Self-Regulatory Organizations; Fixed Income Clearing Corporation; Notice of Filing and Order Granting Accelerated Approval on a Temporary Basis of Proposed Rule Change To Modify the Rules of the Government Securities Division Regarding the Calculation of Clearing Fund Deposits Relating to Inter-Dealer Broker Positions, 52576-52578 [2010-21200]
Download as PDF
<![CDATA[
52576
Federal Register / Vol. 75, No. 165 / Thursday, August 26, 2010 / Notices
Electronic Comments
information from the reporting side
perspective (and the contra side will
provide information from the contra
side perspective).
The implementation date will be
November 10, 2010.
2. Statutory Basis
FINRA believes that the proposed rule
change is consistent with the provisions
of Section 15A(b)(6) of the Act,13 which
requires, among other things, that
FINRA rules must be designed to
prevent fraudulent and manipulative
acts and practices, to promote just and
equitable principles of trade and, in
general, to protect investors and the
public interest. FINRA believes that
adopting the proposed rule change will
aid in FINRA’s surveillance for member
compliance, including with SEC
Regulation SHO.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
FINRA does not believe that the
proposed rule change will result in any
burden on competition that is not
necessary or 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
Written comments were neither
solicited nor received.
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 (i)
as the Commission may designate up to
90 days of such date 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.
mstockstill on DSKH9S0YB1PROD with NOTICES
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:
13 15
U.S.C. 78o–3(b)(6).
VerDate Mar<15>2010
20:12 Aug 25, 2010
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–FINRA–2010–043 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–FINRA–2010–043. This file
number should be included on the
subject line if e-mail 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 (https://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
a.m. and 3 p.m. Copies of such filing
also will be available for inspection and
copying at the principal office of
FINRA. 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–FINRA–2010–043 and
should be submitted on or before
September 16, 2010.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.14
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–21201 Filed 8–25–10; 8:45 am]
BILLING CODE 8011–01–P
14 17
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CFR 200.30–3(a)(12).
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–62743; File No. SR–FICC–
2010–05]
Self-Regulatory Organizations; Fixed
Income Clearing Corporation; Notice of
Filing and Order Granting Accelerated
Approval on a Temporary Basis of
Proposed Rule Change To Modify the
Rules of the Government Securities
Division Regarding the Calculation of
Clearing Fund Deposits Relating to
Inter-Dealer Broker Positions
August 19, 2010.
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 August
18, 2010, the Fixed Income Clearing
Corporation (‘‘FICC’’) filed with the
Securities and Exchange Commission
(‘‘Commission’’) the proposed rule
change described in Items I and II
below, which items have been prepared
primarily by FICC.3 The Commission
previously approved the proposal on a
temporary basis.4 The Commission is
publishing this notice and order to
solicit comments on the proposed rule
change from interested parties and to
grant accelerated approval through
February 18, 2011.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The proposed rule change seeks to
modify the rules of FICC’s Government
Securities Division (‘‘GSD’’) regarding
the calculation of clearing fund
requirements relating to inter-dealer
broker (‘‘IDB’’) positions.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission,
FICC 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. FICC has prepared
summaries, set forth in sections (A), (B),
and (C) below, of the most significant
aspects of these statements.
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 FICC withdrew a substantively identical
proposed rule change filed on August 4, 2010, that
sought approval without requesting that the
approval would be temporary.
4 Securities Exchange Act Release No. 60510
(August 17, 2009), 74 FR 42716 (August 24, 2009).
2 17
E:\FR\FM\26AUN1.SGM
26AUN1
mstockstill on DSKH9S0YB1PROD with NOTICES
Federal Register / Vol. 75, No. 165 / Thursday, August 26, 2010 / Notices
(A) Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
The GSD maintains a clearing fund
comprised of deposits of cash and
eligible securities from its members to
provide liquidity and to satisfy any
losses that might otherwise be incurred
as a result of a member’s default and the
subsequent close-out of its positions.
The GSD uses a Value-at-Risk (‘‘VaR’’)
methodology to calculate clearing fund
requirements.5 The clearing fund
methodology used by GSD analyzes risk
by reference to three factors: (1) End-ofday VaR charge assessing market
volatility for observed open positions at
end-of-day after giving effect to
offsetting positions within the portfolio;
(2) ‘‘margin requirement differential’’
(‘‘MRD’’) to address intraday risk; and (3)
‘‘coverage component’’ (‘‘CC’’) to adjust
the calculation if necessary to reach a
given confidence level.6 The margin
calculation is predicated upon an
assumption that the open positions of a
defaulting member would be liquidated
at the end of a three-day period.
