Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Allow for the Clearing of Real Estate Index Futures Contracts, 76792-76793 [2011-31478]

Download as PDF 76792 Federal Register / Vol. 76, No. 236 / Thursday, December 8, 2011 / Notices SECURITIES AND EXCHANGE COMMISSION [Release No. 34–65870; File No. SR–OCC– 2011–16] Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Allow for the Clearing of Real Estate Index Futures Contracts December 2, 2011. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934,1 notice is hereby given that on November 21, 2011, The Options Clearing Corporation (‘‘OCC’’) filed with the Securities and Exchange Commission the proposed rule change as described in Items I and II below, which items have been prepared primarily by OCC. OCC filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 2 and Rule 19b–4(f)(4) thereunder 3 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. I. Self-Regulatory Organization’s Statement of Terms of Substance of the Proposed Rule Change The proposed rule change would accommodate certain cash-settled futures proposed to be traded by ELX Futures L.P. (‘‘ELX’’). II. Self-Regulatory Organization’s Statement of Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. mstockstill on DSK4VPTVN1PROD with NOTICES A. Self-Regulatory Organization’s Statement of Purpose of, and Statutory Basis for, the Proposed Rule Change In its capacity as a derivatives clearing organization (‘‘DCO’’), registered as such under the Commodity Exchange Act (the ‘‘CEA’’), OCC performs the clearing function for ELX and other futures exchanges. OCC’s existing By-Laws and Rules already accommodate the clearing of cash1 15 U.S.C. 78s(b)(1). U.S.C. 78s(b)(3)(A)(iii). 3 17 CFR 240.19b–4(f)(4). 4 File No. SR–OCC–2010–18, Securities Exchange Act Release No. 63222 (November 1, 2010), 75 FR 68390 (November 5, 2010). 2 15 VerDate Mar<15>2010 15:59 Dec 07, 2011 settled futures. However, a sentence is proposed to be added to Article XII, Section 2 of OCC’s By-Laws to more explicitly describe the rights and obligations of buyers and sellers of cashsettled futures, such as the Agricultural Futures and the Interest Rate Futures. An addition to OCC Rule 1301(e) is also proposed to allow OCC to recover the costs that it would incur in the event of a Clearing Member’s failure to satisfy a non-U.S. Dollar settlement obligation, such as the cost of purchasing the nonU.S. Dollar currency. All of the Euro Interest Rate Futures will be settled in Euros. OCC already clears futures contracts that are settled in Euros, and management believes that the facilities and procedures established in connection with the settlement of the existing Euro-settled futures will generally be sufficient to permit the clearing and settlement of the Euro Interest Rate Futures.4 ELX intends to use, as a final settlement price for each Interest Rate Future, the published settlement price of the corresponding contract on Eurex. ELX plans to use as a final settlement price for each Agricultural Future, the published settlement price of the corresponding contract on the Chicago Board of Trade. OCC performs the clearing function for ELX pursuant to the Clearing Agreement. Pursuant to the terms of the Clearing Agreement, OCC has agreed to clear the specific types of contracts enumerated therein and may agree to clear additional types through the execution by both parties of a new ‘‘Schedule C’’ to the Clearing Agreement. A copy of three proposed new Schedule Cs providing for the clearance of Agricultural Futures, Euribor Futures and German Interest Rate Futures, respectively, which are attached to File SR–OCC–2011–16 as Exhibits 5A, 5B and 5C. OCC believes that the proposed changes to its By-Laws are consistent with the purposes and requirements of Section 17A of the Securities Exchange Act of 1934, as amended (‘‘Exchange Act’’), because they are designed to permit OCC to perform clearing services for products that are subject to the jurisdiction of the CFTC without adversely affecting OCC’s obligations with respect to the prompt and accurate clearance and settlement of securities transactions or the protection of investors and the public interest. The proposed rule change is not inconsistent Jkt 226001 PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 with any rules of OCC, including any rules proposed to be amended. B. Self-Regulatory Organization’s Statement on Burden on Competition OCC 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 OCC has not solicited or received written comments relating to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)(iii) of the Act 5 and Rule 19b–4(f)(4) 6 and became effective on filing. 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 Comments • Use the Commission’s Internet comment form (https://www.sec.gov/ rules/sro.shtml) or • Send an email to rule-comments@ sec.gov. Please include File No. SR– OCC–2011–16 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 No. SR–OCC–2011–16. 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 5 Supra 6 Supra E:\FR\FM\08DEN1.SGM note 2. note 3. 