Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Clarifying Changes to CME Rule 814 and CME Rule 901, 73919-73921 [2014-29102]
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Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Notices
would only benefit other Members by
contributing to increased liquidity and
improve market quality at the Exchange.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange has not solicited, and
does not intend to solicit, comments on
this proposed rule change. The
Exchange has not received any
unsolicited written comments from
Members or other 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)
of the Act 17 and paragraph (f) of Rule
19b–4 thereunder.18 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:
mstockstill on DSK4VPTVN1PROD 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 Number SR–
EDGX–2014–32 on the subject line.
Paper Comments
• 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–EDGX–2014–32. 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
17 15
18 17
U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f).
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16:57 Dec 11, 2014
Jkt 235001
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–EDGX–
2014–32, and should be submitted on or
before January 2, 2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.19
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–29108 Filed 12–11–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73776; File No. SR–CME–
2014–29]
Self-Regulatory Organizations;
Chicago Mercantile Exchange Inc.;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change To Make Clarifying Changes to
CME Rule 814 and CME Rule 901
December 8, 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 26, 2014, Chicago Mercantile
Exchange Inc. (‘‘CME’’) 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
primarily 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
19 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
PO 00000
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Fmt 4703
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73919
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 a proposed rule change
that is limited to its business as a
derivatives clearing organization. More
specifically, the proposed rule change
would make amendments to CME Rule
814 and CME Rule 901 to specify the
time at which a settlement bank
becomes responsible to the clearing
house to perform variation margin
settlement and the point during the
clearing cycle at which a clearing
member’s obligations to the clearing
house cease. The proposed revisions
would not modify clearing house
operations but merely clarify to the
marketplace the clearing cycle currently
in place.
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
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. CME has prepared
summaries, set forth in sections A, B,
and C below, of the most significant
aspects of these statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
CME is registered as a derivatives
clearing organization with the
Commodity Futures Trading
Commission (‘‘CFTC’’) and operates a
substantial business clearing futures and
swaps contracts subject to the
jurisdiction of the CFTC. CME is
proposing to make amendments to CME
Rule 814 and CME Rule 901 to specify
the time at which a settlement bank
becomes responsible to the clearing
house to perform variation margin
settlement and the point during the
clearing cycle at which a clearing
member’s obligations to the clearing
house cease. The proposed revisions
would not modify clearing house
operations but merely clarify to the
marketplace the clearing cycle currently
in place. CME notes that it has also
made a corresponding filing with the
CFTC, in Submission No. 14–280,
regarding the proposed changes.
E:\FR\FM\12DEN1.SGM
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73920
Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Notices
to the clearing house cease,8 it promotes
the prompt and accurate clearance and
settlement of securities transactions
and, to the extent applicable, derivatives
agreements, contracts, and transactions,
assures the safeguarding of securities
and funds which are in the custody or
control of CME or for which it is
responsible, and, in general, protects
investors and the public interest in a
way that is consistent with Section
17A(b)(3)(F) of the Act.9
The proposed changes would reflect
the best practices outlined in the
Principles for Financial Market
Infrastructures (‘‘PFMIs’’), adopted by
the joint Committee on Payment and
Settlement Systems and the Technical
Committee of the International
Organization of Securities
Commissions.5 Principle 8 of the PFMIs
(Settlement finality) states that an
‘‘FMI’s rules and procedures should
clearly define the point at which
settlement is final’’ and that ‘‘[a]n FMI
should be designed to provide clear and
certain final settlement of payments,
transfer instructions, or other
obligations.’’ 6
Revised CME Rule 814 (Settlement
Variation) will specify that ‘‘settlement
variation is deemed final when an
irrevocable commitment to pay has been
provided to the Clearing House by a
settlement bank in a form or manner as
approved by the Clearing House.’’ The
amendment to Rule 814 codifies CME’s
uniform practice in regard to its
settlement bank legal agreements, which
provide that the settlement bank’s
obligation arises upon CME’s receipt of
the settlement bank’s irrevocable
commitment to pay.
CME Rule 901.S (General
Requirements and Obligations) is being
added to state that ‘‘the obligation(s) of
a clearing member to pay settlement
variation and/or performance bond
during each clearing cycle is not
extinguished until all required cash
and/or collateral is deposited into the
correct CME bank account at the
relevant custodial or settlement bank.’’
