Agency Information Collection Activities: Proposed Collection, Comment Request: Form TO, Annual Notice Filing for Counterparties to Unreported Trade Options, 74647-74652 [2012-30227]

Download as PDF Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices 32. ZhangJiaGang ZhongYuan Pipe-Making Co. 33. Zhejiang Jianli Enterprise Co., Ltd. [FR Doc. 2012–30221 Filed 12–14–12; 8:45 am] BILLING CODE P DEPARTMENT OF COMMERCE International Trade Administration srobinson on DSK4SPTVN1PROD with Application(s) for Duty-Free Entry of Scientific Instruments Pursuant to Section 6(c) of the Educational, Scientific and Cultural Materials Importation Act of 1966 (Pub. L. 89–651, as amended by Pub. L. 106– 36; 80 Stat. 897; 15 CFR part 301), we invite comments on the question of whether instruments of equivalent scientific value, for the purposes for which the instruments shown below are intended to be used, are being manufactured in the United States. Comments must comply with 15 CFR 301.5(a)(3) and (4) of the regulations and be postmarked on or before January 7, 2013. Address written comments to Statutory Import Programs Staff, Room 3720, U.S. Department of Commerce, Washington, DC 20230. Applications may be examined between 8:30 a.m. and 5:00 p.m. at the U.S. Department of Commerce in Room 3720. Docket Number: 12–053. Applicant: University of Colorado Boulder, 1800 Grant St., Suite 500, Denver, CO 80203. Instrument: HF2LI Lock-In System. Manufacturer: Zurich Instruments AG, Switzerland. Intended Use: The instrument will be used to measure detected near-field signals scattered off an Atomic Force Microscope (AFM) tip in a scattering-Scanning Near-field Optical Microscope (s-SNOM). The instrument will detect the magnitude and phase of the light scattered by an AFM tip to measure the electromagnetic near-field of optical antennas, plasmonics in metals and semiconductors (including graphene), photonic crystals, and other nanoscale spectroscopy applications. The instrument has the ability to fully digitize the measured signal and analyze it at 50 MHz, as well as the ability to demodulate many frequencies at once, which is essential to the measurement technique. Demodulation at 50 MHz is necessary because the AFM tip oscillates at 350–300 kHz, and higher harmonics (5th or 6th) of this oscillation must be measured to isolate the nearfield signal. Justification for Duty-Free Entry: There are no instruments of the same general category manufactured in the United States. Application accepted VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 by Commissioner of Customs: November 2, 2012. Docket Number: 12–054. Applicant: Purdue University, 525 Northwestern Ave., West Lafayette, IN 47907–2036. Instrument: DD Neutron Generator. Manufacturer: NSD Fusion, Germany. Intended Use: The instrument will be used to determine the behavior of produced scintillation light and ionization electrons of low energy nuclear recoils of Xenon, as well as to compare the combination of energy released in these two channels to energy released in electronic recoils of the same energy. The scintillation and ionization signals are studied in a detector vessel that lies underneath 5 meters of water, thus the instrument needs to be water tight. To study the scintillation light and ionization behavior of liquid xenon to neutrons from a mono-energetic neutron source with energies close to 2.5 MeV, each neutron interaction must be resolved separately, and thus arrive at most once every millisecond. The instrument has been proven to show less than a few hundred counts per second when operated at low voltage, and thus meets this requirement. Justification for Duty-Free Entry: There are no instruments of the same general category manufactured in the United States. Application accepted by Commissioner of Customs: November 2, 2012. Docket Number: 12–057. Applicant: Massachusetts Institute of Technology, 190 Albany St., NW21–121, Cambridge, MA 02139. Instrument: Fast Ferrite Tuner. Manufacturer: AFT Microwave GmbH, Germany. Intended Use: The instrument is part of a magnetic fieldaligned Ion Cyclotron RF antenna, which is used to automatically follow the load variation in real time and make the antenna system load tolerant. The instrument’s unique specifications are its frequency range of 50–80 MHz and 5 MW circulating power. Justification for Duty-Free Entry: There are no instruments of the same general category manufactured in the United States. Application accepted by Commissioner of Customs: November 15, 2012. Dated: December 11, 2012. Gregory W. Campbell, Director of Subsidies Enforcement, Import Administration. [FR Doc. 2012–30342 Filed 12–14–12; 8:45 am] BILLING CODE 3510–DS–P PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 74647 COMMODITY FUTURES TRADING COMMISSION Agency Information Collection Activities: Proposed Collection, Comment Request: Form TO, Annual Notice Filing for Counterparties to Unreported Trade Options Commodity Futures Trading Commission. ACTION: Notice. AGENCY: The Commodity Futures Trading Commission (‘‘Commission’’ or ‘‘CFTC’’) is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (‘‘PRA’’), 44 U.S.C. 3501 et seq., Federal agencies are required to publish notice in the Federal Register concerning each proposed collection of information and to allow 60 days for public comment. The Commission recently adopted a final rule and interim final rule, as required by the DoddFrank Wall Street Reform and Consumer Protection Act (‘‘Dodd-Frank Act’’), governing commodity options. That rulemaking includes a requirement that counterparties to unreported trade options must file an annual notice with the Commission on new Form TO. This notice solicits comments on the reporting requirement that would be imposed by Form TO. DATES: Comments must be submitted on or before February 15, 2013. ADDRESSES: You may submit comments, regarding the burden estimated or any other aspect of the information collection, including suggestions for reducing the burden. Please refer to ‘‘Form TO, ‘Annual Notice Filing for Counterparties to Unreported Trade Options’’’ in any correspondence. Comments may be submitted by any of the following methods: • Mail: Office of Information and Regulatory Affairs, Office of Management and Budget, Attention: Desk Officer for CFTC, 725 17th Street, Washington, DC 20503. • The Agency’s Web site, at http:// comments.cftc.gov/. Follow the instructions for submitting comments through the Web site. • Mail: Sauntia S. Warfield, Assistant Secretary of the Commission, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581. • Hand Delivery/Courier: Same as mail above. • Federal eRulemaking Portal: http:// www.regulations.gov. SUMMARY: E:\FR\FM\17DEN1.SGM 17DEN1 74648 Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices Please submit your comments using only one method. All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to www.cftc.gov. If you wish the Commission to consider information that you believe is exempt from disclosure under the Freedom of Information Act, a petition for confidential treatment of the exempt information may be submitted according to the procedures established in § 145.9 of the Commission’s regulations.1 FOR FURTHER INFORMATION CONTACT: Donald Heitman, Senior Special Counsel, (202) 418–5041, dheitman@cftc.gov, Division of Market Oversight, or David Aron, Counsel, (202) 418–6621, daron@cftc.gov, Office of the General Counsel, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581 SUPPLEMENTARY INFORMATION: Under the PRA, Federal agencies must obtain approval from the Office of Management and Budget (‘‘OMB’’) for each collection of information they conduct or sponsor. ‘‘Collection of Information’’ is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3 and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA, 44 U.S.C. 3506(c)(2)(A), requires Federal agencies to provide a 60-day notice in the Federal Register concerning each proposed collection of information before submitting the collection to OMB for approval. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number. To comply with this requirement, the CFTC is publishing the notice of the proposed collection of information listed below. Abstract: In accordance with section 721 of the Dodd-Frank Act, on April 27, 2012, the Commission published a final and interim final rule governing commodity options (‘‘Commodity Options Rules’’).2 The final rule portion of that rulemaking adopted the Commission’s proposal to generally permit market participants to trade commodity options, which are statutorily defined as swaps,3 subject to 1 17 CFR 145.9. FR 25320, April 27, 2012. 3 See 7 U.S.C. 1a(47)(A)(i). Note that the swap definition excludes options on futures (which must be traded on a designated contract market (‘‘DCM’’) pursuant to part 33 of the Commission’s regulations) (see Commodity Exchange Act (‘‘CEA’’) section 1a(47)(B)(i), 7 U.S.C. 1a(47)(B)(i)), but it includes options on physical commodities (whether srobinson on DSK4SPTVN1PROD with 2 77 VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 the same rules applicable to every other swap. The interim final rule portion of the rulemaking includes a trade option exemption for physically delivered commodity options purchased by commercial users of the commodities underlying the options (‘‘Trade Option Interim Final Rule’’ or ‘‘Trade Option IFR’’), subject to certain conditions. Those conditions, which include both recordkeeping and reporting obligations, are primarily intended to preserve a level of market visibility for the Commission while reducing the regulatory compliance burden for market participants. 