Federal Register / Vol. 77, No. 74 / Tuesday, April 17, 2012 / Notices 22825 

5 15 U.S.C. 78f(b). 

6 15 U.S.C. 78f(b)(4). 

7See Note 3. 

8See Note 4. 

9 15 U.S.C. 78s(b)(3)(A). 

10 17 C.F.R. 240.19b–4(f). 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

Section 6(b) of the Act.5 Specifically, 

the Exchange believes the proposed rule 

change is consistent with Section 6(b)(4) 

of the Act 6, which provides that 

Exchange rules may provide for the 

equitable allocation of reasonable dues, 

fees, and other charges among its 

Trading Permit Holders and other 

persons using its facilities. The 

proposed increases in voluntary 

professional and professional fees are 

reasonable because of the growth in 

professional and voluntary professional 

trading volume.7 This growth requires 

the Exchange to continually invest in 

software, hardware and personnel, the 

cost of which can reasonably be 

expected to be borne by these 

professional and voluntary professional 

market participants that cause these 

investments. 

The Exchange believes the proposed 

increases in voluntary professional and 

professional fees are equitable and not 

unfairly discriminatory because the fees 

as noted are generally tied to an overall 

increase in activity on the Exchange. 

This heightened activity results in 

greater costs to the Exchange, which in 

turn is being passed back through to 

those participants who utilize the 

resources of the Exchange. Further, 

these increased fees will be applied 

equally to all market participants to 

whom they apply, and are in line with 

similar fees offered on other exchanges.8

Maintaining $0.20 per contract 

voluntary professional and professional 

fees for contracts executed through QCC 

transactions or AIM is equitable and not 

unfairly discriminatory because this is 

the same amount as is being assessed to 

broker-dealers for QCC or AIM 

transactions (broker-dealers being 

similarly-situated as voluntary 

professionals and professionals for these 

purposes). 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

CBOE does not believe that the 

proposed rule change will impose any 

burden on competition that is not 

necessary or appropriate 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 

The Exchange neither solicited nor 

received comments on the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A) 9 of the Act and paragraph (f) 

of Rule 19b–4 10 thereunder. 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. 

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 rulecomments@sec.gov. Please include File 

Number SR–CBOE–2012–035 on the 

subject line. 

Paper Comments 

• Send paper comments in triplicate 

to Elizabeth M. Murphy, Secretary, 

Securities and Exchange Commission, 

100 F Street NE., Washington, DC 

20549–1090. 

All submissions should refer to File 

Number SR–CBOE–2012–035. 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 

a.m. and 3 p.m. Copies of the filing also 

will be available for inspection and 

copying at the principal office of the 

Exchange. 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–CBOE– 

2012–035 and should be submitted on 

or before May 8, 2012. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–9141 Filed 4–16–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66786; File No. SR–CME– 

2012–10] 

Self-Regulatory Organizations; 

Chicago Mercantile Exchange Inc.; 

Notice of Filing and Order Granting 

Accelerated Approval of Proposed 

Rule Change Regarding Acceptance of 

Additional Interest Rate Swaps and 

Related Interbank Rates for Clearing 

April 11, 2012. 

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 March 30, 

2012, the Chicago Mercantile Exchange 

Inc. (‘‘CME’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change described in Items I and II 

below, which items have been prepared 

primarily by CME. The Commission is 

publishing this Notice and Order to 

solicit comments on the proposed rule 

change from interested persons and to 

approve the proposed rule change on an 

accelerated basis. 

I. Self-Regulatory Organization’s 

Statement of Terms of Substance of the 

Proposed Rule Change 

CME proposes to amend its rules 

related to its business as a derivatives 

clearing organization offering interest 

rate swap (‘‘IRS’’) clearing services. 

More specifically, the proposed rule 

changes would facilitate the acceptance 

of Japanese Yen (‘‘JPY’’), Swiss Franc 

(‘‘ZHF’’), and Australian Dollar (‘‘AUD’’) 


wreier-aviles on DSK5TPTVN1PROD with NOTICES
22826 Federal Register / Vol. 77, No. 74 / Tuesday, April 17, 2012 / Notices 

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

4 15 U.S.C. 78q–1. In approving this proposed 

rule change, the Commission has considered the 

proposed rule’s impact on efficiency, competition, 

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

denominated interest rate swaps and 

related interbank rates for clearing. The 

proposed rule change also contains the 

corresponding fee changes. The text of 

the proposed rule change is available at 

CME’s Web site at http:// 

www.cmegroup.com/market-regulation/ 

rule-filings.html. 

II. Self-Regulatory Organization’s 

Statement of 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 III 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 Purpose of, and Statutory 

Basis for, the Proposed Rule Change 

CME is registered as a derivatives 

clearing organization with the 

Commodity Futures Trading 

Commission and currently offers 

clearing services for IRS. The changes 

that are the subject of this filing are 

proposed rules that would facilitate 

CME’s acceptance of JPY, ZHF, and 

AUD IRS and related interbank rates for 

clearing beginning April 16, 2012. 