The proposed changes increase the
transparency of the CME legal
framework in this area and align the
existing rules with global PFMI
standards by specifying the times at
which settlement bank obligations to the
clearing house arise and clearing
member obligations are extinguished.
CME believes the proposed rule
change is consistent with the
requirements of the Act including
Section 17A.7 Because the proposed
change clarifies in CME’s rules the time
at which a settlement bank becomes
responsible to the clearing house to
perform variation margin settlement and
the point during the clearing cycle at
which a clearing member’s obligations
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become
effective upon filing pursuant to Section
19(b)(3)(A) 10 of the Act and Rule 19b–
4(f)(4)(ii) 11 thereunder. CME asserts that
this proposal constitutes 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, and 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
5 See Committee on Payment and Settlement
Systems and Technical Committee of the
International Organization of Securities
Commissions, Principles for Financial Market
Infrastructures (Apr. 16, 2012), available at https://
www.bis.org/publ/cpss101a.pdf.
6 Id. at 64.
7 15 U.S.C. 78q–1.
8 Pursuant to a teleconference with CME’s
counsel on December 4, 2014, staff in the Division
of Trading and Markets has modified this sentence
to clarify CME’s intended explanation of the
statutory basis for the proposed rule change.
9 15 U.S.C. 78q–1(b)(3)(F).
10 15 U.S.C. 78s(b)(3)(A).
11 17 CFR 240.19b–4(f)(4)(ii).
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16:57 Dec 11, 2014
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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
specify the time at which a settlement
bank becomes responsible to the
clearing house to perform variation
margin settlement and the point during
the clearing cycle at which a clearing
member’s obligations to the clearing
house cease. The proposed revisions
will not modify clearing house
operations but merely clarify to the
marketplace the clearing cycle currently
in place.
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.
PO 00000
Frm 00042
Fmt 4703
Sfmt 4703
securities-clearing service, which
renders the proposed change effective
upon filing. CME believes that the
proposal does not significantly affect
any securities clearing operations of
CME because CME recently filed a rule
change that clarified that CME has
decided not to clear security-based
swaps, except in a very limited set of
circumstances.12 The rule filing
reflecting CME’s decision not to clear
security-based swaps removed any
ambiguity concerning CME’s ability or
intent to perform the functions of a
clearing agency with respect to securitybased swaps. Therefore, this proposal
will not have an effect on any securities
clearing operations of CME.
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s Internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include File Number SR–
CME–2014–29 on the subject line.
Paper Comments
• 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–CME–2014–29. 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/
12 See Securities Exchange Act Release No. 34–
73615 (Nov. 17, 2014), 79 FR 69545 (Nov. 21, 2014)
(SR–CME–2014–49). The only exception is with
regards to Restructuring European Single Name
Credit Default Swap (‘‘CDS’’) Contracts created
following the occurrence of a Restructuring Credit
Event in respect of an iTraxx Component
Transaction. The clearing of Restructuring
European Single Name CDS Contracts will be a
necessary byproduct after such time that CME
begins clearing iTraxx Europe index CDS.
E:\FR\FM\12DEN1.SGM
12DEN1
Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Notices
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 such
filings will also 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–2014–29 and should
be submitted on or before January 2,
2015.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.13
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–29102 Filed 12–11–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73786; File No. SR–CME–
2014–54]
Self-Regulatory Organizations;
Chicago Mercantile Exchange Inc.;
Notice of Filing and Immediate
Effectiveness of Proposed Rule
Change Related to Position Limits and
Position Accountability of the USD
Malaysian Crude Palm Oil Calendar
(Cleared Only) Contracts
mstockstill on DSK4VPTVN1PROD with NOTICES
December 8, 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 November 25, 2014, Chicago
Mercantile Exchange Inc. (‘‘CME’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) the
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
proposed rule change described in Items
I, II and III, below, which Items have
been primarily 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 a proposed rule change
that is limited to its business as a
derivatives clearing organization
(‘‘DCO’’). More specifically, the
proposed rule change would amend
rules related to the position limits and
position accountability of the USD
Malaysian Crude Palm Oil Calendar
(Cleared Only) Contract for clearing.
