Act 11 requires, among other
The ‘‘F’’ account will use a gross margin
requirements. ICE Clear Europe does not model (for positions in contracts things, that the rules of a clearing
propose to amend its Rules in margined on a gross basis under the agency be designed to promote the
connection with these changes. Rules and Procedures); the ‘‘R’’ account prompt and accurate clearance and
Under CFTC rules, the positions of an will use a net margin model (for settlement of securities transactions
affiliate of an FCM are considered positions in contracts margined on a net and, to the extent applicable, derivative
‘‘proprietary’’ for purposes of basis under the Rules and Procedures). agreements, contracts, and transactions,
segregation requirements and thus Both accounts will be treated as separate to assure the safeguarding of securities
cannot be held in a customer account.5 Proprietary Accounts for purposes of the and funds which are in the custody or
As a result, FCMs, including FCM/BD Rules (and accordingly the accounts control of the clearing agency or for
Clearing Members, have historically will not constitute Customer Accounts which it is responsible and to protect
carried such positions in their of the FCM/BD Clearing Member). New investors and the public interest.
proprietary accounts. However, under paragraph 2.3(f) has been added to
the European Market Infrastructure The amendments are designed to
provide a definition of ‘‘affiliate’’ for clarify the treatment of positions of
Regulation (‘‘EMIR’’),6 when applicable this purpose, based on the relevant
to ICE Clear Europe, a clearing member affiliates of Clearing Members in light of
definitions of proprietary accounts applicable legal and regulatory
will be required to treat an affiliate as under CFTC rules.
a client 7 for various purposes, and requirements. Specifically, for FCM/BD
Paragraph 2.3 has also been revised to Clearing Members, the amendments
accordingly positions of the affiliate clarify the treatment of positions of
should be held in a separate account establish separate accounts in which
affiliates of Non-FCM/BD Clearing
from the proprietary positions of the such positions must be held, in a
Members. New paragraph 2.3(f) also
clearing member.8 Accordingly, ICE manner that is consistent with both
includes a definition of ‘‘affiliate’’ for
Clear Europe proposes to establish new CFTC and EMIR requirements. Such
this purpose, based on the EMIR
position-keeping accounts for use by definition of ‘‘group.’’ Conforming accounts will allow positions of
FCM/BD Clearing Members for positions changes have been made to paragraph affiliates to be held separately from the
of their affiliates, which will be separate 2.3(b)(4) to use such definition. Clearing Member’s positions, consistent
from the clearing member’s own Additional clarifications have been with the EMIR requirements, but will be
positions (and thus satisfy the EMIR made in paragraph 2.3(b)(5) as to the use treated as Proprietary Accounts under
requirement) but at the same time will by certain Non-FCM/BD Clearing the Rules and Procedures, consistent
not be customer accounts for purposes Members of the ‘‘T’’ and ‘‘K’’ accounts with CFTC rules. The amendments also
of applicable CFTC requirements. (as separate Segregated Customer clarify the treatment of positions of
Although it is expected that these Omnibus Accounts for F&O or affiliates of Non-FCM/BD Clearing
accounts will at present be principally Segregated TTFCA Customer Omnibus Members, consistent with EMIR
relevant to F&O Contracts of affiliates of Accounts for F&O) and of the ‘‘F’’ and requirements. Overall, in ICE Clear
FCM/BD Clearing Members, the ‘‘R’’ accounts as available for holding Europe’s view, the amendments will
accounts would also be used for CDS positions of their affiliates. Paragraph enhance its ability (and that of its
5 See,
2.3(c) has been revised to clarify that the Clearing Members) to track positions of
e.g., 17 CFR 1.3(y), 17 CFR 1.20(e)(2).
