27360 Federal Register / Vol. 83, No. 113 / Tuesday, June 12, 2018 / Notices 

10 ICC has satisfied this requirement. 

11 15 U.S.C. 78s(b)(3)(A). 

12 17 CFR 240.19b–4(f)(6). 

13 17 CFR 240.19b–4(f)(6). 

14 17 CFR 240.19b–4(f)(6)(iii). 

15For purposes only of waiving the five-day prefiling requirement and the 30-day operative delay, 

the Commission has considered the proposed rule 

change’s impact on efficiency, competition, and 

capital formation. See 15 U.S.C. 78c(f). 

16 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

investors and the public interest, 

provided that the self-regulatory 

organization has given the Commission 

written notice of its intent to file the 

proposed rule change at least five 

business days prior to the date of filing 

of the proposed rule change or such 

shorter time as designated by the 

Commission,10 the proposed rule 

change has become effective pursuant to 

Section 19(b)(3)(A) of the Act 11 and 

Rule 19b–4(f)(6) 12 thereunder. 

A proposed rule change filed under 

Rule 19b–4(f)(6) 13 normally does not 

become operative prior to 30 days after 

the date of its filing. Pursuant to Rule 

19b–4(f)(6)(iii),14 however, the 

Commission may designate a shorter 

time if such action is consistent with the 

protection of investors and the public 

interest. ICC has requested that the 

Commission waive the five-day prefiling requirement and the 30-day 

operative delay so that ICC may 

implement the proposed rule change by 

the effective date of the GDPR (May 25, 

2018). The Commission notes that the 

proposed rule change is limited to 

revising Rule 407 to facilitate 

compliance with the requirements of the 

GDPR, including committing ICC to 

keeping Personal Data confidential and 

clarifying that ICC’s policies on use of 

personal data will now primarily be 

stated in a privacy notice. The proposed 

rule change does not (i) significantly 

affect the protection of investors or the 

public interest; (ii) impose any 

significant burden on competition; or 

(iii) affect the safeguarding of funds or 

securities in the custody or control of 

ICC or for which it is responsible. 

Waiver of the five-day pre-filing 

requirement and the 30-day operative 

delay would allow ICC to implement the 

proposed rule change by the effective 

date of the GDPR and therefore comply 

with EU law. Therefore, the 

Commission believes that waiving the 

five-day pre-filing requirement and the 

30-day operative delay is consistent 

with the protection of investors and the 

public interest and designates the 

proposed rule change as operative upon 

filing.15

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: (i) Necessary or appropriate in 

the public interest; (ii) for the protection 

of investors; or (iii) otherwise in 

furtherance of the purposes of the Act. 

If the Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or 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 rule-comments@

sec.gov. Please include File Number SR– 

ICC–2018–005 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–ICC–2018–005. 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 website (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 website 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 Credit and on ICE 

Clear Credit’s website at https://

www.theice.com/clear-credit/regulation. 

All comments received will be posted 

without change. Persons submitting 

comments are cautioned that we do not 

redact or edit personal identifying 

information from comment submissions. 

You should submit only information 

that you wish to make available 

publicly. All submissions should refer 

to File Number SR–ICC–2018–005 and 

should be submitted on or before July 3, 

2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.16

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–12551 Filed 6–11–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83386; File No. SR–ICC– 

2018–004] 

Self-Regulatory Organizations; ICE 

Clear Credit LLC; Notice of Filing of 

Proposed Rule Change Relating to 

Formalization of the ICC Model 

Validation Framework 

June 6, 2018. 

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 May 23, 

2018, ICE Clear Credit LLC (‘‘ICC’’) 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 ICC. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

The principal purpose of the 

proposed rule change is to formalize the 

ICC Model Validation Framework. This 

change does not require any revisions to 

the ICC Clearing Rules. 

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, ICC 

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. ICC has prepared 

summaries, set forth in sections (A), (B), 

and (C) below, of the most significant 

aspects of these statements. 


sradovich on DSK3GMQ082PROD with NOTICES
Federal Register / Vol. 83, No. 113 / Tuesday, June 12, 2018 / Notices 27361 

3 15 U.S.C. 78q–1(b)(3)(F). 

4 Id. 

(A) Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

(a) Summary of Proposed Changes 

ICC proposes to formalize the ICC 

Model Validation Framework, which 

sets forth ICC’s model validation 

procedures. ICC has developed a 

proprietary risk management system 

that models the risk of credit default 

swap based portfolios and determines 

appropriate Initial Margin and Guaranty 

Fund requirements. The risk 

management system is composed of risk 

modeling components (‘‘Model 

Components’’) which employ a 

combination of statistical analysis of 

credit spread time series and stress test 

simulation scenarios to address different 

risk drivers. The risk drivers addressed 

by the Model Components constitute the 

foundation of total Initial Margin and 

Guaranty Fund requirements for cleared 

portfolios. The ICC Model Validation 

Framework provides assurances as to 

the appropriateness of its risk 

requirements. ICC’s Risk Oversight 

Officer is the ICC Model Validation 

Framework owner and is responsible to 

the ICC President for the successful 

operation and maintenance of the ICC 

Model Validation Framework. 