1. Recordkeeping Pursuant to Part 45 4 The conditions set out in the Trade Option IFR include recordkeeping requirements for any trade options activity, i.e., the recordkeeping or not traded on a DCM) (see CEA section 1a(47)(A)(i), 7 U.S.C. 1a(47)(A)(i)). Other options excluded from the statutory definition of swap are options on any security, certificate of deposit, or group or index of securities, including any interest therein or based on the value thereof, that are subject to the Securities Act of 1933 and the Securities Exchange Act of 1934 (see CEA section 1a(47)(B)(iii), 7 U.S.C. 1a(47)(B)(iii)) and foreign currency options entered into on a national securities exchange registered pursuant to section 6(a) of the Securities Exchange Act of 1934 (see CEA section 1a(47)(B)(iv), 7 U.S.C. 1a(47)(B)(iv)). Note also that the Commission’s regulations define a commodity option transaction or commodity option as ‘‘any transaction or agreement in interstate commerce which is or is held out to be of the character of, or is commonly known to the trade as, an ‘option,’ ‘privilege,’ ‘indemnity,’ ‘bid,’ ‘offer,’ ‘call,’ ‘put,’ ‘advance guaranty’ or ‘decline guaranty’.’’ 17 CFR 1.3(hh). For purposes of this release, the Commission uses the term ‘‘commodity options’’ to apply solely to commodity options not excluded from the swap definition set forth in CEA section 1a(47)(A), 7 U.S.C. 1a(47)(A). The Commission recently published, in conjunction with the Securities and Exchange Commission (‘‘SEC’’) final rules to further define, among other things, the term ‘‘swap.’’ See Further Definition of ‘‘Swap,’’ ‘‘Security-Based Swap,’’ and ‘‘SecurityBased Swap Agreement’’; Mixed Swaps; SecurityBased Swap Agreement; Final Rule, 77 FR 48207, August 13, 2012 (‘‘Product Definitions Final Rules’’). The Product Definitions Final Rules address the determination of whether a commodity option or a transaction with optionality is subject to the swap definition in the first instance. If a commodity option or a transaction with optionality is excluded from the scope of the swap definition (for example, if it is an excluded forward contract— see id. at 48227), the commodity options rules, including the Form TO reporting requirement, are not applicable. 4 The Commission recently adopted final swap data recordkeeping and reporting rules as new part 45 of the Commission’s regulations. See Swap Data Recordkeeping and Reporting Requirements 77 FR 2136, Jan. 13, 2012. The information in this notice regarding part 45 recordkeeping and reporting is provided as background, in order to describe Form TO in context. However, this notice applies only to Form TO. The PRA implications of the part 45 recordkeeping and reporting requirements were analyzed as part of the part 45 rulemaking process and discussed in the final swap data recordkeeping and reporting rules. PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 requirements of 17 CFR 45.2.5 Such records must be maintained by all trade option participants pursuant to § 45.2 and made available to the Commission as specified therein.6 Section 45.2 applies different recordkeeping requirements, depending on the nature of the counterparty. For example, if a trade option counterparty is a swap dealer (‘‘SD’’) or major swap participant (‘‘MSP’’), it would be subject to the comprehensive recordkeeping requirements of § 45.2(a). If a counterparty is neither an SD nor an MSP, it would be subject to the less stringent recordkeeping requirements of § 45.2(b). The recordkeeping requirement is intended to ensure that trade options market participants are able to provide pertinent information regarding their trade options activity to the Commission, if requested. 2. Reporting Pursuant to Part 45 In addition to part 45 recordkeeping (which applies in some form to all trade options and trade option participants), the interim final rule requires certain trade options to be reported pursuant to part 45’s reporting provisions.7 Under the interim final rule, the determination as to whether a trade option is required to be reported pursuant to part 45 is based on the parties to the trade option and whether or not they have previously reported swaps pursuant to part 45. Specifically, if any trade option involves at least one counterparty (whether as buyer or seller) that has (1) become obligated to comply with the reporting requirements of part 45, (2) as a reporting party, (3) during the twelve month period preceding the date on which the trade option is entered into, (4) in connection with any non-trade option swap trading activity, then such 5 17 CFR 45.2, id. at 2198. CFR 45.2(h) provides that: [a]ll records required to be kept pursuant to this section [17 CFR 45.2] by any registrant or its affiliates or by any non-SD/MSP counterparty subject to the jurisdiction of the Commission shall be open to inspection upon request by any representative of the Commission, the United States Department of Justice, or the [SEC], or by any representative of a prudential regulator as authorized by the Commission. Copies of all such records shall be provided, at the expense of the entity or person required to keep the record, to any representative of the Commission upon request. Copies of records required to be kept by any registrant shall be provided either by electronic means, in hard copy, or both, as requested by the Commission, with the sole exception that copies of records originally created and exclusively maintained in paper form may be provided in hard copy only. Copies of records required to be kept by any non-SD/MSP counterparty subject to the jurisdiction of the Commission that is not a Commission registrant shall be provided in the form, whether electronic or paper, in which the records are kept. 7 See 17 CFR 45.3–45.5, 77 FR at 2199–2204. 6 17 E:\FR\FM\17DEN1.SGM 17DEN1 Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices trade option must also be reported pursuant to the reporting requirements of part 45. If only one counterparty to a trade option has previously complied with the part 45 reporting provisions, as described above, then that counterparty shall be the part 45 reporting entity for the trade option. If both counterparties have previously complied with the part 45 reporting provisions, as described above, then the part 45 rules for determining the reporting party will apply.8 By applying the part 45 reporting requirements to trade options in this manner, the Commission will obtain greater transparency and improved oversight of the swaps markets, both of which are primary statutory objectives of Title VII of the Dodd-Frank Act. The Commission believes, however, that greater transparency regarding the trade options market must be balanced against the burdens of frequent and near-instantaneous reporting required under part 45 of the Commission’s regulations on counterparties who are not otherwise obligated to report because they do not have other reportable swap activity. Accordingly, if neither counterparty to a trade option already is complying with the reporting requirements of part 45 as a reporting party in connection with its non-trade option swap trading activities as described above,9 then such trade option is not required to be reported pursuant to the reporting requirements of part 45.10 srobinson on DSK4SPTVN1PROD with 3. Annual Notice Filing Alternative to Part 45 Reporting: Form TO To the extent that neither counterparty to a trade option has previously submitted reports to a swap data repository (‘‘SDR’’) as a result of its swap trading activities as described above, the Commission recognizes that requiring these entities to report trade options to an SDR under part 45 of the Commission’s regulations solely with respect to their trade options activity would be costly and time consuming. As an alternative, the Trade Option IFR requires any counterparty to an otherwise unreported trade option to submit an annual filing to the Commission for the purpose of providing notice that it has entered into 8 See 77 FR 25327, April 27, 2012, and 17 CFR 45.8. 9 That is, neither counterparty to the trade option has previously reported, as the reporting party, nontrade option swap trading activity during the twelve months preceding the date on which the trade option is entered into. 10 By taking this approach, the Commission ensures that no market participant is compelled to comply with part 45’s reporting requirements based solely on its trade options activity. VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 one or more unreported trade options in the prior calendar year. Unlike with trade options subject to the part 45 reporting requirement, wherein only one counterparty to the trade option reports the transaction to an SDR, the notice filing requirement applies to both counterparties to an unreported trade option. Because the purpose of the notice filing requirement is to identify to the Commission those market participants engaging in unreported trade options, the notice filing requirement applies whether or not such counterparty has also been a nonreporting counterparty to a reported trade option in the twelve months preceding the date on which the unreported trade option was entered into. Market participants will satisfy the annual notice filing requirement by completing and submitting a new Commission form, Form TO, by March 1 following the end of any calendar year during which the market participant entered into one or more unreported trade options. Form TO requires an unreported trade option counterparty to: (1) Provide name and contact information, (2) identify the categories of commodities (agricultural, metals, energy, or other) underlying one or more unreported trade options which it entered into during the prior calendar year, and (3) for each commodity category, estimate the approximate aggregate value of the underlying physical commodities that it either delivered or received in connection with the exercise of unreported trade options during the prior