30996 Federal Register / Vol. 83, No. 127 / Monday, July 2, 2018 / Notices 

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

2 17 CFR 240.19b–4. 

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

4 17 CFR 240.19b–4(f)(6). 

5OCC’s By-Laws and Rules can be found on 

OCC’s public website: http://optionsclearing.com/ 

about/publications/bylaws.jsp. 

6See 17 CFR 39.19(c); see also Derivatives 

Clearing Organization General Provisions and Core 

Principles, 76 FR 69334 (Nov. 8, 2011). OCC is a 

DCO as that term is defined in applicable CFTC 

regulations. See 17 CFR 1.3. 7See 76 FR 69334. 8 76 FR 69334, at 69400. 

9See 17 CFR 39.19(b). 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–83519; File No. SR–OCC– 

2018–009] 

Self-Regulatory Organizations; The 

Options Clearing Corporation; Notice 

of Filing and Immediate Effectiveness 

of Proposed Rule Change To Facilitate 

Reporting Under Commodity Futures 

Trading Commission Regulations 

Applicable to Derivatives Clearing 

Organizations 

June 26, 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 June 15, 

2018, The Options Clearing Corporation 

(‘‘OCC’’) 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 OCC. OCC filed 

the proposed rule change pursuant to 

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

19b–4(f)(6) 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. 

I. Clearing Agency’s Statement of the 

Terms of Substance of the Proposed 

Rule Change 

The proposed rule change by OCC 

would amend OCC Rule 601(e)(2) 

regarding customer information in data 

provided to OCC identifying the 

positions of each futures customer of a 

Clearing Member for purposes of 

calculating the initial margin 

requirement for segregated futures 

accounts. The proposed rule change is 

intended to facilitate reporting under 

Commodity Futures Trading 

Commission (‘‘CFTC’’) regulations 

applicable to Derivatives Clearing 

Organizations (‘‘DCOs’’) such as OCC. 

All terms with initial capitalization that 

are not otherwise defined herein have 

the same meaning as set forth in the 

OCC By-Laws and Rules.5

II. Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

In its filing with the Commission, 

OCC 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. OCC has prepared 

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

and (C) below, of the most significant 

aspects of these statements. 

(A) Clearing Agency’s Statement of the 

Purpose of, and Statutory Basis for, the 

Proposed Rule Change 

(1) Purpose 

The purpose of the proposed rule 

change is to amend the provisions of 

OCC Rule 601(e)(2) with respect to 

information regarding the identity of 

customers included in data provided to 

OCC identifying the positions of each 

futures customer of a Clearing Member 

for purposes of calculating the initial 

margin requirement for segregated 

futures accounts. The proposed rule 

change removes the provisions that 

require ‘‘a unique alphanumeric 

customer identifier for each such 

customer’’ and that provide that 

information submitted to OCC pursuant 

to Rule 601(e)(2) ‘‘shall not include any 

indication of the identity of any 

customer or other personal information 

of a customer.’’ As described below, the 

removal of these provisions will allow 

OCC to perform daily reporting 

consistent with applicable CFTC 

regulations and associated guidance. 

On November 8, 2011, the CFTC 

adopted reporting rules for DCOs in 

CFTC Regulation 39.19 that cover daily, 

quarterly, annual, and event-specific 

reporting.6 The reporting requirements 

in Regulation 39.19 had a compliance 

date of November 8, 2012.7 For daily 

reporting, paragraph (c)(1) of Regulation 

39.19 requires DCOs to submit reports 

with certain initial margin, variation 

margin, cash flows, and end-of-day 

positions for each Clearing Member, by 

house origin and by each customer 

origin. In adopting these daily reporting 

requirements, the CFTC stated that 

‘‘[t]he overall purpose of receiving the 

daily data is to enable [CFTC] staff to 

analyze the data on a regular basis so 

that it can detect certain trends or 

unusual activity on a timely basis.’’ 8

CFTC Regulation 39.19 requires a 

DCO to report certain information in a 

format and manner specified by the 

CFTC.9 Since the regulation’s adoption, 

the CFTC has published a ‘‘Guidebook 

for Daily Reports’’ (‘‘Guidebook’’) that 

provides guidance and specifications to 

DCOs for submitting their daily reports 

under Regulation 39.19. Generally, daily 

reports must include, for each Clearing 

Member, information related to initial 

margin, daily variation margin, daily 

cash flows related to clearing and 

settlement, and end-of-day positions, by 

house origin and by each customer 

origin, for all futures, options, and 

swaps positions, and all securities 

positions held in a segregated account 

or pursuant to a cross margining 

agreement. The most recent version of 

the Guidebook—Version 9.2—was 

published in December 2017; however, 

Version 9.1, which was published 

earlier in 2017, introduced new 

reporting specifications that can be met 

only if OCC amends Rule 601(e)(2) as 

described below. Specifically, Section 

2.1.2.2 of the Guidebook requires DCOs 

(other than exempt DCOs) to ‘‘provide 

the clearing members’ customer 

information that properly describes the 

margins reported’’ by reporting 

customer names and legal entity 

identifiers (‘‘LEIs’’). 

The Guidebook acknowledges that, at 

the time of its publication, customerlevel information may not be available 

for all DCOs. Indeed, following 

publication of Version 9.1 of the 

Guidebook, the CFTC provided informal 

guidance to DCOs in August 2017 

noting that the CFTC was aware that 

DCOs may not have names and LEIs for 

all customer accounts that they clear 

and understood that DCOs and futures 

commission merchants would begin a 

project in the near future to obtain 

names and LEIs for their customers. 

