Federal Register / Vol. 88, No. 188 / Friday, September 29, 2023 / Notices 67397 

32 17 CFR 240.17Ad–22(e)(4)(i). 

33 17 CFR 240.17Ad–22(e)(6)(i). 

34See supra note 20. 

35See id. 

36 17 CFR 240.17Ad–22(e)(6)(i). 

37 17 CFR 240.17Ad–22(e)(6)(iii). 

38See Notice of Filing, supra note 4, at 57486. 

39 17 CFR 240.17Ad–22(e)(6)(iii). 

40 15 U.S.C. 78q–1. 

41 15 U.S.C. 78s(b)(2). 

42 In approving the Proposed Rule Change, the 

Commission considered its impact on efficiency, 

competition, and capital formation. 15 U.S.C. 78c(f). 

43 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

for the reasons discussed above, the 

Commission finds that the Proposed 

Rule Change is reasonably designed to 

better enable FICC to effectively 

identify, measure, monitor, and manage 

its credit exposure to members, and 

those arising from its payment, clearing, 

and settlement processes, including by 

maintaining sufficient financial 

resources to cover its credit exposure to 

each member fully with a high degree of 

confidence consistent with Rule 17Ad– 

22(e)(4)(i).32

C. Consistency With Rule 17Ad– 

22(e)(6)(i) Under the Act 

Rule 17Ad–22(e)(6)(i) under the Act 

requires that each covered clearing 

agency that provides central 

counterparty services, such as FICC, 

establish, implement, maintain and 

enforce written policies and procedures 

reasonably designed to cover its credit 

exposures to its participants by 

establishing a risk-based margin system 

that, at a minimum, considers, and 

produces margin levels commensurate 

with, the risks and particular attributes 

of each relevant product, portfolio, and 

market.33 The Commission believes that 

the proposal is consistent with Rule 

17Ad–22(e)(6)(i) under the Act for the 

reason stated below. 

The Commission agrees that FICC’s 

proposal to add the PD Charge to its 

margin methodology would enable FICC 

to more effectively address the risks 

posed to FICC by un-margined periodover-period fluctuations to member 

portfolios resulting from trades that 

FICC novates and guarantees during the 

coverage gap between margin 

collections. In its filing materials, FICC 

provided information regarding the 

impacts of the proposed PD Charge on 

its margin collection.34 Specifically, the 

Impact Study shows that if the PD 

Charge had been in place from April 

2022 through March 2023, the number 

of backtesting deficiencies would have 

been reduced by 77 (from 498 to 421, or 

approximately 15 percent) and the 

backtesting coverage for 44 members 

(approximately 34 percent of the GSD 

membership) would have improved, 

with 14 members who were below 99 

percent coverage brought back to above 

99 percent.35 The Commission has 

reviewed and analyzed FICC’s analysis 

and agrees that adding the PD Charge to 

FICC’s margin methodology would 

enable FICC to more effectively mitigate 

the risks attributable to intraday margin 

fluctuations arising out of member 

trading activity between margin 

collections. As a result, implementing 

the Proposed Rule Change would better 

enable FICC to collect margin amounts 

at levels commensurate with FICC’s 

intraday credit exposures to its 

members. 

Accordingly, the Commission finds 

the Proposed Rule Change is consistent 

with Rule 17Ad–22(e)(6)(i) under the 

Act because it is designed to assist FICC 

in maintaining a risk-based margin 

system that considers, and produces 

margin levels commensurate with, the 

risks of portfolios that experience 

significant volatility on an intraday 

basis.36

D. Consistency With Rule 17Ad– 

22(e)(6)(iii) Under the Act 

Rule17Ad–22(e)(6)(iii) under the Act 

requires that each covered clearing 

agency, such as FICC, establish, 

implement, maintain and enforce 

written policies and procedures 

reasonably designed to cover its credit 

exposures to its participants by 

establishing a risk-based margin system 

that, at a minimum, calculates margin 

sufficient to cover its potential future 

exposure to participants in the interval 

between the last margin collection and 

the close out of positions following a 

participant default.37 The Commission 

believes that the proposal is consistent 

with Rule 17Ad–22(e)(6)(iii) under the 

Act for the reason stated below. 

As stated above in Section II, FICC’s 

proposal to add the PD Charge is 

designed to address FICC’s exposure to 

its members attributable to trading 

activity that takes place in the interval 

between margin collections. 

