Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Concerning the Options Clearing Corporation's Management Structure, 23121-23123 [2017-10127]

Download as PDF Federal Register / Vol. 82, No. 96 / Friday, May 19, 2017 / Notices 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 No. SR–CBOE– 2017–039, and should be submitted on or before June 9, 2017. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.10 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–10126 Filed 5–18–17; 8:45 am] BILLING CODE 8011–01–P (A) Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change SECURITIES AND EXCHANGE COMMISSION [Release No. 34–80672; File No. SR–OCC– 2017–012] Self-Regulatory Organizations; The Options Clearing Corporation; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Concerning the Options Clearing Corporation’s Management Structure May 15, 2017. asabaliauskas on DSK3SPTVN1PROD with NOTICES 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 May 5, 2017, The Options Clearing Corporation (‘‘OCC’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Items I, II, and III below; Items I and II have been prepared primarily by OCC. OCC filed the proposed rule change pursuant to Section 19(b)(3)(A)(iii) of the Act 3 and Rule 19b–4(f)(6) 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. Clearing Agency’s Statement of the Terms of Substance of the Proposed Rule Change This proposed rule change by OCC concerns the amendment of OCC’s ByLaws to provide that the Board of Directors (‘‘Board’’) may, in its discretion, designate the Chief Operating Officer (‘‘COO’’) to act as President of OCC. 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)(iii). 4 17 CFR 240.19b–4(f)(6). 10 1 15 VerDate Sep<11>2014 19:15 May 18, 2017 Jkt 241001 II. Clearing Agency’s Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), (B), and (C) below, of the most significant aspects of these statements. All terms with initial capitalization that are not otherwise defined herein have the same meaning as set forth in the OCC ByLaws and Rules.5 1. Purpose On April 26, 2017, the Commission approved a proposed rule change by OCC that, among other things, amended OCC’s By-Laws and Rules to: (1) Remove all references to OCC’s President to reflect the fact that the President would no longer be a recognized officer within OCC’s management and (2) reallocate the authority and responsibilities previously granted to the President between the COO and a newly appointed Chief Administrative Officer (‘‘CAO’’).6 OCC is now proposing to amend Article IV, Section 1 of the ByLaws to provide that the Board may, in its discretion, designate that the COO also serve as President of OCC. The purpose of the proposed rule change is to provide further clarity and transparency around OCC’s management structure and the roles and titles of its senior management. Prior to the approval of SR–OCC– 2017–002,7 OCC’s By-Laws stipulated that its President would also serve as COO, with the authority and responsibilities of the COO and President primarily being addressed throughout the By-Laws and Rules in terms of this officer’s capacity as President. As a result of SR–OCC–2017– 002,8 OCC’s By-Laws and Rules were amended to eliminate all references to the President; however, the position of COO was retained, and OCC’s senior management was reorganized within an 5 OCC’s By-Laws and Rules can be found on OCC’s public Web site: http://optionsclearing.com/ about/publications/bylaws.jsp. 6 See Securities Exchange Act Release No. 80531 (April 26, 2017), 82 FR 20502 (May 2, 2017) (SR– OCC–2017–002). 7 Id. 8 Id. PO 00000 Frm 00169 Fmt 4703 Sfmt 4703 23121 Office of the Executive Chairman comprised of the Executive Chairman and Chief Executive Officer, the COO and the CAO. Pursuant to Article IV, Section 8 of the By-Laws, the COO and CAO are responsible for the aspects of OCC’s business that do not report directly to the Executive Chairman, with such responsibilities being determined by the Board to promote the efficient and effective management and operation of OCC. The By-Laws and Rules also address various other authorities and responsibilities of the COO and CAO.9 The proposed rule change would provide that the Board may, in its discretion, designate that the COO also serve as President. The two roles would not, however, be tied together by operation of the By-Laws as it was prior to the approval of SR–OCC–2017–002 and would instead provide the Board with the discretionary authority to make this determination as it deems appropriate. The proposed rule change is not intended to modify OCC’s current management structure or the allocation of duties and responsibilities currently associated with the roles of COO or CAO as set forth in By-Laws and Rules. If the Board determines to designate that the COO also serve as President, the authority and responsibilities of the COO and President would continue to be governed by the allocation of authority and responsibilities of the COO as currently set forth in OCC’s ByLaws and Rules. The proposed rule change would take a similar approach to the previous construction of OCC’s ByLaws and Rules regarding the role of COO and President; however, the proposed approach would now describe the authority and responsibilities of the President and COO throughout the ByLaws and Rules in terms of this officer’s capacity as COO (as opposed to President). OCC notes that, under Article IV, Section 1 of the By-Laws, the Board may, but need not, elect such other officers (i.e., officers in addition to the Executive Chairman, Member Vice Chairman, COO, CAO, Secretary, and Treasurer) as it may from time to time 9 For example, OCC’s Rules provide the Executive Chairman, COO and CAO with the authority to, among other things, impose certain restrictions on a Clearing Member’s