IDBs function as intermediaries
trading with multiple contraparties,
allowing anonymity between trading
parties, and providing liquidity for the
market. IDBs handle large transactions
and operate on small spreads. They
perform a critical function in the
government securities market in the
absence of a centralized trading
exchange.
IDBs submit affirmed trades from
their systems to the GSD with each trade
matched to the contraparty that will
ultimately deliver or receive the
securities. Although IDBs do not
generally hold positions, they may incur
positions at the GSD when their
contraparties are not GSD members.
Because these trades are matched by the
IDB to a contraparty prior to submission
to the GSD, FICC represents that the risk
to FICC in the case of an IDB’s default
is different from that presented when a
dealer member submits a trade that may
not have been already matched to a
contraside.
The clearing fund requirement
applicable to IDB transactions has
increased significantly because of recent
market volatility to the point where
FICC believes it is disproportionate to
the risk that IDB activity presents to the
5 VaR is defined as the maximum amount of
money that may be lost on a given portfolio over
a given period of time within a given confidence
level.
6 Under the GSD clearing fund procedures, CC is
not calculated with respect to IDB repo
transactions. The GSD has recently adjusted the CC
charge with respect to certain IDB cash transactions.
VerDate Mar<15>2010
20:12 Aug 25, 2010
Jkt 220001
GSD. Given the importance of IDB
transactions in the government
securities marketplace, undue and
unsustainable margin requirements on
GSD IDB activity may be harmful and
may introduce systemic risk in the event
members are motivated to avoid
imposition of disproportionate changes
by netting outside of the GSD or by
delaying trade submission until later in
the day. Accordingly, the GSD adjusted
the calculation of the CC charge for IDB
transactions in November 2008 and
conducted a review of the current
margin methodology as applied to IDB
activity.
As a result of this review, the GSD
proposed and the Commission approved
the use of a one-day liquidation
assumption when calculating clearing
fund requirements applicable to IDB
activity.7 Since IDB trades are matched
prior to submission, the GSD believes
that the one-day liquidation period as
opposed to a three-day liquidation
period is a more reasonable assumption
in this context. The assumption of a
three-day liquidation period will
continue to apply to non-IDB activity.
The GSD will continue to monitor the
IDB activity of its members and to
periodically reassess whether the oneday liquidation period provides
adequate coverage. In this regard, FICC
will provide the Commission with data
to allow the Commission to track the
magnitudes and behaviors of the VaR
calculations using a one-day liquidation
horizon and using a three-day
liquidation horizon and with such other
information that the Commission may
request. FICC further notes its ability
under GSD Rule 4 to impose special
charges in response to market
circumstances or other risk factors with
respect to a particular member.
FICC believes that the proposed rule
change is consistent with the
requirements of Section 17A of the Act 8
and the rules and regulations
thereunder because the proposed
change will modify the calculation of
clearing fund requirements for IDB
positions so that the clearing fund
requirements is correlated more closely
with the level of risk associated with
IDB positions.
(B) Self-Regulatory Organization’s
Statement on Burden on Competition
FICC does not believe that the
proposed rule change will have any
impact or impose any burden on
competition.
PO 00000
note 4.
U.S.C. 78q–1.
(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 yet been
solicited or received. FICC will notify
the Commission of any written
comments received by FICC.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The Commission finds that the
proposed rule change is consistent with
the requirements of the Act and the
rules and regulations thereunder and
particularly with the requirements of
Section 17A(b)(3)(F).9 Section
17A(b)(3)(F) requires that the rules of a
clearing agency remove impediments to
and perfect the mechanism of a national
system for the prompt and accurate
clearance and settlement of securities
transactions and to assure the
safeguarding of securities and funds in
the custody or control of the clearing
agency or for which it is responsible.
The Commission finds that the approval
of FICC’s rule change on a temporary
basis through February 18, 2011 is
consistent with this section because by
allowing FICC to temporarily modify its
rules regarding the calculation of
clearing fund requirements for IDB
positions to what it believes correlates
more closely with the level of risk
associated with such positions, FICC
will be taking steps toward potentially
improving the national clearance and
settlement system while still actively
monitoring its ability to fulfill its
safeguarding obligations.
FICC has requested that the
Commission approve the proposed rule
prior to the thirtieth day after
publication of the notice of the filing.