The proposed changes would be made 

to current CME Rule 90102.E. The 

proposed changes would simply add the 

following line items: AUD–BBR–BBSW; 

AUD–LIBOR–BBA; and AUD–AONIA– 

OIS–COMP. 

In connection with the acceptance of 

such swaps, CME is also amending its 

fee schedules for OTC IRS to reflect the 

fees for JPY, ZHF and AUD 

denominated IRS. The proposed rule 

change features a new fee schedule that 

would be applicable to IRS Clearing 

Members clearing OTC IRS transactions 

and, separately, a new fee schedule that 

would be applicable to customers of IRS 

Clearing Members clearing OTC IRS 

transactions. 

In addition, CME also proposes to 

make corresponding changes to its 

Manual of Operations for CME Cleared 

Interest Rate Swaps (‘‘IRS Manual’’). 

These changes would update the IRS 

Manual to reflect the new 

denominations and rate options and 

certain other associated operational 

changes. 

CME believes the proposed rule 

change is consistent with the 

requirements of the Act and particularly 

with Section 17A of the Act because it 

involves clearing of swaps and futures 

contracts and thus relate solely to CME’s 

swaps and futures clearing activities 

pursuant to its registration as a 

derivatives clearing organization under 

the Commodity Exchange Act (‘‘CEA’’) 

and does not significantly affect any 

securities clearing operations of the 

clearing agency or any related rights or 

obligations of the clearing agency or 

persons using such service. CME further 

notes that the policies of the CEA with 

respect to clearing are comparable to a 

number of the policies underlying the 

Act, such as promoting market 

transparency for over-the-counter 

derivatives and futures markets, 

promoting the prompt and accurate 

clearance of transactions, and protecting 

investors and the public interest. The 

proposed rule changes accomplish those 

objectives by offering investors clearing 

for an expanded range of IRS products 

at CME. 

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. 

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. 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 may be 

submitted by using 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 No. SR–CME–2012– 

10 on the subject line. 

• Paper comments should be sent in 

triplicate to Elizabeth M. Murphy, 

Secretary, Securities and Exchange 

Commission, 100 F Street, NE., 

Washington, DC 20549–1090. 

All submissions should refer to File 

Number SR–CME–2012–10. 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 

a.m. and 3 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– 

2012–10 and should be submitted on or 

before May 8, 2012. 

IV. Commission’s Findings and Order 

Granting Accelerated Approval of 

Proposed Rule Change 

Section 19(b) of the Act 3 directs the 

Commission to approve a proposed rule 

change of a self-regulatory organization 

if it finds that such proposed rule 

change is consistent with the 

requirements of the Act and the rules 

and regulations thereunder applicable to 

such organization. The Commission 

finds that the proposed rule change is 

consistent with the requirements of the 

Act, in particular with the requirements 

of Section 17A of the Act,4 and the rules 

and regulations thereunder applicable to 

CME. Specifically, the Commission 

finds that the proposed rule change is 

consistent with Section 17A(b)(3)(F) of 

the Act, which requires, among other 

things, that the rules of a clearing 

agency be designed to promote the 

prompt and accurate clearance and 

settlement of derivative agreements, 

contracts, and transactions because it 

will allow CME to offer its services in 

clearing IRS products to a broader 

category of IRS products and thereby 

should promote the prompt and 


wreier-aviles on DSK5TPTVN1PROD with NOTICES
Federal Register / Vol. 77, No. 74 / Tuesday, April 17, 2012 / Notices 22827 

5 15 U.S.C. 78q–1(b)(3)(F). 

6 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

3Securities Exchange Act Release No. 34–66485 

(February 28, 2012), 77 FR 13164 (March 5, 2012). 

In its filing with the Commission, FICC included 

statements concerning the purpose of and basis for 

the proposed rule change. The text of these 

statements is incorporated into the discussion of the 

proposed rule change in Section II below. 

4The GSD rules define ‘‘Cap’’ as any Debit 

Forward Mark Adjustment Payment or Credit 

Forward Mark Adjustment Payment up to a dollar 

amount, as determined by FICC from time to time, 

that is automatically collected from or paid to the 

Repo Broker, as applicable. 

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

6 15 U.S.C. 78q–1(b)(3)(F). 

7 15 U.S.C. 78s(b)(2). 

8 In approving the proposed rule change, the 

Commission considered the proposal’s impact on 

efficiency, competition and capital formation. 15 

U.S.C. 78c(f). 

accurate clearance and settlement of 

derivative agreements, contracts, and 

transactions.5

In its filing, CME requested that the 

Commission approve this proposed rule 

change prior to the thirtieth day after 

the date of publication of the notice of 

the filing. CME has articulated three 

reasons for so granting approval. One, 

the products covered by this filing and 

CME’s operations as a derivatives 

clearing organization for such products 

are regulated by the CFTC under the 

CEA. Two, the proposed rule change 

relates solely to IRS products and 

therefore relate solely to CME’s swaps 

clearing activities and do not 

significantly relate to CME’s functions 

as a clearing agency for security-based 

swaps. Three, not approving this request 

on an accelerated basis will have a 

significant impact on the swap clearing 

business of CME as a designated 

clearing organization. 