calendar year. For the purposes of item (3), a reporting counterparty should not include the value of commodities that were the subject of trade options that remained open at the end of the calendar year or the value of any trade options that expired unexercised during the prior calendar year. Pursuant to the interim final rule, Form TO is a mandatory annual filing requirement. The form must be submitted to the Commission no later than March 1 for the prior calendar year. For example, if a market participant enters into one or more unreported trade options between January 1, 2013 and December 31, 2013 (the first calendar year for which a Form TO will be due to the Commission is 2013), the market participant must submit a completed Form TO to the Commission on or before March 1, 2014. Form TO is set out in the Trade Option IFR as Appendix A to part 32 of the Commission’s regulations.11 A copy of Form TO is also appended to this notice. Form TO will be available electronically on the Commission’s Web site at least ninety days before the first compliance date for filing the form, March 1, 2014. The Form TO filing requirement is intended to provide the Commission a minimally intrusive level of visibility into the unreported trade options market, to guide the Commission’s efforts to collect additional information through its authority to obtain copies of books or records required to be kept pursuant to the Act 12 should market circumstances dictate, and to enable the Commission to determine whether these counterparties should be subject to more frequent and comprehensive reporting obligations in the future. The Trade Option IFR notice specifically requested comments on trade option reporting and/or notice filing requirements.13 Those comments may be found on the Commission’s Web site, www.cftc.gov, at http:// comments.cftc.gov/PublicComments/ CommentList.aspx?id=1196. All comments received in response to the Trade Option IFR notice regarding Form TO will be considered, along with the comments received in response to this notice, in determining the Commission’s final action on Form TO. If the Commission obtains information required to be kept through this collection, it would protect proprietary information in accordance with the Freedom of Information Act and 17 CFR part 145, ‘‘Commission Records and Information.’’ In addition, § 8(a)(1) of the Act strictly prohibits the Commission, unless specifically authorized by the Act, from making public ‘‘data and information that would separately disclose the business transactions or market positions of any person and trade secrets or names of customers.’’ 14 The Commission is also required to protect certain information contained in a government system of records according to the Privacy Act of 1974, 5 U.S.C. 552a. Burden Statement: The respondent burden for this collection is estimated to be 2 hours per response. These estimates include the time to: (1) Review the commodity categories that were the subject of unreported trade options during the prior calendar year (including a review of counterparties to such transactions to determine which trade options were otherwise unreported); (2) estimate the value of commodities actually delivered or 12 See 17 CFR 1.31(a)(2) and 17 CFR 45.2(h). 77 FR 25320 at 25328. 14 7 U.S.C. 12(a)(1). 13 See 11 See PO 00000 77 FR 25320 at 25340–43. Frm 00017 Fmt 4703 Sfmt 4703 74649 E:\FR\FM\17DEN1.SGM 17DEN1 74650 Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices received pursuant to trade options in each category; and (3) prepare and file Form TO electronically through the Commission’s web-based Form TO. The Commission estimates the average burden of this collection of information as follows: ESTIMATED ANNUAL REPORTING BURDEN HOURS AND BURDEN HOUR COSTS 17 CFR Annual number of respondents Part 32, Appendix A, Form TO. 100 Frequency of response per respondent Hours per response and cost Total annual responses Total hours cost Annually ...................... 2 hours at $200 per response.15 100 (one form per otherwise unreported trade option participant). $20,000 (100 responses times 2 hours per response, based on $100/ hour.) purchased or received and how much it cost. The Commission invites comments on: • Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information will have a practical use; • The accuracy of the Commission’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used; • Ways to enhance the quality, usefulness, and clarity of the information to be collected; and • Ways to minimize the burden of collection of information on those who are to respond, including through the use of appropriate automated electronic, mechanical, or other technological collection techniques or other forms of information technology; e.g., permitting electronic submission of responses. NOTICE: Failure to file a report required by the Commodity Exchange Act (‘‘CEA’’ or the ‘‘Act’’) 17 and the regulations thereunder,18 or the filing of a report with the Commodity Futures Trading Commission (‘‘CFTC’’ or ‘‘Commission’’) that includes a false, misleading or fraudulent statement or omits material facts that are required to be reported therein or are necessary to make the report not misleading, may (a) constitute a violation of section 6(c)(2) of the Act (7 USC 9, 15), section 9(a)(3) of the Act (7 USC 13(a)(3)), and/or section 1001 of Title 18, Crimes and Criminal Procedure (18 USC 1001) and (b) result in punishment by fine or imprisonment, or both. PRIVACY ACT NOTICE 15 The Commission estimates that entities will spend $100 per hour. The $100 per hour estimate was used as the average hourly wage rate in the PRA section of the Internal Business Conduct Standards for Swap Dealers and Major Swap Participants final rule (See 77 FR 20128, 20194) and the wage rate for CCOs under the DCO final rules (See 76 FR 69344, 69428). As the Commission explained in the Internal Business Conduct Standards final rule, the estimate of $100 per hour was based on recent Bureau of Labor Statistics findings, including the mean hourly wage of an employee under occupation code 23–1011, ‘‘Lawyers,’’ that is employed by the ‘‘Securities and Commodity Contracts Intermediation and Brokerage Industry,’’ which is $85.20. The mean hourly wage of an employee under occupation code 11–3031, ‘‘Financial Manager,’’ in the same industry is $80.90. Additionally, SIFMA’s ‘‘Report on Management & Professional Earnings in the Securities Industry—2011’’ estimates the average wage of a compliance attorney at $96.42 and a compliance specialist in the U.S. at $74.85 per hour. As in those rules, the Commission is using a $100 per hour wage rate in calculating the cost burdens imposed by this collection of information and requests comment on the accuracy of its estimate. 16 A trade option is generally a commodity option purchased by a commercial party that, upon exercise, results in the sale of a physical commodity for immediate (spot) or deferred (forward) shipment or delivery. See CFTC regulation 32.3(a) (17 CFR 32.3(a)) for more details. An unreported trade option is a trade option that is not required to be reported to a swap data repository by either counterparty pursuant to CFTC regulation 32.3(b)(1) and part 45 of the Commission’s regulations (17 CFR 32.3(b)(1); 17 CFR part 45). 17 7 U.S.C. section 1, et seq. 18 Unless otherwise noted, the rules and regulations referenced in this notice are found in chapter 1 of title 17 of the Code of Federal Regulations; 17 CFR Chapter 1 et seq. VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 Appendix The Commission’s authority for soliciting this information is granted in sections 4c(b) and 8 of the CEA and related regulations (see, e.g., 17 CFR § 32.3(b)). The information solicited from entities and individuals engaged in activities covered by the CEA is E:\FR\FM\17DEN1.SGM 17DEN1 EN17DE12.000</GPH> srobinson on DSK4SPTVN1PROD with Respondents/Affected Entities: 100. Estimated average number of responses: 100 (one form per year). Estimated total average annual burden on respondents: 2 hours. Frequency of collection: Annually. Average total cost: $20,000. There are no capital costs or operating and maintenance costs associated with this collection. The Commission believes that, as part of customary and usual business practices, all respondents already create and store basic information on what they 74651 Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices required to be provided to the CFTC, and failure to comply may result in the imposition of criminal or administrative sanctions (see, e.g., 7 U.S.C. §§ 9 and 13a–1, and/or 18 U.S.C. 1001). The information requested is most commonly used in the Commission’s market and trade practice surveillance activities to provide information concerning the size and composition of the commodity derivatives markets. The requested information may be used by the Commission in the conduct of investigations and litigation and, in limited circumstances, may be made public on an aggregate basis in accordance with provisions of the CEA and other applicable laws. It may also be disclosed to other government agencies to meet responsibilities assigned to them by law. The information will be maintained in, and any additional disclosures will be made in accordance with, the CFTC System of Records Notices, available on www.cftc.gov. 19 GENERAL INSTRUCTIONS Who Must File a Form TO—17 CFR § 32.3(b)(2) requires every counterparty to an unreported trade option to submit an annual filing to the Commission for the purpose of providing notice that it has entered into one or more unreported trade options in the prior calendar year. As noted above, an unreported trade option is a trade option that is not required to be reported to a swap data repository by either counterparty pursuant to CFTC regulation 32.3(b)(1) and