transactions, positions and activities based on the financial or operational condition of the Clearing Member (Rule 305); extend settlement times in emergency conditions; (Rule 505); waive the required margin deposit of a Clearing Member in the interest of maintaining fair and orderly markets (Rule 609A); and make a determination as to whether the immediate liquidation of some or all of a suspended Clearing Member’s margin deposits and/or contributions to the Clearing Fund would not be in the best interests of the OCC, other Clearing Members, or the general public (Rule 1104). E:\FR\FM\19MYN1.SGM 19MYN1 23122 Federal Register / Vol. 82, No. 96 / Friday, May 19, 2017 / Notices asabaliauskas on DSK3SPTVN1PROD with NOTICES determine are required for the efficient management and operation of OCC. While this provision of Article IV, Section 1 of the By-Laws currently provides the Board with discretionary authority to elect or otherwise designate an officer of OCC to serve as President, OCC believes that the proposed rule change would provide additional clarity and transparency around the Board’s authority to elect a President, particularly in light of recent OCC filing SR–OCC–2017–002. 2. Statutory Basis Section 17A(b)(3)(F) of the Act,10 requires that the rules of a clearing agency be designed, in general, to protect investors and the public interest. OCC believes that the proposed rule change is consistent with the protection of investors and the public interest because it would provide OCC’s users and the general public with further clarity and transparency around OCC’s management structure and the roles and titles of its senior management by clarifying in OCC’s By-Laws that the Board has the discretion to designate that OCC’s COO also serve as President of the corporation. As a result, OCC believes the proposed rule change is consistent with Section 17A(b)(3)(F) of the Act.11 In addition, Rule 17Ad–22(e)(2) 12 requires covered clearing agencies to maintain written policies and procedures reasonably designed to, among other things, provide for governance arrangements that are clear and transparent, specify clear and direct lines of responsibility, and fulfill the public interest requirements in Section 17A of the Act.13 OCC believes that the proposed amendments to its By-Laws would provide clear and transparent statements of the Board’s discretionary authority to designate that the COO also serve as President of OCC. Under the proposed rule change, if the Board would designate that the COO also serve as President, the authority and responsibilities of the COO and President would continue to be governed by the clear allocation of authority and responsibilities provided to the COO as currently set forth in OCC’s By-Laws and Rules. As a result, OCC believes the proposed rule change would provide for governance arrangements that are clear and transparent, specify clear and direct lines of responsibility, and fulfill the public interest requirements in Section 17A of the Act 14 in a manner consistent with Rule 17Ad–22(e)(2).15 The proposed rule change is not inconsistent with the existing rules of OCC, including any other rules proposed to be amended. (B) Clearing Agency’s Statement on Burden on Competition Section 17A(b)(3)(I) of the Act 16 requires that the rules of a clearing agency not impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. OCC does not believe the proposed rule change would have any impact or impose any burden on competition. As discussed in more detail above, OCC believes that the proposed rule change would provide more clarity and transparency to users (and potential users) of OCC regarding OCC’s governance and management arrangements. The proposed rule change would not affect Clearing Members’ access to OCC’s services or disadvantage or favor any particular user in relationship to another user. As such, OCC believes that the proposed changes would not have any impact or impose any burden on competition. (C) Clearing Agency’s Statement on Comments on the Proposed Rule Change Received From Members, Participants or Others Written comments were not and are not intended to be solicited with respect to the proposed rule change, and none have been received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Pursuant to Section 19(b)(3)(A) of the Act,17 and Rule 19b–4(f)(6) 18 thereunder, the proposed rule change is filed for immediate effectiveness because it does not do the following: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) by its terms become operative for 30 days after the date of the filing, or such shorter time as the Commission may designate. Additionally, OCC provided the Commission with written notice of its intent to file the proposed rule change, along with a brief description and text of the proposed rule change, at least five business days prior to the date of filing of the proposed rule change or such 14 15 10 15 U.S.C. 78q–1. CFR 240.17Ad–22(e)(2). 16 15 U.S.C. 78q–1(b)(3)(I). 17 15 U.S.C. 78s(b)(3)(A). 18 17 CFR 240.19b–4(f)(6). U.S.C. 78q–1(b)(3)(F). 