6 Regulation
Clearing House may establish additional Clearing Member affiliates and comply
(EU) No 648/2012 of the European
Parliament and of the Council of 4 July 2012 on position-keeping accounts for a Clearing with relevant regulatory obligations. As
OTC derivatives, central counterparties and trade Member to facilitate separate tracking of a result, in ICE Clear Europe’s view, the
repositories, as well as various implementing positions for each exchange non- amendments will promote the prompt
regulations and technical standards. clearing member for which the Clearing
7 EMIR Article 2(15). EMIR defines ‘‘client’’ as
and accurate clearance and settlement of
‘‘an undertaking with a contractual relationship
Member provides services. The derivative transactions, are consistent
with a clearing member of a CCP which enables that revisions also clarify the treatment of with the safeguarding of funds and
undertaking to clear its transactions with that CCP,’’ such position-keeping accounts for securities in the custody or control of
which suggests that an affiliate can be a client of exchange members as customer or
a clearing member. This understanding of a client ICE Clear Europe, and generally further
is supported in other EU legislation such as MiFID
proprietary, consistent with the the public interest. The amendments are
(see Directive 2004/39/EC of the European requirements of the Rules and Clearing therefore consistent with the
Parliament and of the Council on 21 April 2004 on Procedures and applicable law. requirements of Section 17A(b)(3)(F) of
markets in financial instruments amending Council Amendments to paragraph 3.1(a) of
jstallworth on DSK7TPTVN1PROD with NOTICES
Directives 85/611/EEC and 93/6/EEC and Directive the Act 12 and the regulations
2000/12/EC of the European Parliament and of the the Clearing Procedures provide for the thereunder.13
Council and repealing Council Directive 93/22/ margining of the ‘‘F’’ and ‘‘R’’ accounts
EEC), and in UK case law where affiliates have of FCM/BD Clearing members as 9 15 U.S.C. 78q–1.
consistently been treated as clients to whom separate Proprietary Accounts. The 10 17 CFR 240.17Ad–22.
regulatory obligations were owed. See Re Lehman
Brothers International (Europe) (in administration) summary table following paragraph 3.2 11 15 U.S.C. 78q–1(b)(3)(F).
[2012] UKSC 6. of the Clearing Procedures has been 12 15 U.S.C. 78q–1(b)(3)(F).
8 EMIR Article 39(4). amended to conform to the other 13 17 CFR 240.17Ad–22.
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B. Self-Regulatory Organization’s securities or funds in the custody or Paper Comments
Statement on Burden on Competition control of the clearing agency or for
which it is responsible, and does not • Send paper comments in triplicate
ICE Clear Europe does not believe the to Secretary, Securities and Exchange
proposed changes to the Rules significantly affect the respective rights
or obligations of the clearing agency or Commission, 100 F Street NE.,
discussed herein would have any
adverse impact, or impose any burden, persons using its clearing service, Washington, DC 20549–1090.
on competition not necessary or within the meaning of Rule 19b– All submissions should refer to File
appropriate in furtherance of the 4(f)(4)(i).16 As noted above, the
Number SR–ICEEU–2016–006. This file
purposes of the Act. The proposed amendments provide for a separate
number should be included on the
amendments are intended to clarify the proprietary account to be used for
positions of affiliates of FCM/BD subject line if email is used. To help the
treatment of positions of affiliates of Commission process and review your
Clearing Member, consistent with Clearing Members (as opposed to
combining such positions in the same comments more efficiently, please use
applicable legal requirements. ICE Clear only one method. The Commission will
Europe does not believe the proposed account as the Clearing Member’s own
positions), in order to be consistent with post all comments on the Commission’s
amendments would adversely affect
both CFTC and EMIR requirements. The Internet Web site (http://www.sec.gov/
access to clearing by Clearing Members
or their affiliates (or customers), amendments also provide that such rules/sro.shtml). Copies of the
adversely affect competition among accounts will be margined separately. submission, all subsequent
Clearing Members or adversely affect Certain other clarifications are made amendments, all written statements
the market for clearing services or limit with respect to the accounts used for with respect to the proposed rule
market participants’ choices for clearing positions of affiliates of Non-FCM/BD change that are filed with the