part 45 of the Commission’s regulations. When to file—Form TO is an annual filing requirement due to the Commission no later than March 1 for the prior calendar year. For example, if a market participant enters into one or more unreported trade options between January 1, 2013 and December 31, 2013, the market participant must submit a completed Form TO to the Commission on or before March 1, 2014. Where to file—Generally, Form TO should be submitted via the CFTC’s web based Form TO submission process at http://www.cftc.gov/, or as otherwise instructed by the Commission or its designee. If submission through the web-based Form TO is impossible, the reporting counterparty shall contact the Commission at [techsupport@cftc.gov] or 202–418–5000 for further instructions. What to File—All reporting counterparties filing a Form TO must complete all questions. Signature—Each Form TO submitted to the Commission must be signed or otherwise authenticated by either (1) the reporting counterparty submitting the form or (2) an individual that is duly authorized by the reporting counterparty to provide the information and representations contained in the form. CFTC FORM TO Name and Contact Information for Reporting Counterparty: 1. Reporting Counterparty Name and Address (including City, State, Country, Zip/Postal Code): Reporting Counterparty Web site (if any): Reporting Counterparty Unique Identifier (if any): b Legal Entity Identifier ‘‘LEI’’ (if any) b National Futures Association ID Number (if any) b Other Party Identifier (Please Specify) Phone Number and Email Address: 2. Reporting Counterparty Contact Person 20 Name and Job Title and/or Relationship with Reporting Counterparty: Commodity Category Indication: or more unreported trade options in the following commodity categories: 3. In the prior calendar year, the Reporting Counterparty entered into one Agricultural 21 ................................................................................................................................................................. Metals 22 ........................................................................................................................................................................... Energy 23 .......................................................................................................................................................................... Other (Please Specify) ............................................................................................................................................. Approximate Size of Unreported Trade Options Exercised in the Prior Calendar Year: srobinson on DSK4SPTVN1PROD with 4. Please indicate, by commodity category, the approximate total value 19 Note that, under the Paperwork Reduction Act, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid control number from the Office of Management and Budget. 20 This should be an individual able to answer specific questions about the reporting VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 b b b b YES YES YES YES b b b b NO. NO. NO. NO. (quantity received/delivered multiplied by price paid/received) of physical commodities that the reporting counterparty purchased and/or delivered in connection with the exercise of unreported trade options in the prior calendar year: 24 counterparty’s unreported trade options activity if contacted by Commission staff. 21 Agricultural commodity is defined in the Commission’s regulations at 17 CFR 1.3(zz). 22 Including, but not limited to, gold, silver, platinum, palladium, copper, aluminum, and rare earth metals. 23 Including, but not limited to, petroleum products, natural gas, and electricity. 24 For the purposes of answering this question, a reporting counterparty should not include the value of commodities that were the subject of trade options that remained open at the end of the prior calendar year or any trade options that expired unexercised during the prior calendar year. PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 E:\FR\FM\17DEN1.SGM 17DEN1 74652 Federal Register / Vol. 77, No. 242 / Monday, December 17, 2012 / Notices Agricultural ........................ b None ............................ b Under $10M ................ b $10M to $100M ........... b Over $100M Metals ................................ b None ............................ b Under $10M ................ b $10M to $100M ........... b Over $100M Energy ............................... b None ............................ b Under $10M ................ b $10M to $100M ........... b Over $100M Other .......................... b None ............................ b Under $10M ................ b $10M to $100M ........... b Over $100M Signature/Authentication, Name, and Date b By checking this box and submitting this Form TO (or by clicking ‘‘submit,’’ ‘‘send,’’ or any other analogous transmission command if transmitting electronically), I certify that I am duly authorized by the reporting counterparty identified below to provide the information and representations submitted on this Form TO, and that the information and representations are true and correct. Reporting Counterparty Authorized Representative (Name and Position): llllllllllllllllll l (Name) llllllllllllllllll l (Position) Submitted on behalf of: llllllllllllllllll l (Reporting Counterparty) Date of Submission: llllllllllllllllll l Dated: December 11, 2012. Sauntia S. Warfield, Assistant Secretary of the Commission. [FR Doc. 2012–30227 Filed 12–14–12; 8:45 am] BILLING CODE P DEPARTMENT OF ENERGY Federal Energy Regulatory Commission srobinson on DSK4SPTVN1PROD with Combined Notice of Filings #1 Take notice that the Commission received the following electric rate filings: Docket Numbers: ER12–21–004; ER12–1521–001; ER12–1522–001; ER12–1626–001; ER10–2605–004. Applicants: Agua Caliente Solar, LLC, Alta Wind VII, LLC, Alta Wind IX, LLC, Topaz Solar Farms LLC, Yuma Cogeneration Associates. Description: Notification of Change in Status of the MidAmerican Southwest MBR Sellers. Filed Date: 12/7/12. Accession Number: 20121207–5120. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER12–2617–001. Applicants: Midwest Independent Transmission System Operator, Inc. Description: SA 2431 Glacial Ridge Wind-GRE Deficiency Filing to be effective 9/13/2012. VerDate Mar<15>2010 16:21 Dec 14, 2012 Jkt 229001 Filed Date: 12/7/12. Accession Number: 20121207–5027. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–360–001. Applicants: Grand Ridge Energy LLC. Description: Supplemental Filing of Amended Co-Tenancy, and Shared Facilities Agreement to be effective 11/ 14/2012. Filed Date: 12/7/12. Accession Number: 20121207–5070. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–361–001. Applicants: Grand Ridge Energy II LLC. Description: Supplemental Filing of Amended Co-Tenancy, and Shared Facilities Agreement to be effective 11/ 14/2012. Filed Date: 12/7/12. Accession Number: 20121207–5072. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–362–001. Applicants: Grand Ridge Energy III LLC. Description: Supplemental Filing of Amended Co-Tenancy, and Shared Facilities Agreement to be effective 11/ 14/2012. Filed Date: 12/7/12. Accession Number: 20121207–5073. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–363–001. Applicants: Grand Ridge Energy IV LLC. Description: Supplemental Filing of Amended Co-Tenancy, and Shared Facilities Agreement to be effective 11/ 14/2012. Filed Date: 12/7/12. Accession Number: 20121207–5074. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–374–001. Applicants: Grand Ridge Energy V LLC. Description: Grand Ridge Energy V LLC submits tariff filing per 35.17(b): Supplemental Filing of Amended CoTenancy, and Shared Facilities Agreement to be effective 11/14/2012. Filed Date: 12/7/12. Accession Number: 20121207–5075. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–524–000. Applicants: PJM Interconnection, L.L.C. Description: Original Service Agreement No. 3445; Queue No. X1–073 to be effective 11/14/2012. PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 Filed Date: 12/6/12. Accession Number: 20121206–5107. Comments Due: 5 p.m. ET 12/27/12. Docket Numbers: ER13–525–000. Applicants: Pacific Gas and Electric Company. Description: 2nd Amendment to Gates Solar Station LGIA WDT SA No. 87 to be effective 12/4/2012. Filed Date: 12/6/12. Accession Number: 20121206–5129. Comments Due: 5 p.m. ET 12/27/12. Docket Numbers: ER13–526–000. Applicants: ITC Midwest LLC. Description: Filing of Executed Agreement in Compliance with ER12– 2070 with Modification to be effective 8/20/2012. Filed Date: 12/6/12. Accession Number: 20121206–5143. Comments Due: 5 p.m. ET 12/27/12. Docket Numbers: ER13–527–000. Applicants: Westar Energy, Inc. Description: Kansas Electric Power Cooperative, Inc., Balancing Area Services Agreement to be effective 10/1/ 2012. Filed Date: 12/6/12. Accession Number: 20121206–5161. Comments Due: 5 p.m. ET 12/27/12. Docket Numbers: ER13–528–000. Applicants: Southwest Power Pool, Inc. Description: Revisions to Section 10— Force Majeure and Indemnification to be effective 2/5/2013. Filed Date: 12/7/12. Accession Number: 20121207–5065. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–529–000 Applicants: PJM Interconnection, L.L.C. Description: PJM Interconnection, L.L.C. submits tariff filing per 35.13(a)(2)(iii: Revisions to the PJM OATT Att DD re Avoidable Cost Rates to be effective 2/5/2013. Filed Date: 12/7/12. Accession Number: 20121207–5076. Comments Due: 5 p.m. ET 12/28/12. Docket Numbers: ER13–530–000. Applicants: Arizona Public Service Company. Description: Arizona Public Service Company submits tariff filing per 35.13(a)(2)(iii: Ajo Improvement Company Interconnection Agreement; Service Agreement No. 326 to be effective 12/28/2012. E:\FR\FM\17DEN1.SGM 17DEN1