15 17 11 Id. 12 17 13 15 CFR 240.17Ad–22(e)(2). U.S.C. 78q–1. VerDate Sep<11>2014 19:15 May 18, 2017 Jkt 241001 PO 00000 Frm 00170 Fmt 4703 Sfmt 4703 shorter time as designated by the Commission. A proposed rule change filed under Rule 19b–4(f)(6) normally does not become operative for 30 days after the date of filing. However, Rule 19b– 4(f)(6)(iii) permits the Commission to designate a shorter time if such action is consistent with the protection of investors and the public interest. OCC has requested that the Commission waive the 30-day operative delay contained in Rule 19b–4(f)(6)(iii) so that the proposal may become operative immediately upon filing. OCC believes that a waiver of the 30-day operative delay is consistent with the protection of investors and the public interest because it will enable OCC to implement the proposed rule change in a more timely manner and thereby reinforce the Board’s authority to elect officers, and more specifically, a President, as it deems necessary for the efficient management and operation of OCC. The Commission agrees that a waiver of the 30-day operative delay is appropriate under the particular facts and circumstances concerning this proposed rule change, as the proposed rule change does not present novel or controversial issues. As OCC stated, Article IV, Section 1 of the By-Laws currently provides the Board with discretionary authority to elect or otherwise designate an officer of OCC to serve as President. OCC stated further that the proposed rule change would provide additional clarity and transparency around the Board’s authority to elect a President, particularly in light of recent OCC filing SR–OCC–2017–002. Accordingly, the Commission designates the proposed rule change to be operative upon filing.19 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.20 IV. Solicitation of Comments Interested persons are invited to submit written data, views, and 19 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). 20 Notwithstanding its immediate effectiveness, implementation of this rule change will be delayed until this change is deemed certified under CFTC Regulation § 40.6. E:\FR\FM\19MYN1.SGM 19MYN1 Federal Register / Vol. 82, No. 96 / Friday, May 19, 2017 / Notices Electronic Comments 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 BILLING CODE 8011–01–P • Use the Commission’s Internet comment form (http://www.sec.gov/ rules/sro.shtml); or • Send an email to rule-comments@ sec.gov. Please include File Number SR– OCC–2017–012 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. asabaliauskas on DSK3SPTVN1PROD with NOTICES For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.21 Eduardo A. Aleman, Assistant Secretary. [FR Doc. 2017–10127 Filed 5–18–17; 8:45 am] 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: All submissions should refer to File Number SR–OCC–2017–012. 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 (http://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 such filing also will be available for inspection and copying at the principal office of OCC and on OCC’s Web site at http://www.theocc.com/components/ docs/legal/rules_and_bylaws/sr_occ_17_ 012.pdf. 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–2017–012 and should be submitted on or before June 9, 2017. SECURITIES AND EXCHANGE COMMISSION [Release No. 34–80677; File No. SR–NYSE– 2017–20] Self-Regulatory Organizations; New York Stock Exchange LLC; Notice of Filing of Proposed Rule Change Amending Its Listing Standard for Special Purpose Acquisition Companies To Change Shareholder Vote Requirement for the Approval of a Business Combination May 15, 2017. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on May 1, 2017, New York Stock Exchange LLC (‘‘NYSE’’ or ‘‘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 self-regulatory organization. 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 proposes to amend its listing standard for Acquisition Companies (‘‘ACs’’) to change its shareholder vote requirement for the approval of a Business Combination. The proposed rule change is available on the Exchange’s Web site at www.nyse.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 self-regulatory organization 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 those statements may be examined at 1 15 U.S.C. 78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 2 15 21 17 CFR 200.30–3(a)(12). VerDate Sep<11>2014 19:15 May 18, 2017 23123 Jkt 241001 PO 00000 Frm 00171 Fmt 4703 Sfmt 4703 1. Purpose The Exchange proposes to amend its listing standard for Acquisition Companies (or ‘‘ACs’’) as set forth in Section 102.06 of the NYSE Listed Company Manual (the ‘‘Manual’’) to change its shareholder vote requirement for the approval of a Business Combination. An AC (typically known in the marketplace as a special purpose acquisition company or ‘‘SPAC’’) is a special purpose company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more operating businesses or assets with a fair market value equal to at least 80% of the net assets of the AC held in trust (net of amounts disbursed to management for working capital purposes and excluding the amount of any deferred underwriting discount held in trust) (a ‘‘Business Combination’’). Section 102.06 subjects any AC listed on the NYSE to the following requirements (among others): • If the AC holds a shareholder vote on a Business Combination, it must be approved by a majority of the votes cast by public shareholders 4 at the shareholder meeting at which the Business Combination is being considered; • if a shareholder vote on a Business Combination is held, each public shareholder voting against the Business Combination will have the right to convert its shares of common stock into a pro rata share of the aggregate amount then on deposit in the trust account (net of taxes payable, and amounts disbursed to management for working capital purposes), provided that the Business Combination is approved and consummated; 5 4 Shares held by directors, officers, or their immediate families and other concentrated holding of 10 percent or more are excluded in calculating the number of publicly-held shares. 5 An AC can establish a limit (set no lower than 10% of the shares sold in the AC’s IPO) as to the maximum number of shares with respect to which any public shareholder, together with any affiliate of such shareholder or any person with whom such shareholder is acting as a ‘‘group’’ (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) may exercise conversion rights; E:\FR\FM\19MYN1.SGM 19MYN1

