83 FR 4526 - Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Designation of Longer Period for Commission Action on Proposed Rule Change Concerning Enhanced and New Tools for Recovery Scenarios

SECURITIES AND EXCHANGE COMMISSION

Federal Register Volume 83, Issue 21 (January 31, 2018)

Page Range		4526-4527
FR Document		2018-01816

Federal Register, Volume 83 Issue 21 (Wednesday, January 31, 2018)

[Federal Register Volume 83, Number 21 (Wednesday, January 31, 2018)]
[Notices]
[Pages 4526-4527]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-01816]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-82585; File No. SR-OCC-2017-020]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Designation of Longer Period for Commission Action on 
Proposed Rule Change Concerning Enhanced and New Tools for Recovery 
Scenarios

January 25, 2018.
    On December 18, 2017, The Options Clearing Corporation (``OCC'') 
filed with the Securities and Exchange Commission (``Commission'') 
proposed rule change SR-OCC-2017-020 (``Proposed Rule Change'') 
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act''),\1\ and

[[Page 4527]]

Rule 19b-4 thereunder,\2\ concerning enhanced and new tools for 
recovery scenarios.\3\ The Proposed Rule Change was published for 
comment in the Federal Register on December 26, 2017.\4\ To date, the 
Commission has received one comment letter to the Proposed Rule 
Change.\5\
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ On December 8, 2017, OCC also filed this proposal as an 
advance notice SR-OCC-2017-809 (``Advance Notice'') with the 
Commission pursuant to Section 806(e)(1) of Title VIII of the Dodd-
Frank Wall Street Reform and Consumer Protection Act, entitled the 
Payment, Clearing, and Settlement Supervision Act of 2010 (12 U.S.C. 
5465(e)(1)) and Rule 19b-4(n)(1)(i) of the Act (17 CFR 240.19b-
4(n)(1)(i)). Notice of filing of the Advance Notice was published 
for comment in the Federal Register on January 23, 2018. Securities 
Exchange Act Release No. 34-82513 (Jan. 17, 2018), 83 FR 3244 (Jan. 
23, 2018) (SR-OCC-2017-809).
     On January 22, 2018, the Commission sent OCC a request for 
additional information, which tolls the Commission's 60-day review 
period for the Advance Notice. See Memorandum from Office of 
Clearance and Settlement, Division of Trading and Markets, dated 
January 23, 2018, available at https://www.sec.gov/comments/sr-occ-2017-809/occ2017809.htm. The new review period will be 60 days from 
the date the Commission receives the information requested. See 
Section 806(e)(1). The proposal in the Proposed Rule Change and the 
Advance Notice shall not take effect until all regulatory actions 
required with respect to the proposal are completed.
    \4\ Securities Exchange Act Release No. 34-82531 (Dec. 19, 
2017), 82 FR 61107 (Dec. 26, 2017) (SR-OCC-2017-020).
    \5\ See Letter from Jacqueline H. Mesa, Senior Vice President of 
Global Policy, FIA, dated Jan. 16, 2018, available at https://www.sec.gov/comments/sr-occ-2017-020/occ2017020.htm. Since the 
proposal contained in the Proposed Rule Change was also filed as an 
Advance Notice, the Commission is considering all public comments 
received on the proposal regardless of whether the comments are 
submitted to the Proposed Rule Change or the Advance Notice.
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    Section 19(b)(2) of the Act \6\ provides that, within 45 days of 
the publication of notice of the filing of a proposed rule change, or 
within such longer period up to 90 days as the Commission may designate 
if it finds such longer period to be appropriate and publishes its 
reasons for so finding, or as to which the self-regulatory organization 
consents, the Commission shall either approve the proposed rule change, 
disapprove the proposed rule change, or institute proceedings to 
determine whether the proposed rule change should be disapproved. The 
45th day after publication of the notice for this Proposed Rule Change 
is February 9, 2018. The Commission is extending this 45-day time 
period.
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    \6\ 15 U.S.C. 78s(b)(2).
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    In order to provide the Commission with sufficient time to consider 
the Proposed Rule Change, the Commission finds that it is appropriate 
to designate a longer period within which to take action on the 
Proposed Rule Change.
    Accordingly, the Commission, pursuant to Section 19(b)(2) of the 
Act,\7\ designates March 26, 2018 as the date by which the Commission 
shall either approve, disapprove, or institute proceedings to determine 
whether to disapprove proposed rule change SR-OCC-2017-020.
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    \7\ Id.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\8\
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    \8\ 17 CFR 200.30-3(a)(31).
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Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2018-01816 Filed 1-30-18; 8:45 am]
 BILLING CODE 8011-01-P