The Commission finds good cause for 

granting approval of the proposed rule 

change prior to the thirtieth day after 

publication of the notice of its filing 

because: (i) The proposed rule change 

does not significantly affect any 

securities clearing operations of the 

clearing agency (whether in existence or 

contemplated by its rules) or any related 

rights or obligations of the clearing 

agency or persons using such service; 

(ii) the clearing agency has indicated 

that not providing accelerated approval 

would have a significant impact on its 

IRS clearing business as a designated 

clearing organization; and (iii) the 

activity relating to the non-security 

clearing operations of the clearing 

agency for which the clearing agency is 

seeking approval is subject to regulation 

by another federal regulator. 

V. Conclusion 

It is therefore ordered, pursuant to 

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

proposed rule change (SR–CME–2012– 

10) is approved on an accelerated basis. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.6

Kevin M. O’Neill, 

Deputy Secretary. 

[FR Doc. 2012–9143 Filed 4–16–12; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–66785; File No. SR–FICC– 

2012–01] 

Self-Regulatory Organizations; Fixed 

Income Clearing Corporation; Order 

Approving Proposed Rule Change To 

Make a Technical Correction to the 

Rule Relating to the Calculation of 

Funds-Only Settlement Amounts for 

Repo Brokers 

April 11, 2012. 

I. Introduction 

On February 14, 2012, the Fixed 

Income Clearing Corporation (‘‘FICC’’) 

filed with the Securities and Exchange 

Commission (‘‘Commission’’) the 

proposed rule change SR–FICC–2012– 

01 pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’) 1 and Rule 19b–4 2 thereunder. 

The proposed rule change was 

published for comment in the Federal 

Register on March 5, 2012.3 The 

Commission received no comment 

letters regarding the proposal. For the 

reasons discussed below, the 

Commission is granting approval of the 

proposed rule change. 

II. Description 

The proposed rule change consists of 

modifications to Rule 19, Section 4 of 

the rules of the Government Securities 

Division (‘‘GSD’’) of FICC. The purpose 

of the rule change is to make technical 

corrections to GSD Rule 19 (Special 

Provisions For Brokered Repo 

Transactions), Section 4 (Calculations of 

Funds-Only Settlement Amounts for 

Repo Brokers) as described below. GSD 

Rule 19, Section 4 states that FICC may 

retain any amount of a Credit Forward 

Mark Adjustment Payment that is in 

excess of the Cap 4 and that interest 

earned on such amount shall be paid to 

the Repo Broker on the subsequent 

business day. The second part of this 

sentence is incorrectly stated because 

FICC pays interest to those who were 

debited forward mark adjustment 

amounts not those who were credited 

such amounts. On the following day 

(i.e., the day after the broker received 

the Credit Forward Mark Adjustment 

Payment) when the broker is debited the 

interest for the use of funds it received 

as a credit, the broker will be debited 

the interest on the amount that it 

actually received as a credit (i.e., it will 

not be debited interest for the amount of 

Credit payment withheld above the 

Cap). The rule is also revised to state 

that Repo Brokers with more than one 

Segregated Repo Account must 

aggregate Debit Forward Mark 

Adjustments and Credit Forward Mark 

Adjustment Payments in those accounts 

for purposes of the Cap. The Repo 

Brokers currently comply with this 

correction and the revision reflects 

current practice. 

III. Discussion 

Section 19(b)(2)(B) of the Act 5 directs 

the Commission to approve a proposed 

rule change of a self-regulatory 

organization if it finds that such 

proposed rule change is consistent with 

the requirements of the Act and the 

rules and regulations thereunder 

applicable to such organization. In 

particular, Section 17A(b)(3)(F) 6 of the 

Act 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 assure the 

safeguarding of securities and funds 

which are in the custody or control of 

such clearing agency or for which it is 

responsible. Because the proposed 

change would align FICC’s rulebook 

with its practices and provide 

transparency in its processes, the 

Commission believes that the proposed 

rule change is consistent with FICC’s 

obligations under the Act. 

IV. Conclusion 

On the basis of the foregoing, the 

Commission finds that the proposed 

rule change is consistent with the 

requirements of the Act and in 

particular with the requirements of 

Section 17A of the Act and the rules and 

regulations thereunder. 

It is therefore ordered, pursuant to 

Section 19(b)(2) 7 of the Act, that the 

proposed rule change (File No. SR– 

FICC–2012–01) be, and hereby is, 

approved.8


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