Agencies

[Federal Register Volume 82, Number 96 (Friday, May 19, 2017)]
[Notices]
[Pages 23121-23123]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-10127]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-80672; File No. SR-OCC-2017-012]


Self-Regulatory Organizations; The Options Clearing Corporation; 
Notice of Filing and Immediate Effectiveness of Proposed Rule Change 
Concerning the Options Clearing Corporation's Management Structure

May 15, 2017.
    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 May 5, 2017, The Options Clearing Corporation (``OCC'') filed with 
the Securities and Exchange Commission (``Commission'') the proposed 
rule change as described in Items I, II, and III below; Items I and II 
have been prepared primarily by OCC. OCC filed the proposed rule change 
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) \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.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Clearing Agency's Statement of the Terms of Substance of the 
Proposed Rule Change

    This proposed rule change by OCC concerns the amendment of OCC's 
By-Laws to provide that the Board of Directors (``Board'') may, in its 
discretion, designate the Chief Operating Officer (``COO'') to act as 
President of OCC.

II. Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

    In its filing with the Commission, OCC 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. OCC has prepared summaries, set forth in sections (A), 
(B), and (C) below, of the most significant aspects of these 
statements. All terms with initial capitalization that are not 
otherwise defined herein have the same meaning as set forth in the OCC 
By-Laws and Rules.\5\
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    \5\ OCC's By-Laws and Rules can be found on OCC's public Web 
site: http://optionsclearing.com/about/publications/bylaws.jsp.
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(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis 
for, the Proposed Rule Change