4526 Federal Register / Vol. 83, No. 21 / Wednesday, January 31, 2018 / Notices

terms and conditions of the Orders at an in-person meeting with the Board, 4. BNPP and each Applicant and
granted under section 9(c). including the directors who are not Covered Person will comply in all
10. In addition, BNPP and each ‘‘interested persons’’ of the Funds as material respects with the material
Applicant and Covered Person will defined in section 2(a)(19) of the Act terms and conditions of the Plea
comply in all material respects with the and their ‘‘independent legal counsel’’ Agreement and with the material terms
material terms and conditions of the as defined in rule 0–1(a)(6) under the of the FRB Order, the DFS Order and
Plea Agreement and with the materials Act, if any. The Applicants undertake to any other orders issued by regulatory or
terms of the FRB Order, the DFS Order provide the Boards with all information enforcement agencies addressing the
any other orders issued by regulatory or concerning the Plea Agreement and the Conduct.
enforcement agencies addressing the application as necessary for those Funds 5. Applicants will provide written
Conduct. Applicants further state that to fulfill their disclosure and other notification to the Chief Counsel of the
BNPP and its affiliates have undertaken obligations under the U.S. federal Commission’s Division of Investment
certain remedial measures, as described securities laws and will provide them a Management with a copy to the Chief
in greater detail in the application. copy of the Judgment as entered by the Counsel of the Commission’s Division of
These include certain remedial District Court. Enforcement of a material violation of
measures as required by the Plea 13. Applicants state that certain of the the terms and conditions of any of the
Agreement, the FRB Order, and the DFS Applicants and their affiliates have Orders within 30 days of discovery of
Order, including improvements to the previously received an order under the material violation.
oversight, internal controls and section 9(c) of the Act, as the result of
compliance program, compliance risk Temporary Order
conduct that triggered section 9(a), as
management program, and internal described in greater detail in the The Commission has considered the
audit program for FX trading. application. matter and finds that Applicants have
Applicants state that BNPP and its made the necessary showing to justify
affiliates have taken a number of steps Applicants’ Conditions granting a temporary exemption.
to enhance its internal controls, policies Applicants agree that any order Accordingly,
and procedures relating to its FX granted by the Commission pursuant to It is hereby ordered, pursuant to
activities. Specifically, Applicants the application will be subject to the section 9(c) of the Act, that the
represent BNPP has devised and following conditions: Applicants and any other Covered
implemented new global detailed FX- 1. Any temporary exemption granted Persons are granted a temporary
specific policies and procedures and a pursuant to the application will be exemption from the provisions of
comprehensive program to change the without prejudice to, and will not limit section 9(a), effective as the date of the
culture of the business with the aim that Guilty Plea, solely with respect to the
the Commission’s rights in any manner
each individual within the business Guilty Plea entered into pursuant to the
with respect to, any Commission
understands their responsibility for Plea Agreement, subject to the
investigation of, or administrative
proper conduct and compliance. representations and conditions in the
proceedings involving or against,
Applicants also represent that BNPP has application, until the Commission takes
Covered Persons, including, without
globally rolled out culture and conduct final action on their application for a
limitation, the consideration by the
workshops and training on BNPP’s permanent order.
Commission of a permanent exemption
Foreign Exchange Local Markets
from section 9(a) of the Act requested By the Commission.
remediation program. Additionally,
pursuant to the application or the Robert W. Errett,
Applicants represent that supervisors
have been given increased tools to revocation or removal of any temporary Deputy Secretary.
directly oversee their staff and identify exemptions granted under the Act in [FR Doc. 2018–01905 Filed 1–30–18; 8:45 am]
conduct issues more effectively, connection with the application.
BILLING CODE 8011–01–P
permanent cross-bank chat rooms have 2. None of BNPP, the Applicants or
been prohibited, and reverse trades are any of the other Covered Persons will
monitored through software designed to employ the former employee of an SECURITIES AND EXCHANGE
detect transactions (proprietary and affiliate of the Pleading Entity or any COMMISSION
customer) that were not exposed to the other person who subsequently may be
identified by the Pleading Entity or any [Release No. 34–82585; File No. SR–OCC–
risk of the market and did not result in 2017–020]
a change of beneficial ownership. U.S. or non-U.S. regulatory or
11. As a result of the foregoing, the enforcement agencies as having been Self-Regulatory Organizations; The
Applicants submit that granting the responsible for the Conduct in any Options Clearing Corporation; Notice
exemption as requested in the capacity without first making a further of Designation of Longer Period for
application is consistent with the public application to the Commission pursuant Commission Action on Proposed Rule
interest and the protection of investors. to section 9(c). Change Concerning Enhanced and
12. To provide further assurance that 3. BNPP and each Applicant and New Tools for Recovery Scenarios
the exemptive relief being requested Covered Person will adopt and
herein would be consistent with the implement policies and procedures January 25, 2018.
public interest and the protection of the reasonably designed to ensure that it On December 18, 2017, The Options
investors, the Applicants agree that they will comply with the terms and Clearing Corporation (‘‘OCC’’) filed with
will, as soon as reasonably practical, conditions of the Orders within 60 days
sradovich on DSK3GMQ082PROD with NOTICES