OCC makes its daily reports to the 

CFTC in accordance with Regulation 

39.19 based on information it receives 

from its Clearing Members. OCC Rule 

601(e)(2) requires each Clearing Member 

to submit to OCC on each business day 

a data file that identifies the positions 

in segregated futures accounts of each 

futures customer of the Clearing 

Member using a unique alphanumeric 

customer identifier for each such 

customer. The rule, however, 

specifically requires Clearing Members 

to use a ‘‘unique alphanumeric 

customer identifier for each customer’’ 

and provides that ‘‘such identifiers shall 

not include any indication of the 

identity of any customer or other 

personal information of a customer.’’ 

For these segregated futures accounts, 

OCC prohibits Clearing Members from 

providing information such as customer 

name and LEI; thus, OCC does not 

currently have this information to 

include in its daily reports to the CFTC 

and is not able to provide customerVerDate Sep<11>2014 17:40 Jun 29, 2018 Jkt 244001 PO 00000 Frm 00088 Fmt 4703 Sfmt 4703 E:\FR\FM\02JYN1.SGM 02JYN1

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Federal Register / Vol. 83, No. 127 / Monday, July 2, 2018 / Notices 30997 

10 15 U.S.C. 78q-1(b)(3)(F). 

11 Id. 

12 15 U.S.C. 78q–1(b)(3)(I). 

13 15 U.S.C. 78s(b)(3)(A). 

14 17 CFR 240.19b–4(f)(6). 

15OCC provided the Commission with written 

notice of its intent to file the proposed rule change, 

along with a brief description and text of 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. 

16Notwithstanding its immediate effectiveness, 

implementation of this rule change will be delayed 

until this change is deemed certified under CFTC 

Rule 40.6. 17 17 CFR 200.30–3(a)(12). 

level information with respect to these 

accounts in accordance with the 

Guidebook specifications. 

Consequently, OCC is proposing to 

delete the customer identifier provisions 

from Rule 601(e)(2) so that Clearing 

Members can provide customer names 

and LEIs to OCC so that it can, in turn, 

provide this information on daily 

reports to the CFTC consistent with the 

CFTC staff guidance on daily reporting 

requirements under Regulation 39.19. 

(2) Statutory Basis 

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

requires, among other things, that the 

rules of a clearing agency be designed, 

in general, to protect investors and the 

public interest.10 OCC believes that the 

proposed rule change is consistent with 

Section 17A(b)(3)(F) of the Act.11 As 

noted above, OCC Rule 601(e)(2) 

requires each Clearing Member to 

submit to OCC on each business day a 

data file that identifies the positions in 

segregated futures accounts of each 

futures customer of the Clearing 

Member using a unique alphanumeric 

customer identifier for each such 

customer. The proposed rule change 

would remove this provision and the 

requirement that ‘‘such identifiers shall 

not include any indication of the 

identity of any customer or other 

personal information of a customer.’’ 

Once these provisions are removed, 

Clearing Members can provide this 

information to OCC, who can then 

provide it to the CFTC in accordance 

with the Guidebook specifications. This 

will enhance the CFTC staff’s ability to 

perform its oversight function with the 

information it deems necessary, which 

promotes the protection of investors and 

the public interest. 

(B) Clearing Agency’s Statement on 

Burden on Competition 

Section 17A(b)(3)(I) of the Act 

requires that the rules of a clearing 

agency not impose any burden on 

competition not necessary or 

appropriate in furtherance of the Act.12

OCC does not believe that the proposed 

rule change would impose any burden 

on competition. Rather, the proposed 

rule change removes an existing 

restriction on the data provided to OCC 

by its Clearing Members regarding 

customers with segregated futures 

accounts. As discussed above, this will 

then allow OCC to provide this 

information to the CFTC, consistent 

with the CFTC staff guidance on daily 

reporting requirements under 

Regulation 39.19, who uses the 

information in performing its statutory 

mandate. 

(C) Clearing Agency’s Statement on 

Comments on the Proposed Rule 

Change Received From Members, 

Participants or Others 

Written comments on the proposed 

rule change were not and are not 

intended to be solicited with respect to 

the proposed rule change and none have 

been received. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

Pursuant to Section 19(b)(3)(A) of the 

Act 13 and Rule 19b–4(f)(6)14

thereunder, the proposed rule change is 

filed for immediate effectiveness 

because it does not: (i) Significantly 

affect the protection of investors or the 

public interest; (ii) impose any 

significant burden on competition; and 

(iii) become operative for 30 days from 

the date on which it was filed, or such 

shorter time as the Commission may 

designate.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 necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act.16

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– 

OCC–2018–009 on the subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE, Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–OCC–2018–009. 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 

filing also will be available for 

inspection and copying at the principal 

office of OCC and on OCC’s website at 

https://www.theocc.com/components/ 

docs/legal/rules_and_bylaws/sr_occ_18_

009.pdf. 

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–OCC–2018–009 and should 

be submitted on or before July 23, 2018. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.17

Eduardo A. Aleman, 

Assistant Secretary. 

[FR Doc. 2018–14113 Filed 6–29–18; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

Sunshine Act Meetings 

FEDERAL REGISTER CITATION OF PREVIOUS

ANNOUNCEMENT: 83 Federal Register 

29838, 26 June 2018. 


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