1. Purpose
    On April 26, 2017, the Commission approved a proposed rule change 
by OCC that, among other things, amended OCC's By-Laws and Rules to: 
(1) Remove all references to OCC's President to reflect the fact that 
the President would no longer be a recognized officer within OCC's 
management and (2) reallocate the authority and responsibilities 
previously granted to the President between the COO and a newly 
appointed Chief Administrative Officer (``CAO'').\6\ OCC is now 
proposing to amend Article IV, Section 1 of the By-Laws to provide that 
the Board may, in its discretion, designate that the COO also serve as 
President of OCC. The purpose of the proposed rule change is to provide 
further clarity and transparency around OCC's management structure and 
the roles and titles of its senior management.
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    \6\ See Securities Exchange Act Release No. 80531 (April 26, 
2017), 82 FR 20502 (May 2, 2017) (SR-OCC-2017-002).
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    Prior to the approval of SR-OCC-2017-002,\7\ OCC's By-Laws 
stipulated that its President would also serve as COO, with the 
authority and responsibilities of the COO and President primarily being 
addressed throughout the By-Laws and Rules in terms of this officer's 
capacity as President. As a result of SR-OCC-2017-002,\8\ OCC's By-Laws 
and Rules were amended to eliminate all references to the President; 
however, the position of COO was retained, and OCC's senior management 
was reorganized within an Office of the Executive Chairman comprised of 
the Executive Chairman and Chief Executive Officer, the COO and the 
CAO. Pursuant to Article IV, Section 8 of the By-Laws, the COO and CAO 
are responsible for the aspects of OCC's business that do not report 
directly to the Executive Chairman, with such responsibilities being 
determined by the Board to promote the efficient and effective 
management and operation of OCC. The By-Laws and Rules also address 
various other authorities and responsibilities of the COO and CAO.\9\
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    \7\ Id.
    \8\ Id.
    \9\ For example, OCC's Rules provide the Executive Chairman, COO 
and CAO with the authority to, among other things, impose certain 
restrictions on a Clearing Member's transactions, positions and 
activities based on the financial or operational condition of the 
Clearing Member (Rule 305); extend settlement times in emergency 
conditions; (Rule 505); waive the required margin deposit of a 
Clearing Member in the interest of maintaining fair and orderly 
markets (Rule 609A); and make a determination as to whether the 
immediate liquidation of some or all of a suspended Clearing 
Member's margin deposits and/or contributions to the Clearing Fund 
would not be in the best interests of the OCC, other Clearing 
Members, or the general public (Rule 1104).
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    The proposed rule change would provide that the Board may, in its 
discretion, designate that the COO also serve as President. The two 
roles would not, however, be tied together by operation of the By-Laws 
as it was prior to the approval of SR-OCC-2017-002 and would instead 
provide the Board with the discretionary authority to make this 
determination as it deems appropriate. The proposed rule change is not 
intended to modify OCC's current management structure or the allocation 
of duties and responsibilities currently associated with the roles of 
COO or CAO as set forth in By-Laws and Rules. If the Board determines 
to designate that the COO also serve as President, the authority and 
responsibilities of the COO and President would continue to be governed 
by the allocation of authority and responsibilities of the COO as 
currently set forth in OCC's By-Laws and Rules. The proposed rule 
change would take a similar approach to the previous construction of 
OCC's By-Laws and Rules regarding the role of COO and President; 
however, the proposed approach would now describe the authority and 
responsibilities of the President and COO throughout the By-Laws and 
Rules in terms of this officer's capacity as COO (as opposed to 
President).
    OCC notes that, under Article IV, Section 1 of the By-Laws, the 
Board may, but need not, elect such other officers (i.e., officers in 
addition to the Executive Chairman, Member Vice Chairman, COO, CAO, 
Secretary, and Treasurer) as it may from time to time

[[Page 23122]]

determine are required for the efficient management and operation of 
OCC. While this provision of Article IV, Section 1 of the By-Laws 
currently provides the Board with discretionary authority to elect or 
otherwise designate an officer of OCC to serve as President, OCC 
believes that the proposed rule change would provide additional clarity 
and transparency around the Board's authority to elect a President, 
particularly in light of recent OCC filing SR-OCC-2017-002.
2. Statutory Basis
    Section 17A(b)(3)(F) of the Act,\10\ requires that the rules of a 
clearing agency be designed, in general, to protect investors and the 
public interest. OCC believes that the proposed rule change is 
consistent with the protection of investors and the public interest 
because it would provide OCC's users and the general public with 
further clarity and transparency around OCC's management structure and 
the roles and titles of its senior management by clarifying in OCC's 
By-Laws that the Board has the discretion to designate that OCC's COO 
also serve as President of the corporation. As a result, OCC believes 
the proposed rule change is consistent with Section 17A(b)(3)(F) of the 
Act.\11\
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    \10\ 15 U.S.C. 78q-1(b)(3)(F).
    \11\ Id.
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    In addition, Rule 17Ad-22(e)(2) \12\ requires covered clearing 
agencies to maintain written policies and procedures reasonably 
designed to, among other things, provide for governance arrangements 
that are clear and transparent, specify clear and direct lines of 
responsibility, and fulfill the public interest requirements in Section 
17A of the Act.\13\ OCC believes that the proposed amendments to its 
By-Laws would provide clear and transparent statements of the Board's 
discretionary authority to designate that the COO also serve as 
President of OCC. Under the proposed rule change, if the Board would 
designate that the COO also serve as President, the authority and 
responsibilities of the COO and President would continue to be governed 
by the clear allocation of authority and responsibilities provided to 
the COO as currently set forth in OCC's By-Laws and Rules. As a result, 
OCC believes the proposed rule change would provide for governance 
arrangements that are clear and transparent, specify clear and direct 
lines of responsibility, and fulfill the public interest requirements 
in Section 17A of the Act \14\ in a manner consistent with Rule 17Ad-
22(e)(2).\15\
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    \12\ 17 CFR 240.17Ad-22(e)(2).
    \13\ 15 U.S.C. 78q-1.
    \14\ 15 U.S.C. 78q-1.
    \15\ 17 CFR 240.17Ad-22(e)(2).
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    The proposed rule change is not inconsistent with the existing 
rules of OCC, including any other rules proposed to be amended.