the Securities and Exchange
distribute to the boards of directors or of the date of the Permanent Order or, Commission (‘‘Commission’’) proposed
trustees of the Funds (‘‘Board’’) written with respect to condition four, such rule change SR–OCC–2017–020
materials describing the circumstances later date or dates as may be (‘‘Proposed Rule Change’’) pursuant to
that led to the Plea Agreement, as well contemplated by the FRB Order, the Section 19(b)(1) of the Securities
as any effects on the Funds and the DFS Order or any other orders issued by Exchange Act of 1934 (‘‘Act’’),1 and
application. The written materials will regulatory or enforcement agencies
include an offer to discuss the materials addressing the Conduct. 1 15 U.S.C. 78s(b)(1).

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Federal Register / Vol. 83, No. 21 / Wednesday, January 31, 2018 / Notices 4527

Rule 19b–4 thereunder,2 concerning Accordingly, the Commission, The Proposed Rule Change was
enhanced and new tools for recovery pursuant to Section 19(b)(2) of the Act,7 published for comment in the Federal
scenarios.3 The Proposed Rule Change designates March 26, 2018 as the date Register on December 26, 2017.4 To
was published for comment in the by which the Commission shall either date, the Commission has not received
Federal Register on December 26, approve, disapprove, or institute any comment letters to the Proposed
2017.4 To date, the Commission has proceedings to determine whether to Rule Change.
received one comment letter to the disapprove proposed rule change SR–
OCC–2017–020. Section 19(b)(2) of the Act 5 provides
Proposed Rule Change.5
Section 19(b)(2) of the Act 6 provides that, within 45 days of the publication
For the Commission, by the Division of of notice of the filing of a proposed rule
that, within 45 days of the publication Trading and Markets, pursuant to delegated
of notice of the filing of a proposed rule authority.8 change, or within such longer period up
change, or within such longer period up Eduardo A. Aleman, to 90 days as the Commission may
to 90 days as the Commission may Assistant Secretary.
designate if it finds such longer period
designate if it finds such longer period to be appropriate and publishes its
[FR Doc. 2018–01816 Filed 1–30–18; 8:45 am]
to be appropriate and publishes its reasons for so finding, or as to which the
BILLING CODE 8011–01–P
reasons for so finding, or as to which the self-regulatory organization consents,
self-regulatory organization consents, the Commission shall either approve the
the Commission shall either approve the SECURITIES AND EXCHANGE proposed rule change, disapprove the
proposed rule change, disapprove the COMMISSION proposed rule change, or institute
proposed rule change, or institute proceedings to determine whether the
[Release No. 34–82586; File No. SR–OCC–
proceedings to determine whether the 2017–021] proposed rule change should be
proposed rule change should be disapproved. The 45th day after
disapproved. The 45th day after Self-Regulatory Organizations; The publication of the notice for this
publication of the notice for this Options Clearing Corporation; Notice Proposed Rule Change is February 9,
Proposed Rule Change is February 9, of Designation of Longer Period for 2018. The Commission is extending this
2018. The Commission is extending this Commission Action on Proposed Rule 45-day time period.
45-day time period. Change Concerning Updates to and
In order to provide the Commission In order to provide the Commission
Formalization of OCC’s Recovery and with sufficient time to consider the
with sufficient time to consider the Orderly Wind-Down Plan
Proposed Rule Change, the Commission Proposed Rule Change, the Commission
finds that it is appropriate to designate January 25, 2018. finds that it is appropriate to designate
a longer period within which to take On December 8, 2017, The Options a longer period within which to take
action on the Proposed Rule Change. Clearing Corporation (‘‘OCC’’) filed with action on the Proposed Rule Change.
the Securities and Exchange Accordingly, the Commission,
2 17 CFR 240.19b–4. Commission (‘‘Commission’’) proposed pursuant to Section 19(b)(2) of the Act,6