Agencies

[Federal Register Volume 77, Number 242 (Monday, December 17, 2012)]
[Notices]
[Pages 74647-74652]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-30227]


=======================================================================
-----------------------------------------------------------------------

COMMODITY FUTURES TRADING COMMISSION


Agency Information Collection Activities: Proposed Collection, 
Comment Request: Form TO, Annual Notice Filing for Counterparties to 
Unreported Trade Options

AGENCY: Commodity Futures Trading Commission.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: The Commodity Futures Trading Commission (``Commission'' or 
``CFTC'') is announcing an opportunity for public comment on the 
proposed collection of certain information by the agency. Under the 
Paperwork Reduction Act (``PRA''), 44 U.S.C. 3501 et seq., Federal 
agencies are required to publish notice in the Federal Register 
concerning each proposed collection of information and to allow 60 days 
for public comment. The Commission recently adopted a final rule and 
interim final rule, as required by the Dodd-Frank Wall Street Reform 
and Consumer Protection Act (``Dodd-Frank Act''), governing commodity 
options. That rulemaking includes a requirement that counterparties to 
unreported trade options must file an annual notice with the Commission 
on new Form TO. This notice solicits comments on the reporting 
requirement that would be imposed by Form TO.

DATES: Comments must be submitted on or before February 15, 2013.

ADDRESSES: You may submit comments, regarding the burden estimated or 
any other aspect of the information collection, including suggestions 
for reducing the burden. Please refer to ``Form TO, `Annual Notice 
Filing for Counterparties to Unreported Trade Options''' in any 
correspondence. Comments may be submitted by any of the following 
methods:
     Mail: Office of Information and Regulatory Affairs, Office 
of Management and Budget, Attention: Desk Officer for CFTC, 725 17th 
Street, Washington, DC 20503.
     The Agency's Web site, at http://comments.cftc.gov/. 
Follow the instructions for submitting comments through the Web site.
     Mail: Sauntia S. Warfield, Assistant Secretary of the 
Commission, Commodity Futures Trading Commission, Three Lafayette 
Centre, 1155 21st Street NW., Washington, DC 20581.
     Hand Delivery/Courier: Same as mail above.
     Federal eRulemaking Portal: http://www.regulations.gov.

[[Page 74648]]

    Please submit your comments using only one method.
    All comments must be submitted in English, or if not, accompanied 
by an English translation. Comments will be posted as received to 
www.cftc.gov. If you wish the Commission to consider information that 
you believe is exempt from disclosure under the Freedom of Information 
Act, a petition for confidential treatment of the exempt information 
may be submitted according to the procedures established in Sec.  145.9 
of the Commission's regulations.\1\
---------------------------------------------------------------------------

    \1\ 17 CFR 145.9.

FOR FURTHER INFORMATION CONTACT: Donald Heitman, Senior Special 
Counsel, (202) 418-5041, dheitman@cftc.gov, Division of Market 
Oversight, or David Aron, Counsel, (202) 418-6621, daron@cftc.gov, 
Office of the General Counsel, Commodity Futures Trading Commission, 
---------------------------------------------------------------------------
Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581

SUPPLEMENTARY INFORMATION: Under the PRA, Federal agencies must obtain 
approval from the Office of Management and Budget (``OMB'') for each 
collection of information they conduct or sponsor. ``Collection of 
Information'' is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3 and 
includes agency requests or requirements that members of the public 
submit reports, keep records, or provide information to a third party. 
Section 3506(c)(2)(A) of the PRA, 44 U.S.C. 3506(c)(2)(A), requires 
Federal agencies to provide a 60-day notice in the Federal Register 
concerning each proposed collection of information before submitting 
the collection to OMB for approval. An agency may not conduct or 
sponsor, and a person is not required to respond to, a collection of 
information unless it displays a currently valid control number. To 
comply with this requirement, the CFTC is publishing the notice of the 
proposed collection of information listed below.
    Abstract: In accordance with section 721 of the Dodd-Frank Act, on 
April 27, 2012, the Commission published a final and interim final rule 
governing commodity options (``Commodity Options Rules'').\2\ The final 
rule portion of that rulemaking adopted the Commission's proposal to 
generally permit market participants to trade commodity options, which 
are statutorily defined as swaps,\3\ subject to the same rules 
applicable to every other swap. The interim final rule portion of the 
rulemaking includes a trade option exemption for physically delivered 
commodity options purchased by commercial users of the commodities 
underlying the options (``Trade Option Interim Final Rule'' or ``Trade 
Option IFR''), subject to certain conditions. Those conditions, which 
include both recordkeeping and reporting obligations, are primarily 
intended to preserve a level of market visibility for the Commission 
while reducing the regulatory compliance burden for market 
participants.
---------------------------------------------------------------------------

