[Federal Register Volume 79, Number 120 (Monday, June 23, 2014)]
[Notices]
[Pages 35604-35605]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-14538]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-72405; File No. SR-ICEEU-2014-08]
Self-Regulatory Organizations; ICE Clear Europe Limited; Notice
of Filing and Immediate Effectiveness of Proposed Rule Change Relating
to Clearance of New Energy Futures and Options Contracts
June 17, 2014.
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 June 5, 2014, ICE Clear Europe Limited (``ICE Clear Europe'') filed
with the Securities and Exchange Commission (``Commission'') the
proposed rule changes described in Items I, II and III below, which
Items have been prepared primarily by ICE Clear Europe. 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. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The principal purpose of the change is to modify certain aspects of
the ICE Clear Europe Delivery Procedures in connection with the launch
by the ICE Endex market of three energy futures and options contracts
that will be cleared by ICE Clear Europe: The German Power Base Load
Futures Contract, German Power Peak Load Futures Contract, and German
Power Base Load Option Contract (the ``German Power 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, ICE Clear Europe 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. ICE Clear Europe has prepared summaries,
set forth in sections A, B, and C below, of the most significant
aspects of these statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
The purpose of the rule amendments is to modify certain aspects of
the ICE Clear Europe Delivery Procedures in connection with the launch
by the ICE Endex market of the German Power Contracts that will be
cleared by ICE Clear Europe. ICE Clear Europe does not otherwise
propose to amend its clearing rules or procedures in connection with
the German Power Contracts.
The amendments adopt a new Part J of the Delivery Procedures
applicable to the German Power Contracts in the case of physical
delivery under a futures contract. The amendments provide, among other
matters, specifications for delivery of power under a German Power
Contract through scheduling with the relevant transmission system
operator (``TSO''), including relevant definitions and a detailed
delivery timetable for the contracts. The amendments also address
invoicing and payment for delivery and certain limitations on liability
of the Clearing House for performance or non-performance by the
relevant TSO. The amendments provide for calculation by the clearing
house of buyer's and seller's security to cover delivery obligations
and related liabilities, costs or charges, as well as procedures to
address failed deliveries. The revised procedures also outline various
documentation requirements for the relevant parties.
In addition, changes are made to paragraph 5.1 of the Delivery
Procedures to include the German Power Contracts as well as certain
other natural gas and power futures as contracts for which parties may
nominate transferors and transferees to make and take delivery. Part H
of the Delivery Procedures has also been removed as the relevant
contract moved from trading on the ICE Futures exchange to the ICE
Endex exchange and is now covered by Part G of the Delivery Procedures.
ICE Clear Europe believes that the changes described herein are
consistent with the requirements of Section 17A of the Act \3\ and the
regulations thereunder applicable to it, including the standards under
Rule 17Ad-22,\4\ and are consistent with the prompt and accurate
clearance of and settlement of securities transactions and, to the
extent applicable, derivative agreements, contracts and transactions,
the safeguarding of securities and funds in the custody or control of
ICE Clear Europe or for which it is responsible and the protection of
investors and the public interest, within the meaning of Section
17A(b)(3)(F) of the Act.\5\ The German Power Contracts have similar
characteristics to other ICE Endex and ICE Futures Europe energy
contracts currently cleared by ICE Clear Europe, and ICE Clear Europe
believes that its existing financial resources, risk management,
systems and operational arrangements are sufficient to support clearing
of such products (and address physical delivery under such contracts).
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\3\ 15 U.S.C. 78q-1.
\4\ 17 CFR 240.17Ad-22.
\5\ 15 U.S.C. 78q-1(b)(3)(F).
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Specifically, ICE Clear Europe believes that it will be able to
manage the risks associated with acceptance of the German Power
Contracts for clearing and physical delivery in such contracts. The
German Power Contracts present a similar risk profile to other ICE
Endex contracts currently cleared by ICE Clear Europe, and ICE Clear
Europe believes that its existing risk management and margin framework
is sufficient for purposes of risk management of the German Power
Contracts and related deliveries.
Similarly, ICE Clear Europe has established appropriate standards
for determining the eligibility of contracts submitted to the
clearinghouse for clearing, and ICE Clear Europe believes that its
existing systems are appropriately scalable to handle the German Power
Contracts, which are generally similar from an operational perspective
to the other ICE Endex power contracts currently cleared by ICE Clear
Europe.
For the reasons noted above, ICE Clear Europe believes that the
proposed rule changes are consistent with the requirements of Section
17A of the Act \6\ and regulations thereunder applicable to it.
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\6\ 15 U.S.C. 78q-1.
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B. Self-Regulatory Organization's Statement on Burden on Competition
ICE Clear Europe does not believe the proposed changes to the rules
would have any impact, or impose any burden, on competition not
necessary or appropriate in furtherance of the Act. ICE Clear Europe is
adopting the amendments to the Delivery Procedures in connection with
the listing of new contracts for trading on the ICE Endex market. ICE
Clear Europe believes that such contracts will provide additional
opportunities for interested market
[[Page 35605]]
participants to engage in trading activity relating to the German power
market. ICE Clear Europe does not believe the adoption of related
Delivery Procedures amendments would adversely affect access to
clearing for clearing members or their customers, or otherwise
adversely affect competition in clearing services.
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 changes to the rules have
not been solicited or received. ICE Clear Europe will notify the
Commission of any written comments received by ICE Clear Europe.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective upon filing pursuant
to Section 19(b)(3)(A) \7\ of the Act and Rule 19b-4(f) \8\ thereunder
because it effects a change in an existing service of a registered
clearing agency that primarily affects the clearing operations of the
clearing agency with respect to products that are not securities,
including futures that are not security futures, swaps that are not
security-based swaps or mixed swaps, and forwards that are not security
forwards, and does not significantly affect any securities clearing
operations of the clearing agency or any rights or obligations of the
clearing agency with respect to securities clearing or persons using
such securities-clearing service. 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).
\8\ 17 CFR 240.19b-4(f).
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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-ICEEU-2014-08 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-ICEEU-2014-08. 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 filings will also be available
for inspection and copying at the principal office of ICE Clear Europe
and on ICE Clear Europe's Web site at https://www.theice.com/notices/Notices.shtml?regulatoryFilings.
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-ICEEU-2014-08
and should be submitted on or before July 14, 2014.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\9\
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\9\ 17 CFR 200.30-3(a)(12).
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Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2014-14538 Filed 6-20-14; 8:45 am]
BILLING CODE 8011-01-P