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
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 (‘‘CFTC’’) and offers
clearing services for many different
futures and swaps products. The
proposed rule change that is the subject
of this filing is limited to CME’s
business as a DCO offering clearing
services for CFTC-regulated swaps
products. More specifically, the
proposed rule change would amend
rules related to the position limits and
position accountability of the USD
Malaysian Crude Palm Oil Calendar
Swap (Cleared Only) Contract for
clearing.
The proposed amendment would
establish independent position
accountability levels for CME’s USD
Malaysian Crude Palm Oil Calendar
Swap (the ‘‘Swap’’). Feedback from
counterparties to the Swap suggests that
much of the participation in the product
involves commercial hedgers or
counterparties to commercial hedgers.
The Swap is not subject to mandatory
position limit requirements.
Transitioning from position limits to
position accountability levels will
facilitate the risk reduction practices of
commercial firms and promote the
continued participation of
counterparties to commercial hedgers.
Accordingly, CME proposes to
transition the Swap’s current position
limit of 2,800 contracts into new
position accountability levels to be set
at 2,800 contracts.
The amendment will be reflected in
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 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. The
changes will be effective on filing. CME
notes that it has also certified the
proposed rule change that is the subject
of this filing to its primary regulator, the
CFTC, in a separate filing, CME
Submission No. 14–434.
CME believes the proposed rule
change is consistent with the
requirements of the Exchange Act
including Section 17A of the Exchange
Act.5 CME is proposing the amendment
to establish new independent position
accountability levels for CME’s USD
Malaysian Crude Palm Oil Calendar
Swap, a change that is expected to
facilitate the risk reduction practices of
commercial firms and promote the
continued participation of
counterparties to commercial hedgers.
The change is 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.6
Furthermore, the proposed change is
limited in its 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 change is limited to CME’s
13 17
1 15
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U.S.C. 78s(b)(3)(A).
CFR 240.19b–4(f)(4)(ii).
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Sfmt 4703
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5 15
6 15
E:\FR\FM\12DEN1.SGM
U.S.C. 78q–1.
U.S.C. 78q–1(b)(3)(F).
12DEN1
Agencies
[Federal Register Volume 79, Number 239 (Friday, December 12, 2014)]
[Notices]
[Pages 73919-73921]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-29102]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73776; File No. SR-CME-2014-29]
Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Make Clarifying Changes to CME Rule 814 and CME Rule 901
December 8, 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 26, 2014, Chicago Mercantile Exchange Inc. (``CME'')
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 primarily 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 a proposed rule change that is limited to its
business as a derivatives clearing organization. More specifically, the
proposed rule change would make amendments to CME Rule 814 and CME Rule
901 to specify the time at which a settlement bank becomes responsible
to the clearing house to perform variation margin settlement and the
point during the clearing cycle at which a clearing member's
obligations to the clearing house cease. The proposed revisions would
not modify clearing house operations but merely clarify to the
marketplace the clearing cycle currently in place.
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 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. CME has prepared summaries, set forth in sections A, B,
and C below, of the most significant aspects of these statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
CME is registered as a derivatives clearing organization with the
Commodity Futures Trading Commission (``CFTC'') and operates a
substantial business clearing futures and swaps contracts subject to
the jurisdiction of the CFTC. CME is proposing to make amendments to
CME Rule 814 and CME Rule 901 to specify the time at which a settlement
bank becomes responsible to the clearing house to perform variation
margin settlement and the point during the clearing cycle at which a
clearing member's obligations to the clearing house cease. The proposed
revisions would not modify clearing house operations but merely clarify
to the marketplace the clearing cycle currently in place. CME notes
that it has also made a corresponding filing with the CFTC, in
Submission No. 14-280, regarding the proposed changes.
[[Page 73920]]
The proposed changes would reflect the best practices outlined in
the Principles for Financial Market Infrastructures (``PFMIs''),
adopted by the joint Committee on Payment and Settlement Systems and
the Technical Committee of the International Organization of Securities
Commissions.\5\ Principle 8 of the PFMIs (Settlement finality) states
that an ``FMI's rules and procedures should clearly define the point at
which settlement is final'' and that ``[a]n FMI should be designed to
provide clear and certain final settlement of payments, transfer
instructions, or other obligations.'' \6\
---------------------------------------------------------------------------
\5\ See Committee on Payment and Settlement Systems and
Technical Committee of the International Organization of Securities
Commissions, Principles for Financial Market Infrastructures (Apr.