    \2\ 77 FR 25320, April 27, 2012.
    \3\ See 7 U.S.C. 1a(47)(A)(i). Note that the swap definition 
excludes options on futures (which must be traded on a designated 
contract market (``DCM'') pursuant to part 33 of the Commission's 
regulations) (see Commodity Exchange Act (``CEA'') section 
1a(47)(B)(i), 7 U.S.C. 1a(47)(B)(i)), but it includes options on 
physical commodities (whether or not traded on a DCM) (see CEA 
section 1a(47)(A)(i), 7 U.S.C. 1a(47)(A)(i)). Other options excluded 
from the statutory definition of swap are options on any security, 
certificate of deposit, or group or index of securities, including 
any interest therein or based on the value thereof, that are subject 
to the Securities Act of 1933 and the Securities Exchange Act of 
1934 (see CEA section 1a(47)(B)(iii), 7 U.S.C. 1a(47)(B)(iii)) and 
foreign currency options entered into on a national securities 
exchange registered pursuant to section 6(a) of the Securities 
Exchange Act of 1934 (see CEA section 1a(47)(B)(iv), 7 U.S.C. 
1a(47)(B)(iv)). Note also that the Commission's regulations define a 
commodity option transaction or commodity option as ``any 
transaction or agreement in interstate commerce which is or is held 
out to be of the character of, or is commonly known to the trade as, 
an `option,' `privilege,' `indemnity,' `bid,' `offer,' `call,' 
`put,' `advance guaranty' or `decline guaranty'.'' 17 CFR 1.3(hh). 
For purposes of this release, the Commission uses the term 
``commodity options'' to apply solely to commodity options not 
excluded from the swap definition set forth in CEA section 
1a(47)(A), 7 U.S.C. 1a(47)(A). The Commission recently published, in 
conjunction with the Securities and Exchange Commission (``SEC'') 
final rules to further define, among other things, the term 
``swap.'' See Further Definition of ``Swap,'' ``Security-Based 
Swap,'' and ``Security-Based Swap Agreement''; Mixed Swaps; 
Security-Based Swap Agreement; Final Rule, 77 FR 48207, August 13, 
2012 (``Product Definitions Final Rules''). The Product Definitions 
Final Rules address the determination of whether a commodity option 
or a transaction with optionality is subject to the swap definition 
in the first instance. If a commodity option or a transaction with 
optionality is excluded from the scope of the swap definition (for 
example, if it is an excluded forward contract--see id. at 48227), 
the commodity options rules, including the Form TO reporting 
requirement, are not applicable.
---------------------------------------------------------------------------

1. Recordkeeping Pursuant to Part 45 \4\
---------------------------------------------------------------------------

    \4\ The Commission recently adopted final swap data 
recordkeeping and reporting rules as new part 45 of the Commission's 
regulations. See Swap Data Recordkeeping and Reporting Requirements 
77 FR 2136, Jan. 13, 2012. The information in this notice regarding 
part 45 recordkeeping and reporting is provided as background, in 
order to describe Form TO in context. However, this notice applies 
only to Form TO. The PRA implications of the part 45 recordkeeping 
and reporting requirements were analyzed as part of the part 45 
rulemaking process and discussed in the final swap data 
recordkeeping and reporting rules.
---------------------------------------------------------------------------

    The conditions set out in the Trade Option IFR include 
recordkeeping requirements for any trade options activity, i.e., the 
recordkeeping requirements of 17 CFR 45.2.\5\ Such records must be 
maintained by all trade option participants pursuant to Sec.  45.2 and 
made available to the Commission as specified therein.\6\ Section 45.2 
applies different recordkeeping requirements, depending on the nature 
of the counterparty. For example, if a trade option counterparty is a 
swap dealer (``SD'') or major swap participant (``MSP''), it would be 
subject to the comprehensive recordkeeping requirements of Sec.  
45.2(a). If a counterparty is neither an SD nor an MSP, it would be 
subject to the less stringent recordkeeping requirements of Sec.  
45.2(b). The recordkeeping requirement is intended to ensure that trade 
options market participants are able to provide pertinent information 
regarding their trade options activity to the Commission, if requested.
---------------------------------------------------------------------------

    \5\ 17 CFR 45.2, id. at 2198.
    \6\ 17 CFR 45.2(h) provides that:
    [a]ll records required to be kept pursuant to this section [17 
CFR 45.2] by any registrant or its affiliates or by any non-SD/MSP 
counterparty subject to the jurisdiction of the Commission shall be 
open to inspection upon request by any representative of the 
Commission, the United States Department of Justice, or the [SEC], 
or by any representative of a prudential regulator as authorized by 
the Commission. Copies of all such records shall be provided, at the 
expense of the entity or person required to keep the record, to any 
representative of the Commission upon request. Copies of records 
required to be kept by any registrant shall be provided either by 
electronic means, in hard copy, or both, as requested by the 
Commission, with the sole exception that copies of records 
originally created and exclusively maintained in paper form may be 
provided in hard copy only. Copies of records required to be kept by 
any non-SD/MSP counterparty subject to the jurisdiction of the 
Commission that is not a Commission registrant shall be provided in 
the form, whether electronic or paper, in which the records are 
kept.
---------------------------------------------------------------------------

2. Reporting Pursuant to Part 45

    In addition to part 45 recordkeeping (which applies in some form to 
all trade options and trade option participants), the interim final 
rule requires certain trade options to be reported pursuant to part 
45's reporting provisions.\7\ Under the interim final rule, the 
determination as to whether a trade option is required to be reported 
pursuant to part 45 is based on the parties to the trade option and 
whether or not they have previously reported swaps pursuant to part 45. 
Specifically, if any trade option involves at least one counterparty 
(whether as buyer or seller) that has (1) become obligated to comply 
with the reporting requirements of part 45, (2) as a reporting party, 
(3) during the twelve month period preceding the date on which the 
trade option is entered into, (4) in connection with any non-trade 
option swap trading activity, then such

[[Page 74649]]

trade option must also be reported pursuant to the reporting 
requirements of part 45. If only one counterparty to a trade option has 
previously complied with the part 45 reporting provisions, as described 
above, then that counterparty shall be the part 45 reporting entity for 
the trade option. If both counterparties have previously complied with 
the part 45 reporting provisions, as described above, then the part 45 
rules for determining the reporting party will apply.\8\
---------------------------------------------------------------------------

    \7\ See 17 CFR 45.3-45.5, 77 FR at 2199-2204.
    \8\ See 77 FR 25327, April 27, 2012, and 17 CFR 45.8.
---------------------------------------------------------------------------

    By applying the part 45 reporting requirements to trade options in 
this manner, the Commission will obtain greater transparency and 
improved oversight of the swaps markets, both of which are primary 
statutory objectives of Title VII of the Dodd-Frank Act.
    The Commission believes, however, that greater transparency 
regarding the trade options market must be balanced against the burdens 
of frequent and near-instantaneous reporting required under part 45 of 
the Commission's regulations on counterparties who are not otherwise 
obligated to report because they do not have other reportable swap 
activity. Accordingly, if neither counterparty to a trade option 
already is complying with the reporting requirements of part 45 as a 
reporting party in connection with its non-trade option swap trading 
activities as described above,\9\ then such trade option is not 
required to be reported pursuant to the reporting requirements of part 
45.\10\
---------------------------------------------------------------------------

    \9\ That is, neither counterparty to the trade option has 
previously reported, as the reporting party, non-trade option swap 
trading activity during the twelve months preceding the date on 
which the trade option is entered into.
    \10\ By taking this approach, the Commission ensures that no 
market participant is compelled to comply with part 45's reporting 
requirements based solely on its trade options activity.
---------------------------------------------------------------------------

