Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing of Amendment No. 1, and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 1, To Provide That The Options Clearing Corporation's President Will Be Its Chief Operating Officer, and That the President Will Not Be a Management Director, 73915-73916 [2014-29110]
Download as PDF
Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Notices
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73785; File No. SR–OCC–
2014–18]
Self-Regulatory Organizations; The
Options Clearing Corporation; Notice
of Filing of Amendment No. 1, and
Order Granting Accelerated Approval
of a Proposed Rule Change, as
Modified by Amendment No. 1, To
Provide That The Options Clearing
Corporation’s President Will Be Its
Chief Operating Officer, and That the
President Will Not Be a Management
Director
December 8, 2014.
On October 31, 2014, The Options
Clearing Corporation (‘‘OCC’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change SR–OCC–2014–18
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’) 1 and Rule 19b–4 thereunder.2
The proposed rule change was
published for comment in the Federal
Register on November 7, 2014.3 On
November 11, 2014, OCC filed
Amendment No. 1 to the proposal.4 The
Commission did not receive any
comments on the proposal. The
Commission is publishing this notice to
solicit comments on Amendment No. 1
and is approving the proposed rule
change, as modified by Amendment No.
1, on an accelerated basis.
I. Description of the Proposal
The purpose of this rule change, as
amended, is to provide that OCC’s
President will be its Chief Operating
Officer, rather than its Chief Executive
Officer, and that the President will not
be a management director on OCC’s
Board of Directors. These changes are
being made in connection with the
resignation of OCC’s former President
and Chief Executive Officer, a transition
plan that includes the election of OCC’s
current Chief Operating Officer as
President and Chief Operating Officer,
and the appointment of an Ad Hoc
Search Committee to identify an
appropriate candidate to become OCC’s
1 15
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 Securities Exchange Act Release No. 73497
(November 3, 2014), 79 FR 66440 (November 7,
2014) (SR–OCC–2014–18).
4 In Amendment No. 1, OCC amended the
proposal to clarify that the proposal as described
also amended Article IV, Section 1, of OCC’s ByLaws to reflect OCC’s Board of Directors’ decision
that the President should not be a Management
Director. Specifically, OCC is amending Article IV,
Section 1 of its By-Laws to refer only to the
Executive Chairman, and not the President, as a
Management Director.
mstockstill on DSK4VPTVN1PROD with NOTICES
2 17
VerDate Sep<11>2014
16:57 Dec 11, 2014
Jkt 235001
Chief Executive Officer (collectively, the
‘‘Transition Plan’’). According to OCC,
OCC’s Board of Directors has
determined that in light of the
resignation of the former President and
Chief Executive Officer and the election
of the current Chief Operating Officer as
President, the positions of President and
Chief Executive Officer should be
separated and the position of President
should instead be combined with the
position of Chief Operating Officer. To
reflect this change, OCC is revising
Section 8 of Article IV of its By-Laws to
state that the President will be OCC’s
Chief Operating Officer, rather than its
Chief Executive Officer.
According to OCC, while OCC’s
existing By-Laws provide that the
President, who is also the Chief
Executive Officer, serves as a
Management Director on OCC’s Board of
Directors, given the separation of the
President and Chief Executive Officer
positions and the pending search for a
new Chief Executive Officer, OCC’s
Board of Directors has also determined
that the President should not be a
Management Director. Accordingly,
OCC is revising Section 7 of Article III
and Section 1 of Article IV of its ByLaws to refer only to the Executive
Chairman, and not the President, as a
Management Director. OCC also is
making a conforming revision to Section
8 of Article IV of its By-Laws to state
that the President will not preside at
meetings of the Board of Directors or the
stockholders in the absence or disability
of the Executive Chairman and the
Management Vice Chairman because the
President will no longer serve as a
Management Director.
OCC is also amending its Stockholder
Agreement, Board of Directors Charter
and Fitness Standards for Directors,
Clearing Members and Others. In each
case, conforming changes are being
made to provide that only the Executive
Chairman, not the President, will serve
as a Management Director.
Once a replacement Chief Executive
Officer has been elected by the Board of
Directors, OCC intends to reconsider the
appropriate number of Management
Directors. According to OCC, the rule
change, as proposed and amended,
represents a short-term measure to
implement the Transition Plan and is
not intended as a permanent change in
the composition of the Board of
Directors. As indicated in the filing,
once OCC’s Board of Directors has
elected a Chief Executive Officer, OCC
will propose further changes to its ByLaws, Stockholders Agreement, Board of
Directors Charter and Fitness Standards
for Directors, Clearing Members and
Others. OCC believes that the short-term
PO 00000
Frm 00037
Fmt 4703
Sfmt 4703
73915
flexibility reflected in the foregoing
changes will assist OCC and its Board of
Directors in implementing the
Transition Plan efficiently and
governing OCC effectively.