Specifically, since FICC generally 

novates and guarantees trades upon 

comparison, a member’s trading activity 

may result in coverage gaps due to large 

un-margined intraday portfolio 

fluctuations that remain unmitigated 

between margin collections.38 As 

discussed above in Section IV.C, based 

on the Commission’s review of the filing 

materials, the Commission agrees that 

that FICC’s proposal to add the PD 

Charge to its margin methodology 

should enable FICC to more effectively 

address the risks posed to FICC by unmargined period-over-period 

fluctuations to member portfolios 

resulting from trades that FICC novates 

and guarantees during the coverage gap 

between margin collections. 

Accordingly, the Commission finds 

the Proposed Rule Change is consistent 

with Rule 17Ad–22(e)(6)(iii) under the 

Act because it is designed to better 

enable FICC to cover its credit 

exposures to its members by 

establishing a risk-based margin system 

that specifically calculates margin 

sufficient to cover its potential future 

exposure to members in the interval 

between the last margin collection and 

the close out of positions following a 

member default.39

IV. Conclusion 

On the basis of the foregoing, the 

Commission finds that the Proposed 

Rule Change, as modified by 

Amendment No. 1, is consistent with 

the requirements of the Act and in 

particular with the requirements of 

Section 17A of the Act 40 and the rules 

and regulations promulgated 

thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) of the Act 41 that 

proposed rule change SR–FICC–2023– 

011, be, and hereby is, approved.42

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.43

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–21338 Filed 9–28–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98497; File No. SR– 

CboeBZX–2023–062] 

Self-Regulatory Organizations; Cboe 

BZX Exchange, Inc.; Notice of 

Designation of a Longer Period for 

Commission Action on a Proposed 

Rule Change To Amend the Initial 

Period After Commencement of 

Trading of a Series of ETF Shares on 

the Exchange as It Relates to the 

Holders of Record and/or Beneficial 

Holders, as Provided in Exchange Rule 

14.11(l) 

September 25, 2023. 

On August 14, 2023, Cboe BZX 

Exchange, Inc. (‘‘BZX’’ or ‘‘Exchange’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

to Section 19(b)(1) of the Securities 

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 


lotter on DSK11XQN23PROD with NOTICES1
67398 Federal Register / Vol. 88, No. 188 / Friday, September 29, 2023 / Notices 

3See Securities Exchange Act Release No. 98231 

(August 28, 2023), 88 FR 60516. No comments have 

been received on the proposed rule change. 

4 15 U.S.C. 78s(b)(2). 

5 15 U.S.C. 78s(b)(2). 

6 17 CFR 200.30–3(a)(31). 

1 15 U.S.C 78k–1. 

2 17 CFR 242.608. 

3The OPRA Plan is a national market system plan 

approved by the Commission pursuant to Section 

11A of the Act and Rule 608 thereunder. See 

Securities Exchange Act Release No. 17638 (Mar. 

18, 1981), 22 SEC. Docket 484 (Mar. 31, 1981). The 

full text of the OPRA Plan and a list of its 

participants are available at https://

www.opraplan.com/. The OPRA Plan provides for 

the collection and dissemination of last sale and 

quotation information on options that are traded on 

the participant exchanges. 

4See Securities Exchange Act Release No. 98012 

(July 27, 2023), 88 FR 50939 (‘‘Notice’’). 

5 17 CFR 242.608(b)(2)(i). 

6The full text of the Proposed Amendment 

appears as Attachment A to the Notice. See Notice, 

supra note 4, 88 FR at 50941–42. 7See id. at 50939. 8See id. 

9See id. 

10See id. 

11See id. 

12See id. at 50939–40 (stating OPRA ‘‘used the 

negotiation process as an opportunity to ensure that 

SIAC’s ability to increase the amount of port fees 

would be capped during the term of the 2015 

Processor Agreement for all OPRA data recipients, 

including OPRA members, who were authorized to 

receive direct access to OPRA data.’’). 

change to amend the initial period after 

commencement of trading of a series of 

ETF Shares on the Exchange as it 

specifically relates to holders of record 

and/or beneficial holders under BZX 

Rule 14.11(l). The proposed rule change 

was published for comment in the 

Federal Register on September 1, 2023.3

Section 19(b)(2) of the Act 4 provides 

that within 45 days of the publication of 

notice of the filing of a proposed rule 

change, or within such longer period up 

to 90 days as the Commission may 

designate if it finds such longer period 

to be appropriate and publishes its 

reasons for so finding or as to which the 

self-regulatory organization consents, 

the Commission shall either approve the 

proposed rule change, disapprove the 

proposed rule change, or institute 

proceedings to determine whether the 

proposed rule change should be 

disapproved. The 45th day after 

publication of the notice for this 

proposed rule change is October 16, 

2023. The Commission is extending this 

45-day time period. 

