Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; Notice of Withdrawal of Proposed Rule Change Related to Clearing of Certain iTraxx Europe Index Untranched CDS Contracts on Indices Administered by Markit, 69937 [2014-27704]

Download as PDF Federal Register / Vol. 79, No. 226 / Monday, November 24, 2014 / Notices SECURITIES AND EXCHANGE COMMISSION SECURITIES AND EXCHANGE COMMISSION [Release No. 34–73626; File No. SR–CME– 2014–31] [Release No. 34–73632; File No. SR–FINRA– 2014–046] Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; Notice of Withdrawal of Proposed Rule Change Related to Clearing of Certain iTraxx Europe Index Untranched CDS Contracts on Indices Administered by Markit Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Modify the Gross Income Assessment Pricing Structure November 18, 2014. Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (‘‘Act’’) 1 and Rule 19b–4 thereunder,2 notice is hereby given that on November 7, 2014, Financial Industry Regulatory Authority, Inc. (‘‘FINRA’’) filed with the Securities and Exchange Commission (‘‘SEC’’ or ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by FINRA. FINRA has designated the proposed rule change as ‘‘establishing or changing a due, fee or other charge’’ under Section 19(b)(3)(A)(ii) of the Act 3 and Rule 19b– 4(f)(2) thereunder,4 which renders the proposal effective upon receipt of this filing by the Commission. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. On August 11, 2014, Chicago Mercantile Exchange Inc. (‘‘CME’’) filed with the Securities and Exchange Commission (‘‘Commission’’), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 1 and Rule 19b– 4 thereunder,2 a proposed rule change (SR–CME–2014–31) seeking to enable CME to offer clearing of certain iTraxx Europe index untranched CDS contracts on indices administered by Markit (‘‘iTraxx Contracts’’). Specifically, the proposed rule change would update CME’s CDS Product Rules to provide for the clearing of the iTraxx Contracts. Notice of the proposed rule change was published in the Federal Register on August 18, 2014.3 Notice of Amendment No. 2 to the proposed rule change was published in the Federal Register on October 1, 2014.4 The Commission did not receive comments on the proposal. On October 2, 2014, the Commission extended the time period in which to either approve the proposed rule change, disapprove the proposed rule change, or institute proceedings to determine whether to disapprove the proposed rule change to November 16, 2014.5 On November 14, 2014, CME withdrew the proposed rule change (SR–CME–2014–31). For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.6 Kevin M. O’Neill, Deputy Secretary. [FR Doc. 2014–27704 Filed 11–21–14; 8:45 am] BILLING CODE 8011–01–P 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 Securities Exchange Act Release No. 34–72833 (August 13, 2014), 79 FR 48797 (August 18, 2014) (SR–CME–2014–31). 4 Securities Exchange Act Release No. 34–73275 (October 1, 2014), 79 FR 60563 (October 7, 2014) (SR–CME–2014–31). On August 18, 2014, CME filed Amendment No. 1 to the proposed rule change. CME withdrew Amendment No. 1 on August 29, 2014. 5 Securities Exchange Act Release No. 34–73290 (October 2, 2014), 79 FR 60873 (October 8, 2014) (SR–CME–2014–31). 6 17 CFR 200.30–3(a)(12). asabaliauskas on DSK5VPTVN1PROD with NOTICES 2 17 VerDate Sep<11>2014 20:32 Nov 21, 2014 Jkt 235001 November 18, 2014. II. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change FINRA is proposing to modify the Gross Income Assessment pricing structure in Section 1(c) of Schedule A to the FINRA By-Laws. The text of the proposed rule change is available on FINRA’s Web site at http://www.finra.org, at the principal office of FINRA 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, FINRA 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. FINRA has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A)(ii). 4 17 CFR 240.19b–4(f)(2). 2 17 PO 00000 Frm 00116 Fmt 4703 Sfmt 4703 69937 A. Self-Regulatory Organization’s Statement of the Purpose of, and Statutory Basis for,the Proposed Rule Change 1. Purpose The proposed rule change is intended to provide limited relief from the Gross Income Assessment (‘‘GIA’’) for some smaller FINRA members due to the unanticipated effect of a 2009 change to the method of calculating the assessment. The GIA is one of a few primary revenue sources that funds FINRA’s regulatory operations 5 and is based on a firm’s annual gross revenue.6 In 2008, FINRA established a seven-tier rate structure to assess the GIA, with a minimum assessment of $1,200. The tiered rates, which have remained unchanged, are as follows: (1) $1,200.00 on annual gross revenue up to $1 million; (2) 0.1215% of annual gross revenue greater than $1 million up to $25 million; (3) 0.2599% of annual gross revenue greater than $25 million up to $50 million; (4) 0.0518% of annual gross revenue greater than $50 million up to $100 million; (5) 0.0365% of annual gross revenue greater than $100 million up to $5 billion; (6) 0.0397% of annual gross revenue greater than $5 billion up to $25 billion; and (7) 0.0855% of annual gross revenue greater than $25 billion. As a result of this structure, GIA revenues are derived overwhelmingly from medium-sized and larger firms. Due to rebates, firms with revenues of $1 million or less effectively have paid no GIA since 2008. In November 2009, the Commission approved changes to the GIA and PA intended to help FINRA achieve a more consistent and predictable funding stream to carry out its regulatory mandate.7 The economic and industry downturns in 2008 and 2009 had exposed FINRA’s vulnerability to yearto-year volatility in members’ gross revenues. GIA revenues in 2009 dropped precipitously due to write-offs 5 FINRA’s primary member regulatory pricing structure also includes the Trading Activity Fee, the Personnel Assessment (‘‘PA’’) and the Branch Office Assessment, as well as the processing of new and continuing membership applications. 6 Schedule A to the FINRA By-Laws defines gross revenue for assessment purposes as total income as reported on FOCUS form Part II or IIA, excluding commodities income. 7 See Securities Exchange Act Release No. 61042 (November 20, 2009), 74 FR 62616 (November 30, 2009) (Order Approving File No. SR–FINRA–2009– 057). E:\FR\FM\24NON1.SGM 24NON1