The Commission finds good cause for
approving the proposed rule change
prior to the thirtieth day after the
publication of notice because such
approval will allow FICC to continue to
attempt to correlate IDBs’ clearing fund
requirements with the level of risk
associated with their positions.
The Commission is approving the
proposed rule filing on a temporary
basis through February 18, 2011, so that
FICC will have time to further evaluate
the modified calculation of clearing
fund requirements for IDB positions and
to report its findings and conclusions to
the Commission and so that the
Commission will have time to evaluate
FICC’s findings and conclusions before
a final determination is made regarding
7 See
8 15
Frm 00074
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9 15
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52577
E:\FR\FM\26AUN1.SGM
U.S.C. 78q–1(b)(3)(F).
26AUN1
52578
Federal Register / Vol. 75, No. 165 / Thursday, August 26, 2010 / Notices
adoption of any rule on a permanent
basis.
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 (https://www.sec.gov/
rules/sro.shtml) or
• Send an e-mail to rulecomments@sec.gov. Please include File
Number SR–FICC–2010–05 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Elizabeth M. Murphy, Secretary,
Securities and Exchange Commission,
100 F Street, NE., Washington, DC
20549–1090.
All submissions should refer to File
Number SR–FICC–2010–05. This file
number should be included on the
subject line if e-mail 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 (https://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 Section, 100 F Street, NE.,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of such filings
also will be available for inspection and
copying at the principal office of FICC
and on FICC’s Web site at https://
dtcc.com/downloads/legal/rule_filings/
2010/ficc/2010-05.pdf. 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–FICC–
2010–05 and should be submitted on or
before September 16, 2010.
V. Conclusion
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,10 that the
proposed rule change (File No. SR–
FICC–2010–05) be and hereby is
approved on an accelerated basis
through February 18, 2011.11
For the Commission by the Division of
Trading and Markets, pursuant to delegated
authority.12
Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010–21200 Filed 8–25–10; 8:45 am]
BILLING CODE 8010–01–P
SOCIAL SECURITY ADMINISTRATION
Agency Information Collection
Activities: Proposed Request and
Comment Request
The Social Security Administration
(SSA) publishes a list of information
collection packages requiring clearance
by the Office of Management and
Budget (OMB) in compliance with
Public Law (Pub. L.) 104–13, the
Paperwork Reduction Act of 1995,
effective October 1, 1995. This notice
includes revisions and extensions of
OMB-approved information collections
and a new information collection.
SSA is soliciting comments on the
accuracy of the agency’s burden
estimate; the need for the information;
its practical utility; ways to enhance its
Number of
respondents
Form No.
quality, utility, and clarity; and ways to
minimize burden on respondents,
including the use of automated
collection techniques or other forms of
information technology. Mail, e-mail, or
fax your comments and
recommendations on the information
collection(s) to the OMB Desk Officer
and SSA Reports Clearance Officer to
the following addresses or fax numbers.
(OMB), Office of Management and
Budget, Attn: Desk Officer for SSA,
Fax: 202–395–6974, E-mail address:
OIRA_Submission@omb.eop.gov.
(SSA), Social Security Administration,
DCBFM, Attn: Reports Clearance
Officer, 1333 Annex Building, 6401
Security Blvd., Baltimore, MD 21235,
Fax: 410–965–6400, E-mail address:
OPLM.RCO@ssa.gov.
I. The information collections below
are pending at SSA. SSA will submit
them to OMB within 60 days from the
date of this notice. To be sure we
consider your comments, we must
receive them no later than October 25,
2010. Individuals can obtain copies of
the collection instruments by calling the
SSA Reports Clearance Officer at 410–
965–8783 or by writing to the above email address.
1. Statement of Agricultural Employer
(Year Prior to 1988; and 1988 and
later)—20 CFR 404.702, 404.802,
404.1056—0960–0036. SSA collects the
information on Forms SSA–1002–F3
and SSA–1003–F3 to resolve
discrepancies when farm workers allege
their employers did not report their
wages, or reported their wages
incorrectly. If an agricultural employer
incorrectly reported wages, or failed to
report any wages for an employee, SSA
must attempt to correct its records by
contacting the employer to obtain
convincing evidence of the wages paid.
The respondents are agricultural
employers having knowledge of wages
paid to agricultural employees.
Type of Request: Revision of an OMBapproved information collection.
Average Burden
per Response
(minutes)
Frequency of
response
Total Annual
Burden
(hours)
mstockstill on DSKH9S0YB1PROD with NOTICES
SSA–1002 ........................................................................................