ICC considers both new Model 

Components and enhancements to 

Model Components as part of its Model 

Validation Framework (collectively, 

‘‘Model Change’’). New Model 

Components consider risk drivers that 

are not currently included in the risk 

management system; enhanced Model 

Components improve upon the 

methodologies used by the risk 

management system to consider a given 

risk driver or drivers. ICC classifies 

Model Changes as either Materiality A 

or Materiality B, depending on how 

substantially the Model Change affects 

the risk management system’s 

assessment of risk for the related risk 

driver or drivers. The ICC Chief Risk 

Officer and the ICC Risk Oversight 

Officer will review all enhancements to 

ICC’s risk management system and 

decide which enhancements qualify as 

Model Changes, and which qualifying 

enhancements should be classified as 

Materiality A versus Materiality B. 

Materiality A Model Changes receive a 

higher control standard than Materiality 

B Model Changes. The ICC Risk 

Committee reviews the materiality 

classifications and provides feedback as 

necessary. 

The ICC Model Validation Framework 

sets forth the process for selecting 

Model Validators and describes the 

independent validator criteria, 

including technical expertise and 

independence requirements. The ICC 

Model Validation Framework also 

describes the Model Inventory which is 

maintained by the ICC Risk Department 

and which contains key information 

about all ICC Model Components and 

Model Changes. The ICC Risk Oversight 

Officer will review the model inventory 

at least quarterly to ensure that it 

contains accurate and up to date 

information relating to ICC’s Model 

Components and Model Changes. 

The ICC Model Validation Framework 

consists of four controls: Initial 

validation; ongoing monitoring and 

validation; investigation; and 

independent periodic review. Before 

going live with a Model Change, ICC 

must successfully complete an initial 

validation of the conceptual soundness 

of the methodology and the proposed 

ongoing monitoring and validation 

approach. All Model Changes are 

subject to internal initial validation. In 

addition, Materiality A Model Changes 

are subject to an additional independent 

initial validation. 

Ongoing monitoring and validation 

provides assurances that ICC has 

appropriately configured and calibrated 

the risk management system, including 

any recent Model Change, and that the 

risk management system is achieving 

the desired level of performance. The 

ongoing monitoring and validation 

control consists of three areas: 

Parameter setting, execution monitoring, 

and outcome analysis. 

If ongoing monitoring and validation 

identifies features of the risk 

management system that might indicate 

a Model Component weakness, ICC 

investigates and identifies the root 

cause. If a model weakness is 

discovered during investigation, the ICC 

Chief Risk Officer informs the ICC Risk 

Committee of the ongoing monitoring 

and validation results which triggered 

the investigation. If ICC is satisfied that 

the identified features do not represent 

a model weakness, the ICC Chief Risk 

Officer will present the results of the 

investigation demonstrating no model 

weakness exists. If ICC identifies a 

model weakness during the 

investigation, the ICC Chief Risk Officer 

will present the results of the investing 

demonstrating a model weakness, and 

ICC will remediate the identified 

weakness through an appropriate Model 

Change, which passes through the ICC 

Model Validation Framework starting 

with an Initial validation. 

The ICC Chief Risk Officer provides 

support and information to allow the 

independent validators to perform 

periodic reviews of all ICC Model 

Components and related practices at 

least once in every calendar year. At 

ICC’s choosing, the scope of an 

independent periodic review may cover 

all Model Components used by the risk 

management system, or a subset of 

Model Components, as long as all Model 

Components are included in one or 

more independent periodic reviews 

each year. The independent periodic 

review will demonstrate that the Model 

Components remain fit for purpose; that 

the Model Components assumptions are 

valid; that ICC has adequately addressed 

any medium priority open items from 

Model Change initial validations and 

any other implementation conditions; 

and that ICC has been complying with 

its ongoing monitoring and validation 

requirements and the Model 

Components are performing without any 

significant weakness. The deliverables 

from the independent periodic review 

must include a report from the 

independent validator providing a 

summary of the completed evaluation 

and details of any remaining open 

items, classified by priority. The ICC 

Chief Risk Officer will present the 

periodic review to the ICC Risk 

Committee and describe ICC’s plans in 

relation to any open high or medium 

priority items in the report. 

