Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Changes Making Changes in the Position Limits and Accountability Levels of CME Cleared OTC FX Spot, Forward and Swap Contracts, 27010-27012 [2014-10770]

Download as PDF 27010 Federal Register / Vol. 79, No. 91 / Monday, May 12, 2014 / Notices changes to the Exchange’s operations or its rules. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were either solicited or received. U.S.C. 78s(b)(3)(A). CFR 240.19b–4(f)(6). As required under Rule 19b–4(f)(6)(iii), the Exchange provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and the text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change, or such shorter time as designated by the Commission. 9 17 CFR 240.19b–4(f)(6). 10 17 CFR 240.19b–4(f)(6)(iii). 11 For purposes only of waiving the 30-day operative delay, the Commission has also considered the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). emcdonald on DSK67QTVN1PROD with NOTICES 8 17 VerDate Mar<15>2010 18:00 May 09, 2014 Jkt 232001 BILLING CODE 8011–01–P 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 Number SR– Phlx–2014–26 on the subject line. • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549–1090. All submissions should refer to File Number SR-Phlx–2014-26. 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 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 10:00 a.m. and 3:00 p.m. Copies of the filing also will be available for inspection and copying at the principal office of the Exchange. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–Phlx– 2014–26 and should be submitted on or before June 2, 2014. Frm 00078 Fmt 4703 SECURITIES AND EXCHANGE COMMISSION [Release No. 34–72097; File No. SR–CME– 2014–16] Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Changes Making Changes in the Position Limits and Accountability Levels of CME Cleared OTC FX Spot, Forward and Swap Contracts May 6, 2014. Paper Comments PO 00000 For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.12 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–10776 Filed 5–9–14; 8:45 am] IV. Solicitation of Comments II. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Because the proposed rule change does not (i) significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act 7 and Rule 19b–4(f)(6) thereunder.8 A proposed rule change filed under Rule 19b–4(f)(6) 9 normally does not become operative for 30 days after the date of filing. However, pursuant to Rule 19b–4(f)(6)(iii) 10 the Commission may designate a shorter time if such action is consistent with the protection of investors and the public interest. The Exchange has asked the Commission to waive the 30-day operative delay so that the proposal may become operative immediately upon filing. The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest as it will help to ensure that market participants are properly informed as to the underlying securities eligible for trading of Mini Options contracts on the Exchange. For this reason, the Commission designates the proposed rule change to be operative upon filing.11 At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if 7 15 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. Sfmt 4703 Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’ or ‘‘Exchange Act’’),1 and Rule 19b–4 thereunder,2 notice is hereby given that on April 22, 2014, Chicago Mercantile Exchange Inc. (‘‘CME’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change described in Items I, II and III below, which Items have been prepared by CME. CME filed the proposal pursuant to Section 19(b)(3)(A) of the Act,3 and Rule 19b–4(f)(4)(ii) 4 thereunder, 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 the Terms of Substance of the Proposed Rule Change CME is filing proposed rule changes that are limited to its business as a derivatives clearing organization (‘‘DCO’’). More specifically, the proposed rule changes contain amendments to position limits and position accountability levels of certain CME Cleared Over-the-Counter Foreign Exchange Spot, Forward and Swap Contracts. II. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, CME included statements concerning 12 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f)(4)(ii). 1 15 E:\FR\FM\12MYN1.SGM 12MYN1 Federal Register / Vol. 79, No. 91 / Monday, May 12, 2014 / Notices emcdonald on DSK67QTVN1PROD with NOTICES the purpose 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. CME 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 CME is registered as a DCO with the Commodity Futures Trading Commission and offers clearing services for many different futures and swaps products. The proposed rule changes that are the subject of this filing are limited to CME’s business as a DCO offering clearing services for CFTCregulated swaps products. CME currently lists 73 foreign exchange futures contracts and 31 companion option contracts for trading via open outcry and CME Globex and for submission for clearing through CME ClearPort. In addition, CME lists certain cleared-only OTC FX contracts on 38 different currency pairs. These CME Cleared