(B) Clearing Agency's Statement on Burden on Competition

    Section 17A(b)(3)(I) of the Act \16\ requires that the rules of a 
clearing agency not impose any burden on competition not necessary or 
appropriate in furtherance of the purposes of the Act. OCC does not 
believe the proposed rule change would have any impact or impose any 
burden on competition. As discussed in more detail above, OCC believes 
that the proposed rule change would provide more clarity and 
transparency to users (and potential users) of OCC regarding OCC's 
governance and management arrangements. The proposed rule change would 
not affect Clearing Members' access to OCC's services or disadvantage 
or favor any particular user in relationship to another user. As such, 
OCC believes that the proposed changes would not have any impact or 
impose any burden on competition.
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    \16\ 15 U.S.C. 78q-1(b)(3)(I).
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(C) Clearing Agency's Statement on Comments on the Proposed Rule Change 
Received From Members, Participants or Others

    Written comments were not and are not intended to be solicited with 
respect to the proposed rule change, and none have been received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Pursuant to Section 19(b)(3)(A) of the Act,\17\ and Rule 19b-
4(f)(6) \18\ thereunder, the proposed rule change is filed for 
immediate effectiveness because it does not do the following: (i) 
Significantly affect the protection of investors or the public 
interest; (ii) impose any significant burden on competition; and (iii) 
by its terms become operative for 30 days after the date of the filing, 
or such shorter time as the Commission may designate. Additionally, OCC 
provided the Commission with written notice of its intent to file the 
proposed rule change, along with a brief description and 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.
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    \17\ 15 U.S.C. 78s(b)(3)(A).
    \18\ 17 CFR 240.19b-4(f)(6).
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    A proposed rule change filed under Rule 19b-4(f)(6) normally does 
not become operative for 30 days after the date of filing. However, 
Rule 19b-4(f)(6)(iii) permits the Commission to designate a shorter 
time if such action is consistent with the protection of investors and 
the public interest. OCC has requested that the Commission waive the 
30-day operative delay contained in Rule 19b-4(f)(6)(iii) so that the 
proposal may become operative immediately upon filing. OCC believes 
that a waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest because it will enable 
OCC to implement the proposed rule change in a more timely manner and 
thereby reinforce the Board's authority to elect officers, and more 
specifically, a President, as it deems necessary for the efficient 
management and operation of OCC.
    The Commission agrees that a waiver of the 30-day operative delay 
is appropriate under the particular facts and circumstances concerning 
this proposed rule change, as the proposed rule change does not present 
novel or controversial issues. As OCC stated, Article IV, Section 1 of 
the By-Laws currently provides the Board with discretionary authority 
to elect or otherwise designate an officer of OCC to serve as 
President. OCC stated further that the proposed rule change would 
provide additional clarity and transparency around the Board's 
authority to elect a President, particularly in light of recent OCC 
filing SR-OCC-2017-002. Accordingly, the Commission designates the 
proposed rule change to be operative upon filing.\19\
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    \19\ 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).
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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.\20\
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    \20\ Notwithstanding its immediate effectiveness, implementation 
of this rule change will be delayed until this change is deemed 
certified under CFTC Regulation Sec.  40.6.
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and

[[Page 23123]]

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 (http://www.sec.gov/rules/sro.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number SR-OCC-2017-012 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-2017-012. 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 (http://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 such filing also will be available 
for inspection and copying at the principal office of OCC and on OCC's 
Web site at http://www.theocc.com/components/docs/legal/rules_and_bylaws/sr_occ_17_012.pdf.
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-2017-012 and should 
be submitted on or before June 9, 2017.
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    \21\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\21\
Eduardo A. Aleman,
Assistant Secretary.
[FR Doc. 2017-10127 Filed 5-18-17; 8:45 am]
BILLING CODE 8011-01-P