SSA–1003 ........................................................................................
7,500
25,000
1
1
30
30
3,750
12,500
Total ..........................................................................................
32,500
............................
............................
16,250
10 15
U.S.C. 78s(b)(2).
approving the proposed rule change, the
Commission considered the proposal’s impact on
efficiency, competition, and capital formation. 15
U.S.C. 78c(f).
12 17 CFR 200.30–3(a)(12).
11 In
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20:12 Aug 25, 2010
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E:\FR\FM\26AUN1.SGM
26AUN1
]]>Agencies
[Federal Register Volume 75, Number 165 (Thursday, August 26, 2010)]
[Notices]
[Pages 52576-52578]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-21200]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-62743; File No. SR-FICC-2010-05]
Self-Regulatory Organizations; Fixed Income Clearing Corporation;
Notice of Filing and Order Granting Accelerated Approval on a Temporary
Basis of Proposed Rule Change To Modify the Rules of the Government
Securities Division Regarding the Calculation of Clearing Fund Deposits
Relating to Inter-Dealer Broker Positions
August 19, 2010.
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 August 18, 2010, the Fixed Income Clearing Corporation (``FICC'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change described in Items I and II below, which items
have been prepared primarily by FICC.\3\ The Commission previously
approved the proposal on a temporary basis.\4\ The Commission is
publishing this notice and order to solicit comments on the proposed
rule change from interested parties and to grant accelerated approval
through February 18, 2011.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ FICC withdrew a substantively identical proposed rule change
filed on August 4, 2010, that sought approval without requesting
that the approval would be temporary.
\4\ Securities Exchange Act Release No. 60510 (August 17, 2009),
74 FR 42716 (August 24, 2009).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The proposed rule change seeks to modify the rules of FICC's
Government Securities Division (``GSD'') regarding the calculation of
clearing fund requirements relating to inter-dealer broker (``IDB'')
positions.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, FICC 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. FICC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of these
statements.
[[Page 52577]]
(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The GSD maintains a clearing fund comprised of deposits of cash and
eligible securities from its members to provide liquidity and to
satisfy any losses that might otherwise be incurred as a result of a
member's default and the subsequent close-out of its positions. The GSD
uses a Value-at-Risk (``VaR'') methodology to calculate clearing fund
requirements.\5\ The clearing fund methodology used by GSD analyzes
risk by reference to three factors: (1) End-of-day VaR charge assessing
market volatility for observed open positions at end-of-day after
giving effect to offsetting positions within the portfolio; (2)
``margin requirement differential'' (``MRD'') to address intraday risk;
and (3) ``coverage component'' (``CC'') to adjust the calculation if
necessary to reach a given confidence level.\6\ The margin calculation
is predicated upon an assumption that the open positions of a
defaulting member would be liquidated at the end of a three-day period.
---------------------------------------------------------------------------
\5\ VaR is defined as the maximum amount of money that may be
lost on a given portfolio over a given period of time within a given
confidence level.
\6\ Under the GSD clearing fund procedures, CC is not calculated
with respect to IDB repo transactions. The GSD has recently adjusted
the CC charge with respect to certain IDB cash transactions.
---------------------------------------------------------------------------
IDBs function as intermediaries trading with multiple
contraparties, allowing anonymity between trading parties, and
providing liquidity for the market. IDBs handle large transactions and
operate on small spreads. They perform a critical function in the
government securities market in the absence of a centralized trading
exchange.
IDBs submit affirmed trades from their systems to the GSD with each
trade matched to the contraparty that will ultimately deliver or
receive the securities. Although IDBs do not generally hold positions,
they may incur positions at the GSD when their contraparties are not
GSD members. Because these trades are matched by the IDB to a
contraparty prior to submission to the GSD, FICC represents that the
risk to FICC in the case of an IDB's default is different from that
presented when a dealer member submits a trade that may not have been
already matched to a contraside.
The clearing fund requirement applicable to IDB transactions has
increased significantly because of recent market volatility to the
point where FICC believes it is disproportionate to the risk that IDB
activity presents to the GSD. Given the importance of IDB transactions
in the government securities marketplace, undue and unsustainable
margin requirements on GSD IDB activity may be harmful and may
introduce systemic risk in the event members are motivated to avoid
imposition of disproportionate changes by netting outside of the GSD or
by delaying trade submission until later in the day. Accordingly, the
GSD adjusted the calculation of the CC charge for IDB transactions in
November 2008 and conducted a review of the current margin methodology
as applied to IDB activity.