OTC FX Spot, Forward and Swap Contracts are non-deliverable foreign currency forward contracts and, as such, are considered to be ‘‘swaps’’ under applicable regulatory definitions.5 CME currently aggregates the position limits/accountability levels of exchange-traded FX futures and options with the position limits/ accountability levels of cleared only OTC FX products on the same currency pair. The proposed rule changes make amendments to the Position Limit, Position Accountability and Reportable Level Table and Header Notes located in the Interpretations and Special Notices Section of Chapter 5 of the CME Rulebook. The amendments reflect changes in the position limits and accountability levels of CME Cleared OTC FX Spot, Forward and Swap Contracts. The proposed amendments would establish independent position accountability levels for all CME Cleared OTC FX Spot, Forward and Swap Contracts that will be distinct from the position limits and position accountability levels of the Exchange’s FX futures and options contracts, which shall remain unchanged. In addition, 5 See Commodity Futures Trading Commission and Securities and Exchange Commission Joint Final Rule Defining ‘‘Swap,’’ ‘‘Security-Based Swap,’’ and ‘‘Security-Based Swap Agreement’’; Mixed Swaps; Security-Based Swap Agreement Recordkeeping; Final Rule, 77 FR 48207, 48255 (August 13, 2012). VerDate Mar<15>2010 18:00 May 09, 2014 Jkt 232001 the amendments provide that CME will group Cleared OTC FX Spot, Forward and Swap Contracts for the same currency pair as a single product group. For each OTC FX currency pair, CME will define position accountability on an ‘‘all months combined futuresequivalent contract’’ basis and spot or single month position accountability for CME Cleared OTC FX Spot, Forward and Swap Contracts will cease to exist. Lastly, CME will aggregate and net position accountability levels for each OTC FX currency pair by trading account holder. The changes that are described in this filing are limited to CME’s business as a DCO clearing products under the exclusive jurisdiction of the CFTC and do not materially impact CME’s security-based swap clearing business in any way. The changes will be effective on filing. CME notes that it has also certified the proposed rule changes that are the subject of this filing to its primary regulator, the Commodity Futures Trading Commission (‘‘CFTC’’), in a separate filing, CME Submission No. 14–103R. The text of the CME proposed rule amendments is attached, with additions underlined and deletions in brackets. CME believes the proposed rule changes are consistent with the requirements of the Exchange Act including Section 17A of the Exchange Act.6 CME is amending the CME Rulebook to establish independent position accountability levels for all CME Cleared OTC FX Spot, Forward and Swap Contracts that will be distinct from the position limits and position accountability levels of the Exchange’s FX futures and options contracts and to provide that CME will group CME Cleared OTC FX Spot, Forward and Swap Contracts for the same currency pair as a single product group. CME will also aggregate and net position accountability levels for each OTC FX currency pair by trading account holder under the proposed changes. The proposed changes will enhance CME’s self-regulatory function and as such are designed to promote the prompt and accurate clearance and settlement of securities transactions and, to the extent applicable, derivatives agreements, contracts, and transactions, to assure the safeguarding of securities and funds which are in the custody or control of the clearing agency or for which it is responsible, and, in general, to protect investors and the public interest consistent with Section 17A(b)(3)(F) of the Exchange Act.7 Furthermore, the proposed changes are limited in their effect to products offered under CME’s authority to act as a DCO. The products that are the subject of this filing are under the exclusive jurisdiction of the CFTC. As such, the proposed CME changes are limited to CME’s activities as a DCO clearing swaps that are not security-based swaps and forwards that are not security forwards; CME notes that the policies of the CFTC with respect to administering the Commodity Exchange Act are comparable to a number of the policies underlying the Exchange Act, such as promoting market transparency for overthe-counter derivatives markets, promoting the prompt and accurate clearance of transactions and protecting investors and the public interest. Because the proposed changes are limited in their effect to OTC FX products offered under CME’s authority to act as a DCO, the proposed changes are properly classified as effecting a change in an existing service of CME that: (a) Primarily affects the clearing operations of CME with respect to products that are not securities, including futures that are not security futures, swaps that are not securitybased swaps or mixed swaps; and forwards that are not security forwards; and (b) Does not significantly affect any securities clearing operations of CME or any rights or obligations of CME with respect to securities clearing or persons using such securities-clearing service. As such, the changes are therefore consistent with the requirements of Section 17A of the Exchange Act 8 and are properly filed under Section 19(b)(3)(A) 9 and Rule 19b–4(f)(4)(ii) 10 thereunder. B. Self-Regulatory Organization’s Statement on Burden on Competition CME does not believe that the proposed rule change will have any impact, or impose any burden, on competition. The proposed changes simply establish independent position accountability levels for all CME Cleared OTC FX Spot, Forward and Swap Contracts that will be distinct from the position limits and position accountability levels of the Exchange’s FX futures and options contracts. 