transactions. Although the proposed Clearing Members. In ICE Clear Europe’s Commission, and all written
amendments may impose additional view, these changes will not adversely communications relating to the
compliance costs on Clearing Members, affect the safeguarding of funds or proposed rule change between the
including because of the requirements securities in the custody or control of Commission and any person, other than
to hold affiliate positions in separate ICE Clear Europe, from the perspective those that may be withheld from the
accounts that are separately margined, of Clearing Members or their affiliates or public in accordance with the
ICE Clear Europe believes that such customers. Although the amendments provisions of 5 U.S.C. 552, will be
costs reflect, and are appropriate in light impose certain additional requirements available for Web site viewing and
of, the legal requirements applicable to on Clearing Members that carry printing in the Commission’s Public
such positions. Although the positions on behalf of their affiliates in Reference Room, 100 F Street NE.,
amendments treat affiliate positions of terms of the use of a separate account, Washington, DC 20549, on official
FCM/BD Clearing Members and Non- ICE Clear Europe also believes that the
business days between the hours of
FCM/BD Clearing Members differently amendments will not significantly affect
10:00 a.m. and 3:00 p.m. Copies of such
in certain respects, in ICE Clear the rights or obligations of ICE Clear
filings will also be available for
Europe’s view such differences also Europe or Clearing Members using its
clearing services. As a result, ICE Clear inspection and copying at the principal
result from the different legal
frameworks applicable to such Clearing Europe views these amendments as office of ICE Clear Europe and on ICE
Members. As a result, ICE Clear Europe falling within Rule 19b–4(f)(4)(i).17 Clear Europe’s Web site at https://
does not believe that the proposed At any time within 60 days of the www.theice.com/clear-europe/
amendments to the Clearing Procedures filing of the proposed rule change, the regulation#rule-filings.
will impose any burden on competition Commission summarily may All comments received will be posted
not appropriate in furtherance of the temporarily suspend such rule change if without change; the Commission does
purposes of the Act. it appears to the Commission that such not edit personal identifying
action is necessary or appropriate in the information from submissions. You
C. Self-Regulatory Organization’s public interest, for the protection of
Statement on Comments on the should submit only information that
investors, or otherwise in furtherance of you wish to make available publicly. All
Proposed Rule Change Received From
the purposes of the Act. submissions should refer to File
Members, Participants or Others
ICE Clear Europe has not solicited or IV. Solicitation of Comments Number SR–ICEEU–2016–006 and
received any written comments with Interested persons are invited to should be submitted on or before June
respect to the proposed changes. ICE submit written data, views, and 7, 2016.
Clear Europe will notify the arguments concerning the foregoing, For the Commission, by the Division of
Commission of any written comments including whether the proposed rule Trading and Markets, pursuant to delegated
received by ICE Clear Europe. change is consistent with the Act. authority.18
Comments may be submitted by any of Robert W. Errett,
III. Date of Effectiveness of the
the following methods:
Proposed Rule Change and Timing for Deputy Secretary.
Commission Action Electronic Comments [FR Doc. 2016–11539 Filed 5–16–16; 8:45 am]
The foregoing rule change has become • Use the Commission’s Internet BILLING CODE 8011–01–P
effective upon filing pursuant to Section comment form (http://www.sec.gov/
jstallworth on DSK7TPTVN1PROD with NOTICES
19(b)(3)(A) 14 of the Act and Rule 19b– rules/sro.shtml) or
4(f)(4)(i) 15 thereunder. The amendments • Send an email to rule-
effect a change in an existing service of comments@sec.gov. Please include File
a registered clearing agency that does Number SR–ICEEU–2016–006 on the
not adversely affect the safeguarding of subject line.
14 15 U.S.C. 78s(b)(3)(A). 16 17 CFR 240.19b–4(f)(4)(i).
15 17 CFR 240.19b–4(f)(4)(i). 17 17 CFR 240.19b–4(f)(4)(i). 18 17 CFR 200.30–3(a)(12).
VerDate Sep<11>2014 15:32 May 16, 2016 Jkt 238001 PO 00000 Frm 00063 Fmt 4703 Sfmt 9990 E:\FR\FM\17MYN1.SGM 17MYN1](https://thefederalregister.org/doc/81_FR_30670/page/3.svg)
Document Created: 2018-02-07 15:05:25
Document Modified: 2018-02-07 15:05:25
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 81 FR 30575 |
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