08DEN1 Federal Register / Vol. 76, No. 236 / Thursday, December 8, 2011 / Notices 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 filings also will be available for inspection and copying at OCC’s principal office and OCC’s Web site (https://www.theocc. com/components/docs/legal/rules_and_ bylaws/sr_occ_11_16.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 No. SR–OCC–2011–16 and should be submitted on or before December 29, 2011. For the Commission by the Division of Trading and Markets, pursuant to delegated authority.7 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2011–31478 Filed 12–7–11; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–65869; File No. SR–Phlx– 2011–161] Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Modify Its Optional Anti-Internalization Functionality mstockstill on DSK4VPTVN1PROD with NOTICES December 2, 2011. 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 November 22, 2011, NASDAQ OMX PHLX LLC (‘‘PHLX’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the 7 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Exchange has designated the proposed rule change as constituting a rule change under Rule 19b–4(f)(6) under the Act,3 which renders the proposal effective upon filing with the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange is filing with the Securities and Exchange Commission (‘‘Commission’’) a proposed rule change to modify its optional antiinternalization functionality. The text of the proposed rule change is available at https:// www.nasdaqtrader.com/ micro.aspx?id=PHLXRulefilings, at the Exchange’s principal office, and at the Commission’s Public Reference Room. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, the Exchange 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. The Exchange has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements. A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change 1. Purpose The Exchange is proposing to provide a more granular alternative to the voluntary anti-internalization functionality. Under the proposal, market participants will be given the additional options of (1) assigning a group identification modifier at the port level; and (2) assigning different antiinternalization methodology to specific order entry ports. Currently, anti-internalization processing is available only on an MPID-wide basis with only a single methodology being allowed per MPID. Market participants direct that a particular version of anti-internalization processing be applied to a particular MPID, which is then applied by the system to all quotes/orders entered using that MPID. Market participants have the option, when entering quotes/ orders using the same MPID they do not wish to have automatically interact with each other in the System, to either direct the System to not execute any part of the interacting quotes/orders from the same MPID and, instead, cancel share amounts of the interacting quotes/orders back to the entering party with an arrangement that takes into consideration the size of the interacting quotes/orders (Decrement); or, regardless of the size of the interacting quotes/orders, cancelling the oldest of them in full (Cancel Oldest).4 Under the proposal, market participants entering quotes/orders under a specific MPID may voluntarily assign a unique group identification modifier that represents a group of quotes/orders from the same market participant identifier and order entry port (‘‘Group ID’’). The Group ID will be a two-character code composed of alphanumerics and/or spaces, assigned to a specific order entry port and updated by the Exchange on behalf of the market participant. This additional option will direct the System to execute any so designated incoming quotes/ orders against all eligible resting quotes/ orders except those with the both the same MPID and same Group ID. If the market participant selects the option of utilizing the Group ID, the anti-internalization selection will be applied to all quotes/orders entered using both the same MPID and the same Group ID. If the incoming order has both the same MPID and the same Group ID, the two orders will not execute against each other. If the two orders have the same MPID and different Group IDs, then the order will be eligible to execute against each other as designated by the anti-internalization method. For example: 1. Incoming order ‘‘A’’ has an MPID of ‘‘ABCD’’ and Group ID ‘‘A1’’, resting order ‘‘B’’ has an MPID of ‘‘ABCD’’ and Group ID ‘‘A1’’: in this scenario, these two orders would not execute against each other. 2. Incoming order ‘‘C’’ has an MPID of ‘‘EFGH’’ and Group ID ‘‘XY’’, resting order ‘‘D’’ has an MPID of ‘‘EFGH’’ and Group ID ‘‘ZZ’’: in this scenario, these two orders would execute against each other. Additionally, market participants will now have the option to assign a different anti-internalization methodology (Decrement or Cancel Oldest) to different order entry ports. The anti-internalization method assigned to the port sending the 1 15 VerDate Mar<15>2010 15:59 Dec 07, 2011 3 17 Jkt 226001 PO 00000 CFR 240.19b–4(f)(6). Frm 00105 Fmt 4703 4 See Sfmt 4703 76793 E:\FR\FM\08DEN1.SGM Exchange Rule 3307(a)(4). 08DEN1

