[Federal Register Volume 77, Number 114 (Wednesday, June 13, 2012)]
[Notices]
[Pages 35462-35464]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-14339]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-67156; File No. SR-ICC-2012-09]
Self-Regulatory Organizations; ICE Clear Credit LLC; Notice of
Filing and Immediate Effectiveness of Proposed Rule Change To Amend
Schedule 502 of the ICE Clear Credit LLC Rules To Amend the Reference
Entity Name for Three Credit Default Swap Contracts and the Reference
Obligation International Securities Identification Number Associated
With One Credit Default Swap Contract
June 7, 2012
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 19, 2012, ICE Clear Credit LLC (``ICC'') 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 ICC. ICC filed the proposal pursuant to
[[Page 35463]]
Section 19(b)(3)(A)(iii) of the Act,\3\ and Rule 19b-4(f)(3) \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 parties.
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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)(3).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The purpose of proposed rule change is to amend Schedule 502 of the
ICC Rules in order to reflect the correct credit default swap (``CDS'')
reference entity name for three single name CDS contracts (Exelon
Corporation, Beam Inc., and XLIT Ltd.) and the Contract Reference
Obligation International Securities Identification Number (``Contract
Reference Obligation ISIN'') for one single name CDS contract (Exelon
Corporation) that ICC currently clears. Amended Schedule 502 would also
reflect the industry standard Contract Reference Obligation ISIN of one
CDS contract and reference entity names of three CDS contracts.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, ICC 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. ICC has prepared summaries, set forth in sections (A),
(B), and (C) below, of the most significant aspects of these
statements.\5\
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\5\ The Commission has modified the test of the summaries
prepared by ICC.
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(A) Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The purpose of the rule change is to correct Schedule 502 of the
ICC Rules, which lists all the Contract Reference Obligation ISINs and
entity names of all single name CDS contracts that ICC clears. This
amendment would revise Schedule 502 to update the Contract Reference
Obligation ISIN of one CDS contract and the reference entity names of
three CDS contracts that ICC currently clears. The update does not
require any changes to the body of the ICC Rules. In addition, the
update does not require any changes to the ICC risk management
framework.
Schedule 502 of the ICC Rules is being updated to reflect changes
that are already in place operationally. Namely, on May 7, 2012, Exelon
Corporation became clearing eligible at ICC with a new Contract
Reference Obligation ISIN and new reference entity name. On May 8,
2012, ICC converted all Constellation Energy Group, Inc. trades and
positions to those of Exelon Corporation. On January 16, 2012, Beam,
Inc. became clearing eligible at ICC and on February 1, 2012, ICC
converted all Fortune Brands, Inc. positions to Beam, Inc. positions.
On April 2, 2012, XLIT Ltd. became clearing eligible at ICC and on
April 17, 2012, ICC converted all XL Ltd. trades and positions to XLIT
Ltd. positions. The corresponding updates to Schedule 502 accurately
represent the current operations of ICC and correctly reflect ICC's
cleared activity with respect to the CDS contracts at issue.
Currently, Schedule 502 does not reflect the industry's changes to
the standard Contract Reference Obligation ISIN for Exelon Corporation
or the entity names for Exelon Corporation, Beam Inc., and XLIT Ltd.
Despite the reference entity names and Contract Reference Obligation
ISIN in current Schedule 502, ICC has been clearing CDS contracts using
the new industry standard Contract Reference Obligation ISIN and
reference entity names as of the above dates. Current Schedule 502 does
not accurately represent the operations of ICC. The underlying
contracts have not changed and, notwithstanding the standard Contract
Reference Obligation ISIN change and name changes of the reference
entity, ICC continues to clear the same contract today that it cleared
prior to the standard Contract Reference Obligation ISIN change and
reference entity name changes.
Section 17A(b)(3)(F) \6\ of the Act requires, among other things,
that the rules of a clearing agency be designed to promote the prompt
and accurate clearance and settlement of securities transactions and,
to the extent applicable, derivative agreements, contracts and
transactions. ICC believes that the proposed rule update is consistent
with the requirements of the Act and the rules and regulations
thereunder applicable to ICC, in particular to Section 17A(b)(3)(F),
because the update will facilitate the prompt and accurate settlement
of securities transactions and assure the safeguarding of securities
and funds associated with securities transactions which are in the
custody or control of ICC or for which it is responsible.
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\6\ 15 U.S.C. 78q-1(b)(3)(F).
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(B) Self-Regulatory Organization's Statement on Burden on Competition
ICC does not believe the proposed rule change would have any
impact, or impose any burden, on competition.
(C) Self-Regulatory Organization's Statement on Comments on the
Proposed Rule Change Received From Members, Participants or Others
Written comments relating to the proposed rule change have not been
solicited or received. ICC will notify the Commission of any written
comments received by ICC.
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)(iii) \7\ of the Act and Rule 19b-4(f)(3) \8\ thereunder. At
any time within 60 days of the filing of the proposed rule change, the
Commission summarily may temporarily suspend such rule change if it
appears to the Commission that such action is necessary or appropriate
in the public interest, for the protection of investors, or otherwise
in furtherance of the purposes of the Act.
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\7\ 15 U.S.C. 78s(b)(3)(A)(iii).
\8\ 17 CFR 240.19b-4(f)(3).
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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 (http://www.sec.gov/rules/sro.shtml) or
Send an email to [email protected]. Please include
File Number SR-ICC-2012-09 on the subject line.
Paper Comments
Send paper comments in triplicate to Elizabeth M. Murphy,
Secretary, Securities and Exchange Commission, 100 F Street NE.,
Washington, DC 20549-1090.
All submissions should refer to File Number SR-ICC-2012-09. 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
[[Page 35464]]
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 Section, 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 ICC and on ICC's
Web site at https://www.theice.com/publicdocs/regulatory_filings/ICEClearCredit_032712.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-ICC-2012-09
and should be submitted on or before July 5, 2012.
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\9\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-14339 Filed 6-12-12; 8:45 am]
BILLING CODE 8011-01-P