I. Introduction

A. Overview of the Exemptive Order

On September 18, 2026, Cboe Clear U.S., LLC (“CCUS”), a clearing agency now temporarily registered with the Securities and Exchange Commission (“Commission”) pursuant to Rule 17Ab2-1(c) ^[1] under the Securities Exchange Act of 1934 ^[2] (“Exchange Act”) for a period of 18 months,^[3] filed an application with the Commission (“Application”) ^[4] to obtain an exemption pursuant to section 36(a)(1) ^[5] of the Exchange Act, in accordance with the procedures set forth in Exchange Act Rule 0-12.^[6] Specifically, CCUS requested exemptive relief on behalf of broker-dealers that are CCUS clearing members (“Clearing Members”) from the limitation in Item 13 and Note F of Exhibit A to Rule 15c3-3 ^[7] that confines the Item 13 debit to the amount of margin required and on deposit with the Options Clearing Corporation (“OCC”) for all option contracts written or purchased in customer accounts. This would afford Clearing Members the same treatment for margin required and on deposit at CCUS for purposes of the reserve computation requirements under Item 13 and Note F of Rule 15c3-3a as is currently afforded to margin required and on deposit with the OCC.^[8]

On September 25, 2026, the Commission published a notice of an application for an exemption and requested comment regarding the Application and the proposed conditions set forth therein.^[9] The Notice was published in the Federal Register on September 29, 2026.^[10] The Commission received one comment on the Notice of an Application.^[11] For the reasons discussed below, this order grants Clearing Members conditional exemptive relief from the limitation in Item 13 and Note F of 15c3-3a that confines the Item 13 debit to margin required and on deposit with the OCC for all option contracts written or purchased in customer accounts.

B. Overview of Rule 15c3-3 and Rule 15c3-3a

Rule 15c3-3, the broker-dealer customer protection rule, requires, among other things, broker-dealers that hold customer cash and securities (“carrying broker-dealers”) to compute the net amount of cash owed to customers under a formula in Rule 15c3-3a (“customer reserve computation”).^[12] Generally, carrying broker-dealers must perform this customer reserve computation and make any required deposit into special reserve bank account daily or weekly. The rule also requires a carrying broker-dealer to perform a PAB reserve computation for the proprietary securities and cash it holds for other broker-dealers, known as proprietary accounts of broker-dealers (“PAB accounts”).^[13] Item 13 of the customer reserve computation in Rule 15c3-3a includes as a debit in the computation the amount of margin required and on deposit with OCC for all option contracts written or purchased in customer accounts. Note F to Item 13 states that Item 13 must include the amount of margin required and on deposit with the OCC to the extent such margin is represented by cash, proprietary qualified securities and letters of credit collateralized by customers' securities.^[14] Under that framework, the permitted debit is based on the margin amount posted by the broker-dealer to OCC that is calculated by OCC across all of the broker-dealer's customers with listed options ( i.e., on an omnibus basis).

C. Request for Exemptive Relief From CCUS

In its Application, CCUS requested, pursuant to section 36(a)(1) of the Exchange Act, and in accordance with the procedures set forth in Rule 0-12, that the Commission issue an order exempting its Clearing Members from the limitation in Item 13 and Note F of Rule 15c3-3a that confines the Item 13 debit to the amount of margin required and on deposit with OCC for option contracts written or purchased in customer accounts. CCUS also requested that the exemptive relief apply with respect to the PAB reserve computation.^[15] In effect, CCUS is seeking comparable treatment for its Clearing Members under the customer reserve computation with respect to the margin that is required and on deposit at CCUS as has been afforded broker-dealers that are clearing members of OCC.