3. Annual Notice Filing Alternative to Part 45 Reporting: Form TO

    To the extent that neither counterparty to a trade option has 
previously submitted reports to a swap data repository (``SDR'') as a 
result of its swap trading activities as described above, the 
Commission recognizes that requiring these entities to report trade 
options to an SDR under part 45 of the Commission's regulations solely 
with respect to their trade options activity would be costly and time 
consuming. As an alternative, the Trade Option IFR requires any 
counterparty to an otherwise unreported trade option to submit an 
annual filing to the Commission for the purpose of providing notice 
that it has entered into one or more unreported trade options in the 
prior calendar year. Unlike with trade options subject to the part 45 
reporting requirement, wherein only one counterparty to the trade 
option reports the transaction to an SDR, the notice filing requirement 
applies to both counterparties to an unreported trade option. Because 
the purpose of the notice filing requirement is to identify to the 
Commission those market participants engaging in unreported trade 
options, the notice filing requirement applies whether or not such 
counterparty has also been a non-reporting counterparty to a reported 
trade option in the twelve months preceding the date on which the 
unreported trade option was entered into. Market participants will 
satisfy the annual notice filing requirement by completing and 
submitting a new Commission form, Form TO, by March 1 following the end 
of any calendar year during which the market participant entered into 
one or more unreported trade options.
    Form TO requires an unreported trade option counterparty to: (1) 
Provide name and contact information, (2) identify the categories of 
commodities (agricultural, metals, energy, or other) underlying one or 
more unreported trade options which it entered into during the prior 
calendar year, and (3) for each commodity category, estimate the 
approximate aggregate value of the underlying physical commodities that 
it either delivered or received in connection with the exercise of 
unreported trade options during the prior calendar year. For the 
purposes of item (3), a reporting counterparty should not include the 
value of commodities that were the subject of trade options that 
remained open at the end of the calendar year or the value of any trade 
options that expired unexercised during the prior calendar year.
    Pursuant to the interim final rule, Form TO is a mandatory annual 
filing requirement. The form must be submitted to the Commission no 
later than March 1 for the prior calendar year. For example, if a 
market participant enters into one or more unreported trade options 
between January 1, 2013 and December 31, 2013 (the first calendar year 
for which a Form TO will be due to the Commission is 2013), the market 
participant must submit a completed Form TO to the Commission on or 
before March 1, 2014. Form TO is set out in the Trade Option IFR as 
Appendix A to part 32 of the Commission's regulations.\11\ A copy of 
Form TO is also appended to this notice. Form TO will be available 
electronically on the Commission's Web site at least ninety days before 
the first compliance date for filing the form, March 1, 2014. The Form 
TO filing requirement is intended to provide the Commission a minimally 
intrusive level of visibility into the unreported trade options market, 
to guide the Commission's efforts to collect additional information 
through its authority to obtain copies of books or records required to 
be kept pursuant to the Act \12\ should market circumstances dictate, 
and to enable the Commission to determine whether these counterparties 
should be subject to more frequent and comprehensive reporting 
obligations in the future.
---------------------------------------------------------------------------

    \11\ See 77 FR 25320 at 25340-43.
    \12\ See 17 CFR 1.31(a)(2) and 17 CFR 45.2(h).
---------------------------------------------------------------------------

    The Trade Option IFR notice specifically requested comments on 
trade option reporting and/or notice filing requirements.\13\ Those 
comments may be found on the Commission's Web site, www.cftc.gov, at 
http://comments.cftc.gov/PublicComments/CommentList.aspx?id=1196. All 
comments received in response to the Trade Option IFR notice regarding 
Form TO will be considered, along with the comments received in 
response to this notice, in determining the Commission's final action 
on Form TO.
---------------------------------------------------------------------------

    \13\ See 77 FR 25320 at 25328.
---------------------------------------------------------------------------

    If the Commission obtains information required to be kept through 
this collection, it would protect proprietary information in accordance 
with the Freedom of Information Act and 17 CFR part 145, ``Commission 
Records and Information.'' In addition, Sec.  8(a)(1) of the Act 
strictly prohibits the Commission, unless specifically authorized by 
the Act, from making public ``data and information that would 
separately disclose the business transactions or market positions of 
any person and trade secrets or names of customers.'' \14\ The 
Commission is also required to protect certain information contained in 
a government system of records according to the Privacy Act of 1974, 5 
U.S.C. 552a.
---------------------------------------------------------------------------

    \14\ 7 U.S.C. 12(a)(1).
---------------------------------------------------------------------------

    Burden Statement: The respondent burden for this collection is 
estimated to be 2 hours per response. These estimates include the time 
to: (1) Review the commodity categories that were the subject of 
unreported trade options during the prior calendar year (including a 
review of counterparties to such transactions to determine which trade 
options were otherwise unreported); (2) estimate the value of 
commodities actually delivered or

[[Page 74650]]

received pursuant to trade options in each category; and (3) prepare 
and file Form TO electronically through the Commission's web-based Form 
TO. The Commission estimates the average burden of this collection of 
information as follows:
---------------------------------------------------------------------------

    \15\ The Commission estimates that entities will spend $100 per 
hour. The $100 per hour estimate was used as the average hourly wage 
rate in the PRA section of the Internal Business Conduct Standards 
for Swap Dealers and Major Swap Participants final rule (See 77 FR 
20128, 20194) and the wage rate for CCOs under the DCO final rules 
(See 76 FR 69344, 69428). As the Commission explained in the 
Internal Business Conduct Standards final rule, the estimate of $100 
per hour was based on recent Bureau of Labor Statistics findings, 
including the mean hourly wage of an employee under occupation code 
23-1011, ``Lawyers,'' that is employed by the ``Securities and 
Commodity Contracts Intermediation and Brokerage Industry,'' which 
is $85.20. The mean hourly wage of an employee under occupation code 
11-3031, ``Financial Manager,'' in the same industry is $80.90. 
Additionally, SIFMA's ``Report on Management & Professional Earnings 
in the Securities Industry--2011'' estimates the average wage of a 
compliance attorney at $96.42 and a compliance specialist in the 
U.S. at $74.85 per hour. As in those rules, the Commission is using 
a $100 per hour wage rate in calculating the cost burdens imposed by 
this collection of information and requests comment on the accuracy 
of its estimate.

                          Estimated Annual Reporting Burden Hours and Burden Hour Costs
----------------------------------------------------------------------------------------------------------------
                              Annual  number    Frequency of      Hours per
           17 CFR                   of          response per     response and     Total annual     Total hours
                                respondents      respondent          cost          responses           cost
----------------------------------------------------------------------------------------------------------------
Part 32, Appendix A, Form TO             100  Annually.......  2 hours at $200  100 (one form    $20,000 (100
                                                                per              per otherwise    responses
                                                                response.\15\    unreported       times 2 hours
                                                                                 trade option     per response,
                                                                                 participant).    based on $100/
                                                                                                  hour.)
----------------------------------------------------------------------------------------------------------------

    Respondents/Affected Entities: 100.
    Estimated average number of responses: 100 (one form per year).
    Estimated total average annual burden on respondents: 2 hours.
    Frequency of collection: Annually.
    Average total cost: $20,000.
    There are no capital costs or operating and maintenance costs 
associated with this collection. The Commission believes that, as part 
of customary and usual business practices, all respondents already 
create and store basic information on what they purchased or received 
and how much it cost.
    The Commission invites comments on:
     Whether the proposed collection of information is 
necessary for the proper performance of the functions of the 
Commission, including whether the information will have a practical 
use;
     The accuracy of the Commission's estimate of the burden of 
the proposed collection of information, including the validity of the 
methodology and assumptions used;
     Ways to enhance the quality, usefulness, and clarity of 
the information to be collected; and
     Ways to minimize the burden of collection of information 
on those who are to respond, including through the use of appropriate 
automated electronic, mechanical, or other technological collection 
techniques or other forms of information technology; e.g., permitting 
electronic submission of responses.

