[Federal Register Volume 80, Number 6 (Friday, January 9, 2015)]
[Notices]
[Pages 1451-1453]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-00127]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-73981; File No. SR-CME-2014-58]
Self-Regulatory Organizations; Chicago Mercantile Exchange Inc.;
Notice of Filing and Immediate Effectiveness of Proposed Rule Change To
Extend a Fee Waiver Program for Certain OTC FX Cleared-Only Products
January 5, 2015.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'' or ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on December 22, 2014, Chicago Mercantile Exchange
Inc. (``CME'') 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 CME. CME
filed the proposal pursuant to Section 19(b)(3)(A)(ii) of the Act,\3\
and Rule 19b-4(f)(2) \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)(ii).
\4\ 17 CFR 240.19b-4(f)(2).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
CME is proposing to extend an existing fee waiver program
supporting certain CME cleared-only over-the-counter (``OTC'') foreign
exchange (``FX'') products through December 31, 2015.
The text of the proposed rule change is below. Italicized text
indicates additions; bracketed text indicates deletions.
* * * * *
[[Page 1452]]
CME OTC FX Fee Waiver Program
Program Purpose
The purpose of this Program is to incentivize market participants
to submit transaction in the OTC FX products listed below to the
Clearing House for clearing. The resulting increase in volume benefits
all participant segments in the market.
Product Scope
The following cleared only OTC FX products (``Products''):
1. CME Cleared OTC FX--Emerging Markets.
a. USDBRL, USDCLP, USDCNY, USDCOP, USDIDR, USDINR, USDKRW, USDMYR,
USDPEN, USDPHP, USDRUB, USDTWD Non-Deliverable Forwards.
b. USDCZK, USDHUF, USDHKD, USDILS, USDMXN, USDPLN, USDSGD, USDTHB,
USDTRY, USDZAR Cash-Settled Forwards.
2. CME Cleared OTC FX--Majors.
a. AUDJPY, AUDUSD, CADJPY, EURAUD, EURCHF, EURGBP, EURJPY, EURUSD,
GBPUSD, NZDUSD, USDCAD, USDCHF, USDDKK, USDJPY, USDNOK, USDSEK Cash-
Settled Forwards.
Eligible Participants
The temporary reduction in fees will be open to all market
participants and will automatically be applied to any transaction in
the Products submitted to the Clearing House for clearing.
Program Term
Start date is February 1, 2012. End date is December 31, 201[4]5.
Hours
The Program will be applicable regardless of the transaction time.
Program Incentives
Fee Waivers. All market participants that submit transactions in
the Products to the Clearing House will have their clearing fees
waived.
* * * * *
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, CME included statements
concerning the purpose 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. CME has prepared summaries, set forth in sections A, B,
and C below, of the most significant aspects of such statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
CME is registered as a derivatives clearing organization with the
Commodity Futures Trading Commission (``CFTC'') and currently offers
clearing services for many different futures and swaps products. With
this filing, CME proposes to make proposed changes to CME rules
governing certain cleared-only OTC FX products.
The proposed changes would extend an existing fee waiver program
that applies to these OTC FX products. The only proposed changes are
modifying the current December 31, 2014 termination date for the
current fee waiver program to December 31, 2015.
There is no limit to the number of participants that may
participate in the proposed fee waiver program; it will be open to all
market participants and will be automatically applied to all
transaction fees in the enumerated OTC FX products. The changes that
are described in this filing are limited to fee changes for OTC FX
products. The proposed changes would become effective on filing.
The proposed fee changes are limited to CME's business as a
derivatives clearing organization clearing products under the exclusive
jurisdiction of the CFTC and do not materially impact CME's security-
based swap clearing business in any way. CME notes that it recently
filed a proposed rule change that clarified that CME has decided not to
clear security-based swaps, except in a very limited set of
circumstances.\5\ CME has also certified the proposed rule change that
is the subject of this filing to the CFTC in CFTC Submission 14-523.
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\5\ See Securities Exchange Act Release No. 34-73615 (Nov. 17,
2014), 79 FR 69545 (Nov. 21, 2014) (SR-CME-2014-49). The only
exception is with regards to Restructuring European Single Name CDS
Contracts created following the occurrence of a Restructuring Credit
Event in respect of an iTraxx Component Transaction. The clearing of
Restructuring European Single Name CDS Contracts will be a necessary
byproduct after such time that CME begins clearing iTraxx Europe
index CDS.
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CME believes the proposed rule change is consistent with the
requirements of the Exchange Act including Section 17A of the Exchange
Act.\6\ More specifically, the proposed rule change establishes or
changes a member due, fee or other charge imposed by CME under Section
19(b)(3)(A)(ii) \7\ of the Securities Exchange Act of 1934 and Rule
19(f)(2) \8\ thereunder. CME believes that the proposed fee change is
consistent with the requirements of the Securities Exchange Act of 1934
and the rules and regulations thereunder and, in particular, to Section
17A(b)(3)(D),\9\ because the proposed fee changes apply equally to all
market participants and therefore the proposed changes provide for the
equitable allocation of reasonable dues, fees and other charges among
participants. CME also notes that it operates in a highly competitive
market in which market participants can readily direct business to
competing venues. As such, the proposed changes are appropriately filed
pursuant to Section 19(b)(3)(A) \10\ of the Act and paragraph (f)(2) of
Rule 19b-4 thereunder.
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\6\ 15 U.S.C. 78q-1.
\7\ 15 U.S.C. 78s(b)(3)(A)(ii).
\8\ 17 CFR 240.19b-4(f)(2).
\9\ 15 U.S.C. 78q-1(b)(3)(D).
\10\ 15 U.S.C. 78s(b)(3)(A).
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B. Self-Regulatory Organization's Statement on Burden on Competition
CME does not believe that the proposed rule change will have any
impact, or impose any burden, on competition. The proposed rule change
extends a currently operating OTC FX fee waiver program for an
additional year. These products are swaps under the exclusive
jurisdiction of the CFTC, and, as such, these proposed changes do not
affect the security-based swap clearing activities of CME in any way
and therefore do not impose any burden on competition that is
inappropriate in furtherance of the purposes of the Act.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
CME has not solicited, and does not intend to solicit, comments
regarding this proposed rule change. CME has not received any
unsolicited written comments from interested parties.
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) of the Act \11\ and Rule 19(f)(2)
thereunder.\12\ 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,
[[Page 1453]]
or otherwise in furtherance of the purposes of the Act.
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\11\ 15 U.S.C. 78s(b)(3)(A).
\12\ 17 CFR 240.19(f)(2).
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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 No. SR-CME-2014-58 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-CME-2014-58. 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 CME and on CME's
Web site at http://www.cmegroup.com/market-regulation/rule-filings.html.
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-CME-2014-58 and
should be submitted on or before January 30, 2015.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\13\
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\13\ 17 CFR 200.30-3(a)(12).
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Brent J. Fields,
Secretary.
[FR Doc. 2015-00127 Filed 1-8-15; 8:45 am]
BILLING CODE 8011-01-P