8 15 6 15 U.S.C. 78q–1. 7 15 U.S.C. 78q–1(b)(3)(F). PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 27011 U.S.C. 78q–1. U.S.C. 78s(b)(3)(A). 10 17 CFR 240.19b–4(f)(4)(ii). 9 15 E:\FR\FM\12MYN1.SGM 12MYN1 27012 Federal Register / Vol. 79, No. 91 / Monday, May 12, 2014 / Notices C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others CME has not solicited, and does not intend to solicit, comments regarding this proposed rule change. CME has not received any unsolicited written comments from interested parties. 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) 11 of the Act and paragraph (f)(4)(ii) of Rule 19b–4 12 thereunder. 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: emcdonald on DSK67QTVN1PROD with NOTICES 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– CME–2014–16 on the subject line. Paper Comments • Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549. All submissions should refer to File Number SR–CME–2014–16. 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 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 or 10:00 a.m. and 3:00 p.m. Copies of such filing also will be available for inspection and copying at the principal office of CME and on CME’s Web site at https://www.cmegroup.com/marketregulation/rule-filings.html. All comments received will be posted without change; the Commission does not edit personal identifying information from submissions. You should submit only information that you wish to make available publicly. All submissions should refer to File Number SR–CME–2014–16 and should be submitted on or before June 2, 2014. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.13 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–10770 Filed 5–9–14; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–72106; File No. SR–NSX– 2014–12] Self-Regulatory Organizations; National Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Its Fee and Rebate Schedule To Change Certain Fees Applicable to Liquidity Providers, Eliminate a Rebate and Adopt a Fee for Removing Liquidity, and Reducing a Fee for Routed Orders, All With Respect to Securities Priced at $1.00 or Greater May 6, 2014. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the ‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that, on April 30, 2014, National Stock Exchange, Inc. (‘‘NSX®’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change, as described in Items I, II, and III below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the 13 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 11 15 U.S.C. 78s(b)(3)(A). 12 17 CFR 240.19b–4(f)(4)(ii). VerDate Mar<15>2010 18:00 May 09, 2014 1 15 Jkt 232001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 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 proposing to amend its Fee and Rebate Schedule (the ‘‘Fee Schedule’’) issued pursuant to Exchange Rule 16.1. Specifically, the Exchange is seeking to amend Section I. (Transaction Fees and Rebates) to provide that Exchange Equity Trading Permit (‘‘ETP’’) 3 Holders will be charged a fee for providing liquidity and for removing liquidity in securities priced at $1.00 or greater. The Exchange proposes to eliminate rebates paid to ETP Holders removing liquidity in securities priced at $1.00 or greater. The Exchange also proposes to amend Section II. of the Fee Schedule (Other Services), subsection A., Order Routing (All Tapes), to reduce the fee for orders in securities priced at $1.00 or greater that are routed to other trading centers. The text of the proposed rule change is available on the Exchange’s Web site at https://www.nsx.com, at the principal office of the Exchange, 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 parts 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 amend the Fee Schedule, Section I. to change the fee and rebate structure applicable to ETP Holders providing and removing liquidity on the Exchange in securities priced at $1.00 and above across all Tapes.4 Specifically, the Exchange 3 Exchange Rule 1.5 defines ‘‘ETP’’ as the Equity Trading Permit issued by the Exchange for effecting approved securities transactions on the Exchange’s trading facilities. 4 The term ‘‘Tapes’’ refers to the designation assigned in the Consolidated Tape Association (‘‘CTA’’) Plan for reporting trades with respect to securities in Networks A, B and C. Tape A E:\FR\FM\12MYN1.SGM 12MYN1