Agencies

[Federal Register Volume 79, Number 226 (Monday, November 24, 2014)]
[Notices]
[Page 69937]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-27704]



[[Page 69937]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-73626; File No. SR-CME-2014-31]


Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; 
Notice of Withdrawal of Proposed Rule Change Related to Clearing of 
Certain iTraxx Europe Index Untranched CDS Contracts on Indices 
Administered by Markit

November 18, 2014.
    On August 11, 2014, Chicago Mercantile Exchange Inc. (``CME'') 
filed with the Securities and Exchange Commission (``Commission''), 
pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 \1\ 
and Rule 19b-4 thereunder,\2\ a proposed rule change (SR-CME-2014-31) 
seeking to enable CME to offer clearing of certain iTraxx Europe index 
untranched CDS contracts on indices administered by Markit (``iTraxx 
Contracts''). Specifically, the proposed rule change would update CME's 
CDS Product Rules to provide for the clearing of the iTraxx Contracts. 
Notice of the proposed rule change was published in the Federal 
Register on August 18, 2014.\3\ Notice of Amendment No. 2 to the 
proposed rule change was published in the Federal Register on October 
1, 2014.\4\ The Commission did not receive comments on the proposal.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ Securities Exchange Act Release No. 34-72833 (August 13, 
2014), 79 FR 48797 (August 18, 2014) (SR-CME-2014-31).
    \4\ Securities Exchange Act Release No. 34-73275 (October 1, 
2014), 79 FR 60563 (October 7, 2014) (SR-CME-2014-31). On August 18, 
2014, CME filed Amendment No. 1 to the proposed rule change. CME 
withdrew Amendment No. 1 on August 29, 2014.
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    On October 2, 2014, the Commission extended the time period in 
which to either approve the proposed rule change, disapprove the 
proposed rule change, or institute proceedings to determine whether to 
disapprove the proposed rule change to November 16, 2014.\5\ On 
November 14, 2014, CME withdrew the proposed rule change (SR-CME-2014-
31).
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    \5\ Securities Exchange Act Release No. 34-73290 (October 2, 
2014), 79 FR 60873 (October 8, 2014) (SR-CME-2014-31).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\6\
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    \6\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-27704 Filed 11-21-14; 8:45 am]
BILLING CODE 8011-01-P