3 On December 8, 2017, OCC also filed this rule change SR–OCC–2017–021 designates March 26, 2018 as the date
proposal as an advance notice SR–OCC–2017–809 (‘‘Proposed Rule Change’’) pursuant to
(‘‘Advance Notice’’) with the Commission pursuant by which the Commission shall either
Section 19(b)(1) of the Securities
to Section 806(e)(1) of Title VIII of the Dodd-Frank approve, disapprove, or institute
Wall Street Reform and Consumer Protection Act, Exchange Act of 1934 (‘‘Act’’),1 and
proceedings to determine whether to
entitled the Payment, Clearing, and Settlement Rule 19b–4 thereunder,2 concerning
Supervision Act of 2010 (12 U.S.C. 5465(e)(1)) and updates to and formalization of OCC’s disapprove proposed rule change SR–
Rule 19b–4(n)(1)(i) of the Act (17 CFR 240.19b–
recovery and orderly wind-down plan.3 OCC–2017–021.
4(n)(1)(i)). Notice of filing of the Advance Notice
was published for comment in the Federal Register For the Commission, by the Division of
on January 23, 2018. Securities Exchange Act 7 Id. Trading and Markets, pursuant to delegated
Release No. 34–82513 (Jan. 17, 2018), 83 FR 3244 8 17 CFR 200.30–3(a)(31). authority.7
(Jan. 23, 2018) (SR–OCC–2017–809). 1 15 U.S.C. 78s(b)(1).
Eduardo A. Aleman,
On January 22, 2018, the Commission sent OCC 2 17 CFR 240.19b–4.
a request for additional information, which tolls the 3 On December 8, 2017, OCC also filed this Assistant Secretary.
Commission’s 60-day review period for the proposal as an advance notice SR–OCC–2017–810 [FR Doc. 2018–01817 Filed 1–30–18; 8:45 am]
Advance Notice. See Memorandum from Office of (‘‘Advance Notice’’) with the Commission pursuant
Clearance and Settlement, Division of Trading and BILLING CODE 8011–01–P
to Section 806(e)(1) of Title VIII of the Dodd-Frank
Markets, dated January 23, 2018, available at Wall Street Reform and Consumer Protection Act,
https://www.sec.gov/comments/sr-occ-2017-809/ entitled the Payment, Clearing, and Settlement
occ2017809.htm. The new review period will be 60 Supervision Act of 2010 (12 U.S.C. 5465(e)(1)) and
days from the date the Commission receives the Rule 19b–4(n)(1)(i) of the Act (17 CFR 240.19b–
information requested. See Section 806(e)(1). The 4(n)(1)(i)). Notice of filing of the Advance Notice
proposal in the Proposed Rule Change and the was published for comment in the Federal Register
Advance Notice shall not take effect until all on January 23, 2018. Securities Exchange Act
regulatory actions required with respect to the Release No. 34–82514 (Jan. 17, 2018), 83 FR 3224
proposal are completed. (Jan. 23, 2018) (SR–OCC–2017–810).
4 Securities Exchange Act Release No. 34–82531
On January 22, 2018, the Commission sent OCC
(Dec. 19, 2017), 82 FR 61107 (Dec. 26, 2017) (SR– a request for additional information, which tolls the
OCC–2017–020). Commission’s 60-day review period for the
5 See Letter from Jacqueline H. Mesa, Senior Vice
Advance Notice. See Memorandum from Office of
President of Global Policy, FIA, dated Jan. 16, 2018, Clearance and Settlement, Division of Trading and
sradovich on DSK3GMQ082PROD with NOTICES

available at https://www.sec.gov/comments/sr-occ- Markets, dated January 23, 2018, available at
2017-020/occ2017020.htm. Since the proposal https://www.sec.gov/comments/sr-occ-2017-810/
contained in the Proposed Rule Change was also occ2017810.htm. The new review period will be 60 4 Securities Exchange Act Release No. 34–82532
filed as an Advance Notice, the Commission is days from the date the Commission receives the (Dec. 19, 2017), 82 FR 61072 (Dec. 26, 2017) (SR–
considering all public comments received on the information requested. See Section 806(e)(1). The OCC–2017–021).
proposal regardless of whether the comments are proposal in the Proposed Rule Change and the 5 15 U.S.C. 78s(b)(2).
submitted to the Proposed Rule Change or the Advance Notice shall not take effect until all
6 Id.
Advance Notice. regulatory actions required with respect to the
6 15 U.S.C. 78s(b)(2). proposal are completed. 7 17 CFR 200.30–3(a)(31).

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Document Created: 2018-01-31 00:58:05
Document Modified: 2018-01-31 00:58:05

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		83 FR 4526