[Federal Register Volume 78, Number 245 (Friday, December 20, 2013)]
[Notices]
[Pages 77181-77183]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-30268]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-71083; File No. SR-OCC-2013-807]
Self-Regulatory Organizations; The Options Clearing Corporation;
Advance Notice Concerning the Governance Committee Charter
December 16, 2013.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'') \1\ and Rule 19b-4(n)(1)(i),\2\ notice is hereby given that
on September 14, 2012, The Options Clearing Corporation (``OCC'') filed
with the Securities and Exchange Commission (``Commission'') the
advance notice described in Items I and II below, which Items have been
prepared by OCC. The Commission is publishing this notice to solicit
comments on the advance notice from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4(n)(1)(i).
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I. Clearing Agency's Statement of the Terms of Substance of the Advance
Notice
This advance notice 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 Advance Notice
In its filing with the Commission, OCC included statements
concerning the purpose of and basis for the advance notice and
discussed any comments it received on the advance notice. 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) and (B)
below, of the most significant aspects of such statements.
(A) Clearing Agency's Statement of the Purpose of, and Statutory Basis
for, the Advance Notice
This advance notice 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
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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 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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This advance notice is consistent with Section 806(e)(1)(A) \4\ of
the Clearing Supervision Act because the proposed change could be
deemed to materially affect the nature or level of risks presented by
OCC. The implementation of the GC may result in changes that will
improve OCC's overall risk management process. In addition, the
adoption of the GC Charter will reduce the amount of systemic risk OCC
presents to the financial system because it will enhance the
transparency of OCC's governance arrangements. The advance notice is
not inconsistent with any existing OCC By-Laws or Rules.
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\4\ 12 U.S.C. 5465(e)(1)(A).
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(B) Clearing Agency's Statement on Comments on the Advance Notice
Received From Members, Participants, or Others
Written comments on the advance notice were not and are not
intended to be solicited with respect to the advance notice and none
have been received.
III. Date of Effectiveness of the Advance Notice and Timing for
Commission Action
The proposed changes contained in the advance notice may be
implemented pursuant to Section 806(e)(1)(G) of Clearing Supervision
Act \5\ if the Commission does not object to the proposed changes
within 60 days of the later of (i) the date that the advance notice was
filed with the Commission or (ii) the date that any additional
information requested by the Commission is received. The clearing
agency shall not implement the proposed changes contained in the
advance notice if the Commission objects to the proposed changes.
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\5\ 12 U.S.C. 5465(e)(1)(G).
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The Commission may extend the period for review by an additional 60
days if the proposed changes raise novel or complex issues, subject to
the Commission providing the clearing agency with prompt written notice
of the extension. Proposed changes may be implemented in fewer than 60
days from the date the advance notice is filed, or the date further
information requested by the Commission is received, if the Commission
notifies the clearing agency in writing that it does not object to the
proposed changes and authorizes the clearing agency to implement the
proposed changes on an earlier date, subject to any conditions imposed
by the Commission.
OCC has also filed the advance notice as a proposed rule change
pursuant to Section 19(b)(1) of the Act \6\ and Rule 19b-4
thereunder.\7\ Pursuant to those provisions, 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.
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\6\ 15 U.S.C. 78s(b)(1).
\7\ 17 CFR 240.19b-4.
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The clearing agency shall post notice on its Web site of proposed
changes that are implemented.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing. 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-2013-807 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-2013-807. 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 advance notice that are filed
with the Commission, and all written communications relating to the
advance notice 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 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
[[Page 77183]]
submissions should refer to File Number SR-OCC-2013-807 and should be
submitted on or before January 10, 2014.
By the Commission.
Kevin O'Neill,
Deputy Secretary.
[FR Doc. 2013-30268 Filed 12-19-13; 8:45 am]
BILLING CODE 8011-01-P