(b) Statutory Basis 

Section 17A(b)(3)(F) of the ActHD13

requires, among other things, that the 

rules of a clearing agency be designed to 

promote the prompt and accurate 

clearance and settlement of securities 

transactions, and to the extent 

applicable, derivative agreements, 

contracts and transactions and to 

comply with the provisions of the Act 

and the rules and regulations 

thereunder. ICC believes that the 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder 

applicable to ICC, in particular, to 

Section 17A(b)(3)(F),4 because ICC 

believes that the proposed rule change 

will promote the prompt and accurate 

clearance and settlement of securities 

transactions, derivatives agreements, 

contracts, and transactions. The ICC 

Model Validation Framework provides 

assurances as to the appropriateness of 

changes to ICC’s risk models, including 

the appropriateness of risk 

requirements. As such, the proposed 

rule change is designed to promote the 

prompt and accurate clearance and 

settlement of securities transactions, 

derivatives agreements, contracts, and 

transactions within the meaning of 


sradovich on DSK3GMQ082PROD with NOTICES
27362 Federal Register / Vol. 83, No. 113 / Tuesday, June 12, 2018 / Notices 

5 15 U.S.C. 78q–1(b)(3)(F). 

6 17 CFR 240.17Ad–22. 

7 17 CFR 240.17Ad–22(b)(4). 8 17 CFR 200.30–3(a)(12). 

Section 17A(b)(3)(F) 5 of the Act. The 

proposed rule change will also satisfy 

the requirements of Rule 17Ad–22.6 In 

particular, the proposed rule change sets 

forth ICC’s model validation procedures, 

including the evaluation of the 

performance of ICC’s risk models and 

related parameters and assumptions by 

a qualified and independent Model 

Validator, consistent with the 

requirements of Rule 17Ad–22(b)(4).7

(B) Clearing Agency’s Statement on 

Burden on Competition 

ICC does not believe the proposed 

rule change would have any impact, or 

impose any burden, on competition. 

The ICC Model Validation Framework 

applies uniformly across all market 

participants. Therefore, ICC does not 

believe the proposed rule change 

impose any burden on competition that 

is inappropriate in furtherance of the 

purposes of the Act. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change Received From Members, 

Participants or Others 

Written comments relating to the 

proposed rule change have not been 

solicited or received. ICC will notify the 

Commission of any written comments 

received by ICC. 

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 

such 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 rule-comments@

sec.gov. Please include File Number SR– 

ICC–2018–004 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–ICC–2018–004. 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 website (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 website 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 Credit and on ICE 

Clear Credit’s website at https://

www.theice.com/clear-credit/regulation. 

All comments received will be posted 

without change. Persons submitting 

comments are cautioned that we do not 

redact or edit personal identifying 

information from comment submissions. 

You should submit only information 

that you wish to make available 

publicly. All submissions should refer 

to File Number SR–ICC–2018–004 and 

should be submitted on or before July 3, 

2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.8

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–12550 Filed 6–11–18; 8:45 am] 

BILLING CODE 8011–01–P 

DEPARTMENT OF STATE 

[Public Notice 10438] 

Notice of Determinations; Culturally 

Significant Objects Imported for 

Exhibition Determinations: ‘‘John 

Singer Sargent and Chicago’s Gilded 

Age’’ Exhibition 

SUMMARY: Notice is hereby given of the 

following determinations: I hereby 

determine that certain objects to be 

included in the exhibition ‘‘John Singer 

Sargent and Chicago’s Gilded Age,’’ 

imported from abroad for temporary 

exhibition within the United States, are 

of cultural significance. The objects are 

imported pursuant to loan agreements 

with the foreign owners or custodians. 

I also determine that the exhibition or 

display of the exhibit objects at The Art 

Institute of Chicago, in Chicago, Illinois, 

from on or about July 1, 2018, until on 

or about September 30, 2018, and at 

possible additional exhibitions or 

venues yet to be determined, is in the 

national interest. I have ordered that 

Public Notice of these determinations be 

published in the Federal Register. 

FOR FURTHER INFORMATION CONTACT: 

Elliot Chiu, Attorney-Adviser, Office of 

the Legal Adviser, U.S. Department of 

State (telephone: 202–632–6471; email: 

section2459@state.gov). The mailing 

address is U.S. Department of State, 

L/PD, SA–5, Suite 5H03, Washington, 

DC 20522–0505. 

SUPPLEMENTARY INFORMATION: The 

foregoing determinations were made 

pursuant to the authority vested in me 

by the Act of October 19, 1965 (79 Stat. 

985; 22 U.S.C. 2459), E.O. 12047 of 

March 27, 1978, the Foreign Affairs 

Reform and Restructuring Act of 1998 

(112 Stat. 2681, et seq.; 22 U.S.C. 6501 

note, et seq.), Delegation of Authority 

No. 234 of October 1, 1999, and 

Delegation of Authority No. 236–3 of 

August 28, 2000. 

Marie Therese Porter Royce, 

Assistant Secretary for Educational and 

Cultural Affairs, Department of State. 

[FR Doc. 2018–12588 Filed 6–11–18; 8:45 am] 

BILLING CODE 4710–05–P 

DEPARTMENT OF STATE 

[Public Notice 10441] 

30-Day Notice of Proposed Information 

Collection: Six DDTC Information 

Collections 

ACTION: Notice of request for public 

comments. 

SUMMARY: The Department of State has 

submitted the information collection 


sradovich on DSK3GMQ082PROD with NOTICES