Agencies

[Federal Register Volume 76, Number 236 (Thursday, December 8, 2011)]
[Notices]
[Pages 76792-76793]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-31478]



[[Page 76792]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-65870; File No. SR-OCC-2011-16]


 Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To 
Allow for the Clearing of Real Estate Index Futures Contracts

December 2, 2011.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 
1934,\1\ notice is hereby given that on November 21, 2011, The Options 
Clearing Corporation (``OCC'') filed with the Securities and Exchange 
Commission the proposed rule change as described in Items I and II 
below, which items have been prepared primarily by OCC. OCC filed the 
proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 
\2\ and Rule 19b-4(f)(4) thereunder \3\ 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\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \3\ 17 CFR 240.19b-4(f)(4).
---------------------------------------------------------------------------

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

    The proposed rule change would accommodate certain cash-settled 
futures proposed to be traded by ELX Futures L.P. (``ELX'').

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

    In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections A, B, 
and C below, of the most significant aspects of such statements.

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

    In its capacity as a derivatives clearing organization (``DCO''), 
registered as such under the Commodity Exchange Act (the ``CEA''), OCC 
performs the clearing function for ELX and other futures exchanges. 
OCC's existing By-Laws and Rules already accommodate the clearing of 
cash-settled futures. However, a sentence is proposed to be added to 
Article XII, Section 2 of OCC's By-Laws to more explicitly describe the 
rights and obligations of buyers and sellers of cash-settled futures, 
such as the Agricultural Futures and the Interest Rate Futures. An 
addition to OCC Rule 1301(e) is also proposed to allow OCC to recover 
the costs that it would incur in the event of a Clearing Member's 
failure to satisfy a non-U.S. Dollar settlement obligation, such as the 
cost of purchasing the non-U.S. Dollar currency.
    All of the Euro Interest Rate Futures will be settled in Euros. OCC 
already clears futures contracts that are settled in Euros, and 
management believes that the facilities and procedures established in 
connection with the settlement of the existing Euro-settled futures 
will generally be sufficient to permit the clearing and settlement of 
the Euro Interest Rate Futures.\4\ ELX intends to use, as a final 
settlement price for each Interest Rate Future, the published 
settlement price of the corresponding contract on Eurex.
---------------------------------------------------------------------------

    \4\ File No. SR-OCC-2010-18, Securities Exchange Act Release No. 
63222 (November 1, 2010), 75 FR 68390 (November 5, 2010).
---------------------------------------------------------------------------

    ELX plans to use as a final settlement price for each Agricultural 
Future, the published settlement price of the corresponding contract on 
the Chicago Board of Trade.
    OCC performs the clearing function for ELX pursuant to the Clearing 
Agreement. Pursuant to the terms of the Clearing Agreement, OCC has 
agreed to clear the specific types of contracts enumerated therein and 
may agree to clear additional types through the execution by both 
parties of a new ``Schedule C'' to the Clearing Agreement. A copy of 
three proposed new Schedule Cs providing for the clearance of 
Agricultural Futures, Euribor Futures and German Interest Rate Futures, 
respectively, which are attached to File SR-OCC-2011-16 as Exhibits 5A, 
5B and 5C.
    OCC believes that the proposed changes to its By-Laws are 
consistent with the purposes and requirements of Section 17A of the 
Securities Exchange Act of 1934, as amended (``Exchange Act''), because 
they are designed to permit OCC to perform clearing services for 
products that are subject to the jurisdiction of the CFTC without 
adversely affecting OCC's obligations with respect to the prompt and 
accurate clearance and settlement of securities transactions or the 
protection of investors and the public interest. The proposed rule 
change is not inconsistent with any rules of OCC, including any rules 
proposed to be amended.

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

    OCC 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

    OCC has not solicited or received written comments relating to the 
proposed rule change.

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

    The foregoing rule change has become effective pursuant to Section 
19(b)(3)(A)(iii) of the Act \5\ and Rule 19b-4(f)(4) \6\ and became 
effective on filing. 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.
---------------------------------------------------------------------------

    \5\ Supra note 2.
    \6\ Supra note 3.
---------------------------------------------------------------------------

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 email to rule-comments@sec.gov. Please include 
File No. SR-OCC-2011-16 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 No. SR-OCC-2011-16. 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

[[Page 76793]]

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 filings also will be available for inspection and 
copying at OCC's principal office and OCC's Web site (https://www.theocc.com/components/docs/legal/rules_and_bylaws/sr_occ_11_16.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 No. SR-OCC-
2011-16 and should be submitted on or before December 29, 2011.


    For the Commission by the Division of Trading and Markets, 
pursuant to delegated authority.\7\
---------------------------------------------------------------------------

    \7\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2011-31478 Filed 12-7-11; 8:45 am]
BILLING CODE 8011-01-P
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