[Federal Register Volume 78, Number 241 (Monday, December 16, 2013)]
[Notices]
[Pages 76182-76183]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-29780]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-71030; File No. SR-OCC-2013-18]
Self-Regulatory Organizations; The Options Clearing Corporation;
Notice of Filing of Proposed Rule Change Concerning the Governance
Committee Charter
December 11, 2013.
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, 2013, 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, which
Items have been prepared by OCC. 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.
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I. Clearing Agency's Statement of the Terms of Substance of the
Proposed Rule Change
This proposed rule change by The Options Clearing Corporation
(``OCC'') concerns the charter of the Governance Committee (``GC
Charter'') of OCC's Board of Directors (``Board'').
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.
(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Proposed Rule Change
This proposed rule change concerns the GC Charter. The Board
authorized formation of the Governance Committee (``GC'') at its May
21, 2013, meeting and approved the GC Charter at its September 24,
2013, meeting. As set forth in the GC Charter, the purpose of the GC is
to review the overall corporate governance of OCC and recommend
improvements to OCC's Board. The GC Charter describes the role the GC
plays in assisting the Board in fulfilling its responsibilities, as
described in OCC's By-Laws and Rules, as well as specifying the
policies and procedures governing the membership and organization,
scope of authority, and specific functions and responsibilities of the
GC. In addition, the guidelines for the composition of the GC as well
as the policies regarding its meeting schedule, quorum rules, minute-
keeping and reporting requirements are set forth in the GC Charter and
conform to applicable requirements specified in OCC's By-Laws and
Rules.
The GC is composed of not fewer than five Directors with at least
one Public Director, one Exchange Director and one Member Director.
Management Directors will not be members of the GC. The Board will
designate a GC Chair and if the Chair is not present at a meeting, the
members who are present will designate a member to serve as the Acting
Chair. The GC will meet at least four times a year and a majority of
the GC members constitutes a quorum. The GC is permitted to call
executive sessions from which guests of the GC may be excluded, and GC
members are permitted to participate in all meetings by conference
telephone call or other means of communication that permit all meeting
participants to hear each other. The GC Chair, or the Chair's designee,
will report regularly to the Board on the GC's activities.
The GC Charter sets forth certain functions and responsibilities
for the GC including, but not limited to, the following: review the
composition of the Board as a whole, including the Board's balance of
participant and non-participant directors, business specialization,
technical skills, diversity and other desired qualifications; review
the Board's Charter for consistency with regulatory requirements,
transparency of the governance process and other sound governance
practice and recommend changes to the Board, where appropriate; review
the committee structure of the Board, including the GC, and recommend
changes to the Board, where appropriate; review OCC's policies and
procedures for identifying and reviewing Board nominee candidates,
including the criteria for Board nominees; develop and recommend to the
Board a periodic process of self-evaluation of the role and performance
of the Board, its committees and management in the governance of OCC;
review OCC's policies on conflicts of interest of directors, including
the OCC Directors Code of Conduct and recommend changes, where
appropriate; and, review OCC's new director orientation program as well
as OCC's training and education
[[Page 76183]]
programs for Board members and recommend changes, where appropriate. In
addition to the foregoing, the GC may undertake other and different
activities, as appropriate, or as may be delegated to it by the Board.
In discharging its role, the GC shall confer with management and other
employees of OCC to the extent the GC deems it necessary to so to
fulfill its duties.\3\
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\3\ The GC, subject to the approval of the Board, is permitted
to hire specialists or rely on outside advisors or specialists to
assist it in carrying out the GC's activities. The GC has the
authority to approve the fees and retention terms of such advisors
and specialists.
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OCC believes that the proposed rule change is consistent with
Section 17A(b)(3)(F) of the Act \4\ because the GC Charter helps ensure
that OCC's governance structure is designed to protect investors and
the public interest. By creating a GC Charter that clarifies the duties
and operations of the GC, OCC will have, as required under Rule 17Ad-
22(d)(8), a clear and transparent governance structure that will
fulfill the public interests requirements in Section 17A of the Act,
support the objectives of OCC's owners and participants and promote the
effectiveness of OCC's risk management procedures.\5\
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\4\ 15 U.S.C. 78q-1(b)(3)(F).
\5\ 17 CFR 240.17Ad-22(d)(8).
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(B) Clearing Agency's Statement on Burden on Competition
OCC does not believe that the proposed rule change would impose any
burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.\6\ This proposed rule change
will help ensure that OCC meets regulatory requirements that it has a
clear and transparent governance structure, as well as clarify the
organization, duties and operation of the GC through the adoption of
the GC Charter. To the extent OCC's clearing members are affected by
proposed rule change, OCC believes that, by publishing the terms of the
GC Charter in the public domain, all of its participants will have
greater certainty concerning OCC's governance arrangements.
Accordingly, OCC does not believe that the proposed rule will it impose
any burden on competition that is not necessary or appropriate in
furtherance of the purposes of the Act.
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\6\ 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 on the proposed rule change 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
Within 45 days of the date of publication of this notice in the
Federal Register or within such longer period up to 90 days (i) as the
Commission may designate if it finds such longer period to be
appropriate and publishes its reasons for so finding or (ii) as to
which the self-regulatory organization consents, the Commission will:
(A) By order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule
change should be disapproved.
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-OCC-2013-18 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-OCC-2013-18. 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 of submission. 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 located
at 100 F Street NE., Washington, DC 20549-1090 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/about/publications/bylaws.jsp. 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-2013-18 and
should be submitted on or before January 6, 2014.
For the Commission by the Division of Trading and Markets,
pursuant to delegated authority.\7\
Kevin M. O'Neill,
Deputy Secretary.
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\7\ 17 CFR 200.30-3(a)(12).
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[FR Doc. 2013-29780 Filed 12-13-13; 8:45 am]
BILLING CODE 8011-01-P