II. Discussion and Commission
Findings
Section 19(b)(2)(C) of the Act 5 directs
the Commission to approve a proposed
rule change of a self-regulatory
organization if it finds that the proposed
rule change is consistent with the
requirements of the Act and the rules
and regulations thereunder applicable to
such organization.
The Commission finds that the
proposed rule change is consistent with
Section 17A(b)(3)(F) of the Act,6 which
requires that the rules of a registered
clearing agency be designed to, among
other things, remove the impediments to
and perfect the mechanism of a national
system for the prompt and accurate
clearance and settlement of securities
transactions, and in general, to protect
investors and the public interest. The
proposed rule change, as amended, is
consistent with Section 17A(b)(3)(F)
because it should remove the
impediments to and perfect the
mechanism of a national clearance and
settlement system and protecting
investors and the public interest by
providing transparency with respect to
the composition of OCC’s management
structure and Board of Directors during
the Transition Plan. By clarifying who
from senior management is acting in the
role of OCC’s President and clarifying
which senior management position is
serving as a management director on
OCC’s Board of Directors during the
Transition, both OCC’s members and the
public will have more information on
the overall structure of management and
the Board of Directors at OCC and more
information on the level of authority of
specific senior management positions.
Additionally, this proposed rule change
is consistent with Section 17A(b)(3)(F)
because the Transition Plan will
facilitate uninterrupted, ongoing,
operations at OCC notwithstanding the
above described changes at OCC.
III. Accelerated Approval of the
Proposed Rule Change As Modified by
Amendment No. 1
The Commission finds good cause,
pursuant to Section 19(b)(2)(C)(iii) of
the Act,7 for approving the proposed
rule change, as modified by Amendment
No. 1, earlier than 30 days after the date
5 15
U.S.C. 78s(b)(2)(C).
U.S.C. 78q–1(b)(3)(F).
7 15 U.S.C. 78s(b)(2)(C)(iii).
6 15
E:\FR\FM\12DEN1.SGM
12DEN1
73916
Federal Register / Vol. 79, No. 239 / Friday, December 12, 2014 / Notices
of publication of notice in the Federal
Register.
As discussed above, OCC filed
Amendment No. 1 to describe the
proposed change to Article IV, Section
1 of OCC’s By-Laws to reflect OCC’s
Board of Directors’ decision that the
President should not be a Management
Director. Specifically, OCC is amending
Article IV, Section 1 of its By-Laws to
refer only to the Executive Chairman,
and not the President, as a Management
Director. Amendment No. 1 provides
the Commission with clarifying
information about how OCC is
implementing and providing
transparency about the Transition Plan.
By allowing OCC to implement the
proposed changes, as amended, on an
accelerated basis, OCC will be able to
implement the Transition Plan sooner,
which should allow OCC to manage and
govern OCC more efficiently and
effectively.
Accordingly, the Commission finds
good cause to approve the proposed rule
change, as modified by Amendment No.
1, on an accelerated basis.
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–
OCC–2014–18 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–OCC–2014–18. 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
VerDate Sep<11>2014
16:57 Dec 11, 2014
Jkt 235001
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 OCC. 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–OCC–
2014–18 and should be submitted on or
before January 2, 2015.
V. Conclusion
On the basis of the foregoing, the
Commission finds that the proposal is
consistent with the requirements of the
Act and in particular with the
requirements of Section 17A of the Act 8
and the rules and regulations
thereunder.
It is therefore ordered, pursuant to
Section 19(b)(2) of the Act,9 that the
proposed rule change (SR–OCC–2014–
18), as modified by Amendment No. 1,
be, and it hereby is, approved on an
accelerated basis.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.10
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–29110 Filed 12–11–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–73782; File No. SR–EDGX–
2014–32]
Self-Regulatory Organizations; EDGX
Exchange, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Related to Fees for Use
of EDGX Exchange, Inc.
December 8, 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 November
8 In
approving this proposed rule change, the
Commission has considered the proposed rule’s
impact on efficiency, competition, and capital
formation. See 15 U.S.C. 78c(f).
9 15 U.S.C. 78s(b)(2).
10 17 CFR 200.30–3(a)(12).