16, 2012), available at https://www.bis.org/publ/cpss101a.pdf.
\6\ Id. at 64.
---------------------------------------------------------------------------
Revised CME Rule 814 (Settlement Variation) will specify that
``settlement variation is deemed final when an irrevocable commitment
to pay has been provided to the Clearing House by a settlement bank in
a form or manner as approved by the Clearing House.'' The amendment to
Rule 814 codifies CME's uniform practice in regard to its settlement
bank legal agreements, which provide that the settlement bank's
obligation arises upon CME's receipt of the settlement bank's
irrevocable commitment to pay.
CME Rule 901.S (General Requirements and Obligations) is being
added to state that ``the obligation(s) of a clearing member to pay
settlement variation and/or performance bond during each clearing cycle
is not extinguished until all required cash and/or collateral is
deposited into the correct CME bank account at the relevant custodial
or settlement bank.'' The proposed changes increase the transparency of
the CME legal framework in this area and align the existing rules with
global PFMI standards by specifying the times at which settlement bank
obligations to the clearing house arise and clearing member obligations
are extinguished.
CME believes the proposed rule change is consistent with the
requirements of the Act including Section 17A.\7\ Because the proposed
change clarifies in CME's rules the time at which a settlement bank
becomes responsible to the clearing house to perform variation margin
settlement and the point during the clearing cycle at which a clearing
member's obligations to the clearing house cease,\8\ it promotes the
prompt and accurate clearance and settlement of securities transactions
and, to the extent applicable, derivatives agreements, contracts, and
transactions, assures the safeguarding of securities and funds which
are in the custody or control of CME or for which it is responsible,
and, in general, protects investors and the public interest in a way
that is consistent with Section 17A(b)(3)(F) of the Act.\9\
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78q-1.
\8\ Pursuant to a teleconference with CME's counsel on December
4, 2014, staff in the Division of Trading and Markets has modified
this sentence to clarify CME's intended explanation of the statutory
basis for the proposed rule change.
\9\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------
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
specify the time at which a settlement bank becomes responsible to the
clearing house to perform variation margin settlement and the point
during the clearing cycle at which a clearing member's obligations to
the clearing house cease. The proposed revisions will not modify
clearing house operations but merely clarify to the marketplace the
clearing cycle currently in place.
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 upon filing pursuant
to Section 19(b)(3)(A) \10\ of the Act and Rule 19b-4(f)(4)(ii) \11\
thereunder. CME asserts that this proposal constitutes 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, and 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,
which renders the proposed change effective upon filing. CME believes
that the proposal does not significantly affect any securities clearing
operations of CME because CME recently filed a rule change that
clarified that CME has decided not to clear security-based swaps,
except in a very limited set of circumstances.\12\ The rule filing
reflecting CME's decision not to clear security-based swaps removed any
ambiguity concerning CME's ability or intent to perform the functions
of a clearing agency with respect to security-based swaps. Therefore,
this proposal will not have an effect on any securities clearing
operations of CME.
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\10\ 15 U.S.C. 78s(b)(3)(A).
\11\ 17 CFR 240.19b-4(f)(4)(ii).
\12\ See Securities Exchange Act Release No. 34-73615 (Nov. 17,
2014), 79 FR 69545 (Nov. 21, 2014) (SR-CME-2014-49). The only
exception is with regards to Restructuring European Single Name
Credit Default Swap (``CDS'') Contracts created following the
occurrence of a Restructuring Credit Event in respect of an iTraxx
Component Transaction. The clearing of Restructuring European Single
Name CDS Contracts will be a necessary byproduct after such time
that CME begins clearing iTraxx Europe index CDS.
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's Internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to rule-comments@sec.gov. Please include
File Number SR-CME-2014-29 on the subject line.
Paper Comments
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-CME-2014-29. 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/
[[Page 73921]]
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 such filings will also 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-2014-29
and should be submitted on or before January 2, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-29102 Filed 12-11-14; 8:45 am]
BILLING CODE 8011-01-P