The Commission finds it appropriate 

to designate a longer period within 

which to take action on the proposed 

rule change so that it has sufficient time 

to consider the proposed rule change 

and the issues raised therein. 

Accordingly, the Commission, pursuant 

to Section 19(b)(2) of the Act,5

designates November 30, 2023, as the 

date by which the Commission shall 

either approve or disapprove, or 

institute proceedings to determine 

whether to disapprove, the proposed 

rule change (File No. SR–CboeBZX– 

2023–062). 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.6

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2023–21341 Filed 9–28–23; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–98514; File No. SR–OPRA– 

2023–01] 

Joint Industry Plan; Order Instituting 

Proceedings To Determine Whether To 

Approve or Disapprove a Proposed 

Amendment To Modify the Options 

Price Reporting Authority’s Fee 

Schedule Regarding Caps on the 

Amounts of Certain Port Fees 

September 25, 2023. 

I. Introduction 

On July 14, 2023, the Options Price 

Reporting Authority (‘‘OPRA’’), 

pursuant to Section 11A of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1 and Rule 608 of Regulation 

National Market System (‘‘Regulation 

NMS’’) thereunder,2 filed with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed amendment 

to the Plan for Reporting of 

Consolidated Options Last Sale Reports 

and Quotation Information (‘‘OPRA 

Plan’’).3 The proposed OPRA Plan 

amendment (‘‘Proposed Amendment’’) 

would amend the OPRA Fee Schedule 

to reflect the applicable monthly fee 

caps on certain connectivity ports that 

are used to access OPRA data. The 

Proposed Amendment was published 

for comment in the Federal Register on 

August 2, 2023.4 The Commission has 

not received any comments on the 

Proposed Amendment. 

This order institutes proceedings, 

under Rule 608(b)(2)(i) of Regulation 

NMS,5 to determine whether to approve 

or disapprove the Proposed Amendment 

or to approve the Proposed Amendment 

with any changes or subject to any 

conditions the Commission deems 

necessary or appropriate after 

considering public comment. 

II. Summary of the Proposed 

Amendment 6

OPRA states that the Proposed 

Amendment is designed to amend the 

OPRA Fee Schedule to provide public 

notice that OPRA negotiated terms in 

the 2021 Processor Services Agreement 

(the ‘‘2021 Processor Agreement’’) 

between OPRA and the Securities 

Industry Automation Corporation 

(‘‘SIAC’’) that impose caps on certain 

port fees that can be charged per month 

when SIAC, either directly or through a 

third party, provides direct access to 

OPRA data to any person authorized by 

OPRA to receive direct access to OPRA 

data.7 OPRA further states that, under 

the 2021 Processor Agreement, SIAC is 

OPRA’s ‘‘processor,’’ meaning that SIAC 

gathers the last sale and quote 

information from each of the OPRA 

members, consolidates that information, 

and disseminates the consolidated 

OPRA data.8 According to OPRA, as the 

processor, SIAC works directly with 

OPRA members and data vendors to 

provide connectivity to SIAC, and 

connectivity to SIAC is currently 

provided by an affiliate of SIAC, the ICE 

Global Network (‘‘IGN’’), which both 

sets and charges the port fees associated 

with that connectivity.9

OPRA states that recipients of OPRA 

data can access that data using a 10 

gigabit (‘‘Gb’’), 40 Gb, or 100 Gb network 

connection. OPRA further states that it 

has contractually capped the 

connectivity or ‘‘port’’ fees that SIAC, or 

any third party utilized by SIAC, may 

charge to provide direct connectivity to 

OPRA data using a 10 Gb or 40 Gb 

connection and that it has ‘‘the right to 

approve a cap on port fees that could be 

charged for . . . higher capacity ports’’ 

in the event that such higher capacity 

ports become available in the future.10

OPRA states that the negotiated port 

fee caps of $16,000 per month per 10 Gb 

port and $20,500 per month per 40 Gb 

port were established as part of the 2015 

Processor Agreement between OPRA 

and SIAC.11 OPRA further states that 

these caps were retained in the 2021 

Processor Agreement,12 and that 

OPRA’s Management Committee 


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