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
PO 00000
Frm 00038
Fmt 4703
Sfmt 4703
26, 2014, EDGX Exchange, Inc. (the
‘‘Exchange’’ or ‘‘EDGX’’) 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 Exchange has
designated the proposed rule change as
one establishing or changing a member
due, fee, or other charge imposed by the
Exchange under Section 19(b)(3)(A)(ii)
of the Act 3 and Rule 19b–4(f)(2)
thereunder,4 which renders the
proposed rule change effective upon
filing with the Commission. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange filed a proposal to
amend the fee schedule applicable to
Members 5 of the Exchange pursuant to
EDGX Rules 15.1(a) and (c) (‘‘Fee
Schedule’’). Changes to the Fee
Schedule pursuant to this proposal are
effective upon filing.
The text of the proposed rule change
is available at the Exchange’s Web site
at https://www.directedge.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 the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend its
Fee Schedule to amend: (i) The criteria
3 15
U.S.C. 78s(b)(3)(A)(ii).
CFR 240.19b–4(f)(2).
5 The term ‘‘Member’’ is defined as ‘‘any
registered broker or dealer, or any person associated
with a registered broker or dealer, that has been
admitted to membership in the Exchange. A
Member will have the status of a ‘‘member’’ of the
Exchange as that term is defined in Section 3(a)(3)
of the Act.’’ See Exchange Rule 1.5(n).
4 17
E:\FR\FM\12DEN1.SGM
12DEN1
Agencies
[Federal Register Volume 79, Number 239 (Friday, December 12, 2014)]
[Notices]
[Pages 73915-73916]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-29110]
[[Page 73915]]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73785; File No. SR-OCC-2014-18]
Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing of Amendment No. 1, and Order Granting Accelerated
Approval of a Proposed Rule Change, as Modified by Amendment No. 1, To
Provide That The Options Clearing Corporation's President Will Be Its
Chief Operating Officer, and That the President Will Not Be a
Management Director
December 8, 2014.
On October 31, 2014, The Options Clearing Corporation (``OCC'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change SR-OCC-2014-18 pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4
thereunder.\2\ The proposed rule change was published for comment in
the Federal Register on November 7, 2014.\3\ On November 11, 2014, OCC
filed Amendment No. 1 to the proposal.\4\ The Commission did not
receive any comments on the proposal. The Commission is publishing this
notice to solicit comments on Amendment No. 1 and is approving the
proposed rule change, as modified by Amendment No. 1, on an accelerated
basis.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ Securities Exchange Act Release No. 73497 (November 3,
2014), 79 FR 66440 (November 7, 2014) (SR-OCC-2014-18).
\4\ In Amendment No. 1, OCC amended the proposal to clarify that
the proposal as described also amended Article IV, Section 1, of
OCC's By-Laws to reflect OCC's Board of Directors' decision that the
President should not be a Management Director. Specifically, OCC is
amending Article IV, Section 1 of its By-Laws to refer only to the
Executive Chairman, and not the President, as a Management Director.
---------------------------------------------------------------------------
I. Description of the Proposal
The purpose of this rule change, as amended, is to provide that
OCC's President will be its Chief Operating Officer, rather than its
Chief Executive Officer, and that the President will not be a
management director on OCC's Board of Directors. These changes are
being made in connection with the resignation of OCC's former President
and Chief Executive Officer, a transition plan that includes the
election of OCC's current Chief Operating Officer as President and
Chief Operating Officer, and the appointment of an Ad Hoc Search
Committee to identify an appropriate candidate to become OCC's Chief
Executive Officer (collectively, the ``Transition Plan''). According to
OCC, OCC's Board of Directors has determined that in light of the
resignation of the former President and Chief Executive Officer and the
election of the current Chief Operating Officer as President, the
positions of President and Chief Executive Officer should be separated
and the position of President should instead be combined with the
position of Chief Operating Officer. To reflect this change, OCC is
revising Section 8 of Article IV of its By-Laws to state that the
President will be OCC's Chief Operating Officer, rather than its Chief
Executive Officer.
According to OCC, while OCC's existing By-Laws provide that the
President, who is also the Chief Executive Officer, serves as a
Management Director on OCC's Board of Directors, given the separation
of the President and Chief Executive Officer positions and the pending
search for a new Chief Executive Officer, OCC's Board of Directors has
also determined that the President should not be a Management Director.
Accordingly, OCC is revising Section 7 of Article III and Section 1 of
Article IV of its By-Laws to refer only to the Executive Chairman, and
not the President, as a Management Director. OCC also is making a
conforming revision to Section 8 of Article IV of its By-Laws to state
that the President will not preside at meetings of the Board of
Directors or the stockholders in the absence or disability of the
Executive Chairman and the Management Vice Chairman because the
President will no longer serve as a Management Director.
OCC is also amending its Stockholder Agreement, Board of Directors
Charter and Fitness Standards for Directors, Clearing Members and
Others. In each case, conforming changes are being made to provide that
only the Executive Chairman, not the President, will serve as a
Management Director.