In support of its request, CCUS stated that when the Commission adopted Item 13, and Note F thereto, OCC was the only clearing agency registered with the Commission to provide central counterparty services for securities options. CCUS stated that it does not ( printed page 67882) believe that the Exchange Act requires or warrants different treatment for margin held on similar terms for security option products at different registered clearing agencies. Further, CCUS stated that section 17A(a)(2) of the Exchange Act ^[16] directs the Commission, with due regard for the maintenance of fair competition among clearing agencies, to facilitate a national system for the prompt and accurate clearance and settlement of securities transactions and to assure equal regulation under the Exchange Act of registered clearing agencies. Consequently, CCUS stated that reading Item 13 to exclude margin held at a second registered options clearing agency because it did not exist when the rule was amended would be inconsistent with this statutory mandate.^[17]

To further support its position, CCUS stated that Item 14 ^[18] and Item 15 ^[19] of the customer reserve computation do not name any particular clearing agency, and do not distinguish between registered clearing agencies.^[20] CCUS stated that where the Commission anticipated that more than one clearing agency could hold margin, it framed the customer reserve computation treatment of such margin by reference to a registered category rather than name a specific existing clearing agency.^[21] Consequently, CCUS stated that permitting broker-dealers to treat margin held at other registered clearing agencies would treat functionally equivalent margin on equivalent terms.^[22]

Additionally, CCUS stated that its proposed rules contemplate customer protection standards that satisfy the same regulatory requirements as those under which OCC operates. Specifically, CCUS stated that it will offer separate customer, firm, and market-maker accounts, and that its rules require all funds and assets held for securities customers of a Clearing Member be maintained in a segregated Securities Customer Account. Further, CCUS stated that the binary options it proposed to clear will be fully margined and that its risk management framework provides for daily and intraday margin collection, guaranty fund resources, and a default waterfall.^[23]

In its Application, CCUS stated that a failure to provide equivalent treatment under the customer reserve computation to margin required and on deposit at CCUS would result in its Clearing Members facing a customer reserve computation penalty for clearing customer security options at CCUS. CCUS stated that this result could hinder the development of a cleared securities environment for trading in binary options that CCUS expects to clear.^[24]

In connection with its request for an exemption, CCUS proposed certain conditions that would apply in connection with its Clearing Members being able to include margin required and on deposit with CCUS with respect to customer binary options transactions in the Item 13 debit.^[25]

IV. Discussion

A. Statement of Relief

Section 36(a)(1) of the Exchange Act authorizes the Commission to conditionally or unconditionally exempt any person, security, or transaction, or any class or classes of persons, securities, or transactions, from certain provisions of the Exchange Act or certain rules or regulations thereunder, by rule, regulation, or order, to the extent that such exemption is necessary or appropriate in the public interest, and is consistent with the protection of investors.^[26] As described below, the Commission finds that the conditional exemptive relief granted herein to permit Clearing Members to include an Item 13 debit for margin required and on deposit with CCUS in the customer and PAB reserve computations is appropriate in the public interest, and is consistent with the protection of investors.

In particular, it is appropriate to permit Clearing Members to include an Item 13 debit in the customer and PAB reserve computations for margin required and on deposit at CCUS for customer binary options. Without the availability of an Item 13 debit, increases in the amounts of required customer margin as a result of the clearance of binary options at CCUS would result in corresponding increases in the need for Clearing Members to use their own cash and securities to meet CCUS customer margin requirements. This relief also may avoid potential increases in a Clearing Member's required deposits in its special reserve bank accounts (because there is no permitted Item 13 debit for CCUS to offset credits).^[27] This relief would also help to reduce any capital constraints and inefficiencies for Clearing Members, which may affect their liquidity and reduce their willingness to intermediate customer access to cleared binary options at CCUS. Additionally, it is in the public interest to permit an Item 13 debit to help promote competition in the development of a cleared securities market for trading binary security options of the type anticipated to be cleared by CCUS and facilitate access to the central clearing and settlement of securities options.

Further, the Commission adopted amendments to Rule 15c3-3a to add the Item 13 debit in 1977, when the OCC was the only clearing agency registered with the Commission that provided central counterparty services for options contracts.^[28] The rule's specific reference to OCC therefore identifies the single qualifying clearing agency that existed at that time. However, circumstances have changed. CCUS has been approved as a second clearing agency for options.^[29] Providing this relief will help ensure that the same margin treatment under the Item 13 debit applies to both CCUS and OCC, and to their broker-dealer members, thereby facilitating fair competition among Commission-registered options clearing agencies which is in the public interest. Finally, permitting the Item 13 debit for CCUS will support a broker-dealer's customer facilitation activity in securities options ( printed page 67883) clearing, in light of the increased number of securities clearing agencies.