Agencies

[Federal Register Volume 79, Number 91 (Monday, May 12, 2014)]
[Notices]
[Pages 27010-27012]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-10770]


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

SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-72097; File No. SR-CME-2014-16]


Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Changes 
Making Changes in the Position Limits and Accountability Levels of CME 
Cleared OTC FX Spot, Forward and Swap Contracts

May 6, 2014.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(``Act'' or ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\ notice 
is hereby given that on April 22, 2014, Chicago Mercantile Exchange 
Inc. (``CME'') filed with the Securities and Exchange Commission 
(``Commission'') the proposed rule change described in Items I, II and 
III below, which Items have been prepared by CME. CME filed the 
proposal pursuant to Section 19(b)(3)(A) of the Act,\3\ and Rule 19b-
4(f)(4)(ii) \4\ thereunder, 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\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A).
    \4\ 17 CFR 240.19b-4(f)(4)(ii).
---------------------------------------------------------------------------

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

    CME is filing proposed rule changes that are limited to its 
business as a derivatives clearing organization (``DCO''). More 
specifically, the proposed rule changes contain amendments to position 
limits and position accountability levels of certain CME Cleared Over-
the-Counter Foreign Exchange Spot, Forward and Swap Contracts.

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

    In its filing with the Commission, CME included statements 
concerning

[[Page 27011]]

the purpose 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. 
CME 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

    CME is registered as a DCO with the Commodity Futures Trading 
Commission and offers clearing services for many different futures and 
swaps products. The proposed rule changes that are the subject of this 
filing are limited to CME's business as a DCO offering clearing 
services for CFTC-regulated swaps products.
    CME currently lists 73 foreign exchange futures contracts and 31 
companion option contracts for trading via open outcry and CME Globex 
and for submission for clearing through CME ClearPort. In addition, CME 
lists certain cleared-only OTC FX contracts on 38 different currency 
pairs. These CME Cleared OTC FX Spot, Forward and Swap Contracts are 
non-deliverable foreign currency forward contracts and, as such, are 
considered to be ``swaps'' under applicable regulatory definitions.\5\ 
CME currently aggregates the position limits/accountability levels of 
exchange-traded FX futures and options with the position limits/
accountability levels of cleared only OTC FX products on the same 
currency pair.
---------------------------------------------------------------------------

    \5\ See Commodity Futures Trading Commission and Securities and 
Exchange Commission Joint Final Rule Defining ``Swap,'' ``Security-
Based Swap,'' and ``Security-Based Swap Agreement''; Mixed Swaps; 
Security-Based Swap Agreement Recordkeeping; Final Rule, 77 FR 
48207, 48255 (August 13, 2012).
---------------------------------------------------------------------------

    The proposed rule changes make amendments to the Position Limit, 
Position Accountability and Reportable Level Table and Header Notes 
located in the Interpretations and Special Notices Section of Chapter 5 
of the CME Rulebook. The amendments reflect changes in the position 
limits and accountability levels of CME Cleared OTC FX Spot, Forward 
and Swap Contracts. The proposed amendments would establish independent 
position accountability levels for all CME Cleared OTC FX Spot, Forward 
and Swap Contracts that will be distinct from the position limits and 
position accountability levels of the Exchange's FX futures and options 
contracts, which shall remain unchanged. In addition, the amendments 
provide that CME will group Cleared OTC FX Spot, Forward and Swap 
Contracts for the same currency pair as a single product group. For 
each OTC FX currency pair, CME will define position accountability on 
an ``all months combined futures-equivalent contract'' basis and spot 
or single month position accountability for CME Cleared OTC FX Spot, 
Forward and Swap Contracts will cease to exist. Lastly, CME will 
aggregate and net position accountability levels for each OTC FX 
currency pair by trading account holder.
    The changes that are described in this filing are limited to CME's 
business as a DCO clearing products under the exclusive jurisdiction of 
the CFTC and do not materially impact CME's security-based swap 
clearing business in any way. The changes will be effective on filing. 
CME notes that it has also certified the proposed rule changes that are 
the subject of this filing to its primary regulator, the Commodity 
Futures Trading Commission (``CFTC''), in a separate filing, CME 
Submission No. 14-103R. The text of the CME proposed rule amendments is 
attached, with additions underlined and deletions in brackets.
    CME believes the proposed rule changes are consistent with the 
requirements of the Exchange Act including Section 17A of the Exchange 
Act.\6\ CME is amending the CME Rulebook to establish independent 
position accountability levels for all CME Cleared OTC FX Spot, Forward 
and Swap Contracts that will be distinct from the position limits and 
position accountability levels of the Exchange's FX futures and options 
contracts and to provide that CME will group CME Cleared OTC FX Spot, 
Forward and Swap Contracts for the same currency pair as a single 
product group. CME will also aggregate and net position accountability 
levels for each OTC FX currency pair by trading account holder under 
the proposed changes. The proposed changes will enhance CME's self-
regulatory function and as such are designed to promote the prompt and 
accurate clearance and settlement of securities transactions and, to 
the extent applicable, derivatives agreements, contracts, and 
transactions, to assure the safeguarding of securities and funds which 
are in the custody or control of the clearing agency or for which it is 
responsible, and, in general, to protect investors and the public 
interest consistent with Section 17A(b)(3)(F) of the Exchange Act.\7\
---------------------------------------------------------------------------