Once a replacement Chief Executive Officer has been elected by the
Board of Directors, OCC intends to reconsider the appropriate number of
Management Directors. According to OCC, the rule change, as proposed
and amended, represents a short-term measure to implement the
Transition Plan and is not intended as a permanent change in the
composition of the Board of Directors. As indicated in the filing, once
OCC's Board of Directors has elected a Chief Executive Officer, OCC
will propose further changes to its By-Laws, Stockholders Agreement,
Board of Directors Charter and Fitness Standards for Directors,
Clearing Members and Others. OCC believes that the short-term
flexibility reflected in the foregoing changes will assist OCC and its
Board of Directors in implementing the Transition Plan efficiently and
governing OCC effectively.
II. Discussion and Commission Findings
Section 19(b)(2)(C) of the Act \5\ directs the Commission to
approve a proposed rule change of a self-regulatory organization if it
finds that the proposed rule change is consistent with the requirements
of the Act and the rules and regulations thereunder applicable to such
organization.
---------------------------------------------------------------------------
\5\ 15 U.S.C. 78s(b)(2)(C).
---------------------------------------------------------------------------
The Commission finds that the proposed rule change is consistent
with Section 17A(b)(3)(F) of the Act,\6\ which requires that the rules
of a registered clearing agency be designed to, among other things,
remove the impediments to and perfect the mechanism of a national
system for the prompt and accurate clearance and settlement of
securities transactions, and in general, to protect investors and the
public interest. The proposed rule change, as amended, is consistent
with Section 17A(b)(3)(F) because it should remove the impediments to
and perfect the mechanism of a national clearance and settlement system
and protecting investors and the public interest by providing
transparency with respect to the composition of OCC's management
structure and Board of Directors during the Transition Plan. By
clarifying who from senior management is acting in the role of OCC's
President and clarifying which senior management position is serving as
a management director on OCC's Board of Directors during the
Transition, both OCC's members and the public will have more
information on the overall structure of management and the Board of
Directors at OCC and more information on the level of authority of
specific senior management positions. Additionally, this proposed rule
change is consistent with Section 17A(b)(3)(F) because the Transition
Plan will facilitate uninterrupted, ongoing, operations at OCC
notwithstanding the above described changes at OCC.
---------------------------------------------------------------------------
\6\ 15 U.S.C. 78q-1(b)(3)(F).
---------------------------------------------------------------------------
III. Accelerated Approval of the Proposed Rule Change As Modified by
Amendment No. 1
The Commission finds good cause, pursuant to Section
19(b)(2)(C)(iii) of the Act,\7\ for approving the proposed rule change,
as modified by Amendment No. 1, earlier than 30 days after the date
[[Page 73916]]
of publication of notice in the Federal Register.
---------------------------------------------------------------------------
\7\ 15 U.S.C. 78s(b)(2)(C)(iii).
---------------------------------------------------------------------------
As discussed above, OCC filed Amendment No. 1 to describe the
proposed change to Article IV, Section 1 of OCC's By-Laws to reflect
OCC's Board of Directors' decision that the President should not be a
Management Director. Specifically, OCC is amending Article IV, Section
1 of its By-Laws to refer only to the Executive Chairman, and not the
President, as a Management Director. Amendment No. 1 provides the
Commission with clarifying information about how OCC is implementing
and providing transparency about the Transition Plan. By allowing OCC
to implement the proposed changes, as amended, on an accelerated basis,
OCC will be able to implement the Transition Plan sooner, which should
allow OCC to manage and govern OCC more efficiently and effectively.
Accordingly, the Commission finds good cause to approve the
proposed rule change, as modified by Amendment No. 1, on an accelerated
basis.
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-OCC-2014-18 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-OCC-2014-18. 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 OCC. 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-OCC-2014-18 and should be
submitted on or before January 2, 2015.
V. Conclusion
On the basis of the foregoing, the Commission finds that the
proposal is consistent with the requirements of the Act and in
particular with the requirements of Section 17A of the Act \8\ and the
rules and regulations thereunder.
---------------------------------------------------------------------------
\8\ In approving this proposed rule change, the Commission has
considered the proposed rule's impact on efficiency, competition,
and capital formation. See 15 U.S.C. 78c(f).
---------------------------------------------------------------------------
It is therefore ordered, pursuant to Section 19(b)(2) of the
Act,\9\ that the proposed rule change (SR-OCC-2014-18), as modified by
Amendment No. 1, be, and it hereby is, approved on an accelerated
basis.
---------------------------------------------------------------------------
\9\ 15 U.S.C. 78s(b)(2).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\10\
---------------------------------------------------------------------------
\10\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-29110 Filed 12-11-14; 8:45 am]
BILLING CODE 8011-01-P