The conditions in this order, discussed below in section II.B, are designed to permit the Item 13 debit only in circumstances that provide protections to customers consistent with the customer protection objectives of Rules 15c3-3 and 15c3-3a and the current approach for margin required and on deposit at OCC. For example, Rule 15c3-3 requires broker-dealers to take steps to safeguard customer assets by segregating their securities and cash from the carrying broker-dealer's proprietary business activities.^[30] The conditions in this order are designed to ensure that customer margin is appropriately segregated and that a broker-dealer cannot use customer cash and securities to finance its proprietary business activities. Further, consistent with the existing Item 13 debit for margin required and on deposit at OCC, the conditions of this order explicitly limit the exemption to customer margin required and deposit with CCUS with respect to customer positions in binary options. These conditions help reduce the likelihood of certain risks that may undermine the customer protection objectives of Rule 15c3-3, including that broker-dealers may not appropriately safeguard customer cash and securities or may improperly include debits in their customer reserve computation.

The one comment letter that the Commission received on the Notice of an Application generally supported the request for an exemption,^[31] but recommended that the Commission impose additional conditions in connection with granting the request. Specifically, the commenter pointed to the conditions contained in Note G to the Item 14 debit related to margin required and on deposit at a registered clearing agency for security futures products and futures contracts, as well as Note H to the Item 15 debt related to margin required and on deposit as a registered clearing agency for transactions in Treasury securities and recommended that the Commission impose the conditions therein on CCUS in connection with the requested exemption to the extent that such conditions “fit” binary options.^[32] The Commission has considered the comment letter, and is declining to incorporate the suggested conditions. The conditions proposed by CCUS, and outlined below, are robust and reasonably designed to protect investors.

Accordingly, after careful consideration of the Application and the comment received, the Commission is issuing, pursuant to section 36(a)(1) of the Exchange Act, conditional exemptive relief to exempt Clearing Members from the limitation in Item 13 and Note F of Rule 15c3-3a that confines the Item 13 debit to the amount of margin required and on deposit with the OCC, and as such, Clearing Members may include a debit in Item 13 of their customer and PAB reserve computations for margin required and on deposit with CCUS for all binary options contracts written or purchased in customer accounts, subject to the conditions discussed below.

B. Discussion of Conditions

The first condition provides that CCUS must be registered with the Commission as a clearing agency in accordance with section 17A(b) ^[33] of the Exchange Act and Rule 17ab2-1 ^[34] thereunder. This condition is designed to ensure that the relief provided in this order remains consistent with the customer protection objectives of Rule 15c3-3, and specifically those provided by the limitations in Item 13 and Note F of Exhibit A to Rule 15c3-3, by ensuring that CCUS operates subject to the same regulatory framework as the OCC, which is a registered clearing agency.^[35]

The second condition requires that the relief provided by this order will apply solely to margin required and on deposit with CCUS with respect to customer positions in binary options. This condition is designed to ensure that the relief provided is limited to only margin applicable to options transactions in customer accounts, the same type of transactions covered under Item 13 of Rule 15c3-3a. This condition also will ensure that margin required and on deposit at CCUS as a result of a Clearing Member's proprietary positions may not be included as a debit in the reserve computations. Therefore, this condition is designed to effectuate a fundamental aspect of Rule 15c3-3 that a broker-dealer cannot use customer cash or securities to finance its proprietary business activities.

The third condition provides that the binary options that CCUS clears will be margined by CCUS consistent with the requirements of Rule 17Ad-22(e) and Clearing Members will collect such margin from their customers, with any proposed changes to CCUS's margin system subject to Commission review, and, as appropriate, approval pursuant to section 19(b) of the Exchange Act and Rule 19b-4 thereunder. CCUS has stated that the binary options will be fully margined at the clearing agency level.^[36] This condition ensures that the Clearing Members hold sufficient customer collateral to cover the required margin amounts at CCUS, and that proposed changes to CCUS's margin system would need to be filed with the Commission through a rule filing under section 19(b) of the Exchange Act. The purpose of this condition is to help ensure that the exemption provided under this order is only available when regulatory requirements are appropriately followed.

The fourth condition requires that, for the purposes of Rule 15c3-3a, CCUS will maintain margin required and on deposit with CCUS for binary options contracts written or purchased in customer accounts separately and independently from margin required and on deposit for proprietary positions of Clearing Members. This condition will increase customer protection by ensuring that customer margin is clearly identifiable and segregated from margin related to the Clearing Member's proprietary positions.^[37] In doing so, this condition, similar to the second condition, is designed to further effectuate the fundamental aspect of Rule 15c3-3 that prohibits a broker-dealer from using customer cash or securities to finance its proprietary business activities.

The fifth condition limits the scope of relief provided by this order to the same conditions set forth in Note F to Item 13 of Rule 15c3-3a that apply to margin required and on deposit with OCC for all option contracts written or purchased in customer accounts. Specifically, Note F to Item 13 states that Item 13 must include the amount of margin required and on deposit with the OCC to the extent such margin is represented by cash, proprietary qualified securities and letters of credit collateralized by customers' securities. This condition is thus designed to protect investors by ensuring that ( printed page 67884) Clearing Members can only include the Item 13 debit where they deposit with CCUS the full amount of margin required for all binary options contracts written or purchased in customer accounts. Further, this condition will ensure the permitted debit under Item 13 will remain limited to the same scope of assets that are permissible to use as collateral delivered to the OCC under Note F to Rule 15c3-3a, to remain consistent with established customer protections under the rule.

The sixth condition states that the rules of CCUS must have been amended, as necessary to reflect the conditions of this order. This condition is designed to require that Clearing Members may only include an Item 13 debit in their reserve computations pursuant to this order where the rules of CCUS have been amended to conform to the conditions of this exemptive order. This will also ensure that the rules of CCUS that are amended in accordance with the conditions of this order adequately implement the customer protection objectives of Rule 15c3-3 and Rule 15c3-3a.

For the reasons discussed above, the Commission finds that granting Clearing Members conditional exemptive relief from the limitation in Item 13 and Note F to Rule 15c3-3a that confines the Item 13 debit to the amount of margin required and on deposit with the OCC for all option contracts written or purchased in customer accounts is appropriate in the public interest, and consistent with the protection of investors.

III. Conclusion

Accordingly, it is hereby ordered pursuant to section 36(a)(1) of the Exchange Act, Clearing Members are exempt from the limitation in Item 13 and Note F of Rule 15c3-3a that confines the Item 13 debit to the amount of margin required and on deposit with the OCC for all option contracts written or purchased in customer accounts, and as such, Clearing Members may include a debit in Item 13 of their customer and PAB reserve computations for margin required and on deposit with CCUS for all binary options contracts written or purchased in customer accounts, subject to the following conditions:

1. Registration: CCUS is registered with the Commission as a clearing agency in accordance with section 17A(b) ^[38] of the Exchange Act and Rule 17ab2-1 ^[39] thereunder.

2. Eligibility Limitation: The relief will apply solely to margin required and on deposit with CCUS with respect to customer positions in binary options.

3. Margined Customer Positions: The binary options that CCUS clears will be margined by CCUS consistent with the requirements of Rule 17Ad-22(e) ^[40] and Clearing Members will collect such margin from their customers, with any proposed changes to CCUS's margin system subject to Commission review, and, as appropriate, approval pursuant to section 19(b) ^[41] of the Exchange Act and Rule 19b-4 ^[42] thereunder.

4. Segregation of Customer Margin: For purposes of Rule 15c3-3a, CCUS will maintain margin required and on deposit with CCUS for binary options contracts written or purchased in customer accounts separately and independently from margin required and on deposit for proprietary positions of Clearing Members.

5. The relief would be subject to the same conditions set forth in Note F to Item 13 of Rule 15c3-3a that apply to margin required and on deposit with OCC for all option contracts written or purchased in customer accounts.

6. The rules of CCUS must have been amended to reflect the conditions of this order.