As a result of this review, the GSD proposed and the Commission
approved the use of a one-day liquidation assumption when calculating
clearing fund requirements applicable to IDB activity.\7\ Since IDB
trades are matched prior to submission, the GSD believes that the one-
day liquidation period as opposed to a three-day liquidation period is
a more reasonable assumption in this context. The assumption of a
three-day liquidation period will continue to apply to non-IDB
activity.
---------------------------------------------------------------------------
\7\ See note 4.
---------------------------------------------------------------------------
The GSD will continue to monitor the IDB activity of its members
and to periodically reassess whether the one-day liquidation period
provides adequate coverage. In this regard, FICC will provide the
Commission with data to allow the Commission to track the magnitudes
and behaviors of the VaR calculations using a one-day liquidation
horizon and using a three-day liquidation horizon and with such other
information that the Commission may request. FICC further notes its
ability under GSD Rule 4 to impose special charges in response to
market circumstances or other risk factors with respect to a particular
member.
FICC believes that the proposed rule change is consistent with the
requirements of Section 17A of the Act \8\ and the rules and
regulations thereunder because the proposed change will modify the
calculation of clearing fund requirements for IDB positions so that the
clearing fund requirements is correlated more closely with the level of
risk associated with IDB positions.
---------------------------------------------------------------------------
\8\ 15 U.S.C. 78q-1.
---------------------------------------------------------------------------
(B) Self-Regulatory Organization's Statement on Burden on Competition
FICC does not believe that the proposed rule change will have any
impact or impose any burden on competition.
(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 yet
been solicited or received. FICC will notify the Commission of any
written comments received by FICC.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The Commission finds that the proposed rule change is consistent
with the requirements of the Act and the rules and regulations
thereunder and particularly with the requirements of Section
17A(b)(3)(F).\9\ Section 17A(b)(3)(F) requires that the rules of a
clearing agency remove impediments to and perfect the mechanism of a
national system for the prompt and accurate clearance and settlement of
securities transactions and to assure the safeguarding of securities
and funds in the custody or control of the clearing agency or for which
it is responsible. The Commission finds that the approval of FICC's
rule change on a temporary basis through February 18, 2011 is
consistent with this section because by allowing FICC to temporarily
modify its rules regarding the calculation of clearing fund
requirements for IDB positions to what it believes correlates more
closely with the level of risk associated with such positions, FICC
will be taking steps toward potentially improving the national
clearance and settlement system while still actively monitoring its
ability to fulfill its safeguarding obligations.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------
FICC has requested that the Commission approve the proposed rule
prior to the thirtieth day after publication of the notice of the
filing. The Commission finds good cause for approving the proposed rule
change prior to the thirtieth day after the publication of notice
because such approval will allow FICC to continue to attempt to
correlate IDBs' clearing fund requirements with the level of risk
associated with their positions.
The Commission is approving the proposed rule filing on a temporary
basis through February 18, 2011, so that FICC will have time to further
evaluate the modified calculation of clearing fund requirements for IDB
positions and to report its findings and conclusions to the Commission
and so that the Commission will have time to evaluate FICC's findings
and conclusions before a final determination is made regarding
[[Page 52578]]
adoption of any rule on a permanent basis.
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 (https://www.sec.gov/rules/sro.shtml) or
Send an e-mail to rule-comments@sec.gov. Please include
File Number SR-FICC-2010-05 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street, NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-FICC-2010-05. This
file number should be included on the subject line if e-mail 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 (https://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 Section, 100
F Street, NE., Washington, DC 20549, on official business days between
the hours of 10 a.m. and 3 p.m. Copies of such filings also will be
available for inspection and copying at the principal office of FICC
and on FICC's Web site at https://dtcc.com/downloads/legal/rule_filings/2010/ficc/2010-05.pdf. 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-FICC-2010-05 and should be submitted on or before
September 16, 2010.
V. Conclusion
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\10\ that the proposed rule change (File No. SR-FICC-2010-05) be
and hereby is approved on an accelerated basis through February 18,
2011.\11\
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\10\ 15 U.S.C. 78s(b)(2).
\11\ In approving the proposed rule change, the Commission
considered the proposal's impact on efficiency, competition, and
capital formation. 15 U.S.C. 78c(f).
For the Commission by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
[FR Doc. 2010-21200 Filed 8-25-10; 8:45 am]
BILLING CODE 8010-01-P