    \6\ 15 U.S.C. 78q-1.
    \7\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------

    Furthermore, the proposed changes are limited in their effect to 
products offered under CME's authority to act as a DCO. The products 
that are the subject of this filing are under the exclusive 
jurisdiction of the CFTC. As such, the proposed CME changes are limited 
to CME's activities as a DCO clearing swaps that are not security-based 
swaps and forwards that are not security forwards; CME notes that the 
policies of the CFTC with respect to administering the Commodity 
Exchange Act are comparable to a number of the policies underlying the 
Exchange Act, such as promoting market transparency for over-the-
counter derivatives markets, promoting the prompt and accurate 
clearance of transactions and protecting investors and the public 
interest.
    Because the proposed changes are limited in their effect to OTC FX 
products offered under CME's authority to act as a DCO, the proposed 
changes are properly classified as effecting a change in an existing 
service of CME that:
    (a) Primarily affects the clearing operations of CME with respect 
to products that are not securities, including futures that are not 
security futures, swaps that are not security-based swaps or mixed 
swaps; and forwards that are not security forwards; and
    (b) Does not significantly affect any securities clearing 
operations of CME or any rights or obligations of CME with respect to 
securities clearing or persons using such securities-clearing service.

As such, the changes are therefore consistent with the requirements of 
Section 17A of the Exchange Act \8\ and are properly filed under 
Section 19(b)(3)(A) \9\ and Rule 19b-4(f)(4)(ii) \10\ thereunder.
---------------------------------------------------------------------------

    \8\ 15 U.S.C. 78q-1.
    \9\ 15 U.S.C. 78s(b)(3)(A).
    \10\ 17 CFR 240.19b-4(f)(4)(ii).
---------------------------------------------------------------------------

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

    CME does not believe that the proposed rule change will have any 
impact, or impose any burden, on competition. The proposed changes 
simply establish independent position accountability levels for all CME 
Cleared OTC FX Spot, Forward and Swap Contracts that will be distinct 
from the position limits and position accountability levels of the 
Exchange's FX futures and options contracts.

[[Page 27012]]

C. Self-Regulatory Organization's Statement on Comments on the Proposed 
Rule Change Received From Members, Participants, or Others

    CME has not solicited, and does not intend to solicit, comments 
regarding this proposed rule change. CME has not received any 
unsolicited written comments from interested parties.

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) \11\ of the Act and paragraph (f)(4)(ii) of Rule 19b-4 \12\ 
thereunder. 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.
---------------------------------------------------------------------------

    \11\ 15 U.S.C. 78s(b)(3)(A).
    \12\ 17 CFR 240.19b-4(f)(4)(ii).
---------------------------------------------------------------------------

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-CME-2014-16 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities 
and Exchange Commission, 100 F Street NE., Washington, DC 20549.

All submissions should refer to File Number SR-CME-2014-16. 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 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 or 
10:00 a.m. and 3:00 p.m. Copies of such filing also will be available 
for inspection and copying at the principal office of CME and on CME's 
Web site at https://www.cmegroup.com/market-regulation/rule-filings.html.
    All comments received will be posted without change; the Commission 
does not edit personal identifying information from submissions. You 
should submit only information that you wish to make available 
publicly.
    All submissions should refer to File Number SR-CME-2014-16 and 
should be submitted on or before June 2, 2014.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\13\
---------------------------------------------------------------------------

    \13\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-10770 Filed 5-9-14; 8:45 am]
BILLING CODE 8011-01-P
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