Appendix
[GRAPHIC] [TIFF OMITTED] TN17DE12.000

    NOTICE: Failure to file a report required by the Commodity Exchange 
Act (``CEA'' or the ``Act'') \17\ and the regulations thereunder,\18\ 
or the filing of a report with the Commodity Futures Trading Commission 
(``CFTC'' or ``Commission'') that includes a false, misleading or 
fraudulent statement or omits material facts that are required to be 
reported therein or are necessary to make the report not misleading, 
may (a) constitute a violation of section 6(c)(2) of the Act (7 USC 9, 
15), section 9(a)(3) of the Act (7 USC 13(a)(3)), and/or section 1001 
of Title 18, Crimes and Criminal Procedure (18 USC 1001) and (b) result 
in punishment by fine or imprisonment, or both.
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    \16\ A trade option is generally a commodity option purchased by 
a commercial party that, upon exercise, results in the sale of a 
physical commodity for immediate (spot) or deferred (forward) 
shipment or delivery. See CFTC regulation 32.3(a) (17 CFR 32.3(a)) 
for more details. An unreported trade option is a trade option that 
is not required to be reported to a swap data repository by either 
counterparty pursuant to CFTC regulation 32.3(b)(1) and part 45 of 
the Commission's regulations (17 CFR 32.3(b)(1); 17 CFR part 45).
    \17\ 7 U.S.C. section 1, et seq.
    \18\ Unless otherwise noted, the rules and regulations 
referenced in this notice are found in chapter 1 of title 17 of the 
Code of Federal Regulations; 17 CFR Chapter 1 et seq.
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PRIVACY ACT NOTICE

    The Commission's authority for soliciting this information is 
granted in sections 4c(b) and 8 of the CEA and related regulations 
(see, e.g., 17 CFR Sec.  32.3(b)). The information solicited from 
entities and individuals engaged in activities covered by the CEA is

[[Page 74651]]

required to be provided to the CFTC, and failure to comply may result 
in the imposition of criminal or administrative sanctions (see, e.g., 7 
U.S.C. Sec. Sec.  9 and 13a-1, and/or 18 U.S.C. 1001). The information 
requested is most commonly used in the Commission's market and trade 
practice surveillance activities to provide information concerning the 
size and composition of the commodity derivatives markets. The 
requested information may be used by the Commission in the conduct of 
investigations and litigation and, in limited circumstances, may be 
made public on an aggregate basis in accordance with provisions of the 
CEA and other applicable laws. It may also be disclosed to other 
government agencies to meet responsibilities assigned to them by law. 
The information will be maintained in, and any additional disclosures 
will be made in accordance with, the CFTC System of Records Notices, 
available on www.cftc.gov. \19\
---------------------------------------------------------------------------

    \19\ Note that, under the Paperwork Reduction Act, an agency may 
not conduct or sponsor, and a person is not required to respond to, 
a collection of information unless it displays a currently valid 
control number from the Office of Management and Budget.
---------------------------------------------------------------------------

GENERAL INSTRUCTIONS

    Who Must File a Form TO--17 CFR Sec.  32.3(b)(2) requires every 
counterparty to an unreported trade option to submit an annual filing 
to the Commission for the purpose of providing notice that it has 
entered into one or more unreported trade options in the prior calendar 
year. As noted above, an unreported trade option is a trade option that 
is not required to be reported to a swap data repository by either 
counterparty pursuant to CFTC regulation 32.3(b)(1) and part 45 of the 
Commission's regulations.
    When to file--Form TO is an annual filing requirement due to the 
Commission no later than March 1 for the prior calendar year. For 
example, if a market participant enters into one or more unreported 
trade options between January 1, 2013 and December 31, 2013, the market 
participant must submit a completed Form TO to the Commission on or 
before March 1, 2014.
    Where to file--Generally, Form TO should be submitted via the 
CFTC's web based Form TO submission process at http://www.cftc.gov/, or 
as otherwise instructed by the Commission or its designee. If 
submission through the web-based Form TO is impossible, the reporting 
counterparty shall contact the Commission at [techsupport@cftc.gov] or 
202-418-5000 for further instructions.
    What to File--All reporting counterparties filing a Form TO must 
complete all questions.
    Signature--Each Form TO submitted to the Commission must be signed 
or otherwise authenticated by either (1) the reporting counterparty 
submitting the form or (2) an individual that is duly authorized by the 
reporting counterparty to provide the information and representations 
contained in the form.

CFTC FORM TO

Name and Contact Information for Reporting Counterparty:

    1. Reporting Counterparty
    Name and Address (including City, State, Country, Zip/Postal Code):
    Reporting Counterparty Web site (if any):
    Reporting Counterparty Unique Identifier (if any):

------------------------------------------------------------------------
 
------------------------------------------------------------------------
[square] Legal Entity Identifier
 ``LEI'' (if any)
------------------------------------------------------------------------
[square] National Futures
 Association ID Number (if any)
------------------------------------------------------------------------
[square] Other Party Identifier
 (Please Specify)
------------------------------------------------------------------------

    2. Reporting Counterparty Contact Person \20\
---------------------------------------------------------------------------

    \20\ This should be an individual able to answer specific 
questions about the reporting counterparty's unreported trade 
options activity if contacted by Commission staff.
---------------------------------------------------------------------------

    Name and Job Title and/or Relationship with Reporting Counterparty:
    Phone Number and Email Address:

Commodity Category Indication:

    3. In the prior calendar year, the Reporting Counterparty entered 
into one or more unreported trade options in the following commodity 
categories:

Agricultural \21\.............................     [square]     [square]
                                                        YES          NO.
Metals \22\...................................     [square]     [square]
                                                        YES          NO.
Energy \23\...................................     [square]     [square]
                                                        YES          NO.
    Other (Please Specify)....................     [square]     [square]
                                                        YES          NO.
 

Approximate Size of Unreported Trade Options Exercised in the Prior 
Calendar Year:
---------------------------------------------------------------------------

    \21\ Agricultural commodity is defined in the Commission's 
regulations at 17 CFR 1.3(zz).
    \22\ Including, but not limited to, gold, silver, platinum, 
palladium, copper, aluminum, and rare earth metals.
    \23\ Including, but not limited to, petroleum products, natural 
gas, and electricity.
---------------------------------------------------------------------------

    4. Please indicate, by commodity category, the approximate total 
value (quantity received/delivered multiplied by price paid/received) 
of physical commodities that the reporting counterparty purchased and/
or delivered in connection with the exercise of unreported trade 
options in the prior calendar year: \24\
---------------------------------------------------------------------------

    \24\ For the purposes of answering this question, a reporting 
counterparty should not include the value of commodities that were 
the subject of trade options that remained open at the end of the 
prior calendar year or any trade options that expired unexercised 
during the prior calendar year.

[[Page 74652]]



----------------------------------------------------------------------------------------------------------------
 
----------------------------------------------------------------------------------------------------------------
Agricultural....................  [square] None.....  [square] Under      [square] $10M to    [square] Over
                                                       $10M.               $100M.              $100M
----------------------------------------------------------------------------------------------------------------
Metals..........................  [square] None.....  [square] Under      [square] $10M to    [square] Over
                                                       $10M.               $100M.              $100M
----------------------------------------------------------------------------------------------------------------
Energy..........................  [square] None.....  [square] Under      [square] $10M to    [square] Over
                                                       $10M.               $100M.              $100M
----------------------------------------------------------------------------------------------------------------
    Other.......................  [square] None.....  [square] Under      [square] $10M to    [square] Over
                                                       $10M.               $100M.              $100M
----------------------------------------------------------------------------------------------------------------

Signature/Authentication, Name, and Date

    [square] By checking this box and submitting this Form TO (or by 
clicking ``submit,'' ``send,'' or any other analogous transmission 
command if transmitting electronically), I certify that I am duly 
authorized by the reporting counterparty identified below to provide 
the information and representations submitted on this Form TO, and that 
the information and representations are true and correct.
    Reporting Counterparty Authorized Representative (Name and 
Position):
-----------------------------------------------------------------------
(Name)
-----------------------------------------------------------------------
(Position)

    Submitted on behalf of:
-----------------------------------------------------------------------
(Reporting Counterparty)

    Date of Submission:
-----------------------------------------------------------------------

     Dated: December 11, 2012.
Sauntia S. Warfield,
Assistant Secretary of the Commission.
[FR Doc. 2012-30227 Filed 12-